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Sep 17, 2012

Motorola: the breakup that keeps on giving

(The author is a Reuters Breakingviews columnist. The opinions
expressed are his own.)

By Robert Cyran

NEW YORK, Sept 17 (Reuters Breakingviews) – Motorola has
been the corporate breakup that keeps on giving. Splitting in
two early last year resulted in Google (GOOG.O: Quote, Profile, Research) buying its
cellphone operations for a chunky premium. Motorola Solutions
(MSI.N: Quote, Profile, Research), its emergency communications arm, has done even better.
Moreover, the $14 billion company looks poised to buy back a
third of its stock without much strain.

Sep 12, 2012
via Breakingviews

Apple’s iPhone offers subtle and sublime charms

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By Robert Cyran
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Apple’s iPhone 5 offers subtle and sublime charms. The unveiling of the company’s latest handset may have been a bit of a snooze. Better isn’t as exciting as new. But throw in improved software and it’s enough to be a big hit with consumers – and Apple investors, too.

Sep 11, 2012
via Breakingviews

Tech IPO disaster represents epic cautionary tale

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By Robert Cyran

The author is a Reuters Breakingviews  columnist. The opinions expressed are his own.

The latest IPO disaster is an epic cautionary tale. Special effects creator Digital Domain Media Group, whose credits include “Titanic,” “Transformers” and the Tupac Shakur hologram, filed for bankruptcy protection on Tuesday less than a year after going public. Elements of the company’s problems are shared by other new technology stocks. It’s a case study for investor skepticism. 

Aug 14, 2012

Google searches for local edge with guidebook deal

By Robert Cyran

NEW YORK, Aug 13 (Reuters Breakingviews) – Frommer’s travel guides may be better known among frugal travelers with comfortable shoes than with the digital cool kids. Yet Google’s purchase of the publisher looks like a smart way to further its push into the booming local online advertising market, building on last year’s purchase of Zagat, the dining curator.

The growth of smartphones – more than half of Americans now have one – is profoundly affecting Google. While users flock to the devices, advertisers haven’t yet. This can be easily seen in the search firm’s results – while the number of clicks on ads rose more than 40 percent in the last quarter, the amount of revenue Google fetches per click fell 16 percent.

Aug 10, 2012
via Breakingviews

Yahoo investors counting on Mayer burning cash

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By Robert Cyran
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

This looks like a case of lost in translation for Yahoo. The internet group led by Marissa Mayer says it may use much of the bounty from selling its stake in Alibaba, the Chinese web conglomerate, for acquisitions, rather than returning it to shareholders in the form a special dividend or buyback. As crummy as that sounds, it is already baked into Yahoo’s value. Investors seem resigned to Mayer wasting a chunk of their cash. 

Yahoo obviously did not hire Mayer to wind down the troubled company. The former Google hotshot is ambitious. And the $70 million pay package the company granted her must be predicated on bigger things than acting as a caretaker or liquidator. Yet investors seemed startled that Mayer now may hang on to the $4.2 billion or so Yahoo will reap after taxes from the sale of half of its stake in Alibaba. Yahoo’s shares fell almost 6 percent. 

Aug 9, 2012
via Breakingviews

Market geniuses don’t even get milk

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By Robert Cyran
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.When the most pedestrian of groceries can surprise investors, something has clearly gone off. Along with an unexpected profit, Dean Foods unveiled a corporate split – of one sort of milk from another. By sending the company’s valuation soaring 40 percent, the dairy engineering exposed glaring inefficiencies.

Selling milk is a low-margin business. Most shoppers just pick the cheapest gallon they can find. Many commodity prices, from diesel to grain, can hit margins hard. Passing along such costs to customers isn’t easy.

Aug 6, 2012
via Breakingviews

Best Buy bid looks about as shaky as its target

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By Robert Cyran
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.


The bid for Best Buy looks about as shaky as the target. Richard Schulze, the electronics chain’s founder, wants to take it private for up to $8.8 billion. His 20 percent stake adds credence to the offer, but financing and backers remain elusive. And given the laws where Best Buy is based, a takeover could be tough.

Jul 27, 2012

Amazon and Facebook divide is a matter of faith

By Robert Cyran

NEW YORK, July 27 (Reuters Breakingviews) – Both companies’
quarterly reports showed strong sales growth, feeble earnings
and heavy investment. Yet the online retailer’s stock rose and
the social network’s plunged. Investors believe Amazon will
stick around to reap the benefits. They may have more doubts
about Facebook.

Full view will be published shortly.

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Jul 27, 2012

Facebook loses more friends with fizzle

By Robert Cyran

NEW YORK (Reuters Breakingviews) – Facebook (FB.O: Quote, Profile, Research) has lost a few more friends with its first-time fizzle. The social network’s revenue grew 32 percent from the same period last year in its inaugural earnings report as a public company. While such growth would look fantastic to a company selling toothpaste or beer, it’s not spectacular for a company that was recently sold to investors as the hottest in tech. Worse, profit and margins took a hit even after ignoring stock compensation. Facebook is investing heavily, but investors counted on having cake and eating it. Instead, they’re going hungry.

It’s clear that Facebook has a mobile problem. The number of people checking up on their friends via a smartphone continues to rise sharply and is now well over 500 million. That’s more than half of all users. This has the distinct advantage of allowing people onto the network more often because they don’t have to be sitting in front of a computer. Unfortunately, the downside – so far – is larger. Advertisers haven’t adjusted budgets to this shift, so they pay less per impression and click. The number of ads delivered in the United States per user on Facebook actually fell. And gaming payments have been flat for several quarters due to the growth of mobile, according to the company.

Jul 20, 2012
via Breakingviews

Yahoo pays up for dream of CEO stardust

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By Robert Cyran
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.Yahoo is paying up for the dream of a chief executive sprinkling stardust. After churning through several CEOs in quick succession, it’s easy to see why Google hotshot Marissa Mayer snagged a $70 million pay deal from the fading internet search firm. But as J.C. Penney with its ex-Apple boss shows, there are no quick fixes.

The motivations of Mayer and Yahoo are easy enough to discern. Mayer was the 20th employee at Google, in charge of several of its most important businesses, and a natural candidate for chief executive. But that path was blocked by co-founder Larry Page. Now she will have the chance to be a CEO and to make her mark at the fourth biggest site on the Internet. At 37, Mayer is also young enough – and Yahoo sufficiently troubled – that if she fails to reinvigorate the company she will surely get more chances.

    • About Robert

      "Robert Cyran, U.S. tech columnist, joined Breakingviews in London in 2003 and moved four years later to New York, where he continues to cover global technology, pharmaceuticals and special situations. Robert began his career at Forbes magazine, where he assisted in the start-up of the international version of the magazine. Before working at Breakingviews he worked as a market researcher and reporter covering the pharmaceutical industry. Robert has a Masters degree in economics from Birmingham University and an undergraduate degree from George Washington University."
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