Even though Samsung sold close to double the smartphones that Apple did last quarter, with 50 million sold, which is the largest number of units ever shipped by a single vendor in a single quarter, Apple are still absolutely kicking the asses of the competition when it comes to the industry's operating profits.
Apple have much higher gross margins on their iPhone and iPad's, which completely eclipses its rivals in both revenue, and operating profits. Apple only shipped around 6% of the industry's smartphones and tablets in Q2, but they took a surprising 43% of the industry's revenue, according to Raymond James analyst Tavis McCourt. Apple also generated an absolutely huge 77% of the industry's operating profits, even in a seasonally weak period for iPhone sales.
So, now we find ourselves in a position of weirdness with competitor Samsung. The Korean-based company outsold Apple's ever-so-popular iPhone two-to-one, and still couldn't touch Apple's insane grab of industry operating profits. But, things can change quickly, and all it takes is a single release from a company (a new, surprising, 'magical' iPhone), or a constant stream of releases (Galaxy phones that continue to sell more and more) to turn things around.
Richard Schulze, founder of Best Buy, has offered to buy the retailer for roughly $8.5 billion, according to reports. Schulze resigned as chairman after ex-CEO Brian Dunn was investigated for "personal misconduct" issues, has offered to pay between $24 and $26 per share for Best Buy, which he hopes to make private.
Best Buy has confirmed that they have indeed received the proposal, and says it will be considering it in the near future. As of June, Schulze held over 20% of the company, and plans to put forward $1 billion from that stake into the proposed deal. The remaining $7.5 billion (or so) would come from "premier private-equity firms" who claim to have a "deep experience in retail", as well as debt financing.
While according to Minnesota corporate law, permission from company directors is required in order to form a group for a more complete offer, which is requested in Schulze's offer letter, and has no deadline set. There is reportedly a source close to the matter that says that Schulze entered into the negotiations for the board's permission in the last couple of weeks, but wasn't successful due to the board claiming that it wasn't a good time to go public.
It's been a roller coaster of emotion for users of the popular torrent and tracker site Demonoid. The site has been down for around a week now, and it would appear that the downtime is set to continue. The site was originally taken offline by a DDoS and users rejoiced when they heard that this was the case.
However, more bad news has hit users of the site. Out of Ukraine, word has come that the site has been shutdown by authorities as a gift for the United States government. The takedown was timed to coincide with the very first trip of Deputy Prime Minister Valery Khoroshkovsky to the United States where the topic was copyright infringement.
"Investigators have copied all the information from the servers Demonoid and sealed them," an anonymous ColoCall source confirmed. "Some equipment was not seized, but now it does not work, and we were forced to terminate the agreement with the site." It seems that this week has been a bad week for the site.
"Shortly after [the DDoS] a hacker break-in occurred, and a few days later came the investigators," the source added. The management has back-ups of the site and appear to not be in custody. In fact, the admin is supposedly located in Mexico, about half-way around the world from the servers. Only time will tell if the site will be brought back online.
eBay have entered the same-day shipping service business with eBay Now. eBay Now has arrived, for now, as an iOS app that will allow San Francisco-based residents to get $5 same-day shipping on products from local stores.
The company is signing up users for an "exclusive beta", which lets anyone register and those who do, should get a download link shortly after. It looks like eBay Now currently only works for purchases that exceed $25, but beta testers get $15 off their first eBay Now order as well as free shipping on their first three orders before a $5 delivery fee kicks in.
What do you think of eBay's move for same-day shipping? It's a good idea, but I think they're going to need to rapidly expand it to as much of the US as they can, as quick as they can, if they want to keep up with competitors.
Apple's top-secret market research surveys of iPhone, iPad users could be made public in Apple vs. Samsung trial
The late Steve Jobs famously said that Apple did "no market research", so Apple never really knew what consumers want. But, it looks as though Apple were lying through their teeth, as new documents have been bought up during the Apple vs. Samsung patent lawsuit.
Network World's Yoni Heisler writes that Apple is positively freaking out that the possibility of their extensive market research surveys of iPhone and iPad users could be made public. That sentence should send shivers down Apple's spine, as it is considered the 'secret sauce' to attracting, and keeping loyal Apple users.
The demand for online access to video and data has prompted Google to announce they'll be spending another $184 million in an expansion project for the company's Hamina Datacenter. The Finland-based datacenter is best known for an innovative cooling system that uses seawater from the Bay of Finland in order to reduce cooling costs.
