Daily Tech Snippet: Wednesday, July 6

• Samsung Set to Boost Spending as S7 Revives Smartphone Fortunes: After ending a two-year smartphone slide with the Galaxy S7, Samsung Electronics Co. could be about to hike capital spending to sustain a revival across the company. At least $5 billion more of investment is headed to the display and semiconductor businesses, according to a survey of analyst estimates, to help Samsung ride out bumps in the phone market. Such a move reflects new optimism about the company after the success of the Galaxy S7, with the shares rallying 17 percent this year.“Samsung’s smartphone business has finally had a soft landing after a bumpy ride,” said Chung Chang Won, an analyst at Nomura Holdings Inc. in Seoul. Samsung will probably boost spending on memory and displays, which “are poised for a sudden rise as the next growth drivers.”But with growth in the global smartphone market evaporating, it needs to build up its other major businesses as competitors bring out new products in an attempt to spark growth.

• Tesla Falls After Paring Delivery Forecast Amid Factory Strains: Tesla Motors Inc. fell after the electric-car maker missed second-quarter forecast for global deliveries and lowered its full-year outlook, citing an “extreme” increase in output in the period’s final month. The shares slid 3.3 percent to $209.40 at 9:35 a.m. New York time. They declined 9.8 percent this year through Friday. Deliveries of 14,370 vehicles trailed a projection of about 17,000, after an “extreme production ramp” came too late in the quarter to get the cars to their buyers, Tesla said Sunday. About half of the quarter’s output in the final four weeks.The carmaker has had trouble getting its vehicles to customers fast enough to meet its targets even after increasing production. Tesla said 5,150 cars were still on trucks and ships making their way to clients who ordered them, and will be delivered in the first part of this quarter. Tesla is increasing output at its Fremont, California, factory with an eye toward making 500,000 cars a year by 2018 -- an ambitious timeline that also depends on the carmaker’s battery factory east of Reno, Nevada, coming online with battery-cell production. Tesla missed its deliveries forecast for the second time in a row this year. In the first quarter, the company blamed the shortfall on “hubris” in adding in too much new technology that led to part shortages for the Model X.

• BookMyShow secures $81.5 mn from Stripes Group, others: Movie ticketing platform BookMyShow has raised Rs 550 crore ($81.5 million) from existing and new investors in one of the largest funding rounds for an Indian consumer Internet firm in recent months. BookMyShow’s Mumbai-based parent Bigtree Entertainment Pvt Ltd. said on Tuesday it raised the Series C funding round from investors led by New York-based investment firm Stripes Group. Existing investors Network 18, Accel Partners and SAIF Partners also took part in this round. This round takes the total amount the company has raised to $128 million (Rs 863 crore), making it one of the most heavily funded firms in the media and entertainment sector. The company last raised $25 million (Rs 150 crore) from SAIF Partners, Accel Partners and Network18 in 2014.The latest funding round values the Indian company at $445 million (Rs 3,000 crore), The Economic Times reported citing company sources.The latest funding round values the Indian company at $445 million (Rs 3,000 crore), The Economic Times reported citing company sources.

• Five days of Etsy payment processing outages have merchants flipping: Those hoping to snag some handmade July 4th cookies and home-made vegan sunblockmight have woken up to an empty stomach and sunburn after a serious payment processing outage on e-commerce site Etsy. Over the last five days, a large number of Etsy transactions have been disrupted by “third party” payment processing outages. As of 6pm PST July 5th, over 4,000 messages of frustration have been posted in the company’s Bugs Community Forum. After the Direct Checkout outage, many merchants were left with their hands in their laps explaining delays to buyers. The outage is especially tough for sellers who have to face angry customers. It’s all too easy for an unhappy buyer to blame the seller in a negative review for an outage out of their control.

Daily Tech Snippet: Wednesday, February 24

• European Tech Scene Begins to Feel Silicon Valley’s Woes: At the offices of Deliveroo, a food delivery start-up with headquarters in an upmarket neighborhood here, signs of activity are everywhere. The communal kitchen hums with 20-something developers. A gold-painted scooter, which the co-founder William Shu once used to make deliveries, stands in the center of the office as people bustle about. The frenetic pace belies a more cautious approach that Mr. Shu, 36, a former Morgan Stanley investment banker, has recently started taking at the start-up.Over the last year, Mr. Shu has urged colleagues to be more circumspect with growth plans, forgoing rapid expansion in competitive markets like the United States to focus on places where Deliveroo already has a loyal following. And while the start-up has raised almost $200 million, employs roughly 400 people worldwide and operates in 12 countries, Mr. Shu says profitability — and not just aggressive growth to beat rivals to new markets — is increasingly important as the company moves beyond its British roots. The focus at Deliveroo is symptomatic of a change across many European start-ups. Just as in Silicon Valley, where a number of privately held tech companies have been stung by lower valuations and investor questions about their sustainability, that same unease has now reached Europe’s tech community, in a sign that a move away from soaring boom times in start-ups is going global. Driving the pullback are some of the same forces that have caused a change in Silicon Valley’s start-up scene. Tech stocks are gyrating because of fears of a global economic slowdown — exacerbated in Europe by the region’s migrant crisis and persistent financial problems. Valuations of some start-ups worldwide got ahead of themselves. As a result, venture capitalists in Europe and farther afield are becoming more cautious about funding local start-ups that do not have proven business ideas. “When Silicon Valley sneezes, the rest of the world catches a cold,” said Fred Destin, a partner at the London office of Accel Partners, a venture capital firm. “It’s only a matter of time before Europe faces the same issues that we’re seeing on the West Coast.” In Europe, that is leading to situations like that of Powa Technologies. Last week , Powa, an e-commerce company based in London, entered into administration, a form of bankruptcy. The start-up had raised $175 million since 2013 but had failed to win enough customers for its mobile shopping technology. Deloitte, which is overseeing the sale of the company’s assets, says it is now working to find buyers for the business. Truecaller, a Swedish start-up that had raised around $80 million for its caller ID smartphone application, recently laid off about 20 percent of its staff. A company spokesman declined to comment on the layoffs and said Truecaller remained committed to its business. And SwiftKey, a popular predictive typing smartphone application used by more than 300 million people worldwide, was bought by Microsoft this month for a reported $250 million, which was significantly less than what many of SwiftKey’s investors had expected. “You can already see more hesitance and lower valuations,” Christian Reber, founder of 6Wunderkinder, a German start-up bought by Microsoft last year, said in an email. “The market correction will continue, and that’s not necessarily a bad thing.”

