Exclusive outtakes from industry leaders
For Steve Jobs, the right price was just a matter of timing.
During an interview at the Reuters technology summit, the chief executive of flash memory maker SanDisk recalled an encounter years ago with the Apple chief executive, who was then working on a secret, exotic new MP3 player. It was to be called the iPod.
“We were already in music players,” said Eli Harari. “Steve wanted a one gigabyte flash memory for $100 in the year 2000, because he could get for $100 a 1.8 inch drive from Toshiba and he preferred flash.”
Jobs liked flash because it was smaller, faster and consumed less power than a disk drive — all vital for a better iPod.
“He was really a very, very early adapter for flash,” said Harari. In the end, they couldn’t do the deal because flash cost too much to produce. At least back then, anyway.
“We could not sell one gigabyte for $100,” Harari said. Recalling the price crashes of late 2008, Harari added wistfully: “In the fourth quarter it was 90 cents for one gigabyte.”
Tech managers are not just savvy about new technology but also own the coolest, most cutting edge gadgets, right? Think again, some of them have no use for gadgets at all, finding pleasure instead in century old paintings and (gasp) pen and paper.
Alain Dutheil, CEO of mobile chipmaker ST-Ericsson, is not a man easily deterred when he wants to get somewhere.
“My plane was late and when I arrived there was no car there to take me into town as planned.” So what did the 64-year-old do?
In the midst of this recession, technology companies are drawing attention from investors and consumers alike as everyone tries to predict when the downturn will hit bottom and what new inventions might drive a recovery. How will new software and the Internet affect the way people do business? Can consumers afford to update the entertainment they enjoy in their house or car? Are workers properly equipped to communicate with clients and colleagues around the world? Which technology companies will come out as winners from this global crisis, and who will not make it?
Leading CEOs and senior executives will discuss their strategies and other topics at a time of increased uncertainty, sinking consumer demand and more controlled financing. The annual Reuters Global Technology Summit will generate exclusive interviews and articles, blog postings and online videos.
Fixed-line phone provider Telefonos de Mexico was an old, rusty government-run mammoth when businessman Carlos Slim bought it two decades ago. In a matter of a few years, and with the help of billions of dollars to deploy a nation-wide, state-of-the-art network, Telmex became Slim’s cash cow.
But times change fast. The expansion of cell phone services across Latin America, led by sister company America Movil, has dented Telmex’s domestic revenue in recent years. The arrival of new technologies, which allow international calls at very low prices, hit Telmex’s long-distance sales too.
And let’s not forget the new players in the market.
The company bets Internet services will help it keep business charging ahead. Chief Financial Officer Adolfo Cerezo told the Reuters Latin American Investment Summit that in five years Telmex could become a mostly-web focused company.
The one thing holding back even faster growth is that only a quarter of Mexican families own a computer.
With presence in all key Latin American markets, a comfortable debt payment schedule for the next 10 years, and an undisputed lead in the region, what’s left for America Movil to do? The Mexican cellphone provider, part of the empire of billionaire and Forbes list fixture Carlos Slim, will focus on growing its 3G services in the 18 countries where it operates.
Chief Financial Officer Carlos Garcia-Moreno spoke with Reuters during the Latin American Investment Summit in Mexico City, where he forecast that data traffic could make 25 percent of the company’s overall revenue within three years.
He bets that the arrival of new, cheaper cellphones with catchy web-surfing features will help the company’s data traffic rise. The company is also planning to sell netbooks across the continent to help lift its 3G income.
“Well insulated” China, though suffering from sharp drops in its own equities markets, doesn’t have the sense of crisis that exists in the U.S., says Philip Partnow, managing director of UBS Securities Ltd in Beijing. UBS, the first Western bank to assume management control of a domestic mainland brokerage, points out the fact that what’s hitting companies is not subprime-related securities gone bad.
“I think there’s nothing here we feel is toxid,” he told Reuters on Wednesday at the Reuters China Summit in Beijing. He goes on:
As Russia’s acquisitive corporations have consolidated their positions at home, their ambitions have spread to other fast growing, often risky and untried emerging markets. First they hit the countries of the former Soviet Union, which many Russian businessmen still view as their backyard, and more recently, have expanded in other emerging markets in Asia and Africa. Particularly hospitable have been the old Cold War allies of the Soviet Union, as Russian mobile phone operator Vimpelcom found when it made its first step in Asia by entering a joint venture in Vietnam.
“It was the real red carpet treatment,” Vimpelcom chief executive Alexander Izosimov said.
We asked CEOs at the Reuters Global Technology, Media and Telecoms Summit this week to pick out some stocks they would consider good investment plays.
With the caveat that they couldn’t cite their own company, many executives stuck to consumer favorites like Apple or Google , or delved into alternative energy. Some circled back to prior employers, while others dodged the question, saying if they were into stock-picking, they wouldn’t be CEOs.
Sir Martin Sorrell, CEO of WPP Group Plc, was interviewed as part of the Reuters Global Technology, Media and Telecoms Summit held this week around the globe. He talked to Reuters reporter Kate Holton in London, with groups of reporters calling in from Paris and New York to ask questions. Here are extended excerpts from a longer interview:
SOFTER 2009; REBOUND IN 2010
Reuters: How is the U.S. advertising market holding up in light of the credit crunch and housing crisis?