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Huawei faces ban from Britain's 5G networks by 2027 in crackdown plan
LONDON (BLOOMBERG) - Britain is poised to ban Huawei Technologies from its next generation mobile networks under a two-step plan designed to protect critical communication systems from potential security threats, a person familiar with the matter said.
Under the blueprint, British phone companies will not be able to add any new Huawei components to their 5G networks by the end of the year. After that, all existing equipment made by the Shenzhen-based company would need to be removed from 5G networks by 2027, the person said.
Prime Minister Boris Johnson, his senior ministers and top security chiefs are due to be presented with the proposal at a meeting of the National Security Council on Tuesday (July 14), with an announcement expected later in the House of Commons.
If the plan is agreed at that meeting, it would mark a major reversal by Johnson, and risk escalating tensions between Britain and China at a highly sensitive time.
Johnson gave the green light to Huawei's involvement in emerging mobile networks in January, subject to limits, but he came under pressure from US President Donald Trump to change course. Recent additional US sanctions on the company have changed the calculus in London.
In May, the US banned Huawei from sourcing microchips which use American technology, a move that forced British officials to reassess their view of the security and sustainability of using the company's equipment in 5G networks.
The prevalence of chips that are made with or incorporate US technology caused New Street Research analyst Pierre Ferragu to declare in May that "Huawei has 12 months left to live".
At the same time, Johnson has faced demands from within his own Conservative Party to take a tougher line with Beijing. Senior Tories demanded the premier should give firm deadlines for when Huawei will be blocked from Britain, amid concerns its equipment could be used by Chinese spies - a charge the company denies.
Neiman CEO Geoffroy van Raemdonck bags big checks after waiving salary
The boss of Neiman Marcus has been getting paid lavishly to lead the swanky chain out of bankruptcy — and that’s ruffling feathers in the rank-and-file.
On March 30, Geoffroy van Raemdonck — a Belgian-born luxury merchant who was named chief executive two years ago — declared he was waiving “100 percent” of his salary while he furloughed more than 14,000 workers amid lockdowns that had shuttered the Dallas-based luxury retailer’s stores nationwide.
A recent filing in bankruptcy court, however, reveals that van Raemdonck continued to pocket big paychecks in the weeks that followed, even as thousands of workers at dozens of stores were sent to the unemployment line.
On April 10, van Raemdonck got a salary check for $57,692, implying a yearly salary of $1.5 million, court documents show. Later in the month, two smaller salary checks arrived totaling $17,230. And on April 24, van Raemdonck got a payment of $172,135 to offset taxes on more than $2 million in stock options he received the previous year.
Info on van Raemdonck’s pay since April couldn’t immediately be obtained, and a Neiman Marcus spokeswoman declined to comment for this story.
In the year leading up to Neiman’s bankruptcy filing, van Raemdonck received three pay raises that saw his annual salary jump from $1 million to $1.2 million and finally to $1.5 million on March 13. Along with each bi-weekly paycheck, the executive also received a $19,230 bonus check, according to court documents.
The fat pay and perks are irking Neiman employees, who gripe that van Raemdonck has been slow to bring people back to work as lockdowns get lifted nationwide, instead limiting most stores to curbside pickup service.
“I can tell you that after seeing this I feel betrayed as he has personally told us that he has given up his salary, but never told us he received the bonus,” an employee who asked to remain anonymous for fear of reprisal told The Post in an email.
“He told us he appreciates our sacrifices, but it looks like he’s not making any himself. He has continually talked about love of customers and how we’re in this together, but after no salary increases and job cuts it seems very one-sided.”
Five weeks after van Raemdonck’s no-salary pledge on May 7, Neiman Marcus filed for Chapter 11. That day, van Raemdonck told Women’s Wear Daily that if it weren’t for the coronavirus, the company wouldn’t have gone bankrupt.
“The mood is positive,” he told the trade publication. “We have a very healthy business and we were on track to deliver more profit this year than last year and grow our gross margin and our top line.”
But skeptics say it’s also possible that Neiman — which has been struggling for years under more than $4 billion in debt it was saddled with in a private-equity buyout — had been preparing for a possible bankruptcy months earlier.
In February, the board handed van Raemdonck a $4 million bonus. While it looks like optimism on the face, experts say it also could be part of a recent trend by boards to hand out bonuses shortly before filing for bankruptcy to avoid having to tangle with creditors and judges over generous pay plans in court.
