Tech wrap: AT&T, T-Mobile deal less likely than ever
The chances of AT&T’s bid for T-Mobile USA succeeding rapidly diminshed after AT&T said it would take a $4 billion charge in case its takeover fails. The telecommunications group and T-Mobile owner Deutsche Telekom, said they would continue to pursue anti-trust approval for the $39 billion takeover from the Department of Justice, but withdrew for now applications to the industry regulator.
Both the DOJ and the FCC oppose the deal. FCC approval would be meaningless if the DOJ blocked the transaction, and AT&T and Deutsche Telekom said they would return to the FCC process if they secured approval from the DOJ. Analysts said the merger, badly needed by sub-scale T-Mobile USA , looked less likely than ever to succeed.
Microsoft is planning the first beta of its Office 15 software in January, techblog WinRumors writes.
Microsoft will provide a Technology Preview of the software initially, expected at CES 2012 alongside the Windows 8 beta. Office 15 will be designed with touch at the heart of the applications. Microsoft has redesigned the general look and feel of its popular Outlook email client to make it usable by touch, pen and mouse.
Internet service providers cannot be forced to block their users from downloading songs illegally, as such an order would breach EU rules, Europe’s highest court said. The Luxembourg-based EU Court of Justice (ECJ) issued its verdict in a case involving Belgian music royalty collecting society SABAM and Belgian telecom operator Belgacom unit Scarlet. European consumer organization BEUC said the ruling should get authorities and companies thinking about a fairer way to provide easily accessible legal digital content for consumers.
Alibaba.com, China’s largest e-commerce firm, posted an 11.9 percent rise in quarterly net profit, its slowest growth in nearly two years, with the company raising concerns due to a weak trade outlook stemming from debt woes in the U.S. and Europe. The third-quarter results missed analyst forecasts and were attributed to a weak macroeconomic climate that led to a slower pace of customer additions.
Tech wrap: Facebook cashes in on ads
Facebook’s first-half revenue roughly doubled to $1.6 billion, underscoring the world’s largest social network’s appeal to advertisers, a source with knowledge of its financials told Reuters. Net income in the first half of 2011 came to almost $500 million, said the source, who wished to remain anonymous because privately-held Facebook does not disclose its results. Facebook’s stronger results come as investors have pushed its valuation to roughly $80 billion in private markets, with many industry observers expecting the world’s No. 1 Internet social network to go public in 2012.
Yahoo Chairman Roy Bostock fired CEO Carol Bartz over the phone on Tuesday, ending a tumultuous tenure marked by stagnation and a rift with Chinese partner Alibaba. CFO Tim Morse will step in as interim CEO, and the company will search for a permanent leader to spearhead a battle in online advertising and content with rivals Google and Facebook. Some analysts said Bartz’s departure signaled the company had run out of options after failing to dominate the advertising and content markets and handing over its search operations to Microsoft.
Best Buy said it will offer products online from other sellers through a new third-party Marketplace as the electronics retailer tries to better compete with Internet rivals Amazon.com and eBay. Best Buy Marketplace will add roughly one-third more products online in time for the holiday shopping rush. Buy.com, Mambate, SF Planet, ANT Online, BeachAudio.com and Wayfair are the third-party sellers that signed up for the launch.
Browsing, or aimless navigation by subject or genre that brings you to something unexpected, yet ultimately rewarding, is not well-supported by the search-based or social methods of information discovery that dominate the Web today, Trapit’s Laura Larsell argues. Searching dominates. But most of the time, people don’t have solid ideas of what they really want to find. What’s needed are techniques to more easily group like content, such as the content discovery, personalization and curation platform that Larsell is helping develop, she adds.
An uninspired photo of a plate of sushi discovered by PocketNow may have been captured by Apple’s soon-to-be-unveiled iPhone, according to data the site recovered from the image. The data indicated that an iPhone 4 took the pic. But the image was too big and the aperture of the lens too wide to have been captured by that phone, PocketNow wrote. A flurry of sleuthing ensued online, with multiple theories as to the authenticity of the data proliferating and even image-bending that revealed what looked like hands holding the device responsible for the replication of raw fish on a white plate.
Tech wrap: Apple ousts Nokia as top smartphone vendor
Apple jumped to the top of the global smartphone sales rankings in the second quarter, ending Nokia’s 15-year run as the lead smartphone vendor, according to new research from Strategy Analytics. Apple sold a record 20.3 million iPhones during the quarter, which amounts to about a fifth of the global smartphone market. Impressive considering its iPhone 4 model was released more than a year ago. Samsung also surpassed Nokia to claim second spot, with 17.5 percent of market share. Nokia fell to third place as its market share tumbled to 15.2 from 38.1 percent a year ago.
