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Russia Hits Google With $6.7m Fine

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Russia’s anti-trust authority on Thursday fined Google 438 million rubles ($6.75 million) after finding it guilty of abusing its dominant market position by forcing smartphone makers to install its search engine on Androids.

The Federal Antimonopoly Service in September last year deemed Google in breach of a law on “protecting competition” after an investigation following a complaint by Russia’s largest search engine, Yandex.

Yandex asked the anti-trust authorities to prevent Android phones from being automatically bundled with Google’s search engine.

The FAS said that Google has two months to pay the fine.

Yelena Zayeva, the head of its department for regulating communications and IT was quoted in the statement as saying the ruling “will allow the development of competition on the mobile software market in Russia, which will have a positive effect for consumers.”

All companies whose production is on sale in Russia have to observe the law on competition, “including transnational corporations,” Zayeva added.

Google said in a statement sent to AFP: “We have received notice of the fine from FAS and will analyze closely before deciding our next steps.”

“In the meantime, we continue to talk to all invested parties to help consumers, device manufacturers and developers thrive on Android in Russia,” Google said.

The tech giant’s Android operating system dominates the smartphone market with a share of around 80 percent, which enables Google to offer search and other services to handset users.

Russia’s anti-trust authority had been holding consultations with Google aimed at reaching an amicable agreement, but this required Google to admit guilt.

Google has insisted that consumers are free to choose whether to use its services.

Google has been hit by similar anti-trust charges in other countries, particularly in the European Union, which has launched three cases against Google, one of which is specifically about using the dominance of the Android mobile phone operating system to restrict competition.

Russia’s anti-trust authority this week also launched legal proceedings against US tech giant Apple over the alleged fixing of resellers’ prices for iPhones in the country.

Apple said in a statement sent to AFP: “Resellers set their own prices for the Apple products they sell in Russia and around the world.”

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Technology

Tesla Has the Highest PE Ratio Among the World’s Ten Largest Companies

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Using a stock’s price-to-earnings (P/E) ratio is one of the quickest ways to learn whether a company is overvalued or undervalued. If a company’s stock is undervalued, it may be a good investment based on the current price. If it is overvalued, then investor should consider whether the company’s growth prospects justify the stock price.

According to data presented by StockApps.com, Tesla has the highest PE ratio among the world’s top ten companies by market cap. Last week, the price-to-earnings ratio of the tech giant hit 473 or seven times more than the second-ranked Amazon.

Tesla`s PE Ratio Almost Halved in a Year

The PE ratio is calculated as a stock’s current share price divided by earnings per share in the last twelve months. A high PE ratio could mean a company’s stock is overpriced or that investors are expecting high growth rates in the future. On the other hand, a low PE can indicate either that a company may be undervalued or that it is doing exceptionally well relative to its past trends.

Although Tesla has the highest price-to-earnings ratio among the world’s ten largest companies, the YCharts data showed its PE ratio almost halved in the past year.

In October 2020, the PE ratio of the tech giant stood at around 875. By the end of the year, this figure jumped to over 1,300. In January, Tesla’s PE ratio hit an all-time high of 1,401 and then dropped to 680 by the end of June. Statistics show the company’s price-per-earnings ratio more than halved in the following week, falling to around 350 in the first days of July.

Although this value jumped to 473 over the past three months, that is still 45% less than the PE ratio measured in October 2020.

Far below Tesla, Amazon ranked as the company with the second-highest PE ratio among the top ten. The price-per-earnings ratio of the eCommerce giant stood at 58.1 last week, significantly down from 95.8 a year ago.

As the company with the third-largest PE ratio among the top ten, Microsoft saw its PE ratio slightly increase from 35.5 to 37.4 during the last year.

Health Equity the Company with the Highest PE Ratio Globally, 6,759 as of Last Week

Although Tesla has convincingly the highest price-to-earnings ratio among the top ten companies, the tech giant ranked on the thirty-eight place of the global PE ratio list.

According to MarketBeat data, HealthEquity has the highest PE ratio globally. Last week, the price-to-earnings ratio of the US health care company stood at 6,759 or fourteen times more than Tesla.

The US transportation manufacturing corporation, The Greenbrier Companies ranked second, with a PE ratio of 4,565.

American online retailer of pet food, Chewy, and medical devices manufacturers NuVasive and Tandem Diabetes Care close the top five list, with PE ratios of 3,273, 2,879 and 2,544, respectively.

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Social Media

Facebook and Comic Republic Release #NoFalseNewsZone Comic Book Series in Nigeria

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Facebook Accelerator Programme - Investors King

Facebook and Comic Republic have announced the launch of #NoFalseNewsZone online comic book, an exciting and educational comic series designed to help people think critically about the messages they see and read online. The series helps readers to identify false news and what they can do to help minimise its spread.

