Enterprise

San Miguel Corporation raises white flag, to sell telco assets to Globe and PLDT

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Life moves fast, especially in the Philippine telecommunications industry. Earlier this year, the talk of the town was a potential joint venture between Australia’s Telstra and local conglomerate San Miguel Corporation (SMC), which would have brought an end to the telco duopoly of the Philippine Long Distance Telephone Company (PLDT) and Globe Telecom.

We all know how that turned out — how the ray of hope was shuttered just as quickly as it surfaced. And now, the possibility of SMC, a diversified firm with interests that stretch from food and beverage to oil and infrastructure, providing mobile and internet services is all but kaput.

A report from the Philippine Daily Inquirer today claimed SMC is expected to sell its telecommunications assets to PLDT and Globe in a blockbuster joint deal worth $1 billion. The agreement could be signed off this morning, the paper’s source added. You may recall a similar incident in 2011, when PLDT bought then-rival Sun Cellular from tycoon John Gokongwei.

The highlight of the agreement is the 700MHz spectrum PLDT and Globe stand to acquire, should the deal go through. The wireless spectrum is highly valued for its ability to cover larger areas and provide better cellular coverage inside buildings.

Globe had previously launched a full-on campaign with the promise to “improve internet speed in the country” to get the issue of ownership and distribution of the spectrum in the public discourse, but to no effect. PLDT echoed the same call. Now that they’re getting what they wanted all along, customers should hold them accountable to their words. Because, as anyone in the archipelago knows, delivering quality internet services at reasonable rates should be the top priority of any carrier, with or without the fire of competition.

Source: Philippine Daily Inquirer
Image credit: Wikimapia

Enterprise

The US finally lifts sanctions over ZTE

They can make phones again!

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If you’ve followed your history classes closely, you’ll know that relations between China and the US have been tenuous throughout the years. As of late, Chinese companies — specifically, ZTE — and the US government have constantly been at loggerheads with each other.

Now, a new chapter is finally trying to close off this volume in the China versus US saga.

Following ZTE’s eventual compliance with trade sanctions, the US government has lifted their indefinite ban over the company’s deals with American businesses. Once again, ZTE is free to obtain the parts essential to their phones from the US.

Previously, the US government initiated the ban in response to ZTE’s violations of trade policies with Iran. For reparation, lawmakers offered to stave off more repressive sanctions if ZTE paid fines and replaced their erring employees.

Despite the offer, ZTE failed to comply with these conditions. As a result, the US had no choice but to ban ZTE from initiating business with any American company. This presented a crippling scenario for the company. ZTE’s phones rely heavily on American components including Qualcomm, the company’s chip supplier.

For months, ZTE has crawled through a terrible limbo of being physically incapable of producing any phones. The company’s employees were left to twiddle their thumbs.

Eventually, President Donald Trump tried to rescue the company, citing lost Chinese jobs because of the job. Unfortunately, his rescue efforts came to no avail.

Now, the US has finally acquiesced to give ZTE another chance. Finally, ZTE took the offer and complied with US demands. The company has changed its board and paid US$ 1.4 billion in fines. Additionally, the company has added a compliance team hired by the US to monitor ZTE’s actions should they violate policies again.

Overall, this entire saga is a symptom of the US’ distrust over the Chinese agenda. Besides ZTE, Huawei, and Xiaomi are also feeling the heat of US tensions. At least, the ZTE brouhaha has ended. For now, at least.

SEE ALSO: ZTE’s new concept phone has two notches

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Enterprise

Xiaomi’s IPO performs poorly in stock market on first day [Update: It’s doing better now]

Could hamper its performance this year

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It’s a bad time to invest in China. After the escalating feud between ZTE and the US, more Chinese companies are feeling the brunt of tense Sino-American relations.

Presently, Chinese phone maker Xiaomi has made a lackluster debut on the stock market. Expecting a valuation of over US$ 100 billion, the company has punched in only US$ 54 billion in valuation, making only US$ 4.7 billion in the IPO.

As for individual stocks, Xiaomi opened to a tepid HK$ 16, much less than their expected HK$ 17.

Prior to the debut, controversies have mired the Chinese market. Just from the company’s perspective, Xiaomi has notoriously expanded their product lineup to include the divisive lifestyle market, most of which have not seen overwhelmingly positive returns yet.

Additionally, ZTE’s troubles with the American government have signaled that Chinese products still aren’t welcome in the West. So far, the issue has affected sales of other Chinese companies including Xiaomi and Huawei, despite their popularity in other countries. Of note, both companies still top the charts all over the world.

Regardless, Xiaomi CEO Lei Jun remains confident that their disappointing IPO is only a minor setback to their overall plans. More importantly, he cites that Xiaomi’s goal of maintaining only a five percent profit is still on track.

However, the IPO trouble will undoubtedly cause speed bumps with the company’s plans to expand to the US later this year.

Update (7/10/2018): After the tumultuous debut, Xiaomi’s stocks showed signs of life the day after. During afternoon trading, the shares’ value rocketed up by 9 percent. As a result, their price increased by as much as HK$ 18.56, well above the company’s expectations.

The jump came as Xiaomi announced its inclusion into the Hang Seng Composite Index. The move allows investors from mainland China to invest in Xiaomi’s stocks. Arguably, Chinese investors show more interest toward the company’s future compared to other foreign investors looking at the political issues in the US.

Xiaomi had already decided on the inclusion in the past. However, the company opted to postpone the move in favor of the Hong Kong debut.

SEE ALSO: Xiaomi Mi Mix 3 live images leak showing no chin, no notch

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Galaxy S9 is Samsung’s least popular phone since the Galaxy S3

According to latest sales reports

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After the ancient rulers of Nokia, the twin kingdoms of Apple and Samsung conquered the land with an iron fist. Under their rule, the land grew and prospered with iPhones and Galaxies.

We all know the story by now. Samsung and Apple have stood atop the smartphone industry for more than a decade. With how technology is developing, it seems likely that both brands will remain as two of the top phone manufacturers.

However, Samsung’s sales reports hint that it’s losing its grip on the industry’s peak.

According to the company’s earning guidance for the second quarter, Samsung lost 0.7 percent in sales. Last semester, Samsung posted consolidated sales of 60.56 trillion in Korean won. This semester, the company posted only approximately KWR 58 trillion. However, according to The Verge, the company still saw an 11 percent increase in overall profit.

While 0.7 percent doesn’t seem like much, the loss is the first time in a while that Samsung’s sales have not grown. For the past quarters, Samsung has enjoyed record-breaking numbers on its sales column. The positive trend has finally buckled this year.

Meanwhile, according to Financial Times and Wall Street Journal, the loss came from the Galaxy S9’s less-than-spectacular sales. With current sales, the Galaxy S9 is the company’s least popular phone since the Galaxy S3 in 2012.

As of late, Samsung has suffered mounting pressure from other brands outing their own competitive flagships (see: Huawei P20 Pro). Coupled with its lack of redeemable features, the Galaxy S9 is a tough phone to sell.

Moreover, with Apple taking its screen business elsewhere, Samsung might see a drop in component sales as well.

Regardless, the company will surely still enjoy massive sales numbers. At the same time, the drop should inspire the company to take measures with next year’s Galaxy S10 to get back to their winning ways.

SEE ALSO: Samsung patents its own ‘Face ID’ variant

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