• MasterCard will let you to take a selfie to complete purchases: MasterCard wants to use your face to help fend off fraudsters. Using a new system called MasterCard Identity Check -- or, colloquially, "selfie pay" -- the credit card company will use biometric methods like face recognition and fingerprint scans to better secure online shopping. Right now, Mastercard offers a feature that financial institutions can enable that lets customers set up a password for online payments to help prevent fraud. The new system will use the same principle, but instead of relying on a password that could be forgotten or stolen, it uses your face or fingerprint. Consumers will go through all the normal steps of filling out credit card information when making an online purchase, but this feature adds another step: The website will send a notification through an app on customers' smartphones that asks them to verify their identity. This can be done either through a fingerprint scan or by using the phone's camera to take a brief, selfie-like, video. When taking the "selfie," the user will have to blink to prove that it's a live person and not just an old photo being used to spoof the system.

• Lenovo aims at mature markets with new 'augmented reality' phone: China's Lenovo Group is ready to break into mature markets this summer with the launch of its new smartphone which sports 'augmented reality' features developed under Google's Tango project, its chief executive said on Tuesday. The device, which was announced at the 2016 CES consumer electronics show in Las Vegas in January, will launch in July, Chief Executive Yang Yuanqing said in an interview at Mobile World Congress in Barcelona. Declining to give additional information he said that the phone will include Google's Project Tango technology and more. Project Tango combines 3D motion tracking with depth sensors to give a mobile device the ability to know where it is and how it moves through an area, creating the potential to use augmented reality features on the phone. Augmented reality software then overlays text or graphics on the real-life image. It differs from virtual reality, which seeks to simulate real-world views.

• Tech IPO Freeze Is Sign of Investor Reality Check: The tech IPO market is frozen. Storage vendor Nutanix is further proof. It's been over three months since Square and Match Group debuted, and not a single software or Internet company has followed. Seven of the past 10 technology companies to go public are trading below their offer price, and four are down by at least 20 percent, according to FactSet. Nutanix, which filed its IPO prospectus in December, is holding off on selling shares until the stock market volatility wanes, said sources familiar with the matter. The developer of data center technology that wraps together storage, servers and virtualization was set to go public in late January, but has been advised by its bankers to wait for the market to calm, said the sources, who asked not to be named because the discussions are private. No other high-profile tech companies are publicly on file. Last month, online lender Elevate Credit delayed its IPO due to market conditions, as January marked the worst month for the Nasdaq since 2010. The index is still down 8.5 percent to start the year even after rallying over the past week. For Silicon Valley's financiers, this is all troubling. Big IPOs are their lifeblood. That's how venture investors make outsized profits and justify the billions of dollars they pour annually into start-ups that ultimately go bust or fail to generate returns. Last year should have been a banner year for IPOs. The Nasdaq topped 5,000 for the first time since 2000, and rose for the fourth consecutive year. Investors expressed appetite for risk, bidding up Amazon.comand Netflix, the year's two best large-cap performers. Yet, tech companies went public at the slowest pace since 2009. Instead of IPOs, the highest growth companies were raising mega-rounds of cash in the private market at valuations and revenue multiples that exceeded what public investors were paying. Hedge funds and private equity firms distorted the IPO cycle, putting piles of cash into companies but without rewarding early investors and employees the way public offerings do. Late-stage private financing almost doubled from $8.9 billion in 2013 to $16 billion last year, according to the National Venture Capital Association, with companies including Uber, Airbnb, SpaceX and SoFi each reeling in at least $1 billion. That could mean a painfully dilutive private investment round, selling the business at a loss to some investors or going public at a price below what earlier investors paid. "People just have to get real," said Golden, a managing partner at Revolution Ventures in San Francisco and former director of JPMorgan's technology investment banking practice. "When markets are speaking, we may not like what they're saying but we have to listen."

• Etsy Shares Spike 13% As It Reports Strong Revenue In Fourth Quarter: Etsy didn’t have a good 2015, but it was still able to finish on the stronger side. Today the company reported its fourth-quarter results, coming in at $87.9 million in revenue and a loss of 4 cents per share. Analysts were expecting a loss of 1 cent per share on revenue of $86.5 million. Another important number to track here was the company’s gross merchandise sales (GMS), which rose 21.3% to $741.5 million from $611.5 million in the fourth quarter last year. Shares of Etsy were up as much as 13% in extended trading following the report. Still, it’s partially a recovery from the day where shares ended down around 7% before the company reported earnings. t’s also a strong finish amid the fresh 2015 IPOs, which was one of the weakest years for the IPO market since 2009. Even with the strong showing, Etsy is still trading well below its IPO price — but it is certainly not alone. The fourth quarter was an important one for Etsy — it had to show investors that it could post a strong holiday quarter and bring in new people who would buy gifts and other products on Etsy. It looks like investors were pleased by its ability to beat on revenue and bring in some new buyers and sellers. It also had to show that it could continue to bring those buyers and sellers in through despite its brand as an artisanal marketplace that is quite different from others like eBay. Etsy is also continuing to navigate a shift to more mobile sales, with mobile visits accounting for 61% of the company’s overall visits, and 44% of gross merchandise sales coming from mobile devices. This is all pretty good news for the company. In general, Etsy has not had a good year. Shortly after its IPO the stock hit around $30, but has since cratered to under $8. Today, obviously, didn’t help. To be sure, a lot of companies haven’t been having a good year due to a few things outside their control — like global economic issues and foreign exchange problems — but Etsy in particular is getting hit hard by investors.

Daily Tech Snippet: Wednesday, October 7

• Twitter’s Next Hail Mary, Project Lightning, Has Arrived..is Uncannily Similar to Snapchat's Live Stories: Just 24 hours after Jack Dorsey officially took over as the new CEO, Twitter is finally rolling out Project Lightning, the multimedia update it has aggressively pitched for months, to resuscitate growth and get Twitter back on track with Wall Street. In many ways, Lightning is Twitter’s most important product update ever. The new product, which Twitter is now calling Moments, is the kind of product that will shape how Dorsey is remembered in his third stint at the company he helped create. A Moment is a group of tweets stitched together around a specific topic, such as the Super Bowl or a breaking news event. These Moments are curated by Twitter, or Twitter partners like BuzzFeed and the New York Times, and primarily exist within a new tab inside the Twitter app, although they can be shared as links within tweets as well. Moments tend to be multimedia-heavy, with lots of photo and video tweets included, although that isn’t necessarily a requirement. Unlike your Twitter timeline, in which tweets are typically read in reverse chronological order, Moments are constructed in the same way you’d read a book — with a beginning, middle and end. If you’re familiar with Snapchat’s Live Stories feature, which have become very popular with its users, you’ll notice some striking similarities. (Very striking.) The purpose of the product is twofold. For starters, it’s a way for Twitter to play to its strengths by creating more content and engagement around live events, an area where Twitter truly does dominate other social platforms, including Facebook. When you follow a Moment, Twitter will temporarily insert tweets about that topic into your feed from people you don’t actually follow; as soon as the event is over, you’ll stop seeing tweets from those people. There’s no easy way to follow a bunch of people talking about a breaking news event, for example, so Twitter is trying to do that for you. Twitter is also looking for ways to entice new users, and believes Moments may serve as the bait. Twitter can be underwhelming when you first sign up, admits Madhu Muthukumar, product manager for Moments. But if you can immediately follow a Moment — and all the important people contributing to that event — it’s easier to find interesting people and feel like you’re part of the conversation right away, he added.