“My guess is that when they took the bonus, that bankruptcy was a distinct possibility,” said Kenneth Rosen, a bankruptcy attorney at Lowenstein Sandler. “The pandemic may have expedited it, but in the midst of their distress the entire senior management team grabbed a lot of money,” Rosen said of the filings.
Neiman on June 22 also approved cash payouts for seven other top executives, saying their “workloads expand significantly” during bankruptcy, according to the filing. Chief Merchant Officer Svetlana Todorovich stands to receive the second-highest bonus of $600,000 if Neiman Marcus exits bankruptcy by Sept. 15, and that’s on top of an $800,000 bonus she received on April 17.
But it’s van Raemdonck who stands to bag the biggest prize — an additional bonus of $3 million — if Neiman exits Chapter 11 by Sept. 15. The bonus gets halved if Neiman exits by Oct. 7 and a later exit would net him just $750,000, the documents show.
Some industry insiders say that could explain van Raemdonck’s reluctance to fully reopen stores, noting that rival Saks Fifth Avenue has been more aggressive in opening its doors to customers, outfitting its staff in masks and gloves and aggressively sanitizing store fixtures throughout the day.
“Geoffroy is saving his cash so when the bankruptcy judge asks, do you have enough cash, he can say ‘yes’,” one industry executive speculated.
Rosen, of Lowenstein Sandler, noted that such pay incentives can cloud an executive’s judgment.
“It places them in the position of making a decision that is good for them individually but not necessarily good for the business,” Rosen said. “Every time that person has to make a decision they will think of whether it’ll delay the case and what that will mean for them financially.”
SoftBank hires Goldman Sachs to explore sale options for chip designer Arm after getting...
Masayoshi Son, chairman and chief executive officer of SoftBank Group Corp., gestures whilst speaking during a news conference in London, on Monday, July 18, 2016.
Chris Ratcliffe | Bloomberg | Getty Images
SoftBank has hired Goldman Sachs to explore both an initial public offering and a sale of U.K. chip designer Arm Holdings, according to people familiar with the matter.
SoftBank has been preparing to spin out Arm in an IPO but has recently begun exploring sale options after receiving interest from an outside party, said two people, who asked not to be named because the discussions are private. It's unclear if the outside company or entity is interested in buying all or just part of Arm, which was acquired by SoftBank for about $32 billion four years ago.
The Wall Street Journal first reported SoftBank had hired Goldman to gauge sale interest. Spokespeople at SoftBank and Goldman Sachs declined to comment.
SoftBank is looking for more cash to help support companies in its $100 billion Vision Fund, many of which have struggled since the pandemic and quarantines started. SoftBank agreed to sell about $21 billion of its stake in T-Mobile after merging Sprint with the third largest U.S. wireless company last year. The Japanese technology holding company has said it plans to sell up to $41 billion in assets. SoftBank is also buying back billions of shares, which has helped boost its stock in recent months.
SoftBank bought Arm as an investment in the so-called Internet of Things -- the idea that wireless connectivity among everyday items such as refrigerators, cars and other devices would lead to useful new scenarios. Arm said last week it planned to transfer its IoT divisions to SoftBank. The announcement was made to focus the company on an initial public offering more than a year from now, one of the people said.
Few companies could afford to buy all of Arm without intense regulatory scrutiny. Arm has found a niche as a neutral designer of the microprocessors that works with many of the largest equipment manufacturers, including the majority of the world's smartphones. Apple, Samsung and Qualcomm all use Arm technology in various ways.
There have been few large semiconductor deals in recent years after a flurry of consolidation from 2014 to 2016. Part of the slowdown in recent years is related to CFIUS (The Committee on Foreign Investment in the United States) concerns about sharing technology with Chinese companies. Still, Analog Devices announced it planned to acquire Maxim Integrated Products for about $21 billion on Monday -- a deal that could bring activity back to the market.