The online comic book, which comes in a three-part series will feature the stories of an experienced nurse, an intern reporter and a university student who are on their personal journey to educate people on how to curb false news, and also join the fight against misinformation to help create a #NoFalseNewsZone online.

“Facebook is excited to launch its #NoFalseNewsZone online comic book in collaboration with Comic Republic. We’ve come up with relatable and exciting stories to keep people entertained as we educate them on how to minimise its spread,” Oluwasola Obagbemi, Facebook’s Corporate Communications Manager for Anglophone West Africa said, while commenting on the launch. “As a pioneer of innovation for human connection through social presence, Facebook has given people the power to build communities and bring the world closer together in new and profound ways. Our hope is that with this online comic book, people will make informed decisions by thinking critically about what they read, trust and share,” Obagbemi added.

Speaking on the collaboration, Comic Republic CEO, Jide Martin said: “In a world where we are online for everything essential, it is now critical that we protect our new reality. More than ever, with just one tap online, you can either make or mar a life. As such, we must all be accountable for the information we share on social media. Comic Republic’s mission is rooted in storytelling for a cause, so the #NoFalseNewsZone campaign is right up our alley and such a thrill to work on. I urge people to read and pass it on but most of all, really think before you share unverified messages with their contacts. We don’t need superpowers to do good.”

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E-commerce

What Limits E-commerce Growth in Certain Parts of the World?

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E-commerce - Investors King

E-commerce growth is predicted to reach the pre-pandemic level by the end of this year. However, Fast-Growing and Emerging regions remain excluded from access to global e-commerce due to prevailing constraints on cross-border shopping. 

With global e-commerce sales predicted to reach $4.9 trillion by the end of this year, e-commerce has shaped new consumer habits when it comes to shopping preferences. Despite these predictions, e-commerce growth and accessibility in certain regions is still off-limits due to existing constraints that could be solved—with the right timing and approach.

In the first quarter of 2021, global e-commerce recorded $876 billion in sales—up 38% year-over-year, with predictions of a continued growth of 24.5% by 2025. Yet, the surge has not been as widespread as it would seem at a first glance. Huge numbers of the population in Fast-Growing and Emerging markets are unbanked—as many as 50% of Africans are still financially excluded, South and Central Americans following close behind with 38%. Because of this, certain regions are facing limitations when it comes to cross-border e-commerce.

Frank Breuss, CEO and co-founder of Nikulipe, a Fintech company creating and connecting Local Payment Methods to access Emerging and Fast-Growing Markets, points out that, while each Emerging Market has its own specific issues around cross-border payments, there are three main ones that stand out as most prevalent.

“Problems that are stifling growth in Fast-Growing and Emerging markets have been around for ages. Variety of payment cards, country-specific legislation and currency restrictions, as well as logistics are among the key issues hindering e-commerce growth. For example, while payment cards like Visa and Mastercard are widely available in North America or Western Europe, they’re not easily accessible in Fast-Growing and Emerging markets. Even if consumers have payment cards, these are often local ones, intended for domestic use only, meaning they cannot be used to purchase goods from international merchants.”

Breuss elaborates that the situation is similar with bank transfers. For those who have accounts with local banks, these financial institutions, in most cases, are not well-connected to the banking network internationally, making cross-border bank transfers very slow and expensive.

Country-specific legislations or the lack of them are also ongoing struggles for Fast-Growing and Emerging markets. Operational payment limits, where payment orders can be placed only on working days during certain hours, is something that Latin America deals with. Fragmented market is an ongoing headache for Africa—with over 40 different currencies and regulators, it poses hurdles to international merchants. According to Breuss, even if a consumer is able to purchase goods or services off an international website, the merchant might not have easy access to the payment itself.

Logistics issues like shipment restrictions or custom hold ups are another additional battle for many Emerging markets, adds Breuss. International merchants have to figure out ways to get goods to their clients in these regions in time, as well as overcome customs holdups, which add up to delays.

To help solve these issues for international Merchants and at the same time include as many consumers in global e-commerce as possible is not an easy task—it takes time, local know-how and perseverance, Breuss notes.

“A certain lack of clear regulations and laws in Emerging Markets up the complexity of introducing new solutions. First of all, it’s key to understand the markets and their nuances, in order to offer relevant local payment methods that are suitable for consumer needs in each market. Partnering up with reliable payment solutions providers could aid in handling money flow from Fast-Growing and Emerging markets back to the merchant.”

With issues like payment and card limitations as well as logistics, Fast-Growing and Emerging Markets are ripe for new solutions. Helping solve the long-lasting issues, could eventually draw exclusion from global e-commerce to a close. If consumers continue to show their wish to shop internationally, more merchants will try to find a solution to meet the demand—and consequently, bring more pressure on legislation to adopt the needed changes. Now, with the consumers in Emerging Markets doing exactly that, it seems to be the right time to start solving the complexities.

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