Posts Tagged ‘business’

More iPhone 5c Supply Chain Rumors

October 18, 2013  |  All Things Digital  |  No Comments

Has Apple reduced orders for its new iPhone 5c? A growing chorus of reports suggests that it has. Earlier this week, The Wall Street Journal reported that Apple has told manufacturing partners Pegatron and Hon Hai to ramp down production of the device. Reuters echoed that report later the same day, and now NPD DisplaySearch is making similar claims . In a report published Friday, the research outfit said recent channel checks suggest that Apple has dialed back iPhone 5c production by 35 percent, while increasing iPhone 5s production by 75 percent. NPD attributes the 5c production cuts to demand weakened by the device’s higher-than-expected price. “Rumors about iPhone 5c being ‘cheap’ were circulating as early as Q3 2012,” NPD analysts Tina Teng and Shawn Lee theorize. “The fact that the iPhone 5c is nearly identical to the iPhone 5 — and is not cheap — disappointed some consumers.” Perhaps. That’s certainly an easy explanation for such production cuts following a nine-million-new-iPhones-sold opening weekend . But easy explanations aren’t always accurate, and as similarly pessimistic reports about iPhone 5 demand last year proved, supply chain production volume rumors sometimes aren’t the best information on which to gauge iPhone sales. Things can go from “FLASH: Apple has cut orders for iPhone components due to weaker-than-expected demand!” to “My bad! Apple actually sold 47.8 million iPhones this quarter” pretty quickly. As Apple CEO Tim Cook said in January , “I’d recommend questioning the accuracy of any kind of rumor about build plans. I’d also stress that even if a particular data point were to be factual it would be impossible to interpret what it really means to our business. Our supply chain is very complex and we have multiple sources for our components

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Hulu Names Mike Hopkins CEO, Forssell Out

October 17, 2013  |  Media Week  |  No Comments

As reported , Hulu has struck a deal to make former Fox Networks Group president of distribution Mike Hopkins its new CEO, effective immediately. Less expectedly, interim CEO Andy Forssell will leave the business he's run for the past six months after serving as the company's head of content. Forssell has overseen quite a few changes at Hulu recently, including the introduction of a broad slate of originals and co-productions unveiled at its upfront earlier this year. Hulu is the most traditional and TV-like of the new wave of digital networks that includes Netflix, over-the-top service (and perpetual litigant) Aereo, and, increasingly, portals like AOL, Yahoo and YouTube. This year's NewFront ad buyer presentation was easily the slickest of a disparate (and disorganized) lot, but speculation about instability among stakeholders has made many in the market wary. If nothing else, the choice of Hopkins to lead the company suggests that Disney and 21st Century might not, in fact, starve trying to order a pizza together (NBCU is barred from making management decisions as a condition of its merger with Comcast)—the appointment from within of a new CEO bodes well for the decision-making abilities of the joint venture's partners. “After an extensive search, Mike was simply the best candidate for the job," said Anne Sweeney, co-chairman, Disney media networks and president, Disney/ABC television group. "He has a strong understanding of programming, digital distribution and consumer behavior, and a great vision for Hulu’s next chapter." What that vision will consist of remains to be seen—the company's The Awesomes premiered recently with a sponsorship (Jack Link's) behind it, and it's set to roll out more originals in the coming months. But the departure of Forssell isn't exactly a ringing endorsement of the original content strategy. “On behalf of the Hulu board I want to thank Andy Forssell for his leadership during this past year, and for the vital role he played in building Hulu into the amazing product it is today," said Fox Networks Group chairman and CEO Peter Rice. "We wish him the best on his next venture." Whatever Hopkins has planned, he'll certainly have the cash to do it: "With the foundation you have built, the significant capital infusion of three quarters of a billion dollars, and our partners aligned and fully supportive of what we need to get it done, the sky is the limit for Hulu," he said in a note to staff made public by the streaming service today.

