Quarterly results arrived today from Interpublic Group and Publicis. Guess what? Advertising spending held up in the second quarter, at least for the two ad companies.

You would think — given all the doom and gloom — that corporations would have sharply cut back on spending in the second quarter. Indeed, just about every expert out there has cut spending forecasts.

Yet Interpublic, home of DraftFCB and McCann-Erickson, posted revenue that raced right past expectations and said it was well on the way to achieving its goals for the year.

And the economy? They said they’re watching it and keeping an eye on costs.

“While the growth that we posted during the first half demonstrates that we have yet to see retrenchment on the part of clients, we will continue to monitor the broader economic situation closely,” CEO Michael Roth said in a statement.

French advertising group Publicis also seemed to weather the storm in the second quarter, increasing organic sales in all areas, including the United States. It did say, however, that it expected marketing investments to fall in some areas, citing the automotive and financial sectors, because of the credit crisis and rising commodity and food prices.

Of course, solid spending by clients in the second quarter may not tell us much. Many see advertising spending as a trailing economic indicator, meaning that we could very well see clients cutting budgets for the second half of the year.

“We are not immune to the macroeconomic environment. We will certainly see some client areas affected,” IPG’s Roth said on a conference call. But so far clients see the downturn as an opportunity to build brand, he added.

“We haven’t seen a major pullback.”

On the other hand, clearly everything isn’t sunshine in the advertising world. Just check out Meredith, whose earnings fell because of lower advertising revenue at its magazines. Or take a look at Viacom Inc, whose earnings showed weakness in retail and automotive advertising crimped hurt sales for its cable TV networks.

Keep an eye on:

• Dell is testing a digital music player that could go on sale as early as September in a challenge to Apple (WSJ.com)
• Social networking site MySpace announced a series of new senior executives (paidContent.org)
• Billionaire oil investor T. Boone Pickens has sold all his Yahoo shares in frustration over Yahoo’s failure to reach a deal with Microsoft (San Francisco Chronicle)
• ESPN will unveil a new online network that will encompass a cluster of Internet sites aimed at action sports (LA Times)

(Photo: Reuters)

If Steve Jobs’ well-being is somehow symbiotic with Apple Inc’s well-being, shouldn’t there be an application for tracking his whereabouts?

Someone must have a lucrative business plan for creating an “EDtv” or “The Truman Show” around the guru of the iPod Mac and iPhone.

Perhaps, this exclusive content could be piped to all Apple TV set-top boxes — for a fee. At the very least, how about a desktop widget that shows where in the world Steve Jobs is.

Its a scenario so fantastic that one wonders why noone has already discussed it. But maybe some have come close. The Wall Street Journal says one hedge fund in 2004 hired private investigators to follow Apple’s CEO to hospital visits, hoping to glean information about how sick, or well, he was. Remember — that was the year that Jobs had surgery to cure pancreatic cancer, a fact the company waited months to disclose.

All of this comes because of concerns about Jobs appearance of late, the company’s cloudy response to questions about his health, and their reluctance to disclose a successor-in-waiting at Apple that can match Jobs’s legendary status — and reassure shareholders.

For what its worth, the New York Times says all this sick talk is nonsense, and that Jobs has reassured people that he is “doing well” and free of cancer.

Silicon Valley long-timer John Markoff quotes “a number of his associates” as saying that Jobs is telling them that he is cancer free.
   
But Markoff introduced new details on Jobs’ health record by revealing that Jobs had a surgical procedure this year “to address a problem that was contributing to a loss of weight.” He cited people close to Jobs who were not authorized to speak about his health.  

Markoff also said Jobs ran a high fever the week ahead of his speech announcing the iPhone 3G and considered canceling his appearance. His gaunt appearance at that June 9 event resurrected rumors he was battling cancer. Sources tell Markoff Jobs has been dealing with nutritional problems in the wake of his cancer surgery. The article did not specify if this was a reference to the recent surgery or that of four years ago.

Still, I can’t help but wonder how many of us would subscribe to “The Steve Jobs Channel.”

