Tech wrap: Kodak files for bankruptcy protection
Eastman Kodak, the photography icon that invented the hand-held camera, filed for bankruptcy protection and planned to shrink significantly after a prolonged plunge for one of America’s best-known companies. The Chapter 11 filing may give Kodak the ability to find buyers for some of its 1,100 digital patents, a major portion of its value. According to papers filed with the U.S. bankruptcy court in Manhattan, Kodak had about $5.1 billion of assets and $6.75 billion of liabilities at the end of September. Kodak now employs 17,000 people, down from 63,900 just nine years ago.
Kodak’s long decline can be traced back to one source: the former king of photography’s failure to reinvent itself in the digital age, writes Ernest Scheyder. Kodak’s film dominated the industry but the company failed to adopt modern technologies quickly enough, such as the digital camera — ironically, a product it invented. ”Kodak was very Rochester-centric and never really developed a presence in centers of the world that were developing new technologies,” said Rosabeth Kanter, a professor at Harvard Business School. “It’s like they’re living in a museum.”
Apple unveiled a new digital textbook service called iBooks 2, aiming to revitalize the U.S. education market and quicken the adoption of its market-leading iPad in that sector. The move pits Apple against Amazon.com and other content and device makers that have made inroads into the estimated $8 billion market with their electronic textbook offerings. Apple has been working on digital textbooks with publishers Pearson, McGraw-Hill and Houghton Mifflin Harcourt, a trio responsible for 90 percent of textbooks sold in the United States.
Google’s net revenue jumped more than 27 percent in the fourth quarter but fell short of Wall Street targets, sending shares down sharply in after hours trading. The No.1 Internet search engine said that it earned $2.71 billion, or $8.22 per share in the fourth quarter, compared to $2.54 billion, or $7.81 per share in the year-ago period.
Microsoft said fiscal second-quarter profit fell slightly, as lower computer sales hurt its core Windows business. The company reported net profit of $6.624 billion, or 78 cents per share, compared with $6.634 billion, or 77 cents per share, in the year-ago quarter.
Some members of Congress switched sides to oppose anti-piracy legislation as protests blanketed the Internet on Wednesday, turning Wikipedia dark and putting black slashes on Google and other sites as if they had been censored. Several sponsors of the legislation, including Senators Roy Blunt, Chuck Grassley, Orrin Hatch and John Boozman and Marco Rubio, said they were withdrawing their support. Some blamed Senate Majority Leader Harry Reid for rushing the Senate version of the bill.
Rovio, the Finnish creator of the global smash-hit Angry Birds video game will not join the stock market this year but still aims to eventually seek a listing, its marketing chief said. ”We are not in a rush. This year is way too early for an IPO, there are too many open things, and we are in a very early stage of the Angry Birds lifecycle,” marketing chief Peter Vesterbacka told Reuters.
Shadowing a fund manager at CES
More than 140,000 people descended (or will descend) on Las Vegas this week to kick the tires on a new wave of consumer electronics gadgets. Of those, a relatively small contingent (estimared? 3,500) are portfolio managers and other financial professionals earnestly seeking to place informed bets on the Next Big Thing.
We tagged along as Hampton Adams, head of research and a portfolio manager at Pasadena, California-based Gamble Jones Investment Counsel, hiked around a CES showfloor spanning 30 football fields in a pair of comfortable loafers, taking a first-hand peek at the technology industry’s latest offerings.
Inevitably, Apple always features high on Adams’ agenda even though the consumer electronics trendsetter isn’t even officially there. He wants to see what might be gleaned about Apple from its competitors.
Here’s a photo log of some of the highlights of our nine-hour odyssey. We’ll publish more details of his discoveries on Reuters.com.
SuVolta takes wraps off battery-friendly chip technology
Silicon Valley start-up SuVolta is giving the electronics industry a peek under the hood at its new technology that it claims will drastically boost the energy efficiency of microchips.
That’s something chip designers are focusing more and more on as people increasingly rely on smartphones and tablets that chew up battery charges.
SuVolta says it can halve the amount of power used by chips without affecting their performance, and it is debuting the details of its technology to scientists at the 2011 International Electron Devices Meeting on Wednesday in Washington, DC.
The company says its “Deeply Depleted Channel” technology reduces voltage variability in transistors, drastically cutting the amount of energy that turns into heat and is wasted as microchips crunch data.
Backed by venture capital firm Kleiner Perkins Caufield & Byers, SuVolta has already licensed the new technology to Fujitsu Semiconductor. Fujitsu has been testing it at in one of its fabs and will present the technical paper jointly with SuVolta.
Qualcomm, Texas Instruments and Samsung dominate the mobile chip market using low-power designs licensed by Britain’s ARM Holdings and they are potential customers for SuVolta.
Got an idea but nowhere to pitch it? Try Intel and Facebook
Have you dreamed up the next social media sensation, energy-efficient engine or hot consumer gadget but don’t know where to pitch your idea? If you’re between 18 and 24 years old, log onto Facebook.
Intel and Facebook are teaming up in a new program called Intel Innovators to give young people a forum to debut new ideas and give feedback on other people’s. And $100,000 a month are up for grabs to help turn winning concepts into real start-ups — as long as you’re in the United States.
