Category Archives: Business Technology News

Over the weekend, bookseller Barnes & Noble notified some customers who ordered the Nook e-book reader that the device wouldn’t arrive in time for the holidays. Its consolation gift, $100 toward online purchases for each late Nook, is only part of the cost the company is likely to pay for the blunder.

Barnes & Noble has taken orders for as many as 50,000 of the $259 readers, estimates Forrester Research analyst James McQuivey. He guesses the company will miss shipment on about 2% to 4% of the devices, adding up to $100,000 to $200,000 worth of gift certificates. That’s store credits and not cash, so Barnes & Noble will no doubt recoup some of that investment. Still, it’s not an insignificant cost and “It certainly doesn’t give them any ground against Amazon and Sony,” McQuivey says.

Sony says it will avoid a belated Christmas, announcing on Monday that all orders of its $399 Daily Edition reader that were placed by Dec. 20 will begin shipping Dec. 23 and arrive “in-time for the holidays.” Meanwhile, Amazon has shown no signs of supply issues for the Kindle, despite the company’s claim last week that the e-book reader is having its best month of sales ever.

For Barnes & Noble, the late fee that’s harder to measure is the damage done to its credibility as a device maker, say analysts. The company’s inability to meet consumer demand suggests to Forrester’s McQuivey that the product was rushed to market. “The perception is going to be that they don’t have their act together,” he says. Barnes & Noble blames the delay on unexpected demand.

With the e-reader category evolving so rapidly, the Nook’s tardiness could also rob it of the momentum it will need to face off against the next generation of devices. During January’s Consumer Electronic Show, at least two hyped e-book readers are expected to be shown off to potential buyers: the dual-screen Entourage eDGe and the sleek, flexible Plastic Logic QUE. Though such devices may run into startup snags of their own, they are likely to raise the bar for any would-be buyer of the Nook.

Continue reading →

Now that gearmaker Avaya and Web-calling service Skype share a private-equity owner, the two companies are discussing ways they can better work together. “We are having conversations with [Skype],” Avaya CEO Kevin Kennedy said in an interview today. Kennedy didn’t go into detail, but these talks most likely focus on how the companies can work together, as opposed to some sort of combination of operations.

It’s not difficult to imagine Avaya helping Skype enter new markets, such as the premises of its large business clients. While Skype’s Web-calling service is already widely used by small businesses, it’s yet to prove that it’s reliable enough to serve the needs of large enterprise customers. Perhaps Avaya, whose business is focused on the enterprise, could help Skype make its Web-calling service more attractive to such large companies.

What’s more, Skype could be integrated into Avaya’s products, which include certain Nortel gear (Avaya closed its Nortel acquisition today). Nortel has long helped carriers like Verizon service their corporate customers. By integrating its offerings with Skype’s, Avaya could help reduce these customers’ telecommunications bills.

Continue reading →

Consumer awareness of Android, an operating system for smartphones pushed by Google, is on a steep climb, which bodes well for vendors like Motorola and HTC. Of consumers expecting to shop for smartphones in the next three months, 17% are considering an Android-based device, according to comScore’s new survey of 2,300 consumers. In fact, devices based on Android aren’t far behind the iPhone. Some 20% of consumers are in the market for the Apple device.

The results represent a stark contrast to consumer sentiment of only a few months ago. In August, 7% of consumers were contemplating buying an Android device, while 21% of them were considering the iPhone.

The splash that Motorola’s Droid phone, based on Android, has made recently is partly responsible for increased attention that Android is getting. “In August 2009, just 22 percent of mobile users had heard of the Android, while in November 2009 this figure had reached 37 percent, largely prompted by the Verizon Droid advertising campaign launched in the fall,” according to the report. Android may get a further boost next year, when more Android devices should come onto the market. While the Android movement could still get derailed — for instance, if Google decides to release Android phones under its own brand — it certainly appears to be on the right track now, and rolling along with an ever-increasing speed.