• Bill Gurley on Tech Bubble: I’m a Pragmatist, Not a Doomsayer:  Bill Gurley, general partner at venture capital firm Benchmark, has developed a reputation as the Nostradamus of Silicon Valley. He has repeatedly called out startups and fellow investors for over-the-top valuations, warning of an impending tech bubble. He isn’t ditching that reputation. “It’s kind of my responsibility to call it out,” the venture capitalist said at the Vanity Fair Summit in San Francisco on Tuesday. “If you’re in a car heading over a cliff and I say, ‘Hey, slow down’ — that’s being a pragmatist, not being a doomsayer.” New York Times reporter Nick Bilton, who moderated the panel, asked Gurley how he squares that view with the fact that Benchmark is among the venture firms priming startups with cash. Gurley’s retort: The founders he backs could raise money in any condition — and could do it even better when funding dries up. “Most of the great CEOs I work with want this to stop. They’re forced to play this game,” he replied. “Great entrepreneurs raise money in any cycle. When there’s less money available, the better entrepreneurs have the advantage.”

• Data Transfer Pact Between U.S. and Europe Is Ruled Invalid: Europe’s highest court on Tuesday struck down an international agreement that allowed companies to move digital information like people’s web search histories and social media updates between the European Union and the United States. The decision left the international operations of companies like Google and Facebook in a sort of legal limbo even as their services continued working as usual. The ruling, by the European Court of Justice, said the so-called safe harbor agreement was flawed because it allowed American government authorities to gain routine access to Europeans’ online information. The court said leaks from Edward J. Snowden, the former contractor for the National Security Agency, made it clear that American intelligence agencies had almost unfettered access to the data, infringing on Europeans’ rights to privacy. The court said data protection regulators in each of the European Union’s 28 countries should have oversight over how companies collect and use online information of their countries’ citizens. European countries have widely varying stances toward privacy. Data protection advocates hailed the ruling. Industry executives and trade groups, though, said the decision left a huge amount of uncertainty for big companies, many of which rely on the easy flow of data for lucrative businesses like online advertising. They called on the European Commission to complete a new safe harbor agreement with the United States, a deal that has been negotiated for more than two years and could limit the fallout from the court’s decision. Some European officials and many of the big technology companies, including Facebook and Microsoft, tried to play down the impact of the ruling. The companies kept their services running, saying that other agreements with the European Union should provide an adequate legal foundation. But those other agreements are now expected to be examined and questioned by some of Europe’s national privacy watchdogs. The potential inquiries could make it hard for companies to transfer Europeans’ information overseas under the current data arrangements. And the ruling appeared to leave smaller companies with fewer legal resources vulnerable to potential privacy violations. “We can’t assume that anything is now safe,” Brian Hengesbaugh, a privacy lawyer with Baker & McKenzie in Chicago who helped to negotiate the original safe harbor agreement. “The ruling is so sweepingly broad that any mechanism used to transfer data from Europe could be under threat.”

• Microsoft is making its first-ever laptop: Under the leadership of chief executive Satya Nadella, the message out of Microsoft has been one of collaboration rather than competition. Since Nadella took over in February of last year, the historically sharp-elbowed firm has seemed to soften. A humbler Microsoft emerged, putting a greater focus on helping consumers use its products on whatever device they wanted, rather than being its own cheerleader. But Microsoft showed that its competitive spark is alive and well Tuesday with the announcement that it's making its first-ever laptop. The laptop, called the Surface Book, has a 13.5-inch screen and weighs 3.34 pounds with a detachable keyboard -- clearly putting it in competition with Apple's MacBook Air and the many, many Microsoft partners who make the class of lightweight laptops known as ultrabooks. (So does its starting $1,499 price tag.) The Book can be used as a tablet or as more traditional laptop.

• Samsung Electronics third-quarter profit guidance beats estimates:  Samsung Electronics said on Wednesday its July-September operating profit likely leapt 79.8 percent from a year earlier, beating expectations and pushing the South Korean tech giant's share price sharply higher. Samsung, in a regulatory filing, estimated its third-quarter profit at 7.3 trillion won ($6.29 billion), its first quarterly profit gain in two years and its biggest since the first quarter of 2014. This compared with a 6.7 trillion won profit tipped by a Thomson Reuters SmartEstimate poll of 30 analysts. Samsung's shares opened 4.1 percent higher after the guidance release. Smartphone earnings likely improved from a year earlier, analysts said, partly due to the launch of new lower-end models and the August launch of the Galaxy Note 5. Semiconductor sales were also expected to be strong, driven by the launch of new smartphones including the Galaxy Note 5 and Apple's iPhone 6S models. The weaker South Korean won likely also boosted profits, analysts said. Samsung expects third-quarter revenue to rise by 7.5 percent from a year earlier to 51 trillion won.

• Adobe 2016 forecast disappoints, shares slump: Adobe lowered its profit forecast for 2016 below analyst estimates partly due to a strong dollar, sending its shares down as much as 13 percent in extended trading. The Photoshop maker said it expects full-year revenue of about $5.7 billion and an adjusted profit of $2.70 per share. Analysts on average were expecting revenue of $5.93 billion and earnings of $3.19 per share, according to Thomson Reuters I/B/E/S. In 2013, Adobe forecast an adjusted profit of $3 per share for 2016. The company is expecting a $200 million hit on revenue as a result of the stronger dollar, and a $100 million hit as Adobe's "last material businesses are transitioning to ratable revenue." Adobe has been switching to web-based subscriptions from traditional licensed software to help attract more predictable recurring revenue.

