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The Zacks Analyst Blog Highlights: Alphabet, Facebook, Twitter, News Corp and Apple

Zacks Equity Research


For Immediate Release

Chicago, IL – August 30, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Alphabet GOOGL, Facebook FB, Twitter TWTR, News Corp NWSA and Apple AAPL.

Here are highlights from Thursday’s Analyst Blog:

Alphabet Roundup: Hong Kong News, Waymo, Privacy and More

Being a big technology company is hard work these days. Not only must you satisfy regulators and police your own properties, but you must also keep producing newer and better innovations that will keep the dollars rolling in. Recent news on Alphabet shows it did all that and more.

Hong Kong Influence Campaign Thwarted

Surprise! China, which doesn’t allow American social media companies inside its borders, has been using platforms like YouTube, Facebook and Twitter to spread a disinformation campaign to undermine the Hong Kong protests.

Some protesters identified anti-protest advertising from state-run outlets like China Central Television, or CCTV. The social media companies found that the campaign in fact originated in mainland China and included posts that spoke of the protestors as dangerous and vile extremists.

The trouble started with a new bill that would extradite Hong Kong people to Chinese communist courts. Although the Chinese government has since suspended the bill, the protests have now spread to a wider call for democracy. It’s not unusual for China to annex territory that doesn’t belong to it and then try to establish its hegemony there. Tibet is the best example.

Interestingly, while Google followed other technology companies in removing about 210 YouTube channels involved in the campaign, it doesn’t intend to change its ad policies or block China from the platform, although it has a policy of banning deceptive practices and inauthentic accounts.

Technology companies generally have a system of educating governments about the use guidelines and they would like to leave it at that. Twitter is a refreshing exception because it has blocked advertising from regional state-controlled media.

YouTube said that it would expand its labeling of state-backed media outlets in the region. It currently has a standard disclaimer on all government broadcasters across the world, so presumably it will now add Chinese newspapers like People's Daily, China Daily and Global Times.

"We are deeply concerned by Chinese attempts to manipulate public opinion by spreading disinformation about the situation in Hong Kong," a state department spokeswoman told Reuters.

The Chinese government is pointing to a story in state-run media outlet People’s Daily that says Facebook and Twitter “abused media freedom” by removing accounts revealing violence, while reserving comment on YouTube. Nice observation by a government that censors every bit of news in the country.

Google Has Competition With News Corp As News Aggregator

More competition is always a good thing, if the plans come to fruition. But the story that the WSJ is spinning about its parent company News Corp starting a new aggregation service may not end that way, according to the Journal itself.

But there’s a good bit of detail on the service, so it may not be just a tool to gain leverage with current partners Facebook and Google. For one, it will include hundreds of sources, including national outlets, digital publications, magazines and local newspapers, from which it won’t take a share of ad revenue. Ahem. Apps are also in the cards, and could launch as early as “later this year”. It will use both algorithmic and human curators.

We also know that this is going to be a news service that gives equal treatment to small and big publishers, to paid and free outlets, and to democrats and republicans, or conservatives and otherwise. We’ll see how that goes.

A New Privacy Plan

Google is suggesting a new approach to how you’re tracked on the web that essentially restricts the amount of your information that is shared on the Internet so your anonymity is maintained.

The thinking is that this can be achieved if personally identifiable data is stored on the device rather than the browser, cryptographic tokens are used to confirm a person’s identity and artificial intelligence is used to deliver targeted ads.

Google is obviously against the removal of cookies altogether because that will affect revenues for both publishers and itself. It also won’t solve the problem because developers can use other means to track you. Those are the reasons it has opposed the measures taken by Apple and Mozilla on their browsers.

Google has around 70% of browser market share, so although it wants some standard practices, which is a good thing, it will obviously play a leading role in how those standards are determined.

Actions To Protect Kids

Google’s YouTube recently took a couple of measures for the protection of children using the platform. This is a welcome move and may have been prompted by the FTC investigation into its possible violation of the Children’s Online Privacy Act (COPPA) and how it happened to allow a group of pedophiles to operate on the platform through its messaging feature.

And sure enough, when the company announced its decision to remove private messaging on YouTube, the group of people making the most noise were children who were somehow restricted from using phones or sharing phone numbers, or using a social networking platform. This was a way for them to connect with their online friends while remaining undetected by their parents.

YouTube is also saying it won’t send targeted ads at videos likely to be watched by kids. But this isn’t being well-received because some groups want it to remove all videos that are likely to be watched by kids and divert all kids to the ad-free YouTube for Kids app. They also oppose YouTube’s collection of kids’ data to build a database and target ads at them either now or in the future.

Waymo Developments

There are two bits of news surrounding Waymo and both are interesting.

The first is a decision by Waymo principal scientist and head of research, Drago Anguelov to open up its data set for research by outsiders. Once they buy a standard license, they will have access to the extensive, organized (categorized and labelled) data that Waymo has gathered by virtue of being one of the first companies to start out in this effort.

The goal appears to be to hasten R&D in the space by attracting PhD students, academics and professors to the dataset to help it solve some of its problems. Anguelov says, “Mostly we’re trying to get others into thinking about our problems and working with us, as opposed to doing work that’s potentially not so impactful, given the current state of things.”

But it can also be licensed to independent research labs, robotics labs and research teams at even its competitors.

The second is Uber testing its cars in very heavy rain. The test cars are therefore heading to public roads in Florida and include highway driving to Orlando, Tampa and Fort Myers. Given that weather conditions can be severe due to hurricanes, the cars will be driven by humans to collect data with laser and radar sensors.

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