Continue reading →

News Corp. chief Rupert Murdoch has made no secret of his disdain for the Amazon Kindle business model, punctuating recent earnings calls with remarks that the e-commerce giant pockets too much of the subscription fees for the Wall Street Journal and other content. On Thursday morning his company’s actions spoke louder than words, as it announced an exclusive deal with Sony, Amazon’s top rival in the e-reader business.

Sony’s Daily Edition device will be the first to receive automatic wireless updates of The Wall Street Journal, New York Post, and the MarketWatch Web site. Subscriptions will be offered for a monthly charge of $15 for The Journal, and between $10 and $20 for the other options. For an extra fee, subscribers can choose to receive an update when the markets close in the afternoon, in addition to the morning news.

News Corp. already makes The Journal available for $15 per month on the Kindle, but users of the device cannot receive updates more than once a day. In theory, automatic updates could be made available to the Kindle — but Murdoch’s belief that his company’s cut of $6 to $6.50 is barring any such arrangement. Some speculated News Corp. would walk away from the Kindle altogether, but the new “exclusive” agreement for automatic updates on Sony readers appears to be the best counter the company could muster.

“There [were] issues with Kindle and Sony has been been very understanding of those concerns,” said Robert Thompson, editor of the Wall Street Journal, during a meeting with journalists. “If it wasn’t a better deal I wouldn’t be here today.”

Continue reading →

More users will access the Internet via mobile devices than desktop PCs within five years, according to a Dec. 16 report from Morgan Stanley’s Mary Meeker, one of the analysts who predicted the original Internet boom. “The mobile Internet is ramping faster than desktop Internet did,” according to the report.

Smartphones, e-book readers, connected in-car electronics and wireless home appliances like gaming consoles would sell more than 10 billion units by 2020. That’s ten times more devices than there are desktop PCs, according to the report.

Here’s one interesting observation from the report: Meeker believes that the mobile Internet revolution will produce a new crop of winners, whose ranks won’t include today’s giants. Microsoft, Cisco and Intel benefited from proliferation of PCs. Desktop Internet computing lead to the birth of Google, eBay and Yahoo. Mobile Internet computing winners are yet to be defined, she writes. “It’s notable that, after years in the backwaters of global mobile development, American companies (led by the likes of Apple, Facebook, Amazon.com and Google) are becoming mobile Internet innovation pacesetters,” according to the report.

Continue reading →

The Federal Trade Commission has sued Intel, the world’s largest manufacturer of computer chips, alleging that the company has “illegally used its dominant market position for a decade to stifle competition and strengthen its monopoly.”

In its complaint, the FTC accuses Intel of waging what it calls a “systematic campaign to shut out rivals,” in particular, Intel’s main rival, Advanced Micro Devices, but also other smaller players in the market for PC chips, from access to the marketplace.

The FTC also accuses Intel of misdeeds against other rivals. As first reported by Bloomberg BusinessWeek, the commission is looking into the nature of Intel’s relationship with Nvidia, a company that makes graphics chips or GPUs, which enhance the graphics and imagery in computer games. More recently, they’ve become increasingly useful in general purpose computing, making them a potential alternative to Intel chips.

“These products have lessened the need for CPUs, and therefore pose a threat to Intel’s monopoly power,” the FTC said.

The commission accuses Intel of “smothering potential competition” from GPU chips such as those made by Nvidia, saying in a statement that Intel “misled and deceived potential competitors in order to protect its monopoly.

As Bloomberg BusinessWeek reported on Dec. 3, the FTCs inquiry had homed in on a pair of dueling lawsuits between Intel and Nvidia concerning a patent and contract dispute. Having previously agreed to allow Nvidia to create graphics chips that are compatible with Intel’s processors, Intel, the commission alleges, has sought to hold Nvidia back from becoming a competitive threat. “Intel’s apparent willingness to allow Nvidia to interoperate with Intel’s [chips] has dissolved as it has begun to perceive Nvidia as a threat to its monopoly position in the relevant markets,” the complaint reads.

In an email statement, Nvidia applauded the decision: “We are particularly pleased to see scrutiny being placed on Intel’s behavior toward GPUs, which have become an increasingly important part of the PC industry.”