WATCH: Why SoftBank's purchase of ARM is a positive
Venture X Dallas Campbell Centre Offers Flexible Coworking Tips for Dallas Digital Nomads
Dallas, TX , July 13, 2020 (GLOBE NEWSWIRE) -- Venture X Dallas Campbell Centre Offers Flexible Coworking Tips for Dallas Digital Nomads The phrase “digital nomad” has only been around since 1997, but it has become part of the booming culture of people who have found ways to work from anywhere. Coworking spaces are perfect for this group of workers. With a coworking space, digital nomads can work whenever and wherever they want. Because many digital nomads have a home base where they live when they’re not traveling, coworking spaces offer flexibility, comfort, and professional amenities. If you’re a Dallas digital nomad, there are strategies you can use to make sure your business thrives even as you enjoy the flexibility of creating a work-life balance that best suits your lifestyle. Here are five tips to keep in mind. Here are 5 tips from Dallas Coworking Expert & CEO Jason Bowers to make your business thrive during COVID-19. 1. Choose the Right Coworking Space In real estate, the phrase “location, location, location” is king. The same rule applies to coworking spaces in the sense that finding the right kind of space is critical to your success. Whether you’re a freelancer, entrepreneur,
Tech companies are ending leases and consolidating offices as remote work is here to...
SoundCommerce employees, with CEO Eric Best on far left
SoundCommerce
On a Saturday in April, several executives from SoundCommerce rented a U-Haul, drove it to their office in Seattle and loaded up the truck with stand-up desks, 48-inch monitors and various other gadgets and personal belongings. For two days, they traversed town, dropping the items off at employees' houses and apartments.
With the coronavirus forcing non-essential employees to shelter in place, it had been weeks since any the start-up's 20 or so staffers had worked at the office. It was clear they wouldn't be going back.
The lease expires July 31, and SoundCommerce CEO Eric Best said the company did not extend its contract.
"We polled the team and, for the vast majority, they prefer to remain at home," said Best, who co-founded the software company in 2018. "We're not making any decision for the long term right now. We're thinking about what do we do for the next six to 12 months in terms of maximum safety of team and maximum flexibility of the company."
In the tech hubs of Seattle, Silicon Valley, New York and elsewhere, many CEOs are coming to the same conclusion — real estate is not a worthwhile expense. Start-ups that never intended to be fully distributed are letting leases end or looking for ways to get out of longer deals, while bigger employers are closing facilities, consolidating space and exploring ways to provide workers with flexible arrangements and options closer to home to avoid long commutes.
In May, CBRE was predicting about a 7% drop in office rents per square foot from the first quarter to the fourth quarter. It expected vacancy rates to rise as high as 14.9% in the first quarter of 2021, up from 12.3% in first three months of 2020. Since then, the number of Covid-19 infections in the U.S. has skyrocketed, and states including Florida and Texas continue to see daily record highs.
Facebook, Twitter, Okta and Box are among the tech companies that have announced a more permanent shift to a hybrid approach. Many others are likely to follow as extended school closures or shortened days make remote options essential. Officials in Los Angeles and San Diego announced on Monday that schools will start online-only in the fall.
With that ominous backdrop and no vaccine expected anytime soon, office workers who can be productive at home are showing little desire to leave, and in many parts of the country they don't even have the option.
At SoundCommerce, the office cost was equivalent to the salary for one to two full-time employees, Best said. His company, whose software provides real-time data to online retailers, raised a $6.5 million seed round about a year ago, and now has more options with how to spend its money.
"We could forego the space and either buy additional cash runway, which is important for a start-up," Best said. "Or hire additional engineering capacity, which is even more important for a start-up."
'Pretty much everyone is doing it'
Across the country, Ian White is making a similar calculation at his early-stage start-up ChartHop, which develops software for human resources departments. On Jan. 15, White signed a six-month lease at a WeWork in Brooklyn for an office with about 15 desks.
A quarter of the way through the $1,200-a-month WeWork membership, White sent all nine employees home. The team quickly adapted to life on Zoom and Slack, and as they realized they'd be remote for an extended period, people started leaving New York for less cramped surroundings. White, along with his wife and eight-month-old baby, found an Airbnb by a lake in South Carolina, where they lived for two months.
Meanwhile, ChartHop's WeWork space "just sat there gathering dust and we're still on the hook for a six-month commitment," White said.
ChartHop CEO Ian White
ChartHop
"I asked WeWork for any kind of concession, but they offered nothing, not even the slightest price break," White said. "What they finally came back to me with was, if I was willing to enter another 12-month commitment, they'd give me a free month."
Instead, White is letting the lease expire. With business still picking up, he's continued to hire, adding seven employees since the company went remote. He's given his staff the option of working from home forever and, for those who want to eventually return to in an office, the company will revisit that possibility when it makes sense, White said.
Scott Orn said he's hearing these anecdotes from across his client base. His company, Kruze Consulting, helps about 250 start-ups with tax, accounting and HR services. Orn looked at the data of his clients and concluded that as of May, half of them had eliminated the amount they're spending on WeWork, while 26% had reduced their WeWork expenses.
