Comcast Could Suffer from Universal Access

Over the last couple of years, Comcast as gradually taken control of NBC Universal.  The process has come with relatively little economic problems for Comcast.  Unfortunately, conditions regarding Comcast's functional acquisition of NBC  Universal have still not been determined which makes future costs unsure.  This is especially vital in the area of online videos.

Various public-interest groups and satellite-TV firms have requested the Federal Communications Commission to guarantee that the merged Comcast-NBC Universal not be allowed to withhold its content from rivals online.  Withholding media content from rivals would allow Comcast to virtually control a large share of the online television market while forcing competitors to air less popular and less viewed shows on their website.  A regulation against Comcast could be problematic for Comcast.  Investor confidence could potentially tank as rivals such as Netflix and Sezmi could capitalize on online video services.  Sezmi is uniquely important because it is a venture-capital-backed broadband video service that has the ability to directly compete with cable.  Allowing these companies access to Comcast's online media would undermine Comcast's ability to effectively protect its core-cable-TV business. 

The outcome of this decision from the FCC could have some drastic effects on these industries.  If Comcast is required to allow other companies to use their media, this could undermine their investor confidence and could stifle their growth as a company.  Additionally, other companies would become larger competitors and in a worst-case scenario, undermine Comcast's hold on online-media.

Cite:

http://online.wsj.com/article/SB10001424052748704116004575522141414844222.html?mod=WSJ_Tech_LEFTTopNews

Apple TV Splits Networks

Apple TV is finally arriving to the homes of the first consumers across the nation. Apple just this month announced the service when it revealed a make-over of its new Apple TV device, which delivers programming over the Web. Walt Disney Co.'s ABC network and News Corp.'s Fox broadcasting have agreed to make their shows available for Apple TV. But other national broadcast networks owned by NBC and CBS as well as major cable networks have refrained from offering their services to Apple.

Tech news sites and bloggers across the nation have been all over the Apple TV recently and one of the main topics of discussion was on the pricing of 99 cents for a TV rental show. Apple's price of 99 cents is the same price it charged as it became the dominant music retailer through its iTunes store. But this price is one of the main reasons major broadcast networks are still abstaining from joining this Apple TV movement.

This is not to say that they soon won’t become a part, knowing Apple and their dominance in the music industry there’s no saying that they can’t do the same for TV. Chief Executive Philippe Dauman even said "We value our content a lot, we don't think Apple has it quite right yet." Media companies across the nation are more than eager to increase revenue so taking on Apple TV might be a must knowing how much consumers love Apple products.

Sources:

http://online.wsj.com/article/SB10001424052748703384204575510153153348466.html?mod=WSJ_Tech_LEFTTopNews#articleTabs%3Darticle

http://www.i4u.com/40104/apple-tv-review-round

http://store.apple.com/us/browse/home/shop_ipod/family/apple_tv

Dell to Launch 7-Inch Tablet in Weeks Ahead

Recently, Apple Incorporation launched a very successful innovation—the IPad. Considering it is to be said tablet computers will overtake the technological market Dell Incorporation has come with an innovation. They are planning on launching a seven-inch tablet in a very near future as well as offering it in ten-inch size among the next months. Additionally Dell mentioned they will be bringing new products (“a whole slew of new products”) into the market in the next months.

The seven-inch tablet will operate Google Incorporation’s, Android smartphone’s system as well as Microsoft Corporation’s Windows system. Dell also plans to expand its service towards other countries such as China, considering other big companies have already started expanding as well, in this case selling their five-inch tablet in Australia. Dell’s expectations all point in a good direction, expecting its annual revenue to exceed US $60 billion this year. They also mention their service in China will overtake the Us as the company’s biggest market by 2012, expecting to grow from 18%-20% in its market share.

Dell is certainly “winning the market combat” since innovative products will definitely be a must have or a desire in the public. Concentrating in a country as China is a very smart decision since its revenue is now growing. Launching innovations in such a small time, six months, will definitely make the incorporation grow. Then, should other corporations fear the strength Dell Incoporation is now having the telecommunications market? They have to definitely put an eye on this corporation and start making competition just as Dell started by coming up with a tablet, now commonly offered by various companies.