The announcement of the expansion is the first datacenter growth for the search engine and mobile OS giant since they unveiled plans to build large Asian datacenters in Singapore and Hong Kong. The announcement roughly doubles the Google datacenter investment for the facility, where after spending 40 million euros on the paper mill, the company then spent another 160 million euros ($195 million) on building and equipping the datacenter. The original project took just over 18 months, which is the same ETA on the new expansion plans.
The plans look to be bringing back Google's datacenter investment back to Europe, where we should see more of this in the future as more and more people move toward the cloud.
All it took was 45 minutes for financial services firm Knight Capital to lose an astonishing $440 million on Wednesday, the money was lost during a newly-installed trading piece of software was installed, and it went wrong, very wrong.
$440 million represents nearly double the company's second quarter revenue, and could be enough to see the firm head into an unescapable downward spiral. Automated high-speed trading on the stock market seems to have caused the company this massive problem, but how does it seem to happen so easily? Well, according to the New York Times, Knight Capital "accidentally sold all of the stocks it bought on Wednesday morning":
The problem on Wednesday led the firm's computers to rapidly buy and sell millions of shares in over a hundred stocks for about 45 minutes after the markets opened. Those trades pushed the value of many stocks up, and the company's losses appear to have occurred when it had to sell the overvalued shares back into the market at a lower price.
Research firm Strategy Analytics have some interesting numbers out, where it shows that Apple still have complete and utter dominance when it comes to the tablet market, with 68% of shipments secured by the Cupertino-based company for Q2 2012.
Google's Android platform scooped up 29% of the remaining share. IDC have also released their own estimates of tablet shipments for the same quarter, with their estimates similar to those from Strategy Analytics, with estimates of 25 million tablets shipped, and 68% share for Apple's iPad. IDC breaks these numbers down by manufacturer, instead of platform.
Microsoft have just announced that they've inked an intellectual property (IP) deal with Honeywell, adding them to their ever-growing list of third parties who have to pay to use its software. Microsoft said in a statement:
We are pleased to have reached a patent agreement with Honeywell covering its Android devices under Microsoft's worldwide patent portfolio. Through this agreement Honeywell joins Microsoft's Android patent licensing program and demonstrates its responsible approach to the management of intellectual property.
This deal includes mentions of Chrome OS and Android, and now Microsoft has been quite effective in bringing Android OEMs into agreements that see the company collecting fees. It's not known whether all companies pay a per-unit cost, but at the end of the day they're having to hand over cash to Microsoft, or grab the closest lawyer.
Microsoft have recently talked of having over 70% of the Android OEM smartphone market as part of their licensing deal network, and now they've just added Honeywell to this list, and not so long ago, Pegatron. This deal stands out as it seems preemptive, as Honeywell only launched their first Android-based phone just hours ago.
Apple's proposed new data center has been approved by the Nevada Board of Economic Development, where they've offered the Cupertino-based company $89 million in tax breaks to do so. Apple has planned to build a 350-acre data center east of Sparks that would employ at least 35 full-time workers, and up to 200 contract workers.
Apple will also build a purchasing and business center in downtime Reno, with analysts estimating that the projects could generate a combined $340 million in economic activity over the next 10 years. In June, Washoe County and the city of Reno also agreed to grant Apple tax breaks.
Apple will receive an 85% tax break on its personal property taxes in Washoe County and Reno will offer Apple 75% of its share of sales taxes for the proposed downtown business center. Apple, in exchange for the incentives, will invest $1 billion in the region over the next decade, which can be extended for 20 additional years.
The news just keeps getting worse for investors who purchased Facebook stock. Facebook stock has been in a continual decline ever since they reported their second-quarter earnings last week. Today, it has hit an all-time low of $19.82, according to Google Finance.
The stock hovered around $20, with occasional dips below and, at the time of writing, is currently at $19.90. For a bit of perspective, a stock price of $19 dollars would put the stock at exactly half the IPO offering price of $38.
Yesterday, Facebook closed at $20.88, $0.04 above its lowest closing price of $20.84. It looks as though today could change that lowest closing price record.
I stumbled across some interesting news today, with EA's financial results for the first quarter of this year, which have some interesting facts for the games industry. EA's report is broken down into platforms, PC, Xbox 360 and PlayStation 3.
EA made $292 million from the Xbox 360, $276 million from the PC and $267 million from the PS3. This means that as one of the world's biggest publishers, EA made more money on the PC than they did from the PlayStation 3, which to me, is quite surprising. EA's surge in business for the PC is looking to be attributed from digital sales.