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Actually, the Pool Is Quite Deep

October 9, 2013  |  All Things Digital  |  No Comments

“Dick Costolo, Twitter’s chief executive, has prioritized finding a woman to be on the board, but has found it difficult.” “The issue isn’t the intention, the issue is just the paucity of candidates.” “… the pool for board-qualified women in technology is shallow …” “There is definitely a supply-side problem.” So asserts Twitter’s Chief Technology Officer, Adam Messinger when asked about women on boards … – New York Times, October 5, 2013 Wow. Where to begin? Let’s start with a fact: There are fewer women then men who write and debug software code for a living. No denying that. Now an observation: Having been in many, many board meetings over the years as a director, and other times as an adviser, I have never, not even once, been in a meeting where at any time, even for five minutes, any board member of any gender was asked to give a company directive in machine language, scratch out a decision policy in Ruby on Rails or, for that matter, code anything at all in any language. Image copyright hxdbzxy Most of the meetings I have attended have called on board members to ask questions, make introductions, discuss potential acquisitions or acquisition inquiries and, most importantly, to debate and discuss product strategies, marketing plans, management challenges, compensation structures, financial progress, financing options, investment decisions, how to deal with Wall Street and short- and long-term business goals. None of these topics requires a CS degree or years in the CTO’s office. Tech companies may well choose to have some engineering prowess on the board, but companies with nothing but technical directors will, in all likelihood, lose out to companies strategically advised by those with a diverse set of opinions, perspectives and experiences. The problem isn’t a “shallow pool” of qualified candidates; it’s a dearth of high-profile individuals with the right skill set. The real question is how many companies are building boards to provide actual advice versus how many are looking to put impressive, “A-list” names on a list. Sure, it would help any organization to have Marissa or Sheryl on the board, but as genuinely gifted as those two leaders are, they are not the only females in the Valley with demonstrable talent for thinking strategically, solving problems creatively, analyzing financial performance, negotiating terms and perhaps most importantly, assessing management skills

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Oscar Insurance Founders Bring a Techie Take to Obamacare (Interview)

October 7, 2013  |  All Things Digital  |  No Comments

Image copyright Michael Seto/Business Insider Oscar co-founders Josh Kushner and Mario Schlosser The technology industry likes to think of itself as working on legitimately hard problems with the potential for massive positive impact on the world. Sometimes that’s true, other times… it’s hard to make the case. But in cases where startups bring tech smarts and design into large, hidebound industries, the good fight may actually be getting fought. The latest such effort is Oscar , a new healthcare startup. It offers its own health insurance. Oscar is the only new commercial health insurance provider in New York State in the last 15 years. The Oscar service includes three free physician visits, unlimited calls to a doctor at any time of day or night, and unlimited generic drugs. It is priced near the bottom of the market — currently the third cheapest of 17 options on the new Obamacare health insurance exchange in New York. To be clear, Oscar has not even begun to offer its service yet (January 1 is the kickoff). It’s getting a steady stream of press due in part to a famous co-founder, but that means little for its long-term prospects. Add the uncharted territory of health insurance to the gazillions of reasons that technology startups could fail. And the Affordable Care Act is not exact a beacon of stability. But here’s the Oscar pitch, honed over the last two years, which has raised $40 million from investors including General Catalyst, Khosla Ventures and Founders Fund, and is exceedingly well-timed to the launch of Obamacare, straight from the mouths of co-founders Josh Kushner and Mario Schlosser via a recent phone interview. Health insurance in the United States is traditionally sold to employers. That misaligns incentives around care for actual people, and creates data gaps between something happening, the availability of a provider, and the billing process. By bridging the healthcare process together, Oscar thinks it can be more effective and cheaper. And, not a pain in the ass for all involved. “We actually can make an impact because we control the relationship,” said Kushner, a real estate scion who invested in Instagram via his VC firm Thrive Capital and already has his own Wikipedia page .

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Column: Web Video is Way Too Confusing for Brands

October 7, 2013  |  Media Week  |  No Comments

"Please don't suck" is my mantra as I wheel my hand luggage into a town essentially owned by the large TV advertiser I am set to meet. I am here to discuss their strategy for the transition of TV advertising into Internet connected devices. As I wipe the red arc of Bloody Mary away from my top lip, I know for sure that this particular large TV advertiser, once their defenses are eased, will admit to being completely and utterly confused about to how to buy and track online video in a manner that makes sense for their business needs. Damn, and you were thinking the transition to online video is already underway and most advertisers just need a gentle nudge to fulfill the media prophecy.