Source:

http://online.wsj.com/article/SB10001424052748703882404575520940696477422.html?mod=WSJ_Tech_LEFTTopNews#articleTabs%3Darticle

Could Twitter Be More Than Just A Blog? (WSJ 9/27)

After watching your favorite series aren't you bombarded with "follow us on twitter" logos? Marketers believe that Twitter can transform from a blogging service to a profiting enterprise. We have all noticed the popularity of Twitter and marketers now believe that advertisement could be included on Twitter (sounds a bit like Facebook no?) to create a form of revenue. In April, Twitter signed with 30 brands, including Coca-Cola Co., Virgin America and Starbucks Corp. as an experiment. Unfortunately, Twitter Inc did not produced any new ad buys. In order to boost its advertising, Twitter Inc. hired executive from Goole Inc and Facebook Inc. I don't twitter, but I wonder if those who do will really appreciate the ads on the sidebar? There are more than 160 million registered users around the world. Would this increase with the numerous ads on hte site or will this start a decreasing trend?

Cite Source:

http://online.wsj.com/article/SB10001424052748703793804575512711786346900.html?KEYWORDS=Twitter%27s+a+fledgling

Picture Source:

http://www.google.com/imgres?imgurl=https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhOvtaH71Z0Kiqi6Ch28epK8xWrI1IkqTspQRti_Z3wA7SyPojxDvxoWQiu04ntMhtKgGHUkYInghC6tw9D_42ihFlBOIMiztYEK0ZaK4ddAwgWTPFFc5kxcd6g9e3XweGWw5L3HOfky1p1/s400/FollowMeOnTwitter.jpg&imgrefurl=http://www.iagreewithjoe.com/2008_11_01_archive.html&usg=__dUoC2r0z4vxrDTHFgQd8D5tM-8A=&h=271&w=400&sz=22&hl=en&start=36&sig2=muyvUYt47OCNIaBDcGXP_Q&zoom=1&tbnid=zXMJFhOiXJ2KWM:&tbnh=136&tbnw=200&ei=1JqiTOLPMISClAfEmdmxBA&prev=/images%3Fq%3Dfollow%2Bme%2Bon%2Btwitter%26um%3D1%26hl%3Den%26client%3Dsafari%26rls%3Den%26biw%3D1281%26bih%3D604%26tbs%3Disch:10%2C1006&um=1&itbs=1&iact=rc&dur=279&oei=yJqiTKPsKMPflgecrfGSAw&esq=5&page=3&ndsp=18&ved=1t:429,r:8,s:36&tx=98&ty=52&biw=1281&bih=604

Verizon to Change Mobile Data Plans - Toby Jacob

Verizon recently made indications that the company plans on charging wireless customers based upon their internet data usage and introduce new plans with limits.  This move follows their rival AT&T's recent decision to stop selling unlimited data plan to customers.  AT&T has moved toward selling two different service plans that include monthly caps.

This move was primarily due to the massive increase in Verizon's customer base.  The wireless industry requires billions of dollars in investment in order to sustain a network that smoothly and effectively deals with traffic.  While the details of this plan aren't clear, it may mimic the AT&T plan of $15 a month with a limit of 200 MB of data and $25 a month with a cap of 2 GB.  The plans will allow Verizon to garner increased revenue for the wireless services they provide.  Monthly fees coupled with the potential of people going over the cap will ease the strain companies have on maintaining smooth network traffic.

Increased revenue with Verizon's new data plans will allow more money to be siphoned into areas that will potentially increase innovative wireless technology while subsequently dealing with network trafficking.  Critics have claimed that there may be a risk of consumers switching networks because they may like unlimited plans over the risk of overusing their data plan.

Regardless, the move symbolizes the company's greater goal of create a fiscally secure and strong company.

http://online.wsj.com/article/SB10001424052748703384204575509640930858752.html?mod=WSJ_newsreel_technology

The Newest Telecom Killer

Recently communication via the Internet has come to be the most popular one. Even though cell phones are more efficient for instant messages programs such as Skype are probably more “competent”. They are more competent just because they allow the users to have free calls. The only issue about this is having to be in a computer in order to use it.

Google Incorporation has created a similar innovation that will enable the users to make free calls. Such as Skype, this application will permit the users to make calls, however it has an advantage, US and Canada calls will be completely free while other international calls will have a low cost. These innovations were created in the last years and certainly have been a total success.

