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Business, Financial & Legal Posts - Page 263

Wall Street mildly disapproves of Google, stock trading down 4%

I'm not sure what it was Larry Page said that Wall Street didn't approve of, but it could be either that the revenue was below expectations or the announcement of the stock split to create a new class of non-voting stock. The business will effectively run the same after the stock split so it's hard to see investors getting excited about the stock change.

 

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I have a feeling the stock is down due to the revenue being slightly less than expected. That said, profit was higher than expected, so that would seem to me to cancel out any effect of lower revenue. It's probably more due to the continuing trend of decreasing cost-per-click. It has continued to decline and has fallen by 12 percent year-over-year.

 

Google's stock is trading down by 4 percent, and that's a fact. Some of the above is speculation, but I have a feeling it's pretty close to accurate. It will be interesting to see how the stock split affects prices. I imagine the non-voting will be quite a bit less than the voting stock. I may even be able to afford to invest in Google.

Apple defends itself against Feds and Amazon claims

Just two days after the Department of Justice filed antitrust charges against Apple and major book publishers, Apple has responded to the claims. Contrary to the three book publishers who signed settlements immediately, Apple seems to want to fight this to the end. The other two publishers are also fighting the claims.

 

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Apple spokesman Tom Neumayr:

 

The DOJ's accusation of collusion against Apple is simply not true. The launch of the iBookstore in 2010 fostered innovation and competition, breaking Amazon's monopolistic grip on the publishing industry. Since then customers have benefited from eBooks that are more interactive and engaging. Just as we've allowed developers to set prices on the App Store, publishers set prices on the iBookstore.

 

The response is similar to those of Penguin Group and MacMillan. The pricing of books and apps in Apple's store is set differently from music. The prices for books and apps are set by the publishers whereas the music is set by Apple. It will be interesting to see how this plays out. More as it comes.

Activision Blizzard is the latest casualty in the patent wars, being sued for virtual world infringement

Worlds Inc. has begun a lawsuit against World of Warcraft creator Activision Blizzard. The firm asserts that games like World of Warcraft and Call of Duty infringe on its patent regarding a "system and method for enabling users to interact in a virtual space." The patent seems extremely broad, but they did manage to use it to get a settlement out of NCSoft for City of Heroes in 2010.

 

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"Technologies created by Worlds have helped the businesses of virtual worlds gaming and the sale of virtual goods to grow into a multi-billion dollar industry," said Worlds CEO Thom Kidrin. "While we are pleased to see that the gaming industry and its rapidly growing customer base have enthusiastically embraced our patented technologies, we deserve fair compensation for their use."

 

It will be interesting to see how this plays out in court. If this patent is truly infringed upon by World of Warcraft and Call of Duty, I think many other games would also be considered infringing. That said, I haven't read the patent in full detail. It's scary that a patent can be this broad. It stifles innovation.

RumorTT: Google could get rid of their Motorola hardware division

Google's acquisition of previous powerhouse smartphone maker, Motorola, was approved by the Justice Department in February. There was much talk that Google acquired Motorola for their roughly 17,000 patents they held. Just two months after the acquisition, rumors are circling that Google are looking to dump the entire hardware division.

 

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The Wall Street Journal has tapped the keys on their keyboards and are claiming that Google are already looking to sell their cable set-top box business, and that they've offered the handset division to China's Huawei at a premium. At the moment, Google licenses their Android open-source operating system to 55 manufacturers across the world.

 

This is where Google run into problems: owning the Motorola hardware division means they could risk relationships with these OEMs, if they were to move forward with developing "in-house" hardware. Other manufacturers could see this as a bias toward Google owning the Motorola hardware division. Getting rid of it, would calm the nerves, obviously. Senior vice president of mobile for Google, Andy Rubin, has actually addressed concerns over this at Mobile World Congress in Barcelona.

Continue reading 'RumorTT: Google could get rid of their Motorola hardware division' (full post)

Google announce stock split, lets co-founders maintain control

Google have just announced a plan in which we'll see the company split its stock in an effort to preserve its corporate governance, and still give co-founders Sergey Brin and Larry Page control of the company. This will create a 2-for-1 stock split, where Google have said it will create a new class of stock, Class C, that won't sport any voting power.

 

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Any share holders of Google with Class A or Class B stock will automatically receive a share of the new Class S stock. This new class of shares will trade under a different ticker symbol. This new deal is said to preserve the voting power of Google co-founders. The stock proposal was announced as Google reported a first-quarter profit of $2.89 billion, or $8.75 a share, from $1.8 billion, or $5.51 a share, twelve months ago.

 

Excluding one-time charges and other items, Google's profits sat at $3.33 billion, or $10.08 per share, compared to last years $2.64 billion or $8.08 per share. Google easily beat Wall Street estimates which pegged them at $9.65 per share. Revenue-wise they were not too bad at all, hitting $10.65 billion, a 24-percent increase over $8.58 billion year-over-year. After backing out traffic acquisition costs, revenue amounted to $8.14 billion, missing Wall Street expectations by a slither, pegged at $8.15 billion.

Continue reading 'Google announce stock split, lets co-founders maintain control' (full post)

"One Sony", a new strategy for Sony from newly-appointed CEO Kaz Hirai

Sony have been struggling over the years, and much more so in the last year or so. We know this, and with newly-appointed CEO Kaz Hirai steering the ship that is Sony, they are now hoping a new set of initiatives designed to revitalize the sluggish business will help. The new strategy is called "One Sony".

