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Feb 3, 2015
via Breakingviews

Small print debases $41 bln U.S. spectrum sale

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By Robert Cyran

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The U.S. government has made a windfall. Some $41 billion of bids in its latest radio spectrum sale added up to about twice as much as expected. But the small print is making the auction look flawed. By bidding through entities it doesn’t fully control, the $33 billion Dish Network seems to have secured a 25 percent price discount aimed at small businesses.

Feb 3, 2015
via Breakingviews

Small print debases $41 bln U.S. spectrum sale

Photo

By Robert Cyran

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The U.S. government has made a windfall. Some $41 billion of bids in its latest radio spectrum sale added up to about twice as much as expected. But the small print is making the auction look flawed. By bidding through entities it doesn’t fully control, the $33 billion Dish Network seems to have secured a 25 percent price discount aimed at small businesses.

Jan 29, 2015
via Breakingviews

Facebook investment largesse manageable – for now

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By Robert Cyran

The author is a Reuters Breakingviews columnist. The opinions expressed are his own. 

Facebook’s investment largesse looks manageable – for now. Boss Mark Zuckerberg has splashed out so much on new projects that his company’s fourth-quarter operating margin fell by a third. But the social network’s top line grew 49 percent, thanks to more users and mobile income. That’s a reasonable dynamic, assuming Zuckerberg is picking the right ventures.

Jan 21, 2015
via Breakingviews

SpaceX satellite dream is throwback to 1990s

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By Robert Cyran

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Elon Musk’s satellite dream is a throwback to the 1990s. Google is investing in SpaceX, one of the overworked billionaire’s companies, which along with its commercial rocket launches is planning a broadband network of 4,000 satellites. The pioneering Teledesic tried something similar around two decades ago but ultimately failed. The question for SpaceX is whether the equation has yet changed enough.

Dec 31, 2014

Breakingviews: IBM turnaround requires atypical activist fix

By Robert Cyran

NEW YORK (Reuters Breakingviews) – IBM requires an
atypical activist fix. Big Blue’s strategy of cost cuts and
debt-fueled buybacks is no longer working – even though the
company keeps trying. A tarnished balance sheet, lean staffing
and a history of disposals rule out typical activist wheezes.
Encouraging Chair and Chief Executive Ginni Rometty to invest in
IBM’s core businesses could pay off.

For two decades IBM has run the same playbook. It sells
low-margin businesses, slashes expenses, buys some profitable
software companies, and returns a lot of cash to investors. Over
the past four quarters, the $152 billion company has spent more
than $23 billion on dividends and buybacks.

Dec 31, 2014
via Breakingviews

IBM turnaround requires atypical activist fix

Photo

By Robert Cyran

The author is a Reuters Breakingviews columnist. The opinions expressed are his own. 

IBM requires an atypical activist fix. Big Blue’s strategy of cost cuts and debt-fueled buybacks is no longer working – even though the company keeps trying. A tarnished balance sheet, lean staffing and a history of disposals rule out typical activist wheezes. Encouraging Chair and Chief Executive Ginni Rometty to invest in IBM’s core businesses could pay off.

Dec 22, 2014
via Breakingviews

More than Slim odds America Movil buys T-Mobile

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By Robert Cyran

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Carlos Slim may try to buy the $21 billion T-Mobile US in the coming year. The Mexican billionaire needs to reduce his telephone company’s dependence on its home country. The fourth-largest U.S. wireless operator is cheap, its parent doesn’t want it, and there’s strategic logic to a deal. Increasingly frightful competition in U.S. telecoms may be a sticking point.

Dec 22, 2014

Breakingviews: Pharma toys with mutually assured destruction

By Robert Cyran

NEW YORK (Reuters Breakingviews) – Pharma is toying with
mutually assured destruction. Gilead Sciences lost some $20
billion in value on Monday morning after Express Scripts ditched
its hepatitis C treatments for AbbVie’s discounted drug. This
may kick off widespread price wars throughout the sector. Such
tactics, though, could be a strategic disaster for all
concerned.

Hepatitis C cures have been a Gilead gold mine. It launched
Sovaldi a year ago and sold $8.6 billion of the drug in the
first nine months of the year. Gilead charges $84,000 per
patient for the drug. Insurers grumbled, but paid up. Other
treatments weren’t nearly as effective and chronic disease
causes liver damage. Now AbbVie has muscled in on this turf. Its
newly approved drug, Viekira Pak, appears just as effective in
patients with the most common strain of the virus.

Dec 22, 2014

Breakingviews: More than Slim odds America Movil buys T-Mobile

By Robert Cyran

NEW YORK (Reuters Breakingviews) – Carlos Slim may try to
buy the $21 billion T-Mobile US in the coming year. The
Mexican billionaire needs to reduce his telephone company’s
dependence on its home country. The fourth-largest U.S. wireless
operator is cheap, its parent doesn’t want it, and there’s
strategic logic to a deal. Increasingly frightful competition in
U.S. telecoms may be a sticking point.

Under a recent Mexican law, America Movil’s profit
will be sapped by penalties if it holds more than half of the
country’s telecommunications market. It now has about 70 percent
of the wireless business. So it’s studying divestitures – these
could bring in over $15 billion in cash, according to UBS. And
credit markets are open and investors are willing to lend cheap
money for acquisitions.

Dec 18, 2014

Breakingviews: Rampaging animal spirits birth biotech unicorn

By Robert Cyran

NEW YORK (Reuters Breakingviews) – Rampaging animal spirits
have given birth to a biotechnology unicorn. It’s apt that a
stellar year for initial public offerings in the sector will be
capped by its biggest float ever. Juno Therapeutics is a year
old and revenue free, but its cancer fighting technology is
hot. At nearly a $2 billion valuation, the company shows
capitalism’s ability to catalyze investors’ hopes and resources.

Biotech has had a stunning run. The Nasdaq biotech index has
returned about 40 percent annually over the past three years, as
big firms have turned into fountains of profit. Analysts expect
the top five companies to earn over $30 billion in 2015, about
40 percent more than they will earn this year. That, and a
generous helping of M&A, has enticed investors onto riskier
turf. This year, 86 U.S. drug firms have gone public, according
to Thomson Reuters’ data.

    • About Robert

      "Robert Cyran, U.S. tech columnist, joined Breakingviews in London in 2003 and moved four years later to New York, where he continues to cover global technology, pharmaceuticals and special situations. Robert began his career at Forbes magazine, where he assisted in the start-up of the international version of the magazine. Before working at Breakingviews he worked as a market researcher and reporter covering the pharmaceutical industry. Robert has a Masters degree in economics from Birmingham University and an undergraduate degree from George Washington University."
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