AT&T, Verizon and other companies should not feel threatened with this kind of “competition”. Given that Skype and now the new application Google offers provide the users to call without any cost at all certain competition rises to these companies. Definitely cell phones are more used than these programs, however these companies should keep an eye in their progression in order to avoid ‘harmful’ competition.

The article states: “Google has found yet one more industry it can disrupt. Maybe it will consider making electric cars or staffing dry-cleaners next”. This means this company is becoming more powerful as technology advances, then, should the main companies in the telecommunication panic or will it be just a temporary threat?

Source:

http://247wallst.com/2010/08/25/the-newest-telecom-killer-gmail-voice-calls-goog-t-vz-ebay-vg-call/

Google Adds Calls to Gmail - Severn Henry

Google Inc., in its desire to characterize itself as the "go to" source for research, mail, media, and mapping, now has added a feature in its Gmail to call other people on your friend list. This service even comes complete with a dialing pad. Although Google did not revolutionize the idea of calling over the internet (I will get to that a little bit later), it certainly made a very convenient step for its users. I expect a significant increase in the company's stock, as this new tool will be used very commonly. Allow me to explain why I think Google's stock will increase.


As many of us know, Google will have competition with another company that has ruled the "call through the internet" industry - Skype. I have never used Skype, and cannot tell you the format of it, but this website has boomed in popularity over the past year (as an experiment, count the number of people on your floor who you see Skyping one of their friends and write that number a comment - I am just interested to know). Google will, at first, have a tough time trying to pull subscribers away from Skype into the Gmail calling system. I do not know Skype's calling format, but I cannot imagine a much easier format than Google's. As you can see in the photo that I have provided, you can immediately bring up the keypad to call, or even type a contact's name in the search bar. This way, if a customer wishes to ask for details or clarification about an e-mail that they are reading (ex: student to teacher, employee to boss, CEO to CFO and vice-versa), he or she can now find instant clarification. The user will not have to go to another website or pull out his or her phone to communicate and he or she can take notes about the conversation concerning an e-mail with the extra hand that before was used for the phone.

Borders and e-Books Building A Loving Relationship

We have all heard or purchased an e-book. For those who haven't, its a small electronic book where you can download/purchase a book and read it on a screen! Sony initially created the e-Book, launching a new product in our savvy tech society. Amazon, Barnes & Noble, and other national bookstore hopped on the occasion.

Yet, Borders decided to twist things up and expand their market by partnering up with Kobo a Canadian e-bookstore; that contains 1.5 million book titles. Furthermore it established a partnership with Sony for their Reader Pocket Edition and Sony Reader Touch Edition. Through this partnership, by 2011 Borders claims to hold seventeen percent of the e-book market.

Despite this huge lunge forward, Borders is quite behind comparatively speaking with Amazon (Kindle), Apples (iPad), and Barnes & Nobles (Nook). Borders added a new quirk that none of the former acquire which is that "readers can move books around devices freely".

Since this is still a new product on the market, no one is a dominator in the product. With Borders entering the market, customers might shift their demand to Borders since they have the "new" e-book. Not only is this very competitive between the big industries mentioned above, but also this is causing colossal damage to small business that only sell hard or paper copy books. This generation is very focalized on having everything technical. Less and less people are buying cover bound books, making those businesses turn to bankruptcy.

Reference:

http://www.technewsworld.com/story/70367.html

Clear Wireless (CLWR) is a recently emerged wireless internet service provider founded by Craig McGraw in 2003. It serves an international market place of over 61 markets as of December 2009. Its markets include Ireland, Spain, Belgium, Mexico, and the United States. Clearwire constructs and manages mobile broadband networks that provide high-speed residential and mobile Internet access as well as residential voice services in communities. They have just fewer than 4,000 employees so it is a relatively small corporation.

But in the past 5 years is when things really got going for the company. They merged with Sprint-Nextel in 2008 and Sprint now owns 51% of the company, but other significant shareholders include Comcast and Google. Within the past year Sprint introduced the first commercially available 4G cellphone in the U.S. the HTC EVO 4G. The device uses Clearwire’s 4G network along Sprint’s 3G network and Google’s Android OS. This 4G network is being used by Sprint to compete with the likes of competitors such as the iPhone.