Keep an eye on:

• Google is in final talks to buy Digg for $200 million. (Techcrunch )
• Tribune CEO Sam Zell defended his plan for large cuts at newspapers across the chain. (Hartford Courant)
• New York Times quarterly revenue and profit fall (Reuters)

(Photo: Reuters)

He talked, he cajoled, he wrote stern letters, and issued threatening press releases. Now, it’s really on: Activist investor Carl Icahn filed a proxy on Monday to nominate a slate of nine directors to replace Yahoo’s board and to oust co-founder and current CEO Jerry Yang.

This came after a weekend dust-up in which Yahoo’s board on Saturday night rejected a joint proposal by Icahn and Microsoft for Yahoo to sell its search business to Microsoft and fork over the rest of the company to Icahn.

Icahn, who owns around 5 percent of Yahoo, filed a list that included a good share of well known media investor types, including former Viacom chief Frank Biondi and Mark Cuban, owner of the Dallas Mavericks pro basketball team.

Then, this morning, both sides let loose eight regulatory filings within a couple of hours.

In a letter to shareholders Monday morning, Icahn solicits their support of a Microsoft/Icahn offer:

Our company is now moving toward a precipice. It is currently losing market share in its “Search” function, our current Board has failed to bring in a talented and experienced CEO to replace Jerry Yang and return Jerry to his role as Chief Yahoo, and currently it is witnessing a meaningful exodus of talent.

No wonder Jerry’s head is on the table.

Keep an eye on:

• Apple says it sold 1 million iPhones in its first weekend - (Reuters)
• Publisher Reed Elsevier is on the hunt for a new CEO, sources say - (Reuters)
• China Olympics security undermines media freedoms, experts say - (Reuters)

When Apple’s 3G iPhone went on sale in the U.S. on Friday, the company had in place what it thought was an easy and painless process that would just work in getting customers up and running quickly. Apple said employees could complete the entire sign-up wirelessly, and in test runs figured it would take about 15 minutes per customer.

Turned out that wasn’t exactly the case. By 11 a.m. California time it was clear things weren’t going as planned. Reports on the Web abounded that existing iPhone users and buyers of new ones couldn’t activate the phone once they downloaded the new software.

Some workers in Apple’s flagship Manhattan store told customers the problem was with wireless partner AT&T. But AT&T blamed iTunes. Apple has so far gone radio silent, though by late afternoon it looked like things were improving.

Some fans didn’t seem to mind that the shiny new iPhone they just bought would work as little else than an elegant paperweight until it could be activated.

Danny Fukuba, 17, a recent graduate of Palo Alto High School, was first in line at his local Apple store. He bought the first iPhone last year, and has been camping out since Wednesday night for the second.

“I couldn’t sleep at all for the past couple of nights. I am going to crash as soon as I get my phone,” he said. So why do it? “It’s fun. It’s exciting. This is the first time I’ve actually done anything like this.”

Second kid in line was Eric Vicente, 16, Danny’s friend who will get his old iPhone. “Being first is really cool,” he said. “Because I can’t afford one, I’m getting the hand me down.”

(Top photo: Apple wireless point-of-sale device. Reuters/Eric Auchard
Second photo: People wait in line outside an Apple store in New York. Reuters/Lucas Jackson)

We’re wondering how many iPhones Apple and its telecom partners actually stocked in the 21 countries where it will be sold first. Are some fans who camped out for the launch waiting in vain?

We’ll soon find out. But this is what we can gather from the UK, expected to be one of the biggest selling markets. Actually it’s a bit worrisome, if, say, you live in London and really, really want an iPhone on Friday.

Apple’s only UK carrier partner, O2, says it will have a very limited supply of the phone – like a few dozen phones per store. O2 has already sold out online.

What’s more, according to telegraph.co.uk, only about 50,000 phones have been shipped to the UK (it’s not clear how they came by the number). But to put this in perspective, O2 said it was getting 13,000 orders a second at a peak time on Monday.

 You don’t have to be a math wizard to see that supply wouldn’t keep up with demand for very long under that scenario. 