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Nathan Myhrvold’s Intellectual Ventures Said to Be Hunting for New Capital

October 5, 2013  |  All Things Digital  |  No Comments

Intellectual Ventures founder Nathan Myhrvold It appears that Intellectual Ventures, the controversial company founded on the idea that it could create a capital marketplace in patents, is having trouble raising money for a new fund. According to a Reuters report Thursday which cites sources familiar with the matter, I.V. has slowed down its purchasing of patents and is on the hunt for new sources of funding. Having raised about $6 billion since its founding in 2000, it has gathered up a portfolio of some 70,000 patents. The story said the firm is on the hunt for another $3 billion. One problem: Early investors, including Microsoft and Google, are taking a pass. Google in particular has been on the business end of I.V.-spawned lawsuits against its Motorola Mobility unit. Most of those cases began before Google owned Motorola, but I.V. sued again in June. As it happens, I.V. had a busy summer. It raised its profile in Washington, D.C., boosting its spending on lobbyists against the backdrop of an increase in White House interest in crafting policies meant to regulate patent-trading firms. And last month it struck a licensing deal with Nest , the smart thermostat company. Founder Nathan Myhrvold, a former Microsoft CTO, likes to describe his business model as “invention capital.” Others, namely Google, have labeled I.V. a “patent troll.” And as Myhrvold readily acknowledged in an unapologetic interview with Walt Mossberg at the tenth D: All Things Digital conference in 2012, he’s never going to be the popular kid in the class. Here’s the video of that interview, which in light of I.V.’s reported troubles, bears watching again. [ See post to watch video ]

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Despite Hedging, LivingSocial Is in Discussions to Sell Korean Deals Site Ticket Monster

October 4, 2013  |  All Things Digital  |  No Comments

LivingSocial is engaged in serious talks to sell its Korean deals business Ticket Monster, which it bought in 2011 , according to sources familiar with the discussions. At this point, sources said, it appears more that it’s a matter of when the deal gets done, not if. Sources noted that the troubled daily deals site has been engaged in discussions with a number of possible buyers over the past months, but declined to name them. In a carefully worded statement, LivingSocial CFO John Bax said this week that a deal had not been reached, but little else. Bax said that “there is no transaction pending or anything like that. A lot of people are interested in it, because it’s a great business,” in an interview with the Washington Business Journal . Added Bax: “There has been no transaction.” Clever! Briefed on the details of this post, a LivingSocial spokeswoman said in an email, “the information in the WBJ story is correct and we have no further comment.” ( PandoDaily also reported recently that a deal was in the works, citing a report in a Korean newspaper.) Ticket Monster, or TMon as it is better known in Korea, is perhaps LivingSocial’s easiest and most obvious asset to unload. It sells services and products at a discount, much like LivingSocial and Groupon — the two businesses it looked to for inspiration when it launched in 2010. But unlike its two American counterparts, its ratio of products to services skews much more toward products. When LivingSocial acquired Ticket Monster in 2011 for what was likely at least $100 million in cash and stock, the deal seemed to make some sense; LivingSocial was expanding internationally at a furious pace, and Ticket Monster was expected to be the crown jewel of LivingSocial’s international strategy and the beachhead into the rest of Asia. But as the daily-deal fad started to lose momentum, LivingSocial began abandoning its international expansion in favor of trying to steady its core U.S. business, and the acquisition began to make a lot less sense. This year, Ticket Monster is on track to generate $1 billion in gross billings, Bax told AllThingsD in a recent interview. But TMon’s cut of that is in the low teens percent, at best, according to a person familiar with the business, meaning revenue this year will be at best slightly more than $100 million. TMon did record positive EBITDA in the first half of this year, Bax also said in the previous interview. But neither LivingSocial nor Ticket Monster are throwing off the profits necessary to help each other, and since the companies are run as separate entities, there’s probably no longer any strategic reason for the marriage. In addition, LivingSocial could certainly use the money from a sale as it looks to stabilize its business and carve out a new identity and differentiated path for itself. The company’s revenue grew just six percent in the first half of this year to $264 million, while it recorded a net loss of $81 million. Along the way, it got hit with a hack of customer information and later shut down its local-events business ( in quite the sloppy manner ).