With such competition like this the wireless telecom landscape has changed vastly. Because the iPhone only operates on a slower 3G and AT&T as a whole is largely behind the curve towards a solid 4G network, AT&T is now caught up with Verizon to supply its customers with a 4G network. Now U.S mobile suppliers are basically forced to have to upgrade their entire networks. Sprint, the 3rd largest wireless company, now undoubtedly has the edge in the new 4G network competition thanks to its principal investments with Clearwire Corporation.

Sources:
http://online.wsj.com/quotes/key_facts.html?mod=2_0470&symbol=CLWR&news-symbol=CLWR
http://online.wsj.com/quotes/main.html?symbol=CLWR&type=usstock usfund&mod=DNH_S
http://moconews.net/article/419-atts-randall-stephenson-explains-4gs-growing-pains/

Gatorade Uses Social Media to Revive Itself - Severn Henry

PepsiCo has now reached out to the social media in order to revive one of their products that has been on the slide over the past three years – Gatorade. In making an attempt to sell more drinks, PepsiCo initiated a “Mission Control,” a collection of 4 full time workers who monitor buzz words like “Gatorade,” “G2,” or “G-Series” in Twitter updates or Facebook statuses.


This Wall Street Journal Article attributes the inception of “Mission Control” from the fact that the consumers view Gatorade in a different light – what was once marketed as the only drink that could replenish the fittest bodies of athletes now has just become an ordinary drink. However, when the less athletic begun to consume Gatorade, the exclusive list of people who drunk Gatorade became more muddled – Gatorade’s sole marketing campaign since then has diminished. Neither Michael Jordan, Mia Hamm, nor the Florida Gators appear in commercials like before.


This diligence in online supervision that concerns monitoring hype over a company is certainly a breakthrough step in the telecommunications industry, in that Gatorade is now able to monitor the consumer’s issues with the product. Most companies are beginning to further invest in telecommunications to follow the “net hype” about their own industries, but such funding includes software that tracks these hypes or hiring advertising agencies to track for a company. PepsiCo, however, has an advantage in that it is able to respond to these “net hypes” because it can respond (not a machine) and can speak to represent its own company (agencies cannot do that as far as I know).


In the long run, I do not think that “Mission Control” will not be beneficial for PepsiCo for one simple reason – something like this has never happened for any other company (as far as I know). We have to remember that the Internet is a great business tool to transform the smallest company into a large enterprise – it was not meant to rebuild a business. In our fast, technology driven society, we have learned to leave straggling businesses behind if they cannot update their products. And although Gatorade’s sales rose 2.4% in the past 6 months, most of it is attributed to the fact that the summer of 2010 was abnormally hot. In fact, I would not be surprised if Powerade (Coca-Cola Co.’s version of the sports drink), the cheaper and healthier alternative that still has the athletic image that Gatorade is losing. Powerade should invest further in social media tracking to grow and overpower Gatorade.


Article:

http://online.wsj.com/article/SB10001424052748703466704575489673244784924.html?mod=WSJ_Tech_LEFTTopNews#printMode

RIM Duels With Droid

Wireless phones have outshined in the telecommunication industry. Either for a facility of communication or a need of having a “fashion” apparatus, the public has chosen to go for the now “most desired” brands: Blackberry or IPhone. However another phone is coming to compete with these two famous brands, one powered by Google Inc.’s Android software.

In many companies people have been required to have a Blackberry, just like Union Bank in San Francisco. However this is a ridiculous demand given that other brands such as IPhone and Android may provide the employees with the same or better applications.

Considering all of these three companies are among the key players of the industry in the wireless phone area, competition among them rises each time more and more. This definitely has a positive impact in the telecommunication industry given that more products will come to the market, meaning more income towards the industry. Competition mainly achieves what’s stated before, being a wonderful advantage for any kind of market.

According to the article, “BlackBerry still dominates the business market”. However Apple Inc. and Google are seeking to overtake the top line. Android phones cost from 20% to 20% less than BlackBerrys, which probably will cause the situation to unbalance as it is. BlackBerry should keep their eye on the sales and then respond to the situation that will come. However, again this brings more competition being a positive asset towards the industry.

Source: http://online.wsj.com/article/SB10001424052748704652104575494102654241766.html?mod=WSJ_Tech_LEFTTopNews

H-P to Buy ArcSight for $1.5 Billion

Hewlett-Packard Co. agreed to buy security-software maker ArcSight Inc. for about $1.5 billion, continuing the company's spending spree that began after Chief Executive Mark Hurd resigned last month. Within the past 2 months they’ve purchased multiple companies; 3PAR, Palm, 3COM, Fortified Software, and now ArcSight.

