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Bloomberg Businessweek 1/8/2018

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United States
Bloomberg Finance LP
50 Issues

in this issue

4 min
in brief

Europe ● Germany started enforcing a new law that requires social media networks to deal with hate speech within 24 hours. Twitter promptly suspended the account of far-right leader Beatrix von Storch, who’d called Muslims “rapist hordes.” ● BP said it would take a $1.5b fourth-quarter charge related to the U.S. tax overhaul. The company said lower corporate rates will benefit BP over time. ● Ryanair braced for Brexit. The Irish carrier had a subsidiary apply for a license to avoid being classified as a foreign entity in the U.K. ● Diageo suspended all its advertising on Snapchat after U.K. regulators said the liquor giant wasn’t doing enough to keep the posts away from those younger than 18. The company had made a “sponsored lens” that let users add a mustache reminiscent of the one…

5 min
this stat says iran is ripe for change

In 2008, U.S. demographer Richard Cincotta predicted that Tunisia—then under a well-established authoritarian regime —would probably democratize before 2020 based on the age structure of its population. When Cincotta aired the forecast at a meeting of Middle East experts sponsored by the U.S. Department of State, the audience burst into laughter. “One well-known Middle East scholar laughed until he was in tears,” Cincotta recalled in a 2017 paper explaining his age-structural theory of state behavior. “Because the laughter did not subside, the session’s chair ended the question and answer session.” Today, Tunisia is the one success story of the Arab Spring chain of revolutions that began there in 2010. It is classified as “free” by Freedom House, a U.S. government-funded think tank whose rating system Cincotta uses in his analysis. The reason…

2 min
social media doesn’t have to be terrible

For the social media business, this new year is one of grim tidings. Every day, it seems, pioneers in the field are offering mea culpas—airing regrets, expressing caution, apologizing for a technology that seems to have run amok. One former Facebook Inc. executive recently conceded that the network is “ripping apart the social fabric.” A former engineer at the company has warned of a looming “dystopia.” Another veteran admitted that Facebook is “exploiting a vulnerability in human psychology.” (“God only knows what it’s doing to our children’s brains,” he added.) Across Silicon Valley, insiders have been fretting that the social media’s business model may be undermining the well-being of its users. A growing body of research suggests they have a point. Among the young, social media may be playing a role in…

8 min
masayoshi son has a deal you can’t refuse

Early last year, Cheng Wei, founder and chief executive officer of the Chinese ride-hailing juggernaut Didi Chuxing, tried to resist taking money from legendary investor Masayoshi Son. Cheng told the SoftBank Group Corp. chairman he didn’t need the cash because his company had already raised $10 billion, according to people familiar with the matter. Fine, Son said. Then he suggested he might direct his support to one of Didi’s rivals. Cheng relented and took the investment: $5 billion in the largest fundraising round ever for a tech startup. Son pulled a similar maneuver in November, publicly warning Uber Technologies Inc. that if he didn’t get the deal he wanted, his backing would go to archrival Lyft Inc. Uber also took the money—a $9 billion complicated stock transfer and investment deal announced…

4 min
when a weak rival collapses, watch out

Travelers flying between Germany’s political and financial capitals this fall have been in for an occasional surprise: boarding a humpbacked 747 jumbo jet for the one-hour hop from Berlin to Frankfurt. While the massive planes are typically reserved for long-haul flights to, say, Tokyo, Denver, or Rio de Janeiro, Deutsche Lufthansa AG trotted out its jumbos as seats on its planes grew scarce after insolvent local rival Air Berlin Plc was grounded in October. Lufthansa added the big jets because it has “a responsibility to stabilize the situation to help keep air traffic in the country running,” Chief Executive Officer Carsten Spohr told journalists in October. Air Berlin’s demise, coupled with troubles at low-cost carriers and Middle East rivals, have made Lufthansa the world’s best-performing airline stock over the past 15…

1 min
macau rebounds

Still Growing In 2018 casinos from the local unit of MGM Resorts International and Hong Kong’s SJM Holdings are set to open in Cotai. That will give all six Macau operators—MGM and SJM, along with Galaxy Entertainment, Melco Resorts & Entertainment, Las Vegas Sands, and Wynn Resorts—a presence on the strip. SPOHR: COURTESY LUFTHANSA. *MARKET SHARE ESTIMATES FROM DAIWA CAPITAL MARKETS; MAP DOES NOT INCLUDE SATELLITE CASINOS OPERATED BY THIRD PARTIES; MARKET SHARE FOR GRAND LISBOA INCLUDES ALL GAMING REVENUE FOR SJM, INCLUDING ITS SATELLITE CASINOS; DATA: MACAU’S GAMING INSPECTION AND COORDINATION BUREAU, DAIWA, ANALYST SURVEY COMPILED BY BLOOMBERG…