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Saturday, July 31, 2021
Facebook, Apple, Amazon, Netflix underperform NASDAQ in first trading week of 2021

The spotlight for the week was on Elon Musk’s Tesla. Shares of the electric car manufacturer surged 22% during the last 5 trading sessions to sit at $880.02 per share.

In what was a controversial week in the United States of America on the political front, Wall Street was also in for something that has been rare for equity markets. The top five big tech companies on Wall Street, collectively known as FAANG, underperformed the benchmark index — NASDAQ. While the equity index gained 1.8% during the last five trading sessions, most of the FAANG stocks witnessed losses in the same time period. On the other hand, leading electric vehicle manufacturer Tesla’s stock price jumped over 20%, helping Elon Musk become the world’s richest person beating Amazon’s Jeff Bezos.

Facebook share price dropped 2.62% in the last five trading sessions to end at $267.57 per share. The company is under the spotlight for its updated privacy policy for its messaging software WhatsApp. The firm is seeking user approval to share user data with the parent firm Facebook. Whatsapp has chosen to go with a ‘take it or leave it’ approach where, if users do not consent to the data sharing policy, they will not be allowed to use WhatsApp after February 8, 2021. (Source: Financial Express)

Spectrum sale: Jio may shell out huge money in March auctions

Jio might also go for 700 MHz spectrum for which the reserve prices are 38 per cent higher than 800 MHz spectrum in 19 circles, and 56 per cent higher (than 800 MHz) in Delhi, Mumbai and Kolkata circles

The department of telecommunications (DoT) has recently issued notice inviting applications for radio-wave auctions slated to start on March 1. The reserved prices of spectrum in 700 MHz (megahertz), 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz, and 2500 MHz that are put up for auction are higher in some cases (1800 MHz, 2300 MHz) and lower in others (800 MHz) compared to the last auctions in October 2016.

While these auctions don't have 5G spectrum (3300 MHz-3600 MHz band), a lot of spectrum that the telecom operators currently own will be coming up for renewal. For instance, in the case of Reliance Jio, which has the highest amount of spectrum - 98.8 MHz - expiring this year (among all telcos), the renewal is extremely important for two reasons. The telco currently has spectrum in three bands (800 MHz, 1800 MHz, and 2300 MHz). Firstly, the 800 MHz spectrum, which is coming up for renewal, is the bedrock of Jio's network. While 1800 MHz and 2300 MHz bands provide capacity, the crucial 800 MHz provides Jio indoor coverage, better connectivity and wider reach.

At the reserved price, the purchase of entire 98.8 MHz is going to cost Jio about Rs 23,864 crore.

Secondly, Jio's spectrum footprint is lowest among all private carriers. For example, Jio has a total spectrum holding of 657.7 MHz as compared to Airtel's 859.3 MHz and Vodafone Idea's 924.8 MHz, as per Credit Suisse. Renewal of spectrum is key for Jio since it's catering to the largest number of wireless subscribers (406.35 million in October 2020) in the country, and can ill-afford to deliver inferior network experience to its growing subs base.

"In case of Jio, we estimate that in addition to 44 MHz of spectrum acquired from RCom coming up for renewal, there is 55 MHz of spectrum due for renewal which is still owned by RCom but being used by Jio. We expect Jio to not only renew 44 MHz of its spectrum, but also buy 55 MHz in the auctions. Further, we expect Jio to purchase additional spectrum (beyond expiring spectrum) as it will look to augment its network capacity having garnered 35 per cent subscriber market share and a much higher share of traffic," says Credit Suisse in a recent report.

But the situation is quite different in case of Airtel and Vodafone Idea. With larger network holdings, they will be selectively bidding for the spectrum. In case of Vodafone Idea and Airtel, most of their spectrum is expiring in 1800 MHz band which is not as essential as sub-1 GHz spectrum. Analysts say that Airtel has bought smaller telcos like Videocon Telecom, Telenor, and Tata Teleservices over the years which gives the telco a comfortable position to participate without any pressure. For Vodafone Idea, there are already cash flow issues besides its current spectrum holding justifies its subs count.

That's not all. Jio might go for 700 MHz spectrum for which the reserve prices are 38 per cent higher than 800 MHz spectrum in 19 circles, and 56 per cent higher (than 800 MHz) in Delhi, Mumbai and Kolkata circles. "We do not expect much activity in the 700 MHz auction unless Jio decides to build some capacity for potential 5G rollout this year," a Morgan Stanley report said.

