The Clash of the Titans
Whether it’s in movies or real life, everyone likes to see big names go toe to toe in their given field. Luckily for us, right now a number of huge companies are fiercely competing and we can follow these finance battles. Listen in to hear more:
Apple – Buy Now Pay Later
When you think of industry titans, the first name that should come to mind is Apple. They are the biggest company in the world and have a history of branching into new industries and making waves. Initially they were a computer company, then they started to dominate the music space with iTunes and still compete with Apple Music, then it was iPhones and Apple Watches, now all of a sudden Buy-Now-Pay-Later could be in for a revamp. In Apple genius fashion, buying now and paying later is as simple as swiping right and selecting an interest-free payment plan which is already budgeted for you. News of the latest release has sent shockwaves through the companies in the space, hurting their stock as Apple storms their shores.
Host Andrew Baxter points out that Apple have a massive advantage already because 85% of consumers in the US are set up with Apple pay, and now they can seamlessly introduce their BNPL service. Jack Dorsey, the CEO of Block that recently acquired the pioneer, Afterpay, now has a great challenge on his hands with trying to compete. It is very exciting to see such big names go head to head and Dorsey’s approach to intertwining Afterpay services with their own current finance infrastructure will be critical. Interestingly, these giants are converging in a time where we see consumer spending slowing down when compared to the mammoth spending we saw in Afterpay’s hayday. Who do you think will sink and who will swim?
Disney vs Netflix
The streaming business is another industry being hotly contested at the moment. Once again we have an eye-watering clash of the titans between a long-term market darling – Disney and the first mover in the space – Netflix. Host Andrew Baxter notes that although Netflix did start the streaming service business first and experienced rapid growth since, Disney is not to be trifled with because they own all of their own content. They also have a massive backlog of content they have produced over the years in an array of different styles. From documentaries to animations to big time blockbuster movies, Disney has it all and continues to produce popular content.
Netflix has also ventured into their own productions, but the issue they face is that since Disney pulled their content form the platform for their own, they simply can not meet the tastes of every user. The last quarter saw Disney Plus’ new subscriber figure eclipse that of Netflix, and we have since seen a colossal sell off on Netflix’s share price. As an overall finance business, Disney has a few more strings to their bow and can continue to exert this pressure. We see the pressure already mounting with Netflix clamping down on password sharing. Is this enough to keep up? In Andrew’s opinion, Disney is the favourite in this fight.
The Twitter Acquisition
If Twitter is a market titan, Elon Musk is the apex predator. Musk has expressed serious interest in acquiring Twitter for a while now, but recent news has really shaken up the prospective deal. Host Andrew Baxter is more than familiar with the amount of fake accounts hounding businesses and advertisers on the platform. Musk has accused Twitter of much the same, with no true understanding of how many spam accounts exist on the platform. Like anyone who knows how to make billions of dollars, Musk knows how to save them as well. In this case, Elon’s qualm is that Twitter is not worth what he offered if there are more bots on Twitter than first thought.
Musk aims to lower the price for a better deal on the acquisition. If the terms are not met, the deal is likely to fail. What is exposed, however, is the valuations of these social media platforms who claim to have hundreds of millions of accounts, but how many of them are really active?