Apple watchers were slow to bet how many devices it has ready. Mark McKechnie, an American Technology Research analyst who covers phone rivals Nokia and Motorola, but not Apple, looked to phone industry trends.

“For an initial phone launch five millon would be extreme for day one. One million would be more in line with a normal handset launch,” he said.

Okay, let’s say one million phones. That would mean a stock of over 47,000 devices on average for each of the launch countres.

It sounds like a lot of phones until you consider this: Apple sold 270,000 of the first and more expensive iPhone in the first few days after its launch last year ONLY in the United States and ONLY with AT&T Inc.

But even if Apple runs out in the first weekend it may not be the end of the world. Only a longer term supply void would cause worries that the company was having production problems.

“If you see any period of time where there is an outage of supply for more than a few days anywhere that would be concerning,” said Pacific Crest’s Andy Hargreaves.

((Photo: Reuters - iPhone fans wait outside Telia store in Stockholm)) 

(Here’s an updated chronology. This first posted June 9)  

2007

January 9 - Apple Inc CEO Steve Jobs unveils iPhone in the tech industry’s most anticipated new product introduction of the decade.

June 29 - Apple and U.S. carrier partner AT&T Inc start selling iPhone as technology enthusiasts form long lines outside Apple stores.

July 25 - After big build-up, first weekend sales figures reports disappoint investors. Apple and AT&T sold 270,000 iPhones in first 30 hours; but customers only activate 146,000 of the devices due to initial AT&T service problems.

Sept 5 - Apple cuts price on iPhone with eight gigabytes of storage to $399 from $599. Discontinues sales of four-gigabyte version. Also introduces iPod Touch, an iPhone without the phone, with Wi-Fi connections.

Sept 7 - Apple offers $100 rebate to appease customers angered over iPhone price cut.

Sept 10 - One millionth iPhone sold 74 days after launch.

Sept 24 - Apple warns users against unlocking iPhones to work with network carriers other than Apple’s exclusive U.S. partner, AT&T.

Nov 9 - Apple introduces iPhone in Europe through exclusive deals in Britain with 02, in Germany with T-Mobile, and in France with Orange.

Dec 3 - Apple sued for patent infringement related to iPhone’s visual voicemail feature by Klausner Technologies Inc.

Dec 31 - Apple sold 3.7 million iPhones in its first six months on sale.

2008

Feb 5 - Apple introduces 16-gigabyte iPhone for $499.

March 6 - Apple says its plans to enable corporate e-mail on iPhones, pitting it against business e-mail market leader Research in Motion and its Blackberry line of devices.  Apple offers tools for independent developers to build iPhone software.

March 31 - Apple has sold 5.4 million iPhone units to date. Apple ranks as world’s third largest maker of smartphones, with 5.3 percent versus mobile phone giant Nokia’s 45.2 percent and Blackberry-maker Research in Motion’s 13.4 percent, market researcher Gartner Inc says.

April 23 - Apple CFO reaffirms the company’s original mid-2007 goal of selling 10 million iPhone units by the end of 2008. 

April/May - Apple stores run out of iPhones. Apple announces plans with carriers in South Asia to sell iPhones in Australia, India, the Philippines and Singapore.

June 9 - Apple unveils 3G iPhone, with faster Web links than its predecessor and the ability to support third-party applications such as games and email. The eight-gigabyte 3G iPhone is priced at $199, while the 16-gigabyte phone is priced at $299. 

July 11 - iPhone 3G goes on sale in 22 countries. Fans around Asia queue for two days before the phone’s launch. Websites are swamped with early orders. 

Reuters iPhone 3G coverage
Sources: (Reuters, Apple Inc, SeekingAlpha.com, Gartner Inc)
(Photos: Reuters, Apple Inc, Scoble: Brian Solis/Flickr.com)

The new iPhone is expected to attract hordes of buyers when it goes on sale on Friday in more than 20 countries, helping Apple Inc handily beat its target to sell 10 million of them by the end of 2008. The launch began in New Zealand at 1201 GMT on Thursday. Use the map below to follow Reuters reporters and photographers around the world as the new iPhone goes on sale.