Late last year, Reliance Industries' chairman and managing director Mukesh Ambani had said that Jio will pioneer the 5G revolution in the country in the second half of 2021. Since there's no visibility on the auction timeline for the usual 5G bands (3300 MHz-3600 MHz), there are speculations that Jio could buy 700 MHz spectrum to launch 5G. (Source: Business Today)

Govt signals social media for wage communication amid privacy row

Xiaomi’s Mi 11 will not ship with a charger inside box, CEO Lei Jun confirms Experts fear the move increases risk of data theft and breaches employee-employer confidentiality pact

The Union labour ministry seems keen to institutionalize social media and proposes to use “WhatsApp and other social media" platforms for salary communication when the new labour codes are implemented in a couple of months.

The move comes amid growing concerns over data privacy and raises the fear that it may facilitate access to financial and social security details of workers by social media platforms, labour economists and cyber security experts said.

It heightens concerns over data theft and financial profiling and increases the risk of violation of the employee-employer payment confidentiality system and financial fraud even at the lower rung of the working class, cyber security experts said.

“All payment, including wages, to the workers shall be made by crediting in the bank account of the worker on electronic mode or digital form. Intimation to the payment made to a worker shall be sent to him through short messaging service (SMS) or e-mail or social media communication such as WhatsApp or by issuing a slip," the Union labour ministry has proposed in its draft standing orders for the service sector, manufacturing sector, and mining sector.

The draft orders have been put in the public domain for comments and will be finalized and made part of the Industrial Relation (IR) Code Act after a month.

The draft standing orders have not been well thought through and there are contradictions in different clauses and it seems an attempt at institutionalization of social media in salary communication, said K.R. Shyam Sundar, a labour economist and professor at XLRI, Jamshedpur. “What the draft standing orders convey is that under law, salary information and salary statements can be communicated through WhatsApp and social media platforms. What the draft fails to convey is how this will provide financial privacy to employees and employers. This will lead to a clear breach of confidentiality agreement in employee and employer relations. This is almost rewriting of confidentiality requirements," he added.

“Social media by its function and definition is largely informal. How can that be made part of salary communication, which is a formal, professional, and commercial requirement in an employee-employers relationship? It will have a multiple and cascading impact and should be scrapped immediately," he argued.

Cyber security expert Ritesh Bhatia concurred. “It will lead to financial profiling and financial surveillance," Bhatia said. “Someone may argue that with Aadhhar in place, privacy is already compromised but remember that the Unique Identification Authority of India and Aadhaar numbers are a government of India organization and product. That’s a big solace. You can access some information at least via right to information provisions and take a wrongdoer to court. However, social media platforms are private entities and are not governed by local or domestic laws," Bhatia explained.

Salary communication can be anything like a message on salary credit, corpus in salary account or a salary slip, he said.

An employee-employer relationship is a commercial relationship and any move to shift that to social media platforms partially or fully, will have negative personal, professional, and financial consequences, Bhatia said.

“Take the example of new WhatsApp rules. These say commercial information can be shared with Facebook, its sister organization. The last thing I would like to see is my salary slip or wage information on Facebook or other social media platforms," he said. (Source: Mint)

CAIT asks govt to ban WhatsApp, Facebook over new privacy policy

Damages to telecom towersCAIT said Facebook has more than 200 million users in India and enabling it to access data of every user can pose serious threat to not only the economy but even to the security of the country.

Traders’ body CAIT on Sunday wrote to Information and Technology Minister Ravi Shankar Prasad demanding that the government restrict WhatsApp from implementing its new privacy policy or impose a ban on the messaging app and its parent company Facebook.

The Confederation of All India Traders (CAIT) claimed that through the new privacy policy, “all kinds of personal data, payment transactions, contacts, location and other vital information of a person who is using WhatsApp will be acquired by it and can be used for any purpose by WhatsApp”.

In the communication to Prasad, CAIT has demanded that “government should immediately restrict WhatsApp from implementing the new policy or put a ban on WhatsApp and its parent company Facebook”, the traders’ body stated.

CAIT said Facebook has more than 200 million users in India and enabling it to access data of every user can pose serious threat to not only the economy but even to the security of the country.

However, in an email response to PTI, a WhatsApp spokesperson said, “To further increase transparency, we updated the privacy policy to describe that going forward businesses can choose to receive secure hosting services from our parent company Facebook to help manage their communications with their customers on WhatsApp.

“Though of course, it remains up to the user whether or not they want to message with a business on WhatsApp.”

The spokesperson further said that the update does not change WhatsApp’s data sharing practices with Facebook and does not impact how people communicate privately with friends or family wherever they are in the world.

“WhatsApp remains deeply committed to protecting people’s privacy. We are communicating directly with users through WhatsApp about these changes so they have time to review the new policy over the course of the next month,” the spokesperson added.

An email sent to Facebook seeking comment on the issue did not elicit a response. CAIT Secretary General Praveen Khandelwal said, “The changed privacy policy of WhatsApp is an encroachment on privacy of an individual and runs against the basic fundamentals of Constitution of India and therefore the CAIT has demanded immediate intervention of the government.” (Source: Financial Express)

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