But investors have been worried about H-P's strategy including the high costs it's paying for these acquisitions. On a conference call with investors, H-P executives declined to comment about the bidding process for ArcSight. Moreover, they wouldn’t gamble on taking questions about what would have happened if Mr. Hurd remained CEO. The company continued to disappoint investors when they said that they don’t expect to see any material earnings dilution in its next fiscal year.

All of this shows that HP is trying to expand in several ways such as offering even more products than its original PC base. They are trying to be a “One-Stop-Shop” for businesses that a buying technology. Meaning these companies that are trying to integrate new technology into their working stations don’t have to buy computers from one place, then security software from another, and so on.

Cite:http://online.wsj.com/article/SB10001424052748703466704575490370064465534.html?mod=WSJ_ComputerHardware_leftHeadlines

From WorldCom to MCI - One of the Largest Frauds in America

One of the biggest scandals to hit the telecom industry involves WorldCom, Inc. They revealed a $3.9 billion financial discrepancy leaving the entire telecommunication industry reeling. It is one of the largest scandals in the United States. WorldCom was an international carrier. It recruited more than 70 companies included major telecom and phone companies.

By 1997 WorldCom merged with Brooks Fiber making WorldCom the second largest long distance carrier within the United States. But in 2002 WorldCom filed for bankruptcy. WorldCom said they inflated profits by $3.8 billion when in fact; profits were inflated by $11 billion. Making it the largest accounting fraud in history.

The ethical issues that have arisen are that many strong companies have lots thousands and thousands of dollars, and most employees lost their jobs. All formal officials were sent to court and were charged with criminal penalties, some sentenced to prison.

However, what is interesting about this matter is that it was an internal audit that noticed the illegal behavior. They then notified the board of directors who acted swiftly by firing and trying anybody involved.

This shows that some members at WorldCom take ethics to heart. Instead of being shutdown WorldCom attempted to rectify the hazard it created. This article highlights that even if there are some bad people within the company, once you admit to fraud you can move on and expand. To prove this in April 2004, WorldCom emerged from its $5.7 billion in debt and changed its name to MCI and in 2005 Verizon acquired it, making it a large industry once again.

Cite: http://www.associatedcontent.com/article/162656/worldcom_scandal_a_look_back_at_one.html?cat=3

HP Sues to Stop Ex-Chief's Job

Former chief executive of Hewlett-Packard Co., Mark Hurd, was recently hired by Oracle Corp as a senior executive.  HP has initiated a lawsuit against Hurd claiming that his transfer to Oracle violates the terms of his exit agreement.  Hurd's transfer could potentially leak valuable trade secrets to a competitor which would compromise the future of HP.  This suspected violation of an exit agreement brings into question Mr. Hurd's ethics as he transfers to a rival company.

The purpose of an exit agreement is to provide for a secure and stable departure from a company. The goal is to have both the company and the departing member benefit mutually from leaving the company.  Hurd's departure was based upon sexual harassment allegations, which were found to be unfounded upon investigation, and a violated code of business conduct in which Hurd provided inaccurate expense reports that concealed a personal relationship with a former contractor.  With Hurd's exit, he received an exit package worth approximately $35 million.  HP attempted to secure the company's trade secrets by preventing a transfer to a rival company via the exit agreement.  The lawsuit is complicated though due to a lack of a noncompete clause within Hurd's exit agreement.

HP has shown its commitment to the lawsuit and its ethics policy by hiring Allen Ruby, a San Jose, California based attorney that is notorious for dealing with high-profile clients.  This has sent a message that HP is serious about fighting this case.  The lawsuit could affect future lawsuits regarding the same matter.  Courts generally implement a concept called stare decisis when making decisions.  Stare decisis the legal principle that states that judges are obligated to respect precedents set by prior decisions.  California courts have been known to support employers that transfer and the lawsuit will be an uphill battle for HP.  Hypothetically, if HP wins and the California state court breaks stare decisis, the lawsuit could affect future corporate lawsuits.

