1. Taking one of the FANG companies, what do you think is its greatest macro-environmental threat, and what is its greatest macro-environmental opportunity? During mid-2018, the so-called FANG+ stock market index

(including Facebook, Amazon, Netflix and Alphabet/

Google) fell by more than 10 per cent. A PESTEL analysis helps to explain why.

PESTEL analyses can be done using published sources

(e.g. company annual reports, media articles and consultants’

reports) or more extensively by direct discussion with managers, customers, suppliers, consultants, academics, government officials and financial analysts. It is important not to rely just on an organisation’s managers, who may have limited views. A PESTEL analysis of the four main FANG companies based on published sources shows a growing preponderance of macro-environmental threats over opportunities (specific industry analysis will be dealt with in Chapter 3). In the figure above, the scale of Opportunities and Threats on each of the PESTEL dimensions is indicated by the relative extent of the bars. Just taking some issues for illustration, the figure shows more and longer bars on the Threats side than the Opportunities side. Thus:

• Political: FANG companies face increasing political hostility.

India has banned Facebook’s Free Basics, a free but restricted internet service. The United Kingdom is planning specific taxes for online retailers such as Amazon.