EA has made $342 million from digital sales, up considerably from $232 million last year. Physical sales represent $592 million, dropping from $647 million last year. So, we're seeing that more and more people are going digital, like myself, compared to buying physical copies of games. If this trend continues, we could see digital thrashing physical copies, and when (note that I'm not using the word if) this happens, we're going to see an interesting shift in the gaming world. This is coming from a company who has said that it's "inevitable" that they'll become a 100% digital company.
T-Mobile close to inking deal that will see them sell 7,000 cell towers for approximately $2 billion
If reports floating around are true, T-Mobile are close to inking a deal that would see them selling 7,000 cell towers for approximately $2 billion. Crown Castle International is the current lead bidder for the cell towers, reports the Wall Street Journal.
After a failed acquisition by AT&T, T-Mobile could do with the cash injection, being the fourth-largest US wireless carrier. T-Mobile received $1 billion in wireless spectrum and another $3 billion in cash from AT&T as part of the breakup deal. T-Mobile would also benefit in other ways from the sale of the cell towers in the form of saving money on tower upkeep and service over the coming years.
T-Mobile could also use some of the $2 billion to help build their 4G LTE infrastructure as part of a program that will see the company spend roughly $4 billion over the next few years. Rival bidders for the 7,000 cell towers are lead-bidder Crown Castle International, American Tower Corp. and Global Tower Partners. Once the deal is done, we should hear again and we'll keep you updated.
Jim Keller rejoins AMD as Corporate Vice President and Chief Architect for CPU Cores, lured away from Apple
AMD has been losing talent left and right over the past year. December saw the loss of VP of strategy Patrick Moorhead and Product Director Carrell Killebrew, among others. Just last week week, AMD lost the person responsible for getting AMD GPUs into every single one of the current consoles to NVIDIA.
AMD hasn't been very competitive on the CPU front, and the GPU front seems to be falling behind NVIDIA. Bulldozer had lackluster performance and Piledriver improvements don't seem to be enough to put AMD back into direct competition with Intel. Enter Jim Keller.
Jim Keller worked at AMD between 1998 and 1999 where he led development of the K8 architecture, arguably AMD's biggest lead over Intel, and co-authored the x86-64 specification. Even though he was only there for a short time, he certainly left his mark on the company. His resume is even more impressive with the work he has been doing lately.
Keller joined Broadcom in 2000 where he was the chief architect on a line of MIPS-based network processors. He moved on to PA semiconductor in 2004 where he continued working on networking systems. PA Semiconductor was acquired by Apple in April 2008 and he followed. He worked on Apple's A4 and A5 processors, which have powered the last few generations of mobile Apple products.
Facebook have not had a good time since their IPO launch, where they began trading at $38 per share. But at the close of Tuesday this week, shares were down another 6-percent, reaching just $21.71 per share. This represents a drop of 43-percent since the social networking site went public.
Even after Facebook's first ever earnings report as a public company was released, there are still concerns over the social networking sites growth, which just don't seem to be going away. Investors had hoped to have seen more progress in terms of the user growth, and how the company is capitalizing on the rapid increase of mobile usage. Investors wanted Facebook to "show confidence they could grow the company, and they didn't", said Francis Gaskins of IPODesktop.com.
But, are we at the bottom of the barrel yet? It appears not. Come August 16, just a mere 91 days after the IPO, insiders such as company officers, directors and employees, can sell a whopping 268 million shares of stock. Between 91 and 181 days after the IPO, insiders can sell an additional 137 million shares. If these shares are to see any move, it could spell quite the disaster for Facebook, and drive their share price much, much lower.
Samsung's legal team make iBooBoo in Apple vs. Samsung case, publicly release inadmissible evidence from trial
The Apple vs. Samsung trial is underway at the moment, and it looks like Samsung's legal team have made a pretty bad move, with the team in trouble with Southern District Court Judge Lucy Koh. Samsung have been going on about the 'Sony-style' design mockups this week, and this is what has landed them in trouble.
There were some mockups from Apple designer Shin Nishibori that were designed in order to show how Sony's design sensibilities could be melded with Apple's, in order to create a phone. The design was said by Samsung to exemplify that Apple were working from another company's designs when they were creating the iPhone, which is exactly what Apple are accusing Samsung of.
Apple then pulled out a prototype predating Nishibori's design that dated back to 2005, where they argued that Sony designs were just a riff on what it had done before. At this point, it had negated Samsung's point, in the eyes of Judge Koh. Koh then ruled that Samsung could not present evidence related to these 'Sony-style' designs, or another prototype design that Samsung says it was working on in 2006.