• Etsy doubles down on manufacturing as it faces off with Amazon: Etsy, the online store that made its name selling handmade crafts, is trying to stop merchants from defecting as giant rival Amazon.com Inc prepares to attack it on its own ground with a new site for artisanal items called Handmade. But Etsy's policy of allowing sellers to use outside manufacturers continues to anger some of the smaller vendors of handmade items who helped make it successful. Even changes to that policy have done little to address the criticism or hold off defections, analysts and sellers say. "Until now, Etsy sellers had nowhere else to go," said Gil Luria, an analyst at Wedbush Securities based in Los Angeles. "But what Handmade at Amazon represents is a trip back in time to Etsy's original vision." Etsy disputes that sellers had no other outlets, saying it knows that while about half of its sellers sell only on its site, the other half also use other venues - from craft fairs to their own websites. But on average, even those who sell in many venues make the majority of their income on Etsy, the company said. Etsy, launched 10 years ago, became popular as an alternative to Amazon and eBay, tapping into shoppers' appetite for handmade items. But since its April initial public offering, which valued the company at $4 billion, Etsy's shares have fallen by more than 50 percent. And the company's losses doubled in the most recent quarter due in part to rising expenses and the stronger dollar, which dampened demand for U.S. products.

• Facebook Gives Viewers 3 New Ways to Engage With Their Favorite TV Shows, Challenges Twitter for second-screen supremacy: Facebook is trying to steal some of Twitter's thunder, aiming to be the first choice among second-screen viewers, people who watch TV and engage on social media at the same time. So, this morning Facebook—with its 213 million monthly active users in the U.S.—announced new tools aimed at helping TV producers better engage audiences during live broadcasts.  1. Hashtag voting and polling: This feature should get broadcasters the most excited. Instead of being directed toward separate apps within a show's Facebook page, users will be able to vote directly within a top-level post or comment. 2. Photo and video submissions: Facebook is giving viewers or aspiring contestants on competition series the ability to submit photos and videos directly to show pages. Those can be anything from video questions (Fox News used this to solicit questions for August's GOP debate) to funny submissions for late-night talk shows or audition videos. 3. Custom icons: Taking a page from Twitter's playbook, Facebook will create custom icons—much like Twitter's custom emojis—for certain events such as the Oscars, the Emmys, The Bachelorette and sporting events like the Rugby World Cup.

Daily Tech Snippet: Wednesday, August 5

Apple Denies Planning to Sell Mobile Services Directly to Consumers: Apple, the world’s most profitable mobile phone maker, has denied a report that it is working on a plan to market communications services directly to consumers that would bypass telecom operators on which it now relies. Business Insider on Monday reported that the iPhone maker was testing a so-called mobile virtual network operator (MVNO) service in the United States, which would involve it renting capacity from one or more network operators to sign up its own customers. The mobile phone maker is also in talks with European operators about such an arrangement, the website reported. “We have not discussed nor do we have any plans to launch an MVNO,” said an Apple spokeswoman in a statement on Tuesday.

Facebook Mobile App Advertisers Won't Lose Their Device-Level Data After All As Social giant switches gears: Facebook said three months ago it planned to take away mobile app-install advertisers' ability to collect device-level data. But money talks, and ad-buying marketers evidently protested enough for the social media giant to reverse course. The Menlo Park, California-based company said in an email statement: "We advise our advertisers to apply people-based measurement solutions so they can determine when they're reaching multiple people, not just multiple devices. While we believe device-level reporting is not the most accurate way to properly determine advertising effectiveness, we want to provide advertisers with the choice to measure ads based on what is important to them. In order to provide that choice, we will continue giving advertisers the option to receive device-level reporting from our mobile measurement partners for mobile app ads." For nearly two years, Facebook has allowed app-install marketers to grab information that helped them determine—among other things—how their ads performed on devices such as iPhones, Samsung Galaxies and HTC Ones. Advertisers have to agree to keep that device-level data to themselves, as Facebook wants brands to focus on other metrics and is wary of privacy concerns. When Facebook revealed to marketers its plans to cut off such data while making them focus on campaign-based statistical results, they pushed back, according to a VentureBeat story last month.

Hackers Exploit ‘Flash’ Vulnerability in Yahoo Ads: For seven days, hackers used Yahoo’s ad network to send malicious bits of code to computers that visit Yahoo’s collection of heavily trafficked websites, the company said on Monday. The attack, which started on July 28, was the latest in a string that have exploited Internet advertising networks, which are designed to reach millions of people online. It also highlighted growing anxiety over a much-used graphics program called Adobe Flash, which has a history of security issues that have irked developers at Silicon Valley companies. “Right now, the bad guys are really enjoying this,” said Jérôme Segura, a security researcher at Malwarebytes, the security company that uncovered the attack. “Flash for them was a godsend.” The scheme, which Yahoo shut down on Monday, worked like this: A group of hackers bought ads across the Internet giant’s sports, news and finance sites. When a computer — in this case, one running Windows — visited a Yahoo site, it downloaded malware code. From there, the malware hunted for an out-of-date version of Adobe Flash, which it could use to commandeer the computer — either holding it for ransom until the hackers were paid off or discreetly directing its browser to websites that paid the hackers for traffic.

Crafts website operator Etsy's loss doubles; shares tumble: Crafts shopping website operator Etsy's quarterly loss doubled due to higher marketing expenses and the company said these costs would only increase in the current quarter. Etsy's shares fell more than 15 percent to $16.27 in after-hours trading on Tuesday. The company's marketing costs jumped 77 percent in the second quarter ended June 30 due in part due to higher spending on product listing ads. Total costs rose 49.3 percent. Etsy said it plans to spend more on marketing in absolute dollars in the third quarter than it did in the second quarter or the year-earlier quarter. It also said it expects to increase the pace of hiring in the current quarter compared with both the second quarter and the year-earlier quarter. The company said the strengthening dollar could hurt demand for dollar-denominated goods in the current quarter, which could slow the pace of growth of gross merchandise sales. Gross merchandise sales, a measure of total value of goods sold, rose 24.6 percent in the second quarter, driven by a 24.6 percent growth in active sellers and a 31.6 percent jump in active buyers on Etsy's website. Revenue rose 44.4 pct to $61.4 million in the quarter.

Apple's momentum 'meltdown' bites investors: Has the "curse of the Dow" finally caught up with Apple? Shares of the iPhone maker have been in a rut since posting disappointing quarterly results in late June, falling to a six-month low of $113.25 on Tuesday. The recent declines have wiped out nearly $100 billion of Apple's market value - about as much as fellow Dow components Boeing and McDonald's are worth in total. For CEO Tim Cook, it means his stake of more than 111 million shares is now worth about $12.76 billion, compared with nearly $15 billion at the peak in late April. The dropoff represents a notable bout of weakness for a stock basically impervious to pain for the better part of two years. Strategists pinned the sell-off on the steady run in the shares, as the stock has gained more than 137 percent since hitting a low in April of 2013. In addition, more than 5,700 different funds already own the shares, according to Morningstar data. With Tuesday's declines, the shares have dropped 13 percent over the last 11 trading days. "When you get a stock that is over-owned it’s difficult to find that incremental buyer," said Art Hogan, chief market strategist at Wunderlich Securities in New York. "It’s having its own momentum meltdown."