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One Thing Twitter Won’t Have When It Goes Public: Two Classes of Shares

October 3, 2013  |  All Things Digital  |  No Comments

Stock image copyright Norman Chan It’s standard practice for many media companies, and many tech companies, to issue two kinds of shares: The kind that people like you and I can buy, and the kind that the people who run the company control. That dual class structure effectively means that a small number of people can control a public company, even if they don’t own a majority of the company’s shares. You can argue the pros and cons of that structure , but it’s quite common. And it’s why people ranging from the Sulzberger family (New York Times) to Mark Zuckerberg (Facebook) to Sergey Brin and Larry Page (Google) get to run what are in many ways private companies, even though their shares trade publicly: There’s almost no chance an outsider can buy up shares and push them around. But Twitter, which is both a media and a tech company, isn’t following in their footsteps. The company’s S-1 notes that it has only one class of shares. So Dick Costolo and Evan Williams aren’t given any special powers — their shares entitle them to the same voting power that your shares give you. The messaging here is clear: “At Twitter,” the company’s filing would like to say but can’t because it can’t actually speak, “we are way more responsive to shareholder interests than many of our peers.” There’s a caveat, of course: Twitter’s board retains the right to issue preferred stock, which could indeed come with special voting rights and other powers. It’s the kind of thing you might see employed if a corporate raider like Carl Icahn ever showed up at the door with big ideas. But those shares don’t exist yet, and Twitter said it doesn’t have any plans to issue them. So for now, the company is an interesting anomaly. RELATED POSTS: File Under #Finally: Twitter Unveils IPO, Showing Growing Revenue But No Profits At 215 Million Monthly Active Users, Twitter Has a Growth Problem How Twitter’s Ad Business Went Zero to $500 Million In Less Than Four Years Dick Costolo Makes $14,000 a Year in Take-Home Pay One Thing Twitter Won’t Have When It Goes Public: Two Classes of Shares

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How $10 Million Can Lose You $250 Million

October 3, 2013  |  All Things Digital  |  No Comments

Image copyright Ilin Sergey Every company is seeing a rise in mobile traffic, but often can’t figure out why direct revenue from mobile isn’t increasing at a rate proportional to traffic. While mobile still represents a seemingly small percentage of overall revenue — generally between two percent and 10 percent depending on the business — the growth rate is impossible to deny. A recent study by IBM found that mobile commerce grew by 31 percent in Q1 of 2013, outpacing all e-commerce at 20 percent and in-store at 3.7 percent. Any statistician will tell you that percentages are only as good as their perspective size, coercing many marketing strategies to focus on other “channels.” However — to be blunt — mobile is not a channel. It begins, reinforces and sometimes completes all channels. By not understanding the influence that mobile devices exert in all revenue centers, any company is susceptible to losing revenue at 25 times that of direct mobile revenue. Applying research from a March 2013 Deloitte study , mobile can influence traditional in-store purchases by an astounding 17x. In addition, BloomReach’s internal data anonymously connecting mobile and Web usage on the same merchant shows that mobile can influence a desktop e-commerce channel by up to 7x. So, hypothetically, a company that loses $10 million in yearly mobile revenue that provides poor mobile experiences stands to lose $70 million from desktop revenue and an additional $170 million from in-store purchases — totaling a whopping $250 million. Think it’s not possible

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The Value of a Board at the Seed Stage

September 27, 2013  |  All Things Digital  |  No Comments

Image copyright http://www.shutterstock.com/gallery-923639p1.html For most startup founders, the idea of creating a board of directors early in the company’s life is as welcome as spending a week at Burning Man without water or sunscreen. Thinking about boards makes entrepreneurs imagine instituting process-laden corporate governance, spending hours drafting lengthy board presentations and potentially losing control of their startups — how un-Zuck! In reality, every startup is legally required to have a board (assuming it’s a C-Corp or S-Corp). But there is ongoing debate about whether that board should include anyone other than the founder(s). An outside Director, specifically one representing investors, is tremendously valuable for seed stage companies. Here’s why: Establishing a Cadence Much like sprints in agile software development , setting up a regularly occurring board meeting at the seed stage establishes a cadence for the work of building the company. A scheduled board meeting can also help address another common problem experienced by startups — figuring out how and when to properly leverage your investors and advisers. Board meetings become checkpoints for founders to ask for assistance from an investor and to seek feedback on developments at the company. It doesn’t matter whether the board meetings happen monthly, every six weeks or quarterly. What’s important is that a cadence gets set and that the meetings are used in ways that are productive for the team. Stepping Back and Getting Perspective When your hair’s on fire each and every day as an entrepreneur, it’s easy to spend all of your time firefighting

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