Through the Intel Innovators platform on Facebook, participants can lay out their business ideas and receive suggestions from fans to help refine and improve their plans.
Once a month, a panel of experts including venture capitalists from Intel Capital, SV Angel and Betaworks will award $50,000 to one participant. And the Facebook fan who has built up the most “social capital” by providing feedback to participants will be allowed award another $50,000 to the entrepreneur of their choice.
Would-be Silicon Valley leaders of tomorrow have already pitched several ideas, including a medical tool for collecting bone grafts, a high-tech tent for homeless people and a web application to help patients find affordable prescription medicine. Are we about to discover the next Mark Zuckerberg?
Chipmakers most creative, drugmakers least?
Chipmakers including Intel and Qualcomm make up the world’s most innovative industry, according to a new analysis of patents by Thomson Reuters that is equally notable for some of the companies it does not include.
Thomson Reuters has just released its “Top 100 Global Innovators” list, which it compiled by scrutinizing patent data around the world using a peer-review methodology it developed.
“We tried to take an objective look at technology innovation and apply a composite measure not just of volumes, but also of influence in terms of citations of later published patents, in terms of globalization of patenting,” says Bob Stembridge, the lead analyst behind the study.
Other companies related to semiconductors on the list include Samsung, Analog Devices, SanDisk and Applied Materials, which invents and builds the equipment used to manufacture chips.
But a handful of companies currently seen as leading players in the chip industry are missing from the list.
Britain’s ARM Holdings, whose intellectual property has taken the tablet and smartphone industry by storm in the past few years, was absent from the compilation.
Also missing was Texas Instruments, the world’s No. 3 chipmaker and leader in analog semiconductors.
Tech wrap: Apple misses, Intel beats quarterly expectations
Apple reported a rare miss in quarterly revenue after sales of its flagship iPhone fell well short of Wall Street expectations. The September quarterly report was Apple’s first under new CEO Tim Cook, who took over in August after co-founder Steve Jobs resigned. The company reported a net profit of $6.62 billion, or $7.05 a share. That fell shy of expectations for earnings of $7.39 per share.
One analyst blamed lofty expectations for the miss. “The reality is their business is not an annuity. They have to sell their quarter’s worth of revenue every 90 days. They had a big upgrade cycle with the iPhone, the numbers came in weak. They need to set records every time they report to keep the momentum”, said Colin Gillis at BGC Partners.
Intel forecast quarterly revenue above expectations, defying concerns that the growing popularity of tablets and a shaky economy are eating into demand for personal computers. Intel said revenue in the current quarter would be $14.7 billion, plus or minus $500 million. Analysts on average had expected current-quarter revenue of $14.23 billion, according to Thomson Reuters I/B/E/S. Intel’s processors are used in 80 percent of the world’s PCs but the company has failed to gain traction in mobile gadgets like Apple’s iPad and Google’s Android smartphones. It also increasingly depends on China and other emerging markets to make up for weak sales in the U.S. and Europe.
Yahoo’s net revenue and profit slipped in the third quarter, as the Internet company struggled to revive its online advertising business. Yahoo’s net revenue — which excludes fees paid to partner websites — was $1.07 billion, compared with $1.12 billion at this time last year, and in line with Wall Street expectations.
RIM said it will introduce souped-up operating software for its BlackBerry smartphone and PlayBook tablet designed to make both more formidable competitors to Apple and Google devices. RIM, which made the announcement at a developers conference in San Francisco, said it would install its new BBX platform in next-generation devices but provided no timetable.
Apple plans to shutter U.S. retail stores for several hours on Wednesday so employees can take part in a company-wide celebration of co-founder Steve Jobs’ life, a person familiar with the celebration said. Store employees in the U.S. will use that time to view a live broadcast of the event, which is being held at an outdoor amphitheater at Apple’s headquarters in Cupertino. The celebration — which will be held from 10 a.m. PT to 11:30 a.m. PT — follows a private memorial service for the late tech visionary at Stanford University attended by Silicon Valley luminaries, politicians and celebrities.
from Ask...:
How should we respond to the “enormous” cyber attacks?
Security company McAfee uncovered a series of attacks on the networks of 72 organizations including the U.N., governments and companies around the world and said there was one "state actor" behind them.
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Tech wrap: Apple’s valuation flirts with Exxon’s
Apple shares neared a record $400, a day after the world’s most valuable technology company posted blockbuster results and triggered a spate of brokerage upgrades. Apple’s climb brought the maker of the iPhone and iPad within shouting distance of Exxon Mobil’s market value of more than $400 billion despite the oil and gas producer raking in more than four times Apple’s annual revenue.
“We expect Apple will become the largest market cap company on the planet when the stock hits approximately $445, which is only about 13 percent away from aftermarket levels,” said Gleacher & Co analyst Brian Marshall, based on the assumption that Exxon shares remain flat. Apple shares rose to a high of $405 in after-hours trading on Tuesday.
