Could times be a-changing for tech giant Apple? After coming under fire for its tax evasion policies, it seems as if the company could be softening its stance towards corporate tax obligations, as CEO Tim Cook announced in January that Apple would be making a payment of $38 billion to repatriate part of its overseas cash holdings. Cook also committed to spending $30 billion in the US over a five-year period, creating 20,000 jobs and a new campus in the process.
US stock markets are surfing new highs as better-than-forecast results from technology giants are boosting gains across the sector. Although stronger economic growth in the US and globally has given rise to increased business confidence across the board, it’s estimated that a quarter of the S&P 500’s record-breaking return this year is down to a handful of over-performing tech stars.
The S&P 500’s gains put the index firmly on track to record its 104th month in a bull market. In fact, the price-to-earnings ratio of the US stock market hasn’t been this high since the dotcom bubble of the 1990s. And while there are no signs of an imminent crash, it’s a scenario that’s making some investors nervous.
You know you’ve had a bad week when two adverse rulings come home to roost – with billion-dollar consequences. So, it’s hard not to feel a little of Google’s pain as it faces down a pair of expensive and potentially damaging international judgements.
A record fine for anti-competitive practices
First up, the European Union’s record $2.7-billion fine for anti-competitive behaviour. This relates to the company’s practice of handling its own shopping search engine – Google Shopping – in a different way from those of its competitors by defaulting it to the top of searches while bumping others down the list. Regulators say that by illegally promoting its own price comparison service in this way, Google has ‘abused its market dominance as a search engine’ and demoted the services of competitors like Kelkoo.
Small businesses are the lifeblood of any economy, creating wealth and employment opportunities – and supporting economic growth at grass-roots level. This type of entrepreneurship has always been valued in the United States, where the founders of startups can aspire to become leaders of Fortune 500 companies if they hit on a successful niche.
But are small business owners being unfairly hampered by the raft of regulations introduced following the financial crisis of 2008? It’s an issue that’s hitting the headlines at the moment as President Trump reaffirms his pre-election promises to de-regulate the financial services industry.
In a decision that could have significant implications for thousands of employers and workers in the so-called ‘gig economy’ in the UK, Uber drivers have won the right to be paid the national living wage.
The case, brought by two workers leaves the ride-hailing company open to claims from some 40,000 drivers in the UK and could further pressure other companies to review the way staff are contracted and paid.
Uber had argued it was essentially a tech company, and that its drivers were self-employed contractors able to choose when and where to work. In turn, this gave the company a free pass on workers’ rights, including the obligation to pay a national living wage and other perks such as holiday and sick pay.
The space-sharing disrupter Airbnb has ruffled as many feathers as it has inspired budget-conscious travellers the world over. By enabling homeowners to rent out living spaces – ranging from a single room to a whole house – the company has provided both a money-making opportunity for owners and a cost-effective accommodation model for cash-strapped tourists.
But the San Francisco-based company has plenty of detractors, with hoteliers complaining about the deleterious effect on their businesses, and city dwellers accusing Airbnb of contributing to the process of gentrification by reducing the availability of long-term rentals. The phenomenon has led to concerns about the adverse effect growing tourist numbers might have on historic cities, with a number of authorities cracking down on commercial activity by introducing new regulations.