While the outcome of the lawsuit may take months to decide, examining both companies' ethic statements makes it unclear whether or not Hurd has made an ethical violation.  HP's standards for business conduct have sections that explain how HP protects sensitive information, does not trade or disclose non-public material information, and obtains business intelligence appropriately.  If Hurd feels ethically tied to HP's code of business conduct, he may have violated business ethics.  This also may not be true due to his exit agreement functionally severing his ties with HP.  Additionally, HP would not be obtaining information with Hurd's absence, Oracle would.  While Oracle's ethic statement is not as clear cut, an important section of their business conduct is the importance of not influencing others.  Using a position to coerce or provide information is not ethical under Oracle's business conduct statement. 

The ethics of this transfer will inevitably be sorted through the legal system, but this issue plays a larger role in business.  The transfer of high-ranking executives between companies could decimate a company's ability to remain competitive within a market as their trade secrets would be lost with the departure of an executive.  Oracle is guaranteed to use Hurd's business talent to promote their company.  Whether or not this will have an adverse effect on HP is not apparent yet. 

Article:
http://online.wsj.com/article/SB10001424052748704358904575477870066918884.html?mod=WSJ_Tech_LEFTTopNews

Business Conduct Statements:

-HP: http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9NTg4NjN8Q2hpbGRJRD0tMXxUeXBlPTM=&t=1

-Oracle: http://www.oracle.com/corporate/community/governance/cebc.pdf

Google TV to Roll Out World-Wide Next Year

Google Incorporation is trying to incorporate another service for the public; Google TV. This innovation will allow the public to search through the Internet and search through live TV listings. The company seeks to expand its market outside the US core. This will also facilitate the people’s actions, comforting them with radical commodities, such as chancing the channel with your own voice. The incorporation will also present a new translation feature for smart phones, being able to speak in one language and getting the phone to respond aloud in another one.

I believe the rising of this new product was inspired by the TV service Apple Incorporation offers. Competition among different companies in the telecommunication industry is increasing, given that every company wants to be ahead of the other. Google incorporation is developing this offer providing the public with new commodities, therefore satisfying society’s desire. This will prove a positive impact in the industry by increasing competence in productions and progress of products. In the other hand I believe technology is going way to far from reality. It seems ridiculous to get to the extent whereas one cannot perform an easy task as using a control to change the channel or have a phone answer one’s petition. These commodities have gone way to far, however the companies are forced to take these measures as technology advances considering the public’s attraction is much higher as these silly innovations come over.

Source: http://online.wsj.com/article/SB10001424052748703720004575477953542863096.html?mod=WSJ_Tech_LEFTTopNews

"Intel Chief Chips Away at Plan Beyond PCs" 9/8 - Toby Jacob

Intel's Corporate Chief Executive, Paul Otellini, has indicated that the company is progressing to products beyond PCs.  While numerous recent microprocessor chip deals have secured Intel's consistent growth throughout the year, the company seeks to expand its consumer base towards chips within smartphones, consumer electronic devices, cars, etc.

This move will prove to be beneficial for both the company and the telecommunications industry as a whole.  Intel's expansion into areas such as the auto industry signals a change towards increased cohesiveness between various industries.  The move will not only create numerous new jobs, it may potentially create new products and subsequently creates new areas for competition. Intel's innovation within the telecommunications industry can be seen in the status quo with the release of Google TV.  Intel provided approximately half the code required for the product and the result is proof of the company's initiative.  Another impressive move was Intel's recent acquisition of McAfee Incorporated, a specialist in security software.  The software McAfee produces will bolster Intel's sales by guaranteeing the most secure product available.  In an interview with Mr. Otellini, he states that "the best security is always a combination of hardware and software".  Having a secure combination of hardware and software will help secure a safe transition into Intel's various new products.

Intel's innovative initiative could provide the company with the competitive edge needed to widen the gap between the company and other microprocessor chip companies.  The acquisition of McAfee will provide the security necessary for Intel's expansion and will decrease the risk of setbacks along the way.  New products will provide areas of competition to arise which will be beneficial for the industry as a whole.

Source:
http://online.wsj.com/article/SB10001424052748703453804575480012132581550.html?mod=WSJ_Tech_LEFTTopNews

Apple’s PING Raises Concerns, But will Blossom – Severn Henry

September 7th, 2010

Yet again, Apple has attempted a change in telecommunications; as a new generation of Apple products (iPod Touch, Shuffle, and Nano) has inspired another iTunes update, now including a social networking service called Ping. The digital music distribution powerhouse has currently produced less than satisfactory results from its "first attempt at social networking" for a number of reasons: mainly, its formatting and lack of content. Although I do not believe our industry should currently invest in it, I predict that Ping will become very popular in the near future. I will address the problems that are presently faced with Ping and resolve the issues surrounding it.


