Reuters blog archive
By Robert Cyran
The author is a Reuters Breakingviews columnist. The opinions expressed are his own
Snapchat’s valuation is soaring on tech-land pixie dust. The disappearing-photo business has turned 100 million users, strong demand for chat services and the $20 million sale of a tiny equity stake into a $10 billion price tag. Trouble is, the company lacks revenue – and none is in sight. It’s a reminder that Silicon Valley dreams often trump real economics.
Facebook’s nearly $200-billion market cap confirms two things about social networks. First, there’s value in users, and second, that value accelerates beyond a certain threshold. The idea is that the sites have grown popular enough to run advertisements without turning off users, and advertisers will pay handsomely to reach so many potential customers. That’s a big reason Facebook was willing to plunk down $1 billion for Instagram and $19 billion for WhatsApp.
The gold rush continues. Fast-growing chat applications like Line Corp, the Japanese messaging service owned by South Korea’s Naver, has filed for an initial public offering that could value it at well over $10 billion. And Snapchat, which Facebook tried to buy last year for $3 billion, could now be worth $10 billion, based on venture capital firm Kleiner Perkins Caufield & Byers’ agreement to acquire less than 1 percent of the company for $20 million. That works out to $100 per user, more than double the value of a WhatsApp user when that company was sold earlier this year.
from Alison Frankel:
After almost five years of suing each other in courts in the United States and Europe over patents on mobile devices, Apple and Google abruptly announced Friday night that they've called a ceasefire: They're dropping all of the litigation. They're not even making a deal to cross-license one another's IP, just declaring a truce and walking away.
Apple has not yet settled with Samsung, the device manufacturer that most successfully employs Google's Android operating system, so the two companies haven't entirely resolved their dispute; evidence from the recently concluded patent infringement trial between Apple and Samsung in San Jose, Calif., revealed that Google is paying at least part of Samsung's defense costs. (The Korea Times reported Monday that Apple and Samsung are in global settlement talks.) Until there's a Samsung deal, two law professors, Brian Love of Santa Clara University and Michael Risch of Villanova told Bloomberg, the Google settlement is more important as a symbol than for any actual impact.
from The Great Debate:
It’s hard to imagine communicating without Skype, Facetime, X-Box, Twitter or a text on your smartphone. Mobile devices and other Internet Protocol (IP)-based services powered by high-speed broadband have revolutionized the way we connect with one another at just about every moment of our lives.
Millions of Americans are now abandoning traditional, copper-wire phone service. In just the past three years, U.S. smartphone adoption has increased from 16.9 percent to 54.9 percent, according to Nielsen. One out of three homes in the United States now relies on wireless-only technologies, according to the National Health Interview Survey.
from Expert Zone:
(Any opinions expressed here are those of the author, and not those of Thomson Reuters)
Mobile phones have transcended various phases of evolution since the time they began their journey. They have come a long way from being simple feature phones, which were meant for making calls and sending text messages.
Permit me to not act my age.
I was all grown up already when the Internet became a big deal, scarcely two decades ago. I was like a kid in a candy store. Still, I've only had a couple of heart-stopping moments in those 20 years in which everything has changed.
My heart skipped a beat (along with probably only thousands of others) when I downloaded Mosaic, the first Web browser, on the first day it was released. It consistently froze up. But that small, terribly flawed piece of software was really a time portal, showing me the future, and I could barely breathe.
As Apple reports quarterly earnings based largely on the number of iPhones it sold, the honeymoon continues for the lucky millions able to get their hands on the newest 4S model, which was initially criticized for not being new enough. Apple went on to sell 4 million of them in 3 days.
So, after the initial sales storm, is Apple's iPhone 4S living up to the hype?
First, here's a graphic on how the baby compares to its older sibling:
Corrected: The graphic, above falsely stated that the iPhone 4S had 1GB of memory. As Ben Pingel pointed out, it actually has 512MB.
Microsoft reported a greater-than-expected 30 percent increase in fiscal fourth-quarter profit, helped by sales of its Office software, but profit from its core Windows product fell on soft PC sales. Microsoft posted net profit of $5.87 billion, or 69 cents per share, compared with $4.52 billion, or 51 cents per share, in the year-ago quarter. That easily beat Wall Street's average estimate of 58 cents, according to Thomson Reuters I/B/E/S.
"These are great results given a slower PC environment and it highlights how the company has multiple revenue streams. The $17 billion unearned revenue, which is a forward indicator of business, shows they signed a lot of deals this quarter," said BGC Financial analyst Colin Gillis.
The app uses the phone’s sensory capabilities to evaluate a user’s patterns of movement, such as if walking is unstable or if a fall occurs.
LinkedIn made its remarkable debut on the New York Stock Exchange, at times trading more than 171 percent above its IPO price of $45. The stampede to buy the stock had some remembering back to another time when investors also loved tech stock IPOs: the 1990s and the dotcom bubble.
Does the response to LinkedIn suggest investors are in for another bubble that bursts when the fundamentals overtake the hype? Or is it a sign that investors are hungry for any piece of the social media pie and LinkedIn's happens to be first out of the oven? While Facebook, Groupon, Twitter and Zynga are still expected to go public, LinkedIn Chief Executive Jeff Weiner cautions that his company's spectacular debut should not be seen as a proxy for them.
An unauthorized person stole names, addresses and other personal data belonging to about 77 million people who have accounts on Sony's PlayStation Network, Sony said. The person gained access to people's names, addresses, email address, birthdates, usernames, passwords, logins, security questions and more, Sony said on its U.S. PlayStation blog.