As if Apple’s new royalty status isn’t enough, the gadget maker can also lay claim to being the most profitable in the smartphone business. According to a chart on Business Insider, Apple pulled in two-thirds of all profits in the mobile phone sector last quarter. That’s twice as much as Samsung, RIM and HTC combined.
Did Yahoo get a raw deal when it signed a pact with Alibaba and SofBank to resovle a dispute over online payment service Alipay? That’s the case being made by some analysts. The trio announced it had struck an agreement after months of wrangling over the lucrative asset, under which Alibaba gets up to $6 billion if the mobile payments firm goes public or gets sold. But investors are bothered by the deal, saying it reaffirms perceptions on Wall Street that Yahoo has little say in Alibaba, the e-commerce company founded by Jack Ma and which is 43 percent-owned by Yahoo.
It’s official – you can now get Groupon deals on Foursquare. Foursquare has integrated Groupon coupons into its mobile apps. Users can cash in on the deals now – which will include both daily deals and Groupon Now deals – by using the “Explore” tab on Foursquare’s app, a feature that lets users search for neat activities to do nearby.
Microsoft warned on Thursday that a government review of its U.S. tax obligations in past years could significantly affect its financial statements if not resolved in its favor.The Internal Revenue Service has looked at Microsoft’s use of transfer pricing, among other things, or methods of booking prices and sales between subsidiaries — often leading to opportunities to report earnings in lower-tax jurisdictions.
Tech wrap: Government bringing knife to cyber gun fight?
A recent wave of computer network attacks has boosted concerns about U.S. vulnerability to digital warfare. The Obama administration is racing on multiple fronts to plug the holes in the U.S. cyber defense, focusing on an expanded effort to safeguard its contractors from hackers and building a virtual firing range in cyberspace to test new technologies.
However, the overall gap appears to be widening, as adversaries and criminals move faster than the government and corporations can respond, officials and analysts say.
Microsoft has made available a Windows 7-compatible test version of the software behind its hit Kinect motion-sensing game device, in the hope that developers will invent a host of “hands-free” features for standard PCs.
Microsoft was at first hostile to such attempts, but by releasing a beta version of the Kinect software development kit it is showing that it is interested to see what developers will make of the technology.
Any chance of Taobao trying to cash in on the internet IPO craze was squashed when the Alibaba Group said it had reorganized China’s largest e-commerce website into three separate companies.
The move to split Taobao comes as Alibaba founder Jack Ma grapples with its major shareholders, Yahoo Inc and Japan’s Softbank, over ownership of Alipay, another of the group’s crown jewels.
Ma has not ruled out taking Alibaba public in the future, but analysts said the listing could take a few years, meaning Yahoo will have a longer wait to unlock the value of its prized Chinese asset.
Yahoo’s Ross Levinsohn: We’re still No. 1
As Yahoo’s Executive Vice President of the America’s region, Ross Levinsohn’s task is to transform the image of the lumbering Internet giant to one with a passing resemblance to the darling of the 1990s dotcom era when it called the shots. Though, investors ascribed virtually all of Yahoo’s market value to its prized Asian assets – a major stake in China’s hot Alibaba Group and Yahoo Japan – brushing aside Yahoo’s core U.S. business.
A long time Internet player, Levinsohn, who also headed News Corp’s Fox Interactive Media, sat down with me and Kenneth Li during Internet Week in New York and explained how Yahoo needs to fix its image problem, how much of a distraction the tussle in Asia over Alipay was, and how he expects advertising dollars to continue to migrate to Yahoo.
Reuters: What’s working and not working at Yahoo?
Levinsohn: What is clearly working is hundreds of millions of people interact with our properties. Do you know that we have over 700 million people? Do you know that we have the No.1 or No. 2 positions in 19 categories — sports, news, finance, and entertainment news? OMG is our entertainment news gossip site and we are twice the size of TMZ. We’re bigger than ESPN in sports, we’re bigger than the Wall Street Journal, Fox News and Bloomberg combined in finance. The numbers are astounding and, for some odd reason, Yahoo doesn’t get that credit. It’s an easy story for me to tell that you are able to aggregate huge audiences around premium experiences and we should double down on those things.
Reuters: What’s the disconnect?
Levinsohn: Messaging, partly. I think Yahoo has been doing so many things well for so long and frankly got a little trapped in I think ‘oh, what is Yahoo?’ People don’t ask Google ‘what is Google?’, even though they have this driver of driver-less car division, an operating system and a browser division…
We have a lot of businesses that make a lot of money too. The important thing is to figure out how they all work together. That is another big part of the challenge for me, to take a look at what we do in search and figure out how to optimize that incredible rich product and history, how to integrate what we are doing in mail with our content pieces (and) our search pieces, (and) make sure that (the) product and region are working hand in hand.