Formatting: The article characterized Ping as "a bit socially awkward, especially for people who are used to Facebook" and for good reason: Facebook has rejected mutual interactivity with Ping. This will prove to be the greatest challenge against Ping - iTunes consumers are not ready to disband from the leader in social networking, and iTunes is not contributing something groundbreaking to the market in friend-to-friend communication. With this rises another problem - Ping cannot import one's friends from any social networking site. There is hope in Ping, though - it uses the Twitter format of following artists on iTunes and an apple spokesperson said that the company is attempting to settle a partnership with Facebook. Expect rumors of a partnership deal to appear in the next six months.


Content: As I have said before, "starting from scratch" with one's friend list leaves an unorganized and "empty" list of users. The article also says that Ping only uses the first names of users, making it more difficult to find your friends with common names. The bigger problem - as of this writing, there are only 54 artists that signed on with Ping. I understand that Apple wants to revolutionize all of its products, and it seemed like the right move, but they should have invested more on artist approval with Ping. Time will bring more artists to Ping, and after more iTunes updates, more people will follow these artists.

http://online.wsj.com/article/SB10001424052748704358904575477761760540990.html?mod=WSJ_Tech_RIGHTTopCarousel_1#

Samsung to Invest Heavily as It Pursues New Businesses - 9/7

To start, Samsung Electronics Co. is the worlds largest memory-chip maker. It is now considering to boost its old operations as well as create new business with a record of $ 25.55 billion gain through their new chips and screens for mobile phones in 2011. They plan to spend 26 trillion dollars. It is the largest expenditure to date, and it will also be the most profitable. However, some analysts are worried that this new technology will create an oversupply in the electronics industry. Moreover, a sharp downturn could occur if there were to be a short-circuit in the memory market. Samsung Mobile Display has a hard time meeting the demands for their "ultrathin screens" for their smartphones. When the new facility opens in July However, the production capacity will increase to 30 million screens a month compared to the present 3 million.

Samsung Electronics Co. is based in China whilst many of its phones are sold worldwide. This article is the perfect example of how globalization has effected telecommunications. The ultrathin screens are being used for American cell phone networks like Verizon Wireless and Sprint. They depend heavily on this more power efficient and brighter smartphone screen; because that is what is going to boost their demand, thus making profit. Although the Mr. Choi is not concerned with the shortage at the moment, American networks may need to find an ulterior product for the time being.

Cite:

http://online.wsj.com/article/SB10001424052748703417104575472970931883624.html?KEYWORDS=Samsung+to+invest+heavily+as+it+pursues+new+businesses&mg=com-wsj#ixzz0yxnb8ow8

“Vodafone to Sell China Mobile Stake” – (9/8) Russell Heim

Vodafone is the world’s largest mobile communication company by revenue and the second largest in terms of subscriber’s right behind China Mobile. Vodafone is the 3rd largest company in the London Stock Exchange. Just this Wednesday this powerhouse agreed to sell its entire 3.2% stake in China Mobile for around 6.5 billion. This sale was no surprise to people because for years they have tried to disconnect their ties but were always unable to come to terms.

Since Colao took the top job in the company, investors have been expecting he would sell and divest assets as the company tries to improve its value. He did just that with his 1st big move as CEO after taking over the company 2 years ago. After this stake, shares in Vodafone dropped 0.6% on the London Stock Exchange after the announcement, while shares in China Mobile closed down 3.8% in Hong Kong.

Attached below is the article: http://online.wsj.com/article/SB10001424052748703720004575478190092112252.html?mod=ITP_marketplace_3

"Google, AOL Extend Search Partnership" - Severn Henry

In a recent article from the Wall Street Journal, Google inc. and AOL have both agreed to extend their currently existing web partnership for another 5 years, focusing especially on mobile search and online video. AOL Chief Executive Tim Armstrong says that this agreement will mark "the company's turnaround process," as AOL will begin to transfer its video content to Google's YouTube.

