Bundle of investment news: chinese technology, cloud services and AT&T

Пачка инвестновостей: китайские технологии, облачные сервисы и AT&T

Americans impose sanctions on the Chinese tech sector. Malfunctions Amazon are suggestive of US personnel and education policy. AT&T sells Microsoft's online advertising platform.

Disclaimer: when we talk about, that something has grown, we mean comparison with the same quarter a year earlier. Since all US issuers, then all results are in dollars. When creating the material, sources were used, inaccessible to users from the Russian Federation. Hopefully, you know, what to do.

"Apologize, apologize now!»: America versus Chinese high-tech companies

The story of the ban on the export of high technologies from the United States to "authoritarian" countries has taken a new turn. Biden administration blacklisted a number of large Chinese tech companies:

  • the world's largest drone manufacturer DJI;
  • facial recognition software vendors Megvii and CloudWalk Technology;
  • computer manufacturer Dawning Information Industry - the company once made the world's second most powerful supercomputer;
  • cyber security solution provider Xiamen Meiya Pico;
  • artificial intelligence software developer YITU Technology;
  • cloud business Leon Technology;
  • NetPosa Technologies, providing monitoring services in the cloud.

Now American companies are prohibited from selling goods to these enterprises without special permission., and American investors are prohibited from investing in them. And for what such punishments? For Xinjiang.

All these companies, according to the Americans, to some extent associated with the regime, which the PRC established in Xinjiang Uygur Autonomous Region with widespread surveillance and tight control of the local population.

None of these companies are listed on the American stock exchange., but some of them are traded on Chinese exchanges, and American investment funds could well invest in them.

This is the first time, when tech companies were included in the American blacklist en masse. This is a serious signal to investors, that China's attempts to develop its own high-tech sector will be blocked.

Listed companies, let's face it, not that they are directly involved in the ongoing oppression of the Uyghurs in Xinjiang. У Dawning, eg, have a business in Xinjiang, and Xiamen Meiya Pico works with the Chinese security forces. According to this logic, every second Chinese company can find a "Xinjiang trace" and punish it for this..

US allegations against these companies look far-fetched. Probably, the main goal of the United States is not to find the culprit: Disney has done nothing for that, what did they take off movie in Xinjiang and also thanked the regional administration in the credits. Most likely, this is an opportunity to get to the bottom of Chinese enterprises, working in the high value-added sector, and not those involved in the sewing of sneakers.

  Watching some systems on Collective.

As such, investing in Chinese tech companies looks increasingly risky.: not today, so tomorrow any of them may be delisted from the American stock exchange or simply large Western investment funds will start to ignore these shares.

However, you can make money on this too. From the American point of view, there are also "good" countries in Asia., that is, not having with Washington, unlike China, insoluble contradictions. First of all, this is India, Japan and South Korea.

High tech issuers from these countries: Tata Motors, Sony, LG Display and other interesting companies may well become the beneficiaries of the "emigration" of money of Western investors from China, which is becoming more and more toxic for investors.

Thus, the United States achieved several strategic goals at once.: will deprive Chinese competitors of the money flow and at the same time create false confidence in Chinese companies, that political change in their country will pump their stock: “Well, look, how the exchange is growing in India, and that's all because, what is democracy there!»

However, there are risks here too, even if you will not invest in companies outside the USA at all. US Companies May Still Get Crossfire in Xinjiang Debate. for example, Intel recently sent out messages to its partners asking them to avoid using goods or labor, related to Xinjiang. This caused a lot of outrage among the Chinese public., and Intel had to apologize.

Now the question arises: will ESG investors make the company apologize?, which, most likely, will demand from Intel in the future to show their position more actively, which can negatively affect its sales.

The cloud fell: What does the failure of Amazon Web Service tell us?

Amazon cloud service (Amazon Web Service, AWS) out of order this week: problems started in 04:35 AM ET, most of them decided to 06:51 - although in general the crashes lasted until noon.

Unknown, exactly how many users were affected by the AWS outage, but we know for sure about the problems with the crypto exchange Coinbase and the platform for business communication Slack. Here to talk about, how all this should remind us of the critical importance of cloud infrastructure, - and so it is. But instead of the obvious things, I would like to point out one important point..

AWS crashed for the third time in the last three weeks. So there is no reason to believe, that such incidents will not occur in the future with unenviable regularity. What to do about it, absolutely incomprehensible, since the damage from such breakdowns will also grow with an increase in their duration and frequency. But the reasons for the breakdowns can only be guessed at.. I think, that the problem is a drop in the level of knowledge and experience among Amazon employees - and it will be even worse in the future.