 

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One Sony is said to focus on games, mobile and digital imaging in an effort to generate roughly 70-percent of Sony's total sales from these three divisions. Hirai's first big move is One Sony, and from his previous position within the PlayStation division of Sony, he is adding new titles to their downloadable catalog for the PlayStation Vita as well as the PlayStation 3, and will also improve subscription services on the PlayStation Network.

 

On top of this, the company is preparing better games for their tablet lineup and Vaio-based devices, as well as leveraging their accessories and peripherals market. Sony hopes to generate revenue of around $12.4 billion through gaming by fiscal 2014.

 

In the digital imaging market, Sony hopes to reinforce its development of image sensors, signal processing technologies, lenses and other key digital imaging technologies and leverage them in both its consumer products and broadcast/professional equipment. Sony are also talking of restructuring their television industry, and are said to be looking into expanding business into emerging markets like Mexico and India.

Facebook's Mark Zuckerberg made his offer to purchase Instagram, had deal wrapped up in 48 hours

When Facebook had announced they purchased Instagram for $1 billion, I was shocked, but not so shocked all at the same time. I had realised how popular Instagram was, and would get, but $1 billion from a company as powerful, as influential as Facebook? Just strange. Unless you wanted a ready-made, photo-sharing application and its creators, IP and everything else, so that your competition, Google and Twitter, couldn't scoop the opportunity before you could.

 

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It's being reported that Facebook CEO Mark Zuckerberg had called Instagram co-creator Kevin Systrom just after Instagram had secured $50 million in venture capitalist funding last Thursday, which pegged its value at $500 million. Zuckerberg called Systrom making his offer known, and by the end of the weekend Facebook acquired Instagram for double their pegged value.

 

How did Facebook make the deal so quickly? Well, Zuckerberg has majority voting power, where his Class B shares equate to over 57-percent. This makes his decisions kinda final, and his influence over them quite powerful. Most of his suggested plans would go through, unless he had a change of heart or a deliberate abstention from the voting process itself.

Tumblr is against display ads, CEO says it's 'complete last resort'

It's pretty hard to find a site on the internet these days without some sort of advertising. The larger the site, the more it costs to run and the more income the site needs to have. Tumblr receives and incredible 4.5 billion impressions each week which makes it one of the internet's biggest destinations.

 

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Incredibly, Tumblr has zero ads on it and they plan to keep it that way. Hosting servers for 4.5 billion impressions a week isn't cheap, so the company is trying to find a way to make money and become self-sufficient. Right now they are simply running on investment dollars, something that can't go on forever.

 

CEO David Carp has said in an interview that the site does not want ads. He says that Tumblr is "selling our desks to avoid that, it's a complete last resort." That's some dedication to keeping the site ad free, but can it really work? Karp and Tumblr are hiring a professional revenue executive to help monetize the site.

 

They have started selling highlighted posts for $1, which is basically a form of advertising, but not in the traditional sense. I really hope Tumblr can come up with an ad-free model that can then be copied by other sites across the web. I'm sick of being the 1 millionth visitor to every site I visit.

US Government objects to Megaupload hiring top law firm

In an interesting turn of events, the US Government has filed papers objecting to Megaupload's legal firm choice. Last week, it became known that Megaupload had retained the services of Andrew Schapiro. Schapiro is the same lawyer who led YouTube to a summary judgment in its copyright trial against Viacom.

 

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According to TorrentFreak: "In a new court filing the US government complains that Schapiro's past record in copyright cases, and that of Quinn Emanuel as a whole, present a series of conflicts of interest." Mainly, the government is concerned about a possible conflict with YouTube. Their legal battles against Viacom are back on, and they are also listed as a victim and possible witness against Megaupload.

 

The government says that Schapiro can't have an interest in both cases. Additionally, Schaprio or the law firm he works for has represented many of the companies that could possibly be called as witnesses against Megaupload. These companies include Google, Disney, Fox, Time Warner, Warner Bros., HBO, and various software companies.

 

"It is unclear how Quinn Emanuel intends to zealously represent defendants Megaupload Limited and Kim Dotcom while also protecting confidential attorney-client information gained in the course of representing other clients [...] particularly where those clients' interests are directly opposed to those of the defendants," the government writes.

Continue reading 'US Government objects to Megaupload hiring top law firm' (full post)

Turkish pianist under investigation for 'offending' tweets about religion

You gotta love social networking. It seems to manage to get everyone into trouble at some point or another. This time it has landed a Turkish pianist under investigation for possibly making statements that are offensive to Islam and, additionally, statements that are offensive to Judaism and Christianity.

 

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Since the Tweets have since been deleted, here is what Zaman reports:

 

[quote]Say sent controversial tweets questioning whether heaven in Islamic belief is like a brothel or pub because the Qu'ran says there are rivers of drinks and houris [very beautiful women] in heaven for those who commit good deeds while they are on earth.

 

Say also tweeted about a muezzin who recited the evening call for prayer in 22 seconds, questioning whether he was in a rush to reunite with his lover or go to the rakı table.[/quote]

 

The prosecutor of Turkey is investigating Say for breaking Penal Code Article 216. That portion of the penal code carries a 6-month to 3-year penalty if convicted. The Turkish pianist studied at the Robert Schumann Institute in Düsseldorf, and has over 67 compositions attributed to him.

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