"Three months ago, Amazon was expected to lose 7 cents a share in the third quarter. After the retailer warned that it was investing so heavily in so many things, analysts pushed their loss projections up aggressively to 74 cents a share.Losses Jump at Amazon, as Investments Pile Up - NYTimes.com
Even that was not enough. After the market closed Thursday, Amazon reported that it lost 95 cents a share. There was other disappointing news, too: Revenue came in $260 million less than analysts’ projections, and the company said it might lose money again in the fourth quarter, which in the old days was when retailers made all their profit for the year."
Friday, October 24, 2014
Also see Amazon Takes $170 Million Writedown on Weak Fire Phone Sales (Re/code)
Breaking up is hard to do; simpler to periodically dump lackluster businesses and move on
"Hardware is primarily comprised of the 50-year-old mainframe business and the high-end Unix server business. IBM has long dominated the mainframe business, but that’s like saying it’s a big fish in a lake that’s steadily drying up. And the Unix server business — where IBM competes with Oracle and HP — is on a long, slow death march to zero.Should IBM Break Up? | Re/code
The more likely long-term scenario is a familiar pattern of shedding assets. So far this year it has rid itself of two businesses accounting for $7 billion in revenue: The commodity server business went to Lenovo in January, and this week it announced that it is paying GlobalFoundries $1.5 billion to take its chip-manufacturing operation off its hands. Last year, IBM sold it off its $1.2 billion customer service business to Synnex. Other notable divestitures include the sale of the PC business to Lenovo in 2004."
Also see Microsoft Earnings Top Estimates Despite Dent From Nokia Integration, Layoff Costs (Re/code)
"Sales in the PC business are still in the dumps. Traditional software sales are losing steam to cloud services. And many venerable technology companies are struggling to leap from the old way of doing things to the new.Microsoft’s Sales Increase, Helped by Its Acquisition of Nokia, and Investors Notice - NYTimes.com
Microsoft? Steady as she goes.
While the company still has much to prove in markets like mobile phones, Microsoft on Thursday offered tantalizing signs of progress in the transformation of its business. In the last quarter, the company had a 25 percent increase in sales, largely because of its acquisition of Nokia’s mobile phone business."
See this Rooms blog post and Facebook’s Rooms App Is a Flashback to Internet Bulletin Boards (NYT) for more details
"The app is like an infinitely large house where users can create rooms for specific purposes, like discussing current events, planning exotic vacations or breeding yorkipoos. The posts, which can include photos or videos, appear in chronological order.With New App, Facebook Harkens Back to Internet 1.0 - Digits - WSJ
Like Internet message boards, all posts in Rooms are public. But the creator of a room may limit who can contribute posts. Contributors can use pseudonyms.
Rooms is the latest entry in Facebook’s strategy of building standalone apps independent of the social network itself. This year, it launched the news aggregator Paper, a photo-sharing product called Slingshot and a video-capture app called Hyperlapse."
Convenient common sense (and excellent Uber PR/goodwill generation), one day only
"The limited, one-time promotion dubbed UberHEALTH offered free delivery of a flu vaccination service in Boston, New York City, and Washington, D.C. It was the latest in a series of experiments by Uber to extend the company’s logistical technology beyond basic transportation.Uber offers flu shots on wheels - Business - The Boston Globe
The idea came from Harvard Medical School epidemiologist John Brownstein, who was looking for creative ways to increase relatively low flu vaccination rates in the United States."
Excerpt from an IT big-picture reality check
"More fundamentally, however, the IT industry is rapidly maturing, with overall annual revenue growth reaching only 3%, says Sebastian DiGrande of Boston Consulting Group. Although some parts, such as cloud computing and all things mobile, are expanding rapidly, the biggest sectors, including most hardware, business software and IT services, are growing slowly or even shrinking And these are dominated by big technology firms such as HP and IBM."Information technology: A fork in the digital road | The Economist
Thursday, October 23, 2014
tbd if it will be nonfiction or more like The Social Network
"Christian Bale/Steve Jobs fans around the world can now rejoice as the Hollywood A-lister has been confirmed to be taking on the role of the iconic leader in a forthcoming biopic based on Walter Isaacson’s biography.Christian Bale Will Play Steve Jobs in Upcoming Biopic
The casting decision was confirmed in a Bloomberg interview today with director Aaron Sorkin, who revealed that Bale didn’t even need to audition for the role."
Now you can use IBM's software on Microsoft's cloud to develop apps for your Apple devices...