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Slow, but profound changes in the American education system are conducive to even larger technological collapses in the future. Harvard University recently announced, that for the next four years will not require applicants to submit the results of the standardized exams SAT and ACT upon admission. This is not the first American university, decided to take this step: previously, the University of Chicago and universities did this, UCLA. Total number of American schools, not requiring testing for these exams, during the pandemic almost doubled: from 45 to 80%.

Difficulties in conducting exams during a pandemic is just one of the reasons for not testing., the main reason is completely different. These tests have long been criticized by left-wing liberal progressives for being, that they de facto discriminate against poor African American and Hispanic students.

These populations cannot afford good tutors to prepare for such difficult exams., and therefore whites and Asians are best of all.. And this leads to the fact, that there are not enough African Americans and Hispanics in good universities and, Consequently, they take low-skilled and low-paid jobs in the future.

These conversations are being conducted with an eye on the technological sector with its huge salaries and basic sciences in principle., where there are a lot of whites and Asians - and the rest of the population is represented, let's face it, very modest. Here, by the way, a typical selection of articles from the prestigious paid edition of the New York Times:

  • "Why Do Tech Degrees Not Lead to More Blacks and Hispanics in the Tech Sector";
  • "What does it mean for a black mathematician to be 'one of a kind'";
  • “Face recognition technology works well, if only you are a white guy ";
  • "The race problem in the tech sector goes beyond dry numbers.".

I think, that these trends in the American educational system and in public discourse will not help alleviate the staff shortage of American technology companies - and, most likely, will worsen existing technical problems.

Whatever, what circumstances lead to a shortage of minority technical workers, the abolition of the strict educational qualification in this industry will inevitably lead to a drop in quality. We saw something similar in the case of Boeing., where project managers neglected the old technical standards when hiring specialists and began a large-scale "airplane fall".

Without standardized testing in universities, unqualified graduates will join the ranks of Amazon employees in the future., because in the exact sciences, standardization of educational criteria is not a luxury, but the need. And such are the failures, как у Amazon, in the future, five or more years will become permanent.

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Most likely, the more frequent breakdowns of recent times are caused precisely by the growth of the share of people among Amazon employees, unable to master the program of the classical Russian gymnasium of the pre-revolutionary era. The company has just stepped up its push to increase diversity among its employees amid criticism, that she had previously made insufficient efforts in this direction. A logical question arises: how new workers are, hired for belonging to a group, will correspond to the required technical level? Most likely, will not.

In this context, it is difficult to find beneficiaries of future troubles.: Everyone will suffer - from banks and stock exchanges to streaming services and even industrial enterprises, - as cloud computing is now required by everyone. But you can, at least, hope for an increase in demand for services of educational platforms.

Your ad could be here: AT&T sells Microsoft advertising platform

Telecom giant AT&T (NYSE: T) sells to IT giant Microsoft (NASDAQ: MSFT) Xandr online advertising platform.

The deal cannot be called particularly profitable: Xandr's selling price was $ 1 billion, which is not enough. AT&T bought Xandr in 2018 for 1.6 billion. At the same time, Xandr was not to say that a valuable asset.: for annual revenue in the range of 300-380 million, the division gave 50-90 million losses.

For AT&The inglorious sale of Xandr is only part of her overall strategy: earlier she got rid of the cinema- and TimeWarner media assets, to concentrate on investments in the specialized telecom business. One could say, that AT management&T clearly represents, what is he doing, - but I do not think so.

The company spent a lot of money and time on TimeWarner and was actively suing antitrust regulators., who blocked the deal. In the end, everything ended in nothing for her and the shareholders.: the company failed to raise even the "Netflix killer", not to mention a full-fledged competitor to Disney +. At the time of news about the TimeWarner branch, the number of subscribers to its streaming service HBO Max was 44 million - versus 103 million for Disney +.

But at Microsoft, seem to be, know, what do they do. Advertising revenue now gives Microsoft 5% proceeds: this is an advertisement in Bing's search engine, on social network LinkedIn and on the Xbox gaming platform. So that, may be, Xandr in Microsoft hands will prove to be a useful tool and will delight the company's shareholders.

maybe, something worthwhile will come out for the shareholders of AT&T: the more she focuses on developing her telecom business, the more likely, that it will be able to compete successfully with Verizon.

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