AMD, in an emailed statement, called the FTC’s action “good for consumers,” calling it “yet another example of regulators around the globe acting to protect consumers by enforcing competition laws.”

In a statement Intel called the FTC’s suit “misguided,” and said it has “competed fairly and lawfully,” and that “its actions have benefited consumers.” The FTC’s case, Intel said “is based largely on claims that the FTC added at the last minute and has not investigated.” Additionally, Intel said the complaint is not based “not on existing law but intended to make new rules for regulating business conduct,” that it says would reduce innovation and result in higher prices.

Intel General Counsel Douglas Melamed said in a statement that the case “could have, and should have, been settled.” Settlement talks had progressed, Intel said, but stalled when the FTC insisted on “unprecedented remedies — including the restrictions of lawful price competition and enforcement of intellectual property rights set forth in the complaint — that would make it impossible for Intel to conduct business,” Melamed said.

The case comes on the heels of a Nov. 12 settlement of a private lawsuit filed against Intel by AMD in 2005, the terms of which of hammered out in a two-day session with a mediator in Maui.

FTC officials emphasized that their mandate may go further than that of antitrust regulators. Intel engaged in behavior that violates a section of law that is “broader than the antitrust laws and prohibits unfair methods of competition, and deceptive acts and practices in commerce.”

Continue reading →

While, initially, many consumers snapped up iPhones for their touch screens, that’s changed. Nowadays, it’s the apps that are the biggest driver of iPhone purchases, according to a new report from Piper Jaffray analyst Gene Munster.

That should come as no surprise: Apple and its official U.S. carrier distributor, AT&T, have been touting apps such as Bump, which allows iPhones to exchange contacts and photos by bumping two phones against each other, in their TV commercials. Today, Apple is the mobile apps leader, with more than 100,000 apps offered through its iTunes store. And this could be just the beginning.

Apps currently available in the Apple App Store have “just scratched the surface of what the iPhone can do,” Munster wrote in a Dec. 9 report. “With the addition of various accessories, or built-in features like RFID, the iPhone could become even more functional,” he wrote in a Dec.9 report.

Mobile payment applications could represent one big future opportunity. “….Apple, with the iPhone, iPod touch and iTunes accounts that each have an associated credit card, is uniquely positioned to make mobile payment a reality in the U.S.,” Munster writes. Related mobile apps may help people track their spending or transfer funds, for example.

Continue reading →

By Spencer E. Ante

Mr. McGuire: I want to say one word to you. Just one word.
Benjamin: Yes, sir.
Mr. McGuire: Are you listening?
Benjamin: Yes, I am.
Mr. McGuire: Plastics.
Benjamin: Just how do you mean that, sir?

When Mr. McGuire famously whispered the word plastics to a young and confused child of the suburbs played by Dustin Hoffman in the classic movie The Graduate, the idea was that plastic was the future and young Benjamin should get with the program.

Well, if The Graduate were remade today, the new buzzword for the young could be “analytics.” Thanks to the Internet, the world has become a swelling ocean full of data. One grand challenge of our age is to find a way to harness that data. And that’s where the burgeoning field of analytics comes in. Companies as large as IBM and as small as Twitter are looking to hiring people who can boil down this ocean of data into knowledge and insights that can help improve the performance of their businesses.

But the field is so new and growing so fast that there just aren’t enough qualified workers who can do these jobs. IBM currently has over 2,500 job postings for analytics-related jobs, and 60% of its new hires come from universities.

So IBM is taking the matter into its own hands. On Dec. 9, Big Blue announced that it was working with Fordham University’s School of Business to create a new business analytics curriculum to help prepare students for jobs in the field. IBM is currently working with several other schools on similar initiatives, but this is the first program that IBM has announced.

Starting in the spring of 2010, students will be able to take courses and get hands-on training in business intelligence, data analytics, data mining and other related areas. Companies that applied analytics-derived insights performed better than their peers, according to a new study of 400 executives that IBM released on Dec. 9.

“In this world, intelligence is replacing intuition,” said Ambuj Goyal, a former IBM researcher who is now General Manager of IBM’s Business Analytics and Process Optimization Group. 35,000 people now report to Goyal, according to IBM.