Apple Doing Own Cellular Service Doesn’t Make Sense, at Least Not Today: The appeal is tempting, of course. Apple would then fully own the relationship with the customer rather than leaving that job to one of the “orifices,” as Steve Jobs famously labeled the wireless providers. Google is in fact doing just this with its Google Fi effort, where it offers service starting at $20 per month using the networks of both Sprint and T-Mobile. But the service is fairly limited. It’s offered only on a single Nexus 6 phone and its designed to keep the service more of a test than a true national rival. It doesn’t make sense for Apple for a number of reasons. First it has a tough time doing things small — Apple currently represents a huge part of the carriers’ business, and some of the carriers’ most lucrative customers are its iPhone owners. So the carriers aren’t going to be eager to hand that over to Apple. Even if Apple could convince them to do so, it might not be in Apple’s long-term interest. First of all, consumers today are benefitting from four carriers heavily competing against one another, with a resurgent T-Mobile and an increasingly desperate Sprint both putting price pressure on AT&T and Verizon. Also, carriers spend a fortune to keep their networks strong enough to handle increasing demands and to swiftly upgrade to faster technologies. If they become truly a dumb pipe just selling gigabytes to Apple, the incentive to differentiate on customer service or speed is reduced, as would be the amount of capital they would have to invest. Over time, that could mean both Apple and consumers would lose. Plus, if it is Apple’s name attached to the service, it would have to take on the role of customer support and the perceived blame when the service doesn’t meet customer expectations. “That’s a lot to bite off, and I can’t see Apple wanting to do it,” said Jackdaw Research analyst Jan Dawson. Now, that doesn’t mean Apple isn’t interested in seeing more value come to it over time. With iMessage, for example, Apple took something that consumers value — their text messages — and made it a feature of their phone rather than something tied to their carrier and phone number. There are reports Apple would like to do the same thing with voicemail. Apple also introduced on the latest iPads a SIM card that works across different cellular networks so customers don’t have to choose a carrier when choosing a device. Apple could do something similar with the next iPhone. These moves make sense. Whether Apple has dreams of eventually offering cell service or not, it is to their advantage that consumers are more tied to their iPhone than they are to being a customer of AT & T or T-Mobile. Do such moves also open the door to Apple offering its own cell service some day? Sure. And it would be foolish for Apple not to constantly consider whether such a move makes sense. But, at least for now, the downsides likely outweigh the benefits.

Daily Tech Snippet: Monday, July 20

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• Apple Waits as App Developers Study Who’s Buying Its Watch: In the months surrounding the much-ballyhooed release of the Apple Watch, Apple managers courted Facebook in the hopes that the social networking giant would make a software application for the new gadget. Facebook was not persuaded. Three months after the watch’s release, there is no Facebook app tailored for it. Adam Mosseri, who oversees Facebook’s news feed, said the social network had been studying the Apple Watch but had not figured out how to deliver a good Facebook experience — including the news feed’s stream of posts, photos and videos — on such a small screen. The lack of support from Facebook — and from other popular app makers like Snapchat and Google, which also do not have apps for Apple Watch — underscores the skepticism that remains in the technology community about the wearable device. That puts the watch, Apple’s first new product since the iPad in 2010, in something of a Catch-22: The companies whose apps would most likely prompt more people to buy the device are waiting to see who is buying it and how they use it. Another challenge with the Apple Watch software system is that apps have to process all the data on the iPhone and then beam it to the watch, limiting what the Apple Watch apps can do. The next version of the software, which will be released in the fall, will remedy this by letting developers write apps that run directly on the watch, relying on the iPhone mostly for the Internet connection. That doesn’t mean the Apple Watch lacks apps. Apple released the device in April with more than 3,000 apps — far more than the 500 that were available for the iPhone when the App Store opened in 2008. Yet only five of the 20 most popular free iPhone apps in the United States have versions for the Apple Watch, according to data from App Annie, an analytics firm. And the number of apps for the watch, which now stands at about 7,400, is growing at a slower rate than the explosive uptick of apps that were produced for iPhones and iPads in their early days. While the number of apps for the watch jumped 142 percent in the first three months, that compared to 437 percent for the iPhone and 200 percent for the iPad, according to data provided by App Annie.


• Tesla Offers New ‘Ludicrous Mode’: Zero to 60 in 2.8 Seconds: Tesla Chief Executive Officer Elon Musk introduced a new “Ludicrous Mode” for the dual-motor version of the Model S during a call on Friday, allowing the all-electric sedan to go from zero to 60 miles per hour in 2.8 seconds. The upgrade costs an additional $10,000 for new buyers and results in a 10 percent acceleration improvement. The hold music before the conference call began was a loop of the rap song Beast Mode by Ludacris. Tesla will also offer Ludicrous Mode for its coming Model X SUV, which will probably clock in at zero to 60 mph in 3.3 seconds, according to Musk. “We haven’t tested it yet, so that’s just a guess,” he said. “That’s mad for an SUV, obviously.” Here’s how Tesla squeezed out the extra juice to go from insane to ludicrous. The limiting factor for acceleration during the first 30 mph is traction—basically getting the wheels to stay connected to earth. Tesla had already solved that engineering roadblock. The limiting factor when accelerating from 30 mph to 60 mph, on the other hand, is pulling enough current from the battery pack.


• Google Adds a Record $60 Billion to Its Stock in One Day: The search-engine giant added $65 billion to its market capitalization today, more than the size of Hewlett-Packard Co. The surge, following earnings that topped analyst estimates, is the biggest one-day gain in value ever for a U.S. company, according to data compiled by Standard and Poor's Dow Jones Indices. Apple held the previous record, with a $46.4 billion surge in April 2012. Google’s rally pushed the Mountain View, California-based company further ahead of Microsoft Corp. in rankings of the world’s biggest companies, sending its value to about $468 billion compared with the software giant’s $377 billion. The shares are up 26 percent in five days, the biggest one-week advance since it went public in 2004. Thursday’s report marked the first time since 2013 that Google has announced quarterly adjusted earnings per share higher than expectations. Chief Financial Officer Ruth Porat, who joined the company in May, also signaled plans to bring more restraint to spending at the Internet search giant.