Google, the web-search powerhouse that also controls 66% of the online search advertising market, has now progressed the expansion, as it realizes that nearly everything is trending towards the digital world. The people who have made the most out of this deal, however, is AOL. The company that began to slump once the Broadband era had begun and e-mail competitors begun to charge their services for free (most notably G-Mail, a mail service by Google). Since AOL had split with Time Warner, (AOL had become financially draining) their Ad business was declining by 27% and their search revenue- 18% of its overall revenue, was in the sharp decline as well (AOL chose not to keep up with technological advancements and suffered, as it is still tied with dial-up-Internet Services). And although I cannot tell you the fiscal specifics of the agreement (they have not yet been released), I can say that Google has bolstered the company that only 10 years ago was projected to have a 100 dollar a share rate*.

I think that AOL is a company that our industry should keep a very close eye on, because there still lies some tension in the company, as it could also potentially stifle the talks between itself and the social networking site Myspace. Myspace has kept a one month extension of their search-advertising partnership, but it's popularity has been on the decline since Facebook has proven to be the "go-to" site concerning social networking. As of today, AOL shares are now up 0.4% in the NYSE at $23.


-Severn Henry

Attached below is the article:


http://online.wsj.com/article/SB10001424052748704206804575467382148608518.html?mod=WSJ_Tech_LEFTTopNews#printMode

*: http://news.cnet.com/2100-1033-207859.html

"A New Digital Battlefield" - 9/3

A recent Wall Street Journal article stated that TV shows have emerged as the new front in a rampant digital media battle between Apple and various competitors.  This new approach towards distributing television shows has occurred amidst simultaneous "conflicts" in areas such as digital books and music.  The drive for digital media supremacy has become most evident within the battle between Apple and Amazon.  For years, Apple and Amazon have competed in distributing music, books, and other entertainment, as indicated by fluctuating prices for media purchasing.  The emergence of television as a new and viable market could bring in various industries that will potentially engage in price battles that are the foundation of consumer interest in products.  This scenario is highly likely given that Apple has produced competitors in the numerous fields of media that they control.  For example, Microsoft with the Zune, Windows Vista as an operating system, and most recently, Samsung's release of their iPad competitor, a new product in the tablet market.

The introduction of this new and vibrant area of investment will hopefully foster increased competition between companies. By allowing one company to dominate media, like Apple did with music, many companies could be running out of business options.  Amazon could provide Apple with the competition it needs in a field that is still undecided.  Inevitably, with increased competition comes product innovation and price innovation that will be beneficial to consumers overall.

Cite:
Fowler & Schechner, 2010 (Geoffrey A. Fowler, Sam Schechner, writers for the Wall Street Journal, "A New Digital Battlefield: Amazon, Apple Rivalry Moves Beyond Music and E-Books Into TV Shows", September 3, 2010, http://online.wsj.com/article/SB10001424052748703431604575468051468814036.html?mod=WSJ_Tech_LEFTTopNews)TJ

"FCC Still Weighing Broadband Plan" -- WSJ 9/2

In Summary, FCC Chairman Julius Genachowski is working on creating restrictions and re-regulating broadbands so that the government would have "more sway over how Internet providers run their network". The FCC also held numerous meetings in attempt to compromise on the issue of "net neutrality" which means "Internet providers can't deliberately block or slow legal Internet traffic".

This current even is crucial to our industry seeing that it directly deals with telecommunications. If new regulations sanction things like "net neutrality" or re-regulating broadband networks will actually hurt phone and cable industries. In fact it will decrease the amount of new investors. I am completely for "net neutrality". If a company is going to oversell internet access to its providers then that industry is not well organized, and its buyers should not suffer the company's faults.

Telecom 1st Blog Post

Motorola has “Out-Apped” Apple in China. This is primarily because it is so difficult to find and purchase Apple iPhone applications. Motorola has also started a new store called Shop4Apps, which is not only available in Chinese but also doesn’t require a dual currency credit card. If this is to tell us anything it is that the perhaps the fast growing economy in the world now prefers Motorola devices over Apple’s.

Globalization has caused what is known as a GLIS, or global information system. With globalization any company can now produce goods in countries where they can pay workers the lowest wages. This practice is known as outsourcing. This has affected the growth of the telecommunications industry dramatically because of global software development (GSD). Most of the GSD occurs in Asian countries due to the lower minimum wage.