Fast-growing tech startups also have a lot of analytics jobs that are hard to fill. Envangelos Simoudis, managing director of the venture capital firm Trident Capital, said that 12 of the 50 companies in his firm’s portfolio are focused on the analytics market. And many are learning it’s not easy to find data miners and number crunchers to do the job. “In the last year, it was those companies that did better and continued to hire,” he says. “But it’s still difficult to find people with the right background.”

Simoudis believes the demand for these jobs will only grow thanks to several big trends. One is the sheer data explosion. When Simoudis was working in the software business in the 1980s, he said data warehouses use to handle two terabytes of data. Today, just one small online ad network is generating 100 terabytes of data, while social network Facebook is spewing out 1.5 petabytes of data a year, or 1,500 terabytes. All those status updates and party photos consume massive amounts of data.

The second trend is that decision making has become much more performance based. Intuition is out. Metrics are in, especially in a tough economy where every dollar counts. Lastly, there has been a democratization of data. The rise of the Web and dashboard technologies is giving more and more people the ability to access data. And they want it.

Big Blue has gone mad for analytics this year. In April, it launched a new services unit with 4,000 consultants devoted to the field. Subsequently, it opened seven analytics centers around the world in New York, London and Beijing, to name a few places. And the company recently acquired data analytics company SPSS for $1.2 billion and business analytics firm RedPill.

So for all you unemployed youngsters out there who are looking for jobs, I have one word of advice: “analytics.”

- Spencer Ante also publishes the Creative Capital blog. Click here to see more.

Continue reading →

Long talked about, smartphone pico projectors — small accessories that allow phones to project video and photos onto 40- to 60-inch screens — have finally begun to ship.

Later in December, AT&T will offer LG eXpo smartphone with an add-on pico projector that clips right onto the device. In November, Sparkz Products released its expensive pico projector for the iPhone; the device balances on a tripod stand. Microvision has recently announced that its pico projector design will soon debut in Asia. Indeed, 2010 just could be the year when such video accessories for smartphones will come out in droves, says Ross Rubin, director of industry analysis at NPD Group.

With the devices finally out, what remains to be seen is whether they catch consumers’ eye. Consultant In-Stat recently forecasted that pico projectors will turn into a $1.1 billion market by 2014.

Continue reading →

There’s a big party being held in Brooklyn tonight for Boxee, the Internet video service I wrote about in this story in May. One bit of news is the unveiling of Boxee Beta — it has to date been available only in a Alpha version — that has been rebuilt from the ground up.

Engadget has a look at Boxee Beta.

For those unfamiliar, Boxee is an elegant and free media center application for the Mac and Windows that in many ways represents what people imagine when they think of TV moving to the Internet. From within Boxee you can watch Web video in all its various forms: Video podcasts, YouTube clips, downloaded movies, and with some limitations TV shows on from Hulu on your computer.

But it doesn’t stop there. It’s so good, that I’ve heard numerous cases of people actually dropping their cable or satellite TV service, in favor of connecting a Mac running Boxee to their favorite TV set. Others have been known to hack their AppleTV devices and install Boxee on them.

That fact in particular suggested opportunity. One of the things founder Avner Ronen told me at the time was that he hoped to get the Boxee service built into consumer hardware, and that he hoped to have some news on this front in time for the Consumer Electronics Show in Las Vegas, which is now less than a month away.

Ronen and his team have delivered, and that is I think the bigger news. I just heard that the first so-called Boxee Box (pictured) will be made by D-Link, the company behind scores of home networking products.

In addition to video, Boxee plays music from your personal music collection, streams music from your favorite Pandora Radio stations, organizes your photos. It’s also social: You can share what you’re watching with your friends on Twitter and Facebook, and also discover things you might like from your Boxee-using friends.

D-Link says the Boxee Box has already won a “Best of Innovations” award from the Consumer Electronics Association. No price has yet been announced, but they’re promising to deliver the product to stores during the second half of 2010. More about the Boxee Box is here.

Continue reading →