• Etsy Surges Most Since IPO on Mention in Google Revenue Call: Etsy surged the most since it went public, after Google said the online artisan marketplace is seeing a boost in traffic from mobile-search results. Etsy gained 31 percent to $21.98 at the close in New York, the biggest climb since its IPO on April 16. The shares had increased 5.2 percent from the stock’s debut through Thursday’s close. Brooklyn-based Etsy, a platform where sellers offer homemade and vintage items ranging from jewelry to wall art, has been trying to boost sales after its first-quarter net loss widened. Google’s “deep links,” which redirect users to mobile applications when they click results from a Web search, could help Etsy lure more shoppers to its marketplace.“Developers like Etsy are already seeing a boost in traffic as a result of deep linking,” Omid Kordestani, Google’s chief business officer, said on an earnings phone call Thursday. Etsy’s sudden spike may be creating what’s called a short squeeze -- meaning traders who were betting against the company have to cover their positions at the higher price, leading to swings in the stock.


• China central bank issues guidelines on internet finance development: The central bank called on the government to support internet firms in setting up platforms for expenditures and loans, crowdfunding, the sale of financial products and other financing platforms. It called for broadening channels of financing and supporting private investment funds to back the internet finance industry. The bank also recommended tax breaks for qualifying small enterprises including start-ups, saying that provincial level governments should increase their support for those companies.


• Indian PC market dips as smartphone, tablet sales rise: PC market in the country has declined for the first time to 10.6 million units, falling over 10 per cent, on account of growing consumer preference for smartphones and tablets, industry body MAIT today said. According to MAIT-IMRB report, desktop and notebook market cumulatively stood at 11.8 million units in 2013-14. Smartphone market in 2014-15 grew 33 per cent to 69.6 million units, while phablets and tablets grew 527 per cent (50.8 million) and four per cent (3.4 million units) respectively. In revenue terms, the PC market declined to Rs 21,058 crore in 2014-15 from Rs 25,117 crore in the previous fiscal. For smartphones and tablets, the revenue was up 88 per cent to over Rs 65,815 crore in 2014-15 from Rs 34,900 crore a year ago. “The growth is expected to continue in 2015-16 with smartphones expected to grow 27 per cent, phablets 65 per cent and tablets 16 per cent,” he said. During the year 2014-15, server sales registered a growth of 30 per cent over the last financial year at 1,82,727 units. The overall size of Indian ICT hardware market, which comprises printers, servers and computers among others, stood at USD 15.87 billion, showing a growth of 23.98 per cent over the previous year.

Daily Tech Snippet: Wednesday, May 20

• Yahoo shares fall as Marissa Mayer’s plan to spin off Yahoo’s $34 billion stake in Alibaba tax-free could run into resistance from federal tax authorities. An official from the Internal Revenue Service told tax lawyers in Washington on Tuesday that the agency was weighing potential changes to how it treats some kinds of tax-free spinoffs. The I.R.S. is particularly concerned about spinoffs in which the operating business comprises only a small portion of the new publicly traded company, according to the official. That is exactly the type of spinoff that Ms. Mayer, chief executive of Yahoo, proposed in January. The Internet company intends to bundle its small-business services division with its 384 million shares of Alibaba into a new company and spin it off to Yahoo shareholders later this year. As reports of the I.R.S. review circulated on Tuesday in the last half-hour of trading, Yahoo shares plunged, closing at $40.98, down 7.6 percent. More than half of the company’s stock market valuation is based on its stake in Alibaba. Robert Peck, an Internet stock analyst with SunTrust Robinson Humphrey, said it was unclear whether any change in the government’s tax treatment of spinoffs would affect transactions already in the works, such as the Yahoo-Alibaba transaction. “It’s very ambiguous,” he said. “Does it apply to current deals they are looking at, or future deals only?” If Yahoo’s disposal of Alibaba were fully taxed, Mr. Peck estimated that the fair value for Yahoo’s stock would be about $40 a share, or roughly the current level. If the spinoff remains tax-free as Yahoo envisioned it, then Yahoo shares are worth closer to $55, he said. Currently, a spinoff must include an operating business, not just assets like stock, to qualify as a tax-free transaction. The I.R.S. has not established firm guidelines about how important the operating business must be to the spinoff company. Yahoo Small Business, the operating unit that Yahoo is proposing to include with the Alibaba stake, is a strong business that never fit well with the rest of Yahoo’s portfolio, according to Amit Kumar, who ran the unit until last November. “The profitability and revenue profile were surprisingly strong, compared to many other businesses at Yahoo,” he said. “But certainly by the fact that Yahoo chose Yahoo Small Business as the division to spin off, they don’t consider it a core business.”

• Google Search Now Shows Tweets, but Will It Help Twitter Get More Users? Tweets have begun to show up in Google search results, and Twitter's stock is up a bit. Probably not a coincidence. Investors hope this deal will help the company capture a broader audience, and turn the casual onlookers, who may stumble upon a tweet while browsing the Web, into active members. While Google is giving Twitter a nice billboard for its content, the experience leaves something to be desired. The full body of the tweet, including a photo if there is one, lives on the search page. Clicking one brings you to Twitter's site, which includes the same information, along with the number of retweets and favorites the post has received. (If you're not a Twitter user, do these numbers even mean anything to you?) Above that, for nonmembers, are giant buttons that say “Sign Up” and “Log In.” Hit just about any other button on the page, and you get a popup that implores you, again, to please, please sign up for Twitter. As the company struggles to add users at the rate it used to, a key part of Twitter's strategy involves drawing people in from around the Web. Twitter has been working on the experience for logged-out users on desktop computers, adding a new homepage that allows people to browse tweets about certain subjects, like Nascar or cute animals. James Cakmak, an analyst at Monness, Crespi, Hardt & Co., says the Google deal shows Twitter isn't there yet on mobile. With the current implementation, Twitter runs the risk of drawing people to click on tweets, only to repel them with desperate pleas to sign up or log in for more, he says. “The experience is pretty cool in the search results, but that does not necessarily correlate to engagement, monetization, and conversion,” Cakmak says. “There is nothing on mobile to drive eyeballs to. The logged-out experience is barely figured out on desktop, and they've been working on it since November.”

• Etsy Plunges 13% After Reporting Its First-Quarter Financial Performance: Shares of Etsy ,the online marketplace for handmade goods which IPO-ed in April, plunged today after the company reported roughly in-line revenue and a wider-than-expected loss. Etsy, a popular marketplace for handmade goods, reported top line of $58.5 million, ahead of expectations of $58 million. However, the company lost $36.6 million in the quarter, or $0.84 per share. In the year-ago quarter, Etsy had a far-smaller $463,000 loss. Etsy is off over 13 percent in after-hours trading as of the time of writing. The company’s revenue growth, compared to the year-ago quarter of 44.4 percent, greatly outpaces the expansion of sales on its platform, which posted a slimmer 28.2 percent rise. Investors may view that discrepancy as indicative of potentially deprecated revenue growth. Adding to the negative pressure is the company’s notes on its second — i.e. current — quarter, which indicated lower revenue growth, increased headcount and rising costs. Combined, you can spell that in the following way: margin pressure. Etsy’s operating expenses rose 72.6 percent compared to the year-ago quarter.