"IBM and Microsoft announced today that they are working together to provide their respective enterprise software on Microsoft Azure and IBM Cloud. As adoption of hybrid cloud computing accelerates, this relationship will give clients, partners and developers more choice in the cloud, helping them drive new business opportunities, spur innovation and reduce costs."IBM and Microsoft to offer greater choice in the hybrid cloud | News Center
See Introducing Fabric (Twitter Developer Blog) for more details
"Twitter is releasing a new software development kit today at its developer’s conference. It’s called Fabric. It does lots of very pretty things, and the people who write mobile apps are going to eat it up. Which, OK, that’s nice. But the bigger story is what Fabric represents. Because it isn’t just a tool for developers any more than Greek horses were meant to beautify Troy. Fabric is the foundation for Twitter to transform a business based purely on a single product—tweets!—into a diversified service aimed at every person and company that makes mobile apps. That, in turn, would affect every person who uses mobile apps. In other words, everyone."Twitter's Audacious Plan to Infiltrate All Your Apps | WIRED
A busy week for U.S. tech company CEOs in China
"He said that while he knows more words in Mandarin, his wife also speaks Cantonese and has much better listening comprehension than he does. “One time I asked her, why is my listening comprehension so bad?” Mr. Zuckerberg said. “She said, ‘Your listening comprehension in English is also bad.’”Zuckerberg, Speaking Chinese, Shows Up at Beijing Forum - NYTimes.com
Mr. Zuckerberg’s new association with Tsinghua University shows how Facebook is playing the long game in China. The hope appears to be that engagement with China, along with Facebook’s current operations selling advertisements to Chinese companies, will help the company some day open a form of its website in China."
A more social stream-centric approach to email; see An inbox that works for you (Google Blog) for more details
"“In 2004, when Gmail was launched we were still 3 years away from the first iPhone.” While the world has moved from clam-shells to touchscreens, email hasn’t evolved in step. Inbox is Google’s attempt to bring email up to speed. “We thought, ‘What if we started completely fresh, what if we built a whole new product that was an inbox that really, truly tried to do the work for you?’—an inbox that tried to help you get back to what mattered to you,” Gawley said of Inbox’s inspiration.Gmail’s New Inbox App Puts the Important Stuff on Top - Personal Tech News - WSJ
And indeed, Inbox does look different than other email apps. It looks more like a social networking feed than a traditional inbox. And that’s the point, said Jason Cornwell, the lead designer on both Gmail and Inbox. “It looks really different than Gmail, but that’s because we’re trying to solve a different problem,” Cornwell said. “We’re trying to be the best place to get back to the things that matter to you.”"
Fire Phone fiasco forgiven
"Analysts are generally enthusiastic. Cowen and Company said this week that it expected Amazon to lose “only” 57 cents a share. Colin Gillis of BGC Partners, usually somewhat skeptical of Amazon, issued an upbeat note that focused on the potential of the company to use its various hardware for an advertising network.Amazon Spends and Grows, but Still Wants for Money - NYTimes.com
“We are actually mildly positive on the potential of the current investment cycle as Amazon builds an ecosystem with its Kindle readers (success), tablets (mild success), App store (mild success), Fire TV (limited traction but a good product) and phone (failure, priced too high and limited distribution),” Mr. Gillis wrote. He noted that the retailer knows where its tens of millions of customers live, what they like and how they consume."
Seems somehow fitting
"The rare working version of Apple's first pre-assembled computer was sold through Bonhams auction house, which anticipated the sale to garner between $300,000 and $500,000, reports Reuters.Rare working Apple I goes for record-smashing $905,000 at auction
Unlike other recent Apple 1 auctions, the winning bid came from a foundation, not a well-heeled individual buyer. The Henry Ford organization purchased the computer and plans to show it off at its museum in Dearborn, Mich. "
Wednesday, October 22, 2014
Interesting times; also see Apple Says iCloud Servers Have Not Been Compromised Following Reports Of Hacks In China (Business Insider)
"The group, Greatfire.org, has alleged Chinese government involvement in the hack, a claim the government has strongly refuted. Apple has not issued any public statements on the matter.Apple CEO discusses security with top Chinese official amid hacking claims: Xinhua | Reuters
At a meeting on Wednesday in Zhongnanhai, the Beijing complex housing China's central government, Cook and Vice Premier Ma Kai exchanged views on "protection of users' information" as well as "strengthening cooperation and in information and communication fields," according to Xinhua.
Greatfire told Reuters that Apple appeared to have rerouted user data on Tuesday to circumvent the hack."
Another vote for Apple Pay (and similar payment systems)
"In the latest hacking of American retailers and restaurants, Staples said on Tuesday that its computer systems were compromised in an intrusion involving customers’ credit- and debit-card information.Staples Is Latest Retailer Hit by Hackers - NYTimes.com
Staples, the office supplier based in Framingham, Mass., said it was working with law enforcement agencies to determine the extent of the problem. The company did not say when the attack occurred or in which stores, or how many payment cards might have been affected."