Orn said his company, which was based at a WeWork location in downtown San Francisco, also let its lease expire.
"Pretty much everyone is doing it, who can do it," Orn said. "It was actually hard getting dates from WeWork where the elevators were not in use from others moving out."
It's an easy decision, Orn said, because "you'll be able to pick up super-cheap subleases at the very least when people are ready to go back."
A WeWork spokesperson declined to comment, but Chairman Marcelo Claure provided positive spin to the Financial Times recently.
Claure, SoftBank's operating chief who joined WeWork last year when SoftBank took control of the company, said that large enterprises are seeking more flexibility and turning to the office-share provider for space. Mastercard, Microsoft and Citigroup are among companies that have signed new leases in the past month.
According to the FT's report, Claure said revenue was "flat during the crisis," and that the company is now poised to start generating positive cash flow next year, ahead of schedule.
Industrious CEO Jamie Hodari said his company, which competes with WeWork, is seeing a similar trend, with employers including Salesforce, Pivotal and ServiceNow moving to a more distributed model. Hodari said that the churn rate, or the percentage of companies deciding not to renew their memberships, spiked in late March and early April, but is now back to pre-Covid levels.
Over the last couple months, Industrious has started working with clients on an even more flexible model that would allow companies to rent fractional space and pay based on usage. For example, a company could rent space for two days a week in one location and three in another and have a set amount of desks for those times and days.
"About eight weeks ago, companies said to us that once things reopen, people will want to go to work but no one wants to go to work five days a week," Hodari said. "There's a level of flexibility that companies are anticipating that we're working to try and provide. But it's pretty out there. It hasn't traditionally existed in the real estate market."
Industrious office
Industrious
Credit Karma, a financial-tech company Intuit is acquiring for about $7 billion, is in a complicated situation. The company, headquartered in San Francisco, signed a lease last year for 106,000 square feet across the Bay Bridge in downtown Oakland.
Some of Credit Karma's 1,100 Bay Area employees were going to start moving to the Oakland office in 2020, but the full migration was expected to happen over several years. About 100 people who live in certain areas were going to be allowed to stay in the San Francisco office to keep their commutes manageable.
Those plans all changed shortly after the pandemic struck. The company closed the San Francisco headquarters for good, allowing employees to come in and pick up essentials like medicine, bicycles or valuable personal items. Whenever employees return to work, Oakland will be the lone office in the Bay Area, and those who would have stayed in San Francisco will instead be able to work from home.
"Covid hit and we started to have to make some harder decisions around financials in general," said Colleen McCreary, Credit Karma's chief people officer. "We decided to make the call now to consolidate into Oakland. It was going to be something over time we'd probably be getting to anyway, but this really expedited that."
Still, Credit Karma has its six floors in San Francisco on the books, and the leases vary for each. The company is looking for ways to offload that space, which may mean having to subsidize some costs for new tenants, said people with knowledge of the matter who asked not to be named because the negotiations are confidential. McCreary said she hasn't been involved with those talks and isn't aware of the details.
'We'll play it by ear'
Elevate Security, a 30-person start-up with offices in Berkeley, California, and Montreal, let both leases expire in June, saving the company about $10,000 a month.
Robert Fly, Elevate's co-founder and CEO, said there are challenges to managing a remote workforce. Trying to recreate the water cooler conversation and figuring out ways to properly show gratitude for jobs well done have become important, particularly for people who thrive in communal environments, he said.
"It was a little rough in the beginning but now that we've cleaned up a lot of communication and collaboration, I actually think it's better," Fly said. He said that every day around lunch, the team gets together on Zoom for a 15-minute stretching session.
Elevate Security video chat
Elevate Security
When he decided not to renew the leases, Fly put the company's belongings in storage and created a spreadsheet with all the available inventory, from computers and audio-visual equipment to couches, desks and chairs. Employees noted on the spreadsheet what they were taking, and let co-workers know in a Slack channel when they would pick up the items to maintain distancing.
The equipment and furniture may eventually find its way back into an Elevate office. Or not.
"We don't have plans at the moment to actively search for real estate," Fly said. "I can't predict what the pandemic holds. The new reality might be we stay remote forever, or maybe we have two- to three-person office hubs. We'll play it by ear."
WATCH: The pandemic has sparked greater acceptance in society towards remote work
