Apple plans to build a circular “spaceship” building in hometown Cupertino — and be the best office building in the world, CEO Steve Jobs said. The ailing Jobs, formally on leave from the company, made his second public appearance in two days late on Tuesday to show off plans to the Cupertino city council. Apple has grown “like a weed” Jobs said, and needs a place to put roughly 12,000 people. The massive new structure would be in addition to the main campus at 1 Infinite Loop.
EBay and its online payment unit, PayPal, sued Google and two executives for stealing trade secrets related to mobile payment systems, highlighting the growing battle between companies vying for a major stake in what has been described as a $1 trillion opportunity. The two executives, Osama Bedier and Stephanie Tilenius, were formerly with PayPal and led the launch on Thursday of Google’s own mobile payment system in partnership with MasterCard, Citigroup and Sprint.
Apple denied it is tracking the movements of its iPhone customers, but said it will provide a software update that stores less location information on phones in response to public outcry over privacy issues. Apple plans to release a software update that would cut the size of the wireless hotspot location database stored on its iPhones, and stop backing up that information. The software will be released in the next few weeks, it said.
Apple reported quarterly revenue of $24.67 billion on strong iPhone and Mac sales, racing past Wall Street estimates. In the quarter, the company sold 18.65 million iPhones and 3.76 million Macintosh computers. Analysts expected 16.3 million and 3.64 million, respectively. Sales of iPads and iPods fell short. The number of iPads sold was 4.69 million, shy of the 6.3 million expected. Sales of iPods were 9 million, versus expectations of 9.85 million.
EBay said it will buy e-commerce service provider GSI Commerce for $1.96 billion in cash to build up its online marketplaces, as it ramps up its battle with Amazon.com. GSI is attractive to eBay because of its expertise in taking customer orders, managing them and filling them, which also happens to be an area of strength for Amazon. GSI, which owns Web businesses such as Rue La La and ShopRunner, also provides retailers such as Aeropostale and TJX’s Marshalls chains with technology, payment processing and customer care services for their e-commerce sites.
eBay said Wednesday that the value of goods sold in the U.S. through its mobile applications surged 133% to $100 million during the month before Christmas. Globally, the growth was even stronger: Up 166% to $230 million worth of goods.
When a company has a lot of cash and not so many new sources of revenue, it can be tempting to buy its way into new markets. But such a strategy has its risks, which are best illustrated by ill-fated acquisitions like eBay’s $3.1 billion purchase of Skype in 2005. eBay ended up taking a writedown for the deal and sold off two-thirds of the company at a $2.75 billion valuation four years after the purchase.
The “mobile wallet” concept has been bandied around for years as a promise that one day “soon” we’ll be able to leave our purses at home and pay for everything via the cellphone.
Of course we were also meant to to get to work using Jetpacks and have robots cleaning the house by now too.
However, with credit card companies and banks desperately looking at new avenues for growth, they’re starting to talk up mobile with a vengeance as they all battle for a dominant place in the fledgling mobile payments industry.
And since they’re doing it, online payments provider PayPal has joined the fray because if consumers really want to move their lives to the cellphone, it can’t limit itself to the desktop.
Interestingly PayPal says it is seeing early signs of mobile success in an area where it looks to make an old fashioned bank service – check cashing – more convenient.
The unit of eBay says it handled $100,000 in checks from its mobile customers in roughly a day and a half after it kicked off its mobile check cashing service, which allows you to add money to your PayPal account by just taking a cellphone photo of a physical check and using the PayPal mobile app.
Roughly a month later, PayPal says it processed over $1 million worth of checks.
This is a pittance in comparison with what banks handle — U.S. banks processed $30.6 billion of checks in 2006, according to a study by the Federal Reserve Bank of Atlanta, implying $2.55 billion worth of checks every month.
Still PayPal is happy enough with the result that it is already looking for ways to improve the service, specifically by reducing the check-clearing window from six days, where it currently stands.
It is also experimenting with other services aimed at expanding beyond eBay auctions and other online transactions where it is most popular. One is allowing consumers to pay for goods in a store by using a mobile PayPal app on their phone, which would require the vendor as well as the consumer to open a PayPal account.
For this service PayPal says it has signed up 200 merchants in just a few weeks. In comparison the credit card industry has convinced retailers to install contactless payment terminals in all of 150,000 locations in about five years.
The idea with contactless payments is that you can wave your phone to pay instead of having to fumble in your wallet for a credit card. Paypal is also trying out this method for size via its partnership with a company called Bling Nation, which lets you spend from your PayPal account by slapping a “Bling” sticker to the outside of your phone and waving at the machine.
“We don’t know which will take off so we’re experimenting,” said Laura Chambers, a senior director for PayPa.l But she noted that “merchants aren’t excited about hardware upgrades.”
At a New York event where the company showcased their mobile services, a bunch of which were launched on October 6, Chambers said that this year would be a year of experiments for her company.
And since mobile operators have a direct relationship with their customers, Chambers said PayPal is also in talks with U.S. operators about how they can work together. She would not disclose any details but said: “There’s a great opportunity to replace the wallet and for the mobile phone to become the wallet.”
The social networking website of Mark Zuckerberg (pictured) is now worth $23 billion, close to the value of online shopping website Ebay, based on the price of a recent stock purchase by private equity firm Elevation Partners. Elevation purchased $120 million in Facebook stock from private shareholders, valuing the company at $23 billion, a person familiar with the matter told Reuters on Monday.