Not a bad ROI for a $666.66 investment
"The duo presented what would become the Apple 1 at the Homebrew Computer Club and won their first order from Paul Terrell, owner of the Byte Shop, of 50 fully assembled units for $500 apiece. One of those motherboards is going to auction on Wednesday as part of Bonhams’s “History of Science” auction, and it is expected to fetch from $300,000 to $400,000."A 1976 Apple 1 Is Expected to Sell for Up to $500,000 at Auction - Businessweek
I'm hoping the next MacBook Pro will be introduced in Q1, along with a new (and < $2,500) 5K Thunderbolt Display
"You may ask, why not just plug a laptop into a giant 5K monitor? So far, at least, there’s no way to do that. Dell announced its UltraSharp 27 Ultra HD 5K in September, but standard laptops today can’t drive it. Besides, when it ships in December, it will cost $2,500. Apple’s 5K display is available today, and for the same price includes the best personal computer Apple has ever made. Apple’s 15- and 13-inch MacBook Pro laptops also have Retina screens with a similar density of pixels, but the iMac’s screen is much, much larger."Retina iMac Review: The Screen That Makes Desktops Relevant Again - WSJ - WSJ
Lead paragraphs from a pragmatic iPad reality check; also see iPad Air 2 Review: The Best Tablet Needs to Work Harder (WSJ) and Apple iPad Air 2 Review: It’s Better, but Is It Better Enough? (Re/code)
"Let’s get this out of the way first: Apple’s new iPads are the best tablets on the market today. The iPad Air 2, the company’s new top-of-the-line device, is substantially faster than its predecessor, which was already more powerful than just about every rival. It sports a terrific minimalist design, almost a millimeter and a half thinner than last year’s pretty skinny iPad Air. And both the new Air and the iPad Mini 3, Apple’s latest small tablet, include TouchID and Apple Pay, Apple’s fingerprint scanner and payment system, which are handy innovations that make signing into apps and shopping for goods online much easier than in the past.IPad Air 2 and Mini 3 Review: One Thumb Up, and Another Down - NYTimes.com
So these are fantastic tablets. The question is: Do you need a fantastic tablet?"
Tuesday, October 21, 2014
tbd if Amazon or Google will offer a similar on-prem/private cloud option; HP is already partially there for hybrid AWS scenarios, with its Eucalyptus acquisition. For more details, see Unveiling The Microsoft Cloud Platform System, powered by Dell (Windows Server Blog). In other Azure news, see Cloudera Selects Microsoft Azure as a Preferred Cloud Platform (Cloudera blog).
"With Dell as its hardware partner, Microsoft will offer customers pre-assembled racks of servers running Windows Server 2012 R2, System Center 2012 R2 and Windows Azure Pack. Azure Pack, originally known as "Windows Azure Services for Windows Server," provides users with the on-premises equivalents of a number of Azure technologies, including a self-service portal for managing services like Web sites, virtual machines and Service Bus; a portal for administrators to manage "resource clouds"; scalable Web hosting and more.Microsoft launches Azure cloud in a box | ZDNet
The Microsoft Cloud Platform System will be available starting next month, said Microsoft executives."
A busy "retirement"
"Professor Ballmer shows up on Tuesday and Thursday mornings to teach 80 or so MBA hopefuls. His class, Leading Organizations, runs two hours to covers topics ranging from accountability to time allocation. I popped in recently for a class dubbed “storytelling,” which mostly hit on the thinking that went into marketing products at Microsoft—and whether or not the various approaches worked. Ballmer teaches the class with Susan Athey, a well-regarded economics professor, and they were joined on this day by Mark Penn, the pollster and political strategist who has done work for the Clintons, Tony Blair, and Microsoft."Steve Ballmer at Stanford: A Conversation With a New MBA Professor - Businessweek
A stark contrast to Apple's latest financial news, yesterday's dismal IBM news marks the abrupt end of the company's Palmisano-era strategy
"But all along, IBM has been buying up its own shares as if they were a hot item. Since 2000, IBM spent some $108 billion on its own shares, according to its most recent annual report. It also paid out $30 billion in dividends. To help finance this share-buying spree, IBM loaded up on debt.The Truth Hidden by IBM’s Buybacks - NYTimes.com
While the company spent $138 billion on its shares and dividend payments, it spent just $59 billion on its own business through capital expenditures and $32 billion on acquisitions. (To be fair, Ms. Rometty has been following a goal set by her predecessor, Samuel J. Palmisano, to return $20 a share to stockholders by 2015. Ms. Rometty abandoned it only on Monday.)"