Intel posted second-quarter revenue above expectations, defying investors’ concerns about slowing personal computer sales. Intel’s revenue in the June quarter was $13.1 billion, up 22 percent over the year-ago period and above the $12.83 billion expected by analysts, according to Thomson Reuters I/B/E/S.
EBay reported better-than-expected quarterly results as the company’s main online Marketplace business showed signs of a turnaround and its PayPal unit continued to grow quickly. EBay said second-quarter net income was $283.4 million, or 22 cents per share. That compares to net income of $412 million, or 31 cents a share, in the same period a year earlier.
Apple updated its MacBook Air and Mac mini with next-generation processors and operating systems. The new MacBook Air went on sale starting at $999, with the latest generation of Intel Core i5 and i7 processors, the operating system Lion, and a backlit keyboard. The Mac mini was priced at $599, delivering up to twice the processor and graphics performance of the previous generation, the company said.
Samsung launched a thinner and lighter version of its Galaxy tablet. The Galaxy Tab 10.1 inch is an upgraded version of the 7-inch introduced in October. Priced from $500 onwards in the U.S. market, the same as Apple’s 9.7-inch iPad, it faces tough me-too competition from more than 100 devices, mostly running Google’s Android operating system.
Samsung poached a second employee from Research In Motion in a month, setting back the BlackBerry maker as it struggles to regain its stride. Ryan Bidan, senior product manager for RIM’s PlayBook tablet computer, left for a job as director of product marketing for Samsung Telecommunications America, according to his profile on professional networking site LinkedIn.
Tech wrap: Nokia wins big in patent fight with Apple
Nokia is likely to be paid hundreds of millions of dollars by Apple after victory in a legal wrangle over technology used in its arch-rival’s top-selling iPhone. Nokia said the deal would boost second-quarter earnings. Analysts said it was clear the sums involved would be significant, with some experts estimating Apple’s one-off payment at $650 million.
J.C. Penney is bringing in Ron Johnson, Apple’s senior vice president of retail, who oversaw the iPad maker’s wildly successful foray into brick and mortar stores as its new chief executive. Johnson will take the reigns November 1, Penney said.
The recent string of sensational hacker attacks is driving companies to seek “cyberinsurance” worth hundreds of millions of dollars, even though many policies can still leave them exposed to claims, writes Ben Berkowitz. Insurers and insurance brokers say demand is soaring, as companies try to protect themselves against civil suits and the potential for fines by governments and regulators, but also as they seek help paying for mundane costs like “sorry letters” to customers.
World leaders should put cyber security on the international agenda at forums such as the G20 and bring pressure to bear on “slower-moving” nations to take a stand against hacking, Peter Coroneos, co-founder of the International Internet Industry Association said. “Getting the issue elevated to a level like the G20 would be a good way to promote engagement with economies that might otherwise move a little slower,” Coroneos told Reuters.
It may take the Supreme Court to end a years-long battle between Olympic rowing twins Cameron and Tyler Winklevoss, and Facebook founder Mark Zuckerberg. The identical twin brothers are challenging a San Francisco federal appeals court ruling that upheld a $65 million cash-and-stock settlement they reached with Facebook in 2008. While they appeal to the Supreme Court, related litigation will be on hold, the appeals court ruled late on Monday.
Advanced Micro Devices is launching new processors aimed at mainstream personal computers and challenging rivals Intel and Nvidia. AMD’s Llano chips, which include both central and graphics processors, are aimed at mid- to high-end laptops and desktop computers. The chips, part of AMD’s Fusion family, have much-improved battery life and will soon be available in laptop and desktop computers, the Sunnyvale, California-based company said.
Google and solar power company SolarCity formed a partnership to create a new $280 million fund designated for residential solar projects — the largest of its kind in the U.S.. Customers who want solar panels installed on their homes but do not want to make a big upfront investment, are able to tap the fund. SolarCity has more than 15,000 solar projects and finances about 80 percent of the its customers’ solar systems.
Tech wrap: Sony’s new security setback
Mere days after Sony began restoring access to its PlayStation Network, the company said it had discovered a security flaw on one of the websites set up to help the millions of users affected by April’s massive data breach reset their passwords.
The “security hole“, as Sony spokesman Dan Race termed it, could allow the hackers who perpetrated the April breach to access the accounts using the data they had stolen. Sony shut the webpage down in response. No hacking had taken place prior to taking down the page, Race noted.
Hacking occupied the minds of executives at the Reuters Global Technology Summit as well. Mobile hacking in particular was a hot topic of discussion, with executives at software giants and startups alike expressing their desire to cash in on ways to help smartphone users protect themselves as hackers increasingly target mobile devices.
“The mobile security market will one day be bigger than that of computers,” said Neil Rimer, co-founder of Geneva-based fund Index Ventures.
In other summit news, a senior Intel executive told Reuters that the popularity of the iPad and other Apple devices often helps shape how the chipmaker thinks about future devices and the chips that will power them. An executive at Rovio, creator of the popular mobile game Angry Birds, told Reuters it is aiming for a stock market listing in New York within two or three years.
Microsoft co-founder Bill Gates seems pleased with his company’s acquisition of Skype. Combining Microsoft and Skype will vastly improve the state of video conferencing, Gates told the BBC in an interview.