• Autodesk earnings: revenue $646M, +9.1% Y/Y; shares fall 8% in extended trading. Autodesk which makes computer-aided design software, forecast lower-than-expected profit and revenue for the second quarter, citing a stronger dollar. Autodesk, known for its AutoCAD software used by construction companies, engineers and manufacturers to design products and simulate real-world performance, now expects revenue growth of 2-4 percent for the year. The company had earlier forecast a 3-5 percent growth. Shares of the company, which also cut its profit and revenue forecast for the year, fell nearly 8 percent in extended trading on Tuesday. Autodesk, which gets nearly two-thirds of its revenue from outside the Americas, projected currency rate fluctuations to hit revenue growth by 5 percentage points for the year ending January 31. Revenue increased to 9.1 percent $646.5 million. The company, which is moving from a license-based business to a cloud-based subscription model, said subscription revenue rose 15.7 percent to $319.8 million. Subscriptions bring in less money upfront, as payment is spread over the entire period of use unlike traditional packaged software, but typically ensure more predictable recurring revenue. The switch to the new model increased Autodesk's costs. While total cost of revenue increased 16.6 percent, total operating expenses went up 13.1 percent. The company's net income fell to $19.1 million, or 8 cents per share, from $28.3 million, or 12 cents per share, a year earlier.

• No, Uber drivers can’t game the ‘surge pricing’ system as easily the way one driver claims: Uber's "surge pricing" algorithm is both critical to its success and a huge proverbial target on the company's back. It is, Uber says, supply and demand in its most basic form: When drivers are scarce, and demand is high, prices go up. That's good for drivers who are now being paid less on the Uber base rate since the company began dropping prices to beat the competition and generate demand. And it can be good for those who are desperate for a ride — and are willing to pay. Critics say that surge pricing can result in truly absurd fares at peak times, and the company admitted making a misstep by allowing surge pricing to go into effect in the middle a natural disaster. Recently, a video, purportedly from an Uber driver, was published online claiming to show a strategy that Uber drivers can use to manipulate the system by inducing higher and higher surge fares. There's no narration of what's happening, but over the course of about three minutes, the "driver" demonstrates how to do this by accepting rides, then immediately canceling them. The person does this several times, and by the end of the video, surge pricing increases to 2.1 times the normal fare in some areas. The video, titled "Driving for surge," was initially posted publicly in April but has now been made private. The video was also posted in a thread on a message board for ride-share drivers last week by a user who was labeled on the message board as a "well-known member." That person encouraged drivers to get "on the surge bus" and ride "to profits together." The person who shared the video on the ride-sharing forum claimed that he has been "doing this for months" without hearing anything from Uber. It is unclear whether that is true, and Uber would not comment on the individual driver, who included his first name and license plate number in the video. Even if the strategy was plausible, it probably won't work for long, as other drivers on the forum quickly pointed out. "This is a terrible strategy. You'll get deactivated within a week with that many trip cancellations," one driver commented. Surge pricing in an entire city, where there might be hundreds or thousands of drivers on the road, is unlikely to be affected by the actions of a single driver — or even a handful of drivers. Surge pricing kicks in when a lot of different users begin requesting rides and there aren't enough drivers. Sure-fire predictors for surge pricing: bad weather, rush hour or, perhaps, the time just before Sunday brunch. Because Uber monitors every ride, repeatedly canceling rides is really just a good way for a driver to trigger enhanced scrutiny.

Daily Tech Snippet: Friday, April 17

• Forcing Login Helps Facebook Solve the Global Cookie Shortage: The company tracks app users across devices to prove ads work. For advertisers, one of the Web’s advantages over TV is the ability to track which ads get clicks and lead to sales. However, most mobile apps block cookies, leaving marketers blind. This cookie crunch has become a full-blown crisis as shopping on smartphones and tablets has exploded. Last year, U.S. marketers bought about $19 billion worth of ads on phones and $32 billion on PCs, according to researcher EMarketer; this year, the company estimates, the total will be $29 billion on phones and $30 billion on PCs. Enter Facebook, which promises the more than 1 million businesses that advertise through its Atlas Solutions network that they can follow 1.4 billion users from PCs to smartphones to tablets and back. To use Facebook, you have to log in, and the social network records identifying information about each device you’ve logged in from. That data is stored in your profile, so Facebook knows it’s you online, even when you’re visiting other sites. Atlas is an ad network, like Google’s AdSense, that Facebook bought from Microsoft in 2013 and relaunched late last year. Its advantage lies in the depth of Facebook’s knowledge of its consumers. Even though advertisers don’t know the identity of specific users, the demographic information Facebook gives them, broken down by characteristics such as age and gender, can help them tailor ad campaigns for different audiences, says Jonathan Nelson, chief executive officer of Omnicom Digital, an early adopter of Atlas. “If you can connect the dots backwards, you can understand, ‘How did that happen?’ ” Nelson says. “That’s a gold mine.” The Atlas network can also track Facebook users’ behavior on other websites, says Brad Smallwood, vice president for marketing science. Retailers can embed special Atlas code into their websites or apps that detect whether a customer buying a blouse she saw on her mobile browser viewed a related ad on Facebook. Atlas is an important test for Facebook, which gets more than 90 percent of its revenue from ads, as it tries to boost its appeal to mobile advertisers and compete with Google. The search giant commanded 37 percent of U.S. mobile ad revenue in 2014, more than double Facebook’s share, and has also begun tracking people across devices by using login data. Facebook’s ads, however, are more tailored to individual users based on what it knows about them.

• Etsy Closes Up 86 Percent On First Day Of Trading: Etsy, the online marketplace for handmade goods, went public today. Shares opened at $31 on the NASDAQ, popping up 94 percent from the initial set price of $16 per share. The company closed its first day of trading at $30 per share, an 86% percent rise from its initial price. The company raised over $287 million by selling 16.7 million shares before trading, valuing the company at nearly $1.8 billion. Stock went up close to $35 by mid morning. Etsy is now worth more than $3.5 billion. The handmade crafts company is not yet turning a profit, but has seen year-over-year growth in revenue for the past few years, rocketing from $74.6 million in 2012, to $125 million in 2013 and to $195.59 million last year. It had 1.4 million active sellers and 19.8 million active buyers as of December. The success of the company’s IPO bodes well for the technology liquidity market, as it could spur other firms waiting on the sidelines to pull the trigger on their own IPOs. The technology IPO market has been slow so far in 2015. Box listed its shares earlier this year, receiving a massive 70 percent day one pop. Box’s shares, however, have since receded. The success of Etsy’s IPO could shine especially bright for Shopify, another company that recently filed for its own initial offering. They are related, if not analogous companies; Shopify provides e-commerce tools to small and medium-sized business, a moderate contrast to Etsy’s own solution. Still, the companies both track the aggregate dollar flow through their respective platforms. Etsy saw gross merchandise sales (GMS) in 2014 of $1.93 billion, while Shopify saw gross merchandise volume (GMV) of $3.76 billion in the same period. Etsy derives, as you expect, more revenue per dollar-through-platform given its intimate status as the marketplace network itself, in contrast to Shopify’s SaaS solution that helps others build their own sales channels. Given the enthusiastic reception of Etsy by investors, Shopify might anticipate a similiary warm reaction given the shared overtones of the two companies. The latter company has yet to price.