View Larger Map

Here we go…

Two days before the iPhone’s launch, fans around Asia are queuing up to buy Apple’s latest offering. They don’t seem to care that it’s raining or freezing cold or if lining up early means missing work or school.

The July 11 launch will be the first chance, after all,  for Asian consumers to own an iPhone.

“I’ve told my professor I was going to go buy an iPhone, and he gave me permission,” said Hiroyuki Sano, a 24-year-old graduate student who early on Tuesday arrived in rainy Tokyo from Nagoya to be first in line. Sano, speaking to Reuters, and incidentally wearing a T-shirt with an Apple logo, described his professor as an equally big Apple fan. “He sent me off cheerfully.”

The United States has already been through this, when the iPhone first went on sale a year ago. As the New York Times recalls, “TV news coverage was relentless. Hard-core fans camped out to be the first in line. Bloggers referred to Apple’s new product as the ‘Jesus phone’.”

The paper adds, “This time, though, when the iPhone 3G goes on sale in AT&T and Apple stores, iPhone Mania will be considerably more muted. That’s partly because the mystery is gone, partly because the AT&T service costs more and partly because there aren’t many new features in what Apple is calling the iPhone 3G. ”

But let’s be clear: There’s still a boatload of interest in this phone and plenty of people will be talking about it this week, offering their two cents on what they like and dislike about the iPhone.

One big name, the Wall Street Journal’s Walt Mossberg, is already weighing in, with a mixed review, knocking the battery life but applauding the phone’s introduction of third party software. 

“I’ve been testing the iPhone 3G for a couple of weeks, and have found that it mostly keeps its promises. In particular, I found that doing email and surfing the Internet typically was between three and five times as fast using AT&T’s 3G network as it was with the older AT&T network to which the first iPhone was limited.”

“Bottom line: If you’ve been waiting to buy an iPhone until it dropped in price, or ran on faster cell networks, you might want to take the plunge, if you can live with the higher service costs and the weaker battery life. The same goes for those with existing iPhones who love the device but crave faster cellular data speeds. But if you already own an iPhone, and can usually use Wi-Fi for data, you probably should hold off and get the free software upgrade before deciding whether it’s worth getting the new hardware.”

But is it worth a two-day wait in line, in the rain, wearing a silly T-shirt?

Keep an eye on: 

• Carl Icahn would have more support in his proxy battle against Yahoo if he pledged not to sell the company for less than $33 a share, said Legg Mason portfolio manager Bill Miller (Reuters) 
• WPP Group, the world’s second-largest advertising company, made a hostile 1.08 billion pound ($2.13 billion) bid for Britain’s Taylor Nelson Sofres, challenging its agreed merger with GfK Holdings AG (Reuters)
• A blind trust run by New York City Mayor Michael Bloomberg is willing to pay between $4.5 billion and $5 billion to buy Merrill Lynch & Co’s 20 percent stake in financial news and data provider Bloomberg LP (NY Post)
• The smaller of Hollywood’s two performers unions ratified a new prime-time TV contract on Tuesday, undermining a last-ditch bid by the larger, more militant Screen Actors Guild to secure a richer deal (Reuters)
• NBC Universal Chief Executive Jeff Zucker is looking to spin off or sell some of the company’s assets when he attends a media conference (NY Post)

(Photo: Reuters)

.

1975

Microsoft (then spelled “Micro Soft”) is founded by William “Bill” Gates, a 20-year-old Harvard dropout, and Paul Allen, his 22-year-old school chum. They begin selling its first product, a BASIC programming language interpreter.

1980

Microsoft signs an agreement to build the operating system that became known as MS-DOS for IBM’s new personal computer, which was launched in 1981. Microsoft was allowed to license the operating system to others, spawning an industry of “IBM-compatible” machines dependent on Microsoft software.

1983

February: Paul Allen, ill with Hodgkin’s disease, resigns from active management of the company but remains on the board of directors.

1986

March 13: Microsoft’s stock goes public with an initial price of $21 a share, closing the first day of trading at $28. Revenue for its previous fiscal year (which ended June 1985) $140.4 million.