Also see Kindle Voyage Sets a High Bar for a High Price (Re/code); in less complimentary Amazon news, see Amazon’s Monopsony Is Not O.K. (NYT)
"Compared with previous Kindles, text on the Kindle Voyage appears both sharper and in starker relief against the background. Graphics, like charts and graphs, look just as clear as they do in any black-and-white book.Voyage, a High-End Amazon Kindle That Beats Hardcovers - NYTimes.com
The effect is beguiling. If you look at the new Kindle for any stretch of time, you don’t just forget that you’re reading an e-book; you forget that you’re using any kind of electronic device at all.
Amazon says the Voyage offers a better approximation of print than has ever been available on an e-reader, but for me, it’s far better than that. It offers the visual clarity of printed text with the flexibility of an electronic device."
Check the link below for a round-up of other stats and a Q&A recap
"CEO Tim Cook opening remarks celebrate hardware sales and revenue numbers:Apple Earnings: $42.1 Billion, Driven By Nearly 40 Million iPhones Sold
“Demand for the iPhone has been staggering”
“Strongest revenue growth rate in seven quarters . . . a new record for Apple’s September quarter”
Especially proud of Mac results, especially vs. rest of industry . . . achieved quarterly PC market share record
App store revenue grew 36 percent over last year
437 Apple retail stores around the world
Developing markets: $50 billion in revenue in fiscal 2014
Company made 20 acquisitions in fiscal 2014
2014 the company’s best year on the books"
Monday, October 20, 2014
Excerpt from another Apple Pay reality check
"Best Buy and WalMart are saying they won’t play with Apple Pay. Why?Apple Pay Is Here And It's Going To Be Great: Why The Skeptics Have It Wrong
Two reasons, neither is good. First, they are burying their heads in the sand about NFC. Every merchant in the U.S. needs to support chip-based credit cards by October 2015 or face the liability risk of fraudulent transactions on their own (today, that risk is borne by issuing banks). It’s true that retailers can accept so called EMV cards without supporting NFC, but doing so entering the holiday season is going to be a decision those retailers will live to regret. Today, the speed of credit-card checkout is something we mostly take for granted and with chip cards, that’s about to change. Support for NFC isn’t about making Apple happy, it’s going to be about making customers happy.
The second reason some retailers are being obstinate is a quixotic endeavor to do mobile payments called MCX, for Merchant Customer Exchange. Gap, CVS, Exxon Mobil and a whole host of companies have agreed to collaborate on a payments solution whose advantage to consumers centers mostly on integrated loyalty-program features."
A market mainstreaming milestone for cloud platforms
"German business software maker SAP on Monday cut its outlook for full-year operating profit amid an accelerating shift by customers to buy its software over the Internet rather than as packaged software, delaying recognition of those sales.SAP Cuts Profit Outlook as More Customers Switch to Cloud | Re/code
SAP said it now 2014 expects operating profit, excluding some special items, of 5.6 billion to 5.8 billion euros ($7.14 billion to 7.40 billion), down from 5.8-6.0 billion euros previously."
Pay different -- and if merchants want consumer data, they can directly negotiate with consumers for it
"The world’s largest retailer,Wal-Mart Stores (WMT), is rejecting Apple Pay altogether. It has said it has no plans to accept Apple’s payments, and is working on its own system developed by Merchant Customer Exchange, or MCX, in conjunction with a handful of other big merchants. MCX and Wal-Mart declined to discuss their reasons for not working with Apple Pay. Analysts say the primary reason for the parallel effort is to make sure that merchants retain control of the relationship with their customers."Apple Pay Is Too Anonymous for Panera, Starbucks, and Other Retailers - Businessweek
An unusual use of the term "sell"
"It’s true: IBM will pay GlobalFoundries $1.5 billion over three years to take over its commercial semiconductor manufacturing business and IBM will take a $4.7 billion cash charge for its third quarter as a result.It’s official: IBM to sell chip-making biz to GlobalFoundries — Tech News and Analysis
Under terms of the deal, first reported by Bloomberg News, GlobalFoundries will be IBM’s exclusive provider of server processors in the 22-nm and 10-nm semiconductors for 10 years. And the $1.5 billion cash consideration will be adjusted by an estimated $200 million depending on the amount of working capital involved, per an IBM statement."
Truthiness and consequences
"As Danny Sullivan explained on his site Marketing Land, “The challenge Google faces is that it really doesn’t ‘know’ anything — it only gets answers from others, and those answers, not vetted by human beings for accuracy, can be wrong.”Stephen Colbert Has a Mock Feud With Google Over Search Results - NYTimes.com
Even after a little sleuthing, Mr. Sullivan could not determine where Google got its 5-foot-10 answer for Mr. Colbert’s height. He noted that Bing, Microsoft’s search engine, also listed Mr. Colbert as 5-10 but credited the entertainment site IMDb. Over the weekend, that changed on Bing and IMDb, and Mr. Colbert is listed at 5-11.
And Siri, the iPhone service that answers questions, still lists Mr. Colbert at 5-10."