Officials over at the US Federal Trade Commission have agreed to let Google pay a settlement for circumventing privacy settings with Safari, Apple's web browser. Unnamed sources have told Reuters that Google will be seen handing over $22.5 million to avoid further proceedings, but it will not be forced to admit liability.
Google were accused of implementing code that bypassed Safari's default security provisions in an attempt to enable Google+ users to take advantage of the social network's +1 button. Google, at first tried to argue that initial reports had mischaracterized the method, which was limited to signed-in users and associated with cookies that didn't take any personal information.
Critics have said that Google's strategy had allowed its own DoubleClick ad network to track user activity, all without providing any notification of doing so, but Google eventually disabled the function. This case marks the biggest single fine ever served by the FTC at $22.5 million, with the penalty believed to be comparatively high due to consent decree that Google agreed to last year, barring the company from misrepresenting its privacy practices to its users.
Internet streaming sensation Spotify has released its latest figures, one of which is that it now has 4 million paying customers. The music service has been a massive hit ever since it was released, and these latest figures show just how big it is. Spotify's Ken Parks, speaking at a panel in the Global Business Summit on Creative Content in London, updated everyone with the running totals.
Talking to a 'Future for the Music Industry' panel, Parks announced that Spotify now sports 15 million active users, of which four million are willing to pay for the service. Spotify is a massive competitor to Apple's iTunes and is popular with users who don't want to be locked into an ecosystem as Spotify is multi-platform.
Earlier this month, it was announced that steaming accounts for 89% of music sales in Spotify's home market of Sweden. Parks will be looking for subscription numbers to increase as more countries start to become comfortable with music in the cloud. Based upon the numbers from Sweden, it appears people already are, at least in that country.
Yahoo have been in the news quite a lot lately, for all the right reasons, with ex-Google exec Marissa Mayer appointed the new CEO and president of the company. But, interim CEO, Ross Levinsohn has confirmed that he's leaving the company after not being named for the permanent position.
Levinsohn had allegedly been telling candidates for senior positions that he would be the next CEO, and according to reports, Yahoo employees were hoping that he would stay on with the company in some capacity, as well as help guide the company itself. But, over the weekend, Levinsohn e-mailed, saying:
I wanted to let you know that my time at Yahoo has come to an end. It has been an incredible journey for me and I could not be prouder of what we accomplished over the past few years helping define Yahoo as a leader in digital media and advertising. Yahoo is an amazing brand and company, and I leave knowing we did all we could to help inform and entertain more than 700 million users each month. Leading this company has been one of the best experiences of my career, but it is time for me to look for the next challenge.
Research firm Strategy Analytics has some new numbers for everyone to peer at, with the US Android handset sales dropping in Q2, but iOS sales went up. Overall, smartphone shipments for all manufacturers fell a little, by 5-percent to 23.8 million, compared to 25.2 million from the same quarter last year.
These changes in numbers are attributed to a combination of things, such as a volatile economy, and changes in upgrade policies by major carriers. Android sales in Q2 2011 were 15.3 million, taking up 60.6-percent of the market. This year, with the launch of flagship models such as Samsung's Galaxy S III, Android-based phones managed just 13.4 million sales, with 56.3-percent of the market, representing a drop of almost two million handsets over the period.
iOS was the only platform to not lose its footing, where it rose by nearly two million units, the same number Android lost, to reach 7.9 million units sold. It also increased Apple's marketshare from 23.2- to 33.2-percent, even with rumors of a new iPhone coming in the next few months. BlackBerry OS lost a million sales or so, and shrank to 1.6 million, or just 6.5-percent of the current market. This is believed to be the lowest market share RIM has ever had in recent history.
Ever since the whole SOPA debacle, GoDaddy have been having a hard time. This hard time has turned into the company's CEO, Warren Adelman stepping down after just eight months on the GoDaddy throne. Adelman had replaced former CEO, Bob Parsons, and will be succeeded by major GoDaddy investor, Scott Wagner of KKR Capstone. Adelman said in a release:
I am proud to have been part of a team that has built a terrific business. I've spent close to a decade with Go Daddy, and it has been an amazing and rewarding time in my life. As much as I have enjoyed my roles as CEO and formerly as President and Chief Operating Officer, I have reached a juncture in my life when I would like to spend more time with my family.
GoDaddy really fizzled out with their support for SOPA, but the company still found success by reporting they hit $1.1 billion sales, as well as hitting the 10 million user mark.