1989

August: Microsoft introduces earliest version of its “Office” software suite, which includes the popular word processing program “Word”. Today, the company says it has more than 500 million users.

1990

June: The U.S. Federal Trade Commission begins a secret probe focusing on possible collusion between Microsoft and IBM. Microsoft remains under the microscope of regulators for another 18 years.

1992

January: Gates, 32, is named the richest American, with more than $6.5 billion, thanks to his one-third stake in Microsoft.

1993

June: A federal judge rules in favor of Microsoft, ending 63 months of litigation by Apple Computer Inc., which charged that Windows copied the look and feel of its Macintosh computers.

August: After the FTC deadlocks twice on the issue, the Justice Department announces it has taken over the Microsoft investigation, which now focuses on its business practices.

1995

January: Microsoft unveil one of it more celebrated flops, a software companion called “Bob”.

July: Gates is named the world’s wealthiest man for the first time with an estimated worth of $12.9 billion.

August: Microsoft launches Windows 95 with a marketing blitz five times bigger than any of its previous efforts. Experts say the system offers no technological breakthrough but adds features enjoyed for years by users of the rival Apple system.

1999

Microsoft added to the Dow Jones Industrial Average. Its revenue for the fiscal year ending in June reaches $19.75 billion.

2000

January: Steve Ballmer named to succeed Gates as CEO. Gates remains Chairman.

June: At an event with university students in Tokyo, Gates is asked what more he wanted in life. He promptly replies, “privacy.”

2001

May: Microsoft launches Windows XP operating system.

November: Microsoft jumps into the interactive game business with the launch of the Xbox , taking on rivals such as Sony and Nintendo. Its most important day-of-release game, “Halo: Combat Evolved”, is a huge hit, helping to drive Xbox sales, and eventually sells more than 5 million copies

2003

February: Microsoft shares split for the 9th time. One original share is now equal to 288 shares.

2006

June: Gates says he will transition out of a day-to-day role in the company in July 2008. Steve Ballmer is the companies top decision maker; Ray Ozzie steps up to be Chief Software Architect.

2007

January: Microsoft launches “Vista” , the latest version of its ubiquitous Windows operating system software, in 70 countries, and expects it to be installed on over 100 million PCs worldwide. Influential Wall Street Journal columnist Walt Mossberg, in his review of Vista, called it a “worthy, but largely unexciting, product.”

2008

January: Ballmer makes a $44.6 billion takeover offer to Yahoo’s board. Yahoo later rejects the offer, setting off a lengthy battle over the future of Yahoo.

March: While still wealthier than many nations, Gates falls to third on the list of Earth’s richest man, behind famed investor Warren Buffet and telecoms tycoon Carlos Slim. Forbes magazine estimates Gates wealth at $58 billion.

June 27: Bill Gates steps down out of a day-to-day role in the company, to focus on philanthropy. He still holds nearly a 9 percent stake in Microsoft, and remains its biggest shareholder. Since 2000, Microsoft’s stock has fallen 52 percent.

(Photos: From Reuters, Microsoft.com, Flickr, Google Finance)

Don’t think that Apple’s executives are great humanitarians or just a bunch of really nice guys for cutting the price of the new iPhone in half. They are in it for the money — and they stand to make more and more of it with this second generation iPhone.

Research firm iSuppli “virtually” cracked open the 3G iPhone “using insights from our analysis staff to develop estimates of iPhone content, suppliers and costs.” (It plans to really deconstruct the phone when it is released on July 11.)

ISuppli concluded that each iPhone costs $173 to make. It will sell at retail at $199. When you tack on an estimated $300 Apple gets in subsidies from wireless carriers, that puts the value of each iPhone to Apple at about $500.

The similarly priced first-generation iPhone cost $256 — $226 after “component price reductions” — and sold for $499.

This is how iSuppli breaks down the iPhone it (virtually) broke down :

(The data does not include other costs, including software development, shipping and distribution, packaging, and miscellaneous accessories included with each phone, iSuppli says.)

(Source: iSuppli, Photo: Reuters)