“Time Warner Cable has earned the miserable reputation it enjoys among consumers” — Tim Wu of the NY Attorney General’s office, which has been investigating Time Warner Cable for allegedly misrepresenting its internet speeds to customers. No wonder Charter Communications (which acquired TWC) is eliminating the brand entirely.
MARKET SNAPSHOT
Big Picture
- U.S. stocks couldn’t manage to stay positive to end the week, as global growth concerns weighed on markets after a poll from The Independent showed 55% of respondents favored a Brexit (more on that in a bit)
Alternatives to Watch
- Oil fell 3% due to both a strengthening U.S. dollar and a report showing that the U.S. rig count rose for the second week in a row
Market Movers
- Twitter had a rough end to the week, dipping 4% after notifying millions of users that their accounts were at risk of being hacked
CORPORATE PRIMER
Tesla Avoids a Regulatory Headache
On Friday, the Brew reported on Tesla’s brewing tension with the National Highway Traffic Safety Administration over an investigation into Model S safety concerns. Luckily for Tesla, things got squared away over the weekend as the company (reluctantly) agreed to change its “Goodwill Agreement” with customers. Basically, this means Tesla will have to re-word its agreement for warranty-related repairs to make sure it’s on par with what the NHTSA wants. Long story short, regulatory crisis averted for Tesla—but not without a few eye rolls from CEO Elon Musk.
The Rise and Fall of Gawker
Tabloid reporting is a tough business model to sustain—after all, every column creates an enemy. While Gawker (owner of Deadspin and Gizmodo) may have reaped the profits of its sensationalist heyday, it has finally met its maker…announcing bankruptcy this weekend. And who is this maker? Hulk Hogan, of course. Gawker was sued for $140 million for releasing a video of Hulk Hogan doing Hulk Hogan things in the bedroom. On the sidelines, digital media and magazine publisher Ziff Davis has begun bidding for the battered company’s assets starting at $90 million. Fun fact: the Gawker prosecution was financed by billionaire investor Peter Thiel, who was outed as gay in 2007 by none other than Gawker. How the wheel turns.
Amazon Takes on Another Market
Not satisfied with Spotify, Apple Music, Tidal or any of the other countless music streaming services out there? That’s what Amazon is banking on…or maybe you just might like Amazon’s own reinvention of the wheel a bit better. Yep, Amazon is reportedly planning on dropping a standalone music subscription service—both as a complement to the Amazon Echo and as a brand new revenue stream for the e-commerce giant. Incase you haven’t noticed, Amazon has been a major disruptive force in the retail sector, and Spotify and Apple can’t be too pleased to have Amazon entering the ring. Oh, and the pricing will be $9.99 a month…sound familiar?
WORLD MACRO
The Dreaded Brexit
If you thought the odds that Britain would actually exit the European Union were all hogwash, you might want to reconsider: a new poll shows “Brexit” leading by 19 points over remaining in the EU. In response, Prime Minister David Cameron went on a publicity spree, and he really pulled out all the stops. He started off yesterday warning that leaving the EU would decrease the U.K.’s defense spending, in addition to leaving the government with a smaller budget for pensions and health care (and everybody likes those). Cameron also pointed out that the U.K.’s influence is greater as a result of its membership in the EU. With the vote to occur later this month, all eyes are on the U.K.—and this one might come down to the wire.
OTHER STORIES
- New Xbox One S leaks
- Monsanto said to rebuff new Bayer offer
- Dan Gilbert, AT&T each bid $5 billion for Yahoo, patents
- Facebook threatens to delete synced photos
ECONOMIC CALENDAR
- Monday: N/A
- Tuesday: Retail Sales; Import/Export Prices; Business Inventories
- Wednesday: Fed Meeting Announcement; Producer Price Index; Industrial Production
- Thursday: Oracle, Kroger, Rite Aid, Smith & Wesson Earnings; Consumer Price Index; Weekly Jobless Claims; Housing Market Index
- Friday: Housing Starts
FATHER’S DAY IS HERE
Did this title freak you out? Did you just Google Father’s Day to check the date? Sorry to start your Monday morning like this, but consider this your reminder: it’s time to go tie shopping. And it’s likely that this year you’ll spend more than you did last year, according to an annual survey by the National Retail Federation. Exactly how much more are Americans expected to shell out on dad?
- The big number: 10 bucks. Yep, this year will see a $10 hike in spending for the average person on Father’s Day. It may not sound like a lot…until you consider the total Father’s Day spend on an average American dad: $126.
- Add up everyone’s spending on Sunday, and it comes out to $14.3 billion nationwide. That’s a lot of father appreciation.
- Where’s all the money going? There’s an 80% increase in spending on movies in the week before Father’s Day, and a 12% increase in restaurant spending. Better get your X-Men tickets before they sell out.
- Then again, maybe you’ve already got this one under control: interestingly, Father’s Day gifts are typically bought in the weeks before the holiday, while Mother’s Day gifts tend to be purchased last minute. Either way, consider yourself warned.
INTERVIEW QUESTION OF THE DAY
What are precedent transactions? (Answer)
BUSINESS PERSON OF THE DAY
Thomas Perkins passed away at the age of 84 last week. He was a founding father of modern venture capital investing through his co-founding of venture firm KPCB in 1972, well before “venture capital” became a household name.
FOOD FOR THOUGHT
For the second time, the annual GLIDE Foundation auction raised exactly $3,456,789 for a lunch with Warren Buffett. Is it more weird that this is the second time an anonymous bidder won the auction with the exact amount from 2012 or that someone paid this much for lunch?
[protected-iframe id=”8513446c42932c5a0e3fda7e8aad590e-97886205-61771510″ info=”//s3.amazonaws.com/downloads.mailchimp.com/js/mc-validate.js” ]