Regulators Concerned About Stifling Rivals
Popular tech giants Amazon and Microsoft are now facing fresh scrutiny from regulators in the UK due to their overwhelming dominance in the cloud computing market. Ofcom has referred these companies to the Competition & Markets Authority (CMA) due to concerns about their grip on the market potentially stifling competitors. According to an Ofcom study, Amazon's Web Services arm holds an 80% share of the cloud computing market, while Google holds 10%. The UK cloud computing market is valued at £7.5 billion.
Cloud Computing Revolutionizes Data Storage
In recent years, cloud computing has become an integral part of the digital world, with numerous industries, governments, and the public sector relying on the storage of information on remote servers known as "the cloud." This has eliminated the need for physical hardware to store data, stream media, and save photos and videos.
Concerns Raised by UK Firms
Ofcom's Fergal Farragher stated that many UK firms have expressed concerns about difficulties in mixing and matching cloud providers. This has led to Ofcom referring its cloud computing study to the CMA for further investigation. Both Amazon and Microsoft have expressed their willingness to cooperate with the CMA probe.
Amazon and Microsoft Respond
While Amazon and Microsoft are open to engaging with the regulatory investigation, Amazon believes that Ofcom's findings are based on a "misconception." The company argues that only a small percentage of IT spending goes towards the cloud and that customers have the freedom to meet their IT needs using a combination of different services. Furthermore, they warn that unwarranted intervention could have unintended consequences, given the massive number of data transfers that customers make daily.
New Car Sales Rebound in September
Car sales experienced a significant increase in September, with 272,610 vehicles sold, marking a 21% rise. However, while the sales numbers still remain 20% below pre-pandemic levels, the demand for new cars remains strong. Notably, the sale of electric vehicles continues to grow, with 45,323 cars sold in September, an 18.9% increase compared to the previous year. Mike Hawes, of the Society of Motor Manufacturers and Traders, commends the market's resilience but emphasizes the need for mandatory targets for EV charging infrastructure to support the upcoming tougher EV targets.
Puma Shares Plunge After Profit Forecast Revision
German sportswear brand Puma faced a significant drop in its shares, plummeting more than 11% on the Frankfurt Stock Exchange. This decline came after analysts revised their profit forecast, suggesting that Puma's hopes of achieving a £580 million profit may not be achievable. The brand, known for its collaborations, such as the Puma X Fenty trainer range with singer Rihanna, declined to comment on the situation.
Imperial Brands Announces £1.1 Billion Share Buyback
Imperial Brands, a tobacco giant, revealed its plans to repurchase £1.1 billion worth of shares. This announcement comes just a day after UK Chancellor Rishi Sunak announced a ban on cigarette sales to anyone born after January 2009. Following the ban, Imperial Brands' shares initially fell but then rose by 3.8% as the company sought to reward investors after price increases contributed to robust sales figures. The company also expressed concerns about potential unintended consequences resulting from the prohibition.
Pawnbroker Ramsdens Set to Achieve Record Profits
UK pawnbroker Ramsdens is poised to achieve record profits this year, thanks to increased demand for its services amidst the cost of living crisis. The company expects to surpass £10 million in profits for the year ending September 2023, compared to £8.4 million the previous year. Ramsdens reported a 20% growth in its loan book, reaching a record £10.3 million. The company attributes its success to customers taking out loans averaging £174 and a significant increase in people selling off family heirlooms to take advantage of high gold prices.
Predictions for a Return to the Office
A global survey by KPMG found that nearly two-thirds of company CEOs believe that full return to office work will occur within the next three years, with 2026 as the target year. However, in order to incentivize employees to return to the office, 87% of CEOs are considering linking rewards, raises, or promotions to in-person office attendance. Various companies, including Ao World, Amazon, Zoom, Meta, and Goldman Sachs, have already implemented plans for employees to return to the workplace.
Collapse in New Home Construction
Figures from the construction industry indicate that the number of new homes being built experienced its most significant decline since the 2009 financial crisis. Developers decided to scale back projects due to reduced demand resulting from higher mortgage costs. They are wary of building houses that may need to be sold at lower prices. Experts warn that a shortage of homes could limit potential declines in house prices. Furthermore, the construction purchasing managers' index fell from 50.8 in August to 45.0 in September, reflecting an overall contraction in the construction industry.
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