Tech wrap: Yahoo battle with Alibaba heats up
Yahoo’s battle with Alibaba intensified as they issued contradictory statements over the Chinese company’s transfer of a major Internet asset to its CEO. Analysts said the handover of Alipay, an online e-commerce payment system, to Alibaba CEO Jack Ma has reduced the value of Yahoo’s 43 percent Alibaba stake. Yahoo said it had been blindsided by the deal, while Alibaba countered that Yahoo was aware of the transaction by virtue of having a board seat, now held by former Yahoo Chief Executive Jerry Yang, who is also a Yahoo director.
PR agency Burson-Marsteller, in the spotlight after it was revealed that Facebook had hired the firm to run a smear campaign against Google, said it will give the employees in charge of the operation extra training instead of firing them, The Daily Beast’s Dan Lyons writes.
Cisco Systems is expected to cut thousands of jobs in possibly its worst-ever round of layoffs to meet Chief Executive John Chambers’ goal of slashing costs by $1 billion. Four analysts contacted by Reuters estimated the world’s largest maker of network equipment will eliminate up to 4,000 jobs in coming months, with the average forecast at 3,000. That would represent 4 percent of Cisco’s 73,000 permanent workers. It also has an undisclosed number of temporary contractors.
A British judge banned Twitter users from identifying a brain-damaged woman in one of the first attempts to prevent the messaging website from revealing sensitive information. Lawyers say leaks of information protected by a British injunction on U.S.-based Twitter show that court orders to gag the press are unsustainable.
Celebrities who bombard fans with Twitter updates are likely to have shorter careers than those who maintain an aura of mystique, according to a survey. Easy access to stars through social networking websites has made them less appealing and increases the likelihood of followers getting bored, music consumer research by publishers Bauer Media said.
Travelers in the western U.S. should not rely solely on technology such as GPS for navigation, authorities said, after a Canadian couple were lost in the Nevada wilderness for 48 days. Sheriff’s offices in remote, high-elevation parts of Idaho, Nevada and Wyoming report the past two years have brought a rise in the number of GPS-guided travelers driving off marked and paved highways and into trouble.
The media is hungry for corporate excess
Guess where the paparazzi are training their lenses these days? For those of you who missed it, The New York Times writes that gossip rags have all but abandoned Britney Spears for the thrill of capturing corporate excesses on camera. From the paper:
The tabloid media, of course, have always peered into the excesses of the rich and famous with a mix of puritan disapproval and voyeurism. But these outlets and other news organizations are now recording troubling uses of taxpayer money at country clubs, private airports and glamorous retreats and, in so doing, explicitly tapping into a fierce populist anger at corporate America, and even pressuring Congress to hold companies accountable.
Populist indignation apart, perhaps people also feel a sense of glee when watching or reading about the severe scaling back of corporate budgets that once supported lavish lifestyles. Gawker may have captured the glee best in this biting account of The Wall Street Journal story on Goldman Sachs executives being asked to stay at Embassy Suites rather than the Ritz.
Reporters are often sent to capture nuggets of corporate excess, the more outrageous the better. An affinity for $40 crab legs? Flying to DC in private jets to ask for bailout money? Poolside sales conferences with six-figure tabs? The media loves writing about this stuff almost as much as people enjoy reading it. So if you’ve got any tips, let us know.
Keep an eye on:
- New AOL CEO Tim Armstrong sees a lot of options for AOL’s future. (All Things Digital)
- Alibaba seeks partnerships with U.S. companies. (Reuters)
- Carl Icahn says he doesn’t intend to push for a sale of Lions Gate. (Reuters)
(Photo: Reuters)
Note to Yahoo’s Bartz: Ma company, Ma way
Yahoo CEO Carol Bartz has earned a reputation as a strong-willed, no-nonsense executive.
But she may have her met match in Jack Ma, the founder and CEO of Alibaba, which owns and operates Yahoo China.
“Personally I have a management philosophy: when you see someone in the kitchen, don’t give them directions. Let them do it,” Ma told Reuters during a visit to New York on Thursday. “I do it my own way. I don’t listen to Yahoo.”
Ma doesn’t need to listen to Yahoo. As part of a 2005 deal, Yahoo has a 40% stake in Alibaba.com, but Yahoo China is Ma’s baby.
When it comes to Yahoo China, Ma says, Yahoo is just a shareholder.
Ma paid a visit to his largest shareholder and met with Bartz during this trip to the U.S., though he would not say what they discussed.
Could Bartz be considering a new strategy in China, and a sale of its stake in Alibaba, as some have speculated?
Let the Chinese run their business in China. The rate US is selling bonds (to bail out their banks/car manufacturers), China may own corporate American soon.
On a more positive note, the AT&T plan to acquire T-Mobile has raised awareness for the need to apply more radio spectrum to wireless broadband services — particularly in rural America.
Moreover, perhaps we’ll see the FCC announce support for more unlicensed spectrum (taken from abandoned analog TV channels) in 2012.
David H. Deans