• European Regulators Are Stifling the Ad Business for Google, Facebook and Others: Regulators, consumers fight some of their best tactics: This week, Google was the latest, and perhaps the hardest hit, by the scrutiny overseas, as the European Union charged it with anti-trust practices by favoring its own Web properties in search results over rivals. Often, Google serves up results for shopping items to the detriment of e-commerce competitors, and it delivers instant reviews, keeping traffic away from rivals like Yelp. The ultimate penalty could force Google to change its search tactics, but the probe could also veer into other aspects of its business that impact advertising. Here in the U.S., regulators declined to label Google a search monopoly when they fully investigated the company in 2013, but they still closely watch how it competes with rivals and deals with consumers. The Mountainview, Calif.-company is not alone in these tense situations with European leaders. Facebook has been hit over user privacy, especially in Germany. The continent also is going after tech companies over taxes and security issues. The less the companies are able to operate freely, the less data they can accumulate, and the less finely tuned—and less valuable—their ads are, according to marketing experts. This week, industry research group eMarketer, which tracks global marketing spending, found social ad revenue is growing more slowly in western Europe than in North America or Asia. Meanwhile central and eastern Europe lagged further behind, and the disparity in overall digital growth was even greater. A number of factors drive digital ad dollars, but one is the ease with which tech companies can collect data on users, target ads and charge for such messages. European attitudes could hinder one of the most effective types of digital advertising, retargeting. "One of the main attractions to social media from advertisers (particularly to Facebook and Twitter, who own 75 percent of spending in this market) is the ability to use data to target customized audiences," said Dan Marcec, public relations director at eMarketer, in an email. "So any restriction on that would have an effect." Google wants to give brands new retargeting tools for search ads, according to reports this week. A source confirmed the company is interested in using advertisers' e-mail lists to do so. When reached for comment, Google said it always considers new products, but had nothing to share at this time. Another digital advertising source said Google's interest in retargeting could attract more regulatory spotlights. Fair or not, while Twitter and Facebook build fully integrated data machines for targeted ads across the Web, Google sometimes gets closer review in the U.S. and Europe. "It's clear Google is starting to think about using search to inform more advertising, and it runs a risk with regulators," the ad executive said, speaking on condition of anonymity. Some of Google's top rivals, including Microsoft, are said to be leading the charge in tipping off regulators about practices they see as unfair—practices that touch on all corners of its business, like search, data, privacy and advertising.

• China Halts New Policy on Tech for Banks: China has suspended a policy that would have effectively pushed foreign technology companies out of the country’s banking sector, according to a note sent by Chinese regulators to banks. Dated Monday, the letter called for banks to “suspend implementation” of the rules, which have been at the center of a brewing trade conflict between the United States and China. The rules, put into effect at the end of last year, called for companies that sell computer equipment to Chinese banks to turn over intellectual property and submit source code, in addition to other demands. At stake is billions of dollars of business for major American companies that make the advanced computing hardware and software that crunches numbers for banks across China. Trade groups representing companies including Microsoft, IBM and Apple have complained that such policies are protectionist. Yet the development is only a small reprieve for American tech companies. The suspension is temporary as authorities revise the rules. It is unclear how regulators will change the rules, but industry officials say a new version — even if it avoids more contentious issues like forcing the disclosure of source code — will still be problematic to multinational tech companies. China’s vice minister of finance, Zhu Guangyao, informed Nathan Sheets, the Treasury’s under secretary, of the decision to suspend the rules during a meeting in Washington, a senior administration official said. The recent trade debate is part of a wider clash between China and the United States over online security and technology policy. Such backpedaling is rare for Chinese policy makers, yet there is a precedent. In 2009, China said all computers imported to the country must come with filtering software called Green Dam-Youth Escort preinstalled. After heavy international pressure, China suspended the rule indefinitely.

• With Eye on Mobile, Yahoo Revises Its Search Partnership With Microsoft: Yahoo and Microsoft announced on Thursday that they had amended their 10-year search partnership to allow Yahoo to deliver its own search results and ads for up to half the searches made by visitors to Yahoo sites and apps. Under the original agreement, struck five years ago, Yahoo was required to use Microsoft’s Bing search results and ads for all desktop searches, although it was free to use alternatives on mobile devices. Yahoo’s one billion users will not see a new search experience immediately, and any changes will probably be gradual. The venerable Internet company, which dominated web search before the rise of Google, sold its search technology to Microsoft under the original agreement and has only a small team devoted to search now. But Ms. Mayer, who oversaw the interface and other major elements of the search experience at Google, has made it clear that she wants Yahoo to innovate on search, and the company has been experimenting with new approaches on mobile devices, particularly in personalizing results and presenting ads. Search is vital to Yahoo’s business, accounting for 35 percent of the company’s revenue last year, or $1.8 billion. Under the original agreement, Microsoft gives Yahoo about 90 percent of the revenue from ads it shows on Yahoo. The companies said that under the revised deal, “this existing underlying economic structure remains unchanged.” Desktop users in the United States conducted 12.7 percent of their searches on Yahoo and 20.1 percent on Bing in March, according to comScore, a research firm. Google dominated the market with 64.4 percent of searches. Ms. Mayer and Microsoft’s chief executive, Satya Nadella, were both personally involved in the negotiations. Microsoft has poured billions of dollars into search, and Mr. Nadella is committed to remaining in the business. Microsoft was a primary agitator behind the European Commission’s decision on Wednesday to bring antitrust charges against Google, accusing the company of abusing its dominance in search to hurt consumers and competitors. Yahoo will now be able to sell desktop search ads to advertisers through its Gemini platform, which the company is building into a one-stop shop for buying ads across all Yahoo properties as well as other apps and sites in its network. Microsoft will gradually take over sales of all ads for Bing search, allowing it to integrate the team more closely with the people developing search technology. Previously, the premium ads were sold by Yahoo sales representatives.