How will the new rules hurt Walmart and Amazon? The Indian government recently updated its policies for foreign direct investments (FDI) in e-commerce platforms, and the changes could throttle Walmart (NYSE: WMT) and Amazon.com's (NASDAQ: AMZN) growth in the country. The new rules, which go into effect on Feb. 1, will ban online retailers from offering exclusive sales, prevent them from selling products in which they own equity interest, and introduce new restrictions on discounts and cashback offers. The rules are aimed at helping smaller retailers compete more effectively against Walmart's Flipkart and Amazon. The new FDI rules could hurt Flipkart and Amazon in several ways. First, both companies frequently partner with big brands to launch platform-exclusive sales, especially for smartphones. Amazon previously launched an exclusive sale withXiaomi (NASDAQOTH: XIACF), and Flipkart did the same with Oppo. The new rules wil...
Facebook payments for 200MM Indian users; $1 Trillion lost in Crypto, but $700MM inflows; VR Headsets at ~2MM per quarter -- via Autonomous ↻NEXT
PAYMENTS: Can Facebook be trusted to provide Whatsapp Payments to 200 million users in India?
Facebook's hair is on fire again. A set of company emails from around 2015 have been acquired by a UK parliamentary committee, despite being sealed by a court in the United States. The emails were on a private computer of a person of interest (Ted Kramer, CEO of Six4Three) who was traveling in the UK. The sovereign issues are interesting in themselves, as global technology companies stretch across jurisdictions to be subject to the laws of each one of them. Case in point is the US arrest of the Huawei (massive Chinese phone manufacturer) CFO in Canada as part of a feud on intellectual property and selling goods to economically sanctioned countries like Iran. So, if you're running a tech company with global impact, maybe just telecommute lest you be snatched by a regulator.
What we learned from the emails is that Facebook acts like a monopoly, using its control over APIs and data to (1) starve or (2) reward players that help cement its position at the center of the attention economy. It is ruthless in its taking and leveraging of customer data, it does so with minimal warning, and it is largely unconcerned about the social consequences unless they have negative PR implications. What else is new ? It's a successful capitalist organism following its incentive structure. But from this vantage point, let's take a look at Whatsapp in India.
Whatsapp has 200 million users in India, and like several other tech companies, wants to power payments to this population. It has formally written to the Reserve Bank of India to get permission. Why do we think India is a better target for tech company wallets than the West? A few reasons. The first is the large percentage of the population that is unbanked, and therefore not served by a financial incumbent, but served by a chat app. The second is the cost of customer acquisition is far lower when a user is already captured, vs. when you have to convert them cold. And third, consumer preferences have not been set with "good enough" services as in the West, and China's example shows the way. A takeaway concern we have is around Aadhaar, India's digital government identity. If Facebook can't be trusted with data we permission it to store, can it be trusted to ingest the equivalent of Social Security numbers?
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