Daily Tech Snippet: Thursday, July 28

• Facebook trounces Wall Street estimates with sharp ad sales growth: Facebook Inc provided more evidence on Wednesday that it can turn eyeballs into profit as the maker of the world's most popular app and social website trounced Wall Street's estimates, sending its shares to an all-time high. The leading social media company's mobile app and push into video attracted new advertisers and encouraged existing ones to spend more. It now has more than 1.7 billion monthly users, well ahead of any rivals. Its shares were up 5.4 percent in after-hours trading at $130.01, after hitting their highest since the company went public in 2012. Mobile advertising revenue accounted for 84 percent of the company's total advertising revenue, compared with 76 percent a year earlier. Total advertising revenue surged 63 percent to $6.24 billion, beating the average analyst estimate of $5.80 billion.Meanwhile, Facebook still has several untapped areas for revenue opportunities, including its WhatsApp and Messenger apps, both of which have more than 1 billion users. But Wehner said the company does not plan to monetize them any time soon, and that it is instead focused on building interactions between businesses and users on the apps. Facebook also owns picture-sharing app Instagram, which recently announced it has more than 500 million users. Facebook has yet to say how much money Instagram makes, but research firm eMarketer predicts it will make $1.5 billion in revenue this year.Total revenue rose 59.2 percent to $6.44 billion, ahead of analysts' average estimate of $6.02 billion.

• GoPro revenue plunges 47 percent, but beats estimates: GoPro's quarterly revenue plunged 47.4 percent, but beat analysts' estimates, which have been sharply lowered on shrinking demand for the company's body-mounted point-of-view cameras. The company's shares were up 2.4 percent in volatile trading after the bell on Wednesday. GoPro's revenue fell to $220.8 million in the second quarter ended June 30 from $419.9 million a year earlier.The company, whose cameras are worn by surfers, skydivers and other action junkies, said second-quarter units shipments rose 8 percent to 759,000 compared with the first quarter. Its average selling price increased 11 percent sequentially and 14 percent on a year-over-year basis. GoPro, however, maintained its full-year revenue guidance of $1.35 billion to $1.5 billion. Analysts on average were expecting revenue of $1.34 billion. GoPro posted a loss of $91.77 million, or 66 cents per share, for the second quarter.

• Groupon reports better-than-expected revenue, still not profitable: Deal site Groupon saw its shares rising today in after-hours trading, following a better-than-expected second quarter earnings report.Groupon revenue in the first half of 2016 reached $1.49 billion.Groupon beat Wall Street revenue expectations with second quarter revenue of $756 million. And it posted a better-than-expected net loss of $6.8 million on a non-GAAP basis, or $0.01 loss per share. In a phone interview, Groupon CEO Rich Williams said that the reasons the company did not make profits in the last quarter are essentially two: Groupon is still investing in marketing and other efforts to attract new customers, and they face other costs associated with company restructuring.In the first half of 2016, Groupon revenue looked better than it did over the same period last year. But the company is not looking quite as strong as it did in the first half of 2015 in terms of profitability.

Daily Tech Snippet: Friday, April 15

• Lyft Is Gaining on Uber as It Spends Big for Growth: In January, Lyft said it raised $1 billion, which is helping fuel the spending spree and steal market share from Uber Technologies Inc. To keep costs in check, Lyft has promised investors to cap its losses at no more than $50 million a month, according to a person familiar with the matter who asked not to be identified because the plans are private.Meanwhile, Uber has been working to fulfill its own promise to shareholders and employees that it would achieve profitability in North America by the second quarter of 2016, a milestone it says it has now reached in the U.S. and Canada. In February, Uber earned an average of 19¢ per ride in the U.S., according to previously undisclosed financial documents. Uber takes about a 25 percent cut of a typical fare, most of which goes to antifraud efforts, credit-card processing, customer support, marketing, and software development, the documents show. Not included in Uber’s profitability calculations are interest, taxes, or equity-based compensation for employees. Uber Chief Executive Officer Travis Kalanick’s commitment to profitability has left an opening for Lyft, and the smaller upstart’s free-spending strategy is starting to pay off.  Lyft says it has captured 45 percent of trips in Austin, Texas, and Los Angeles and 43 percent in San Francisco, where both companies are based. Uber says it had 55 percent of ride-hailing sales in Austin, 75 percent in Los Angeles, and 66 percent in San Francisco, citing third-party credit card data from the first two weeks of March. Uber says Lyft has shaken loose only a few percentage points. “From everything I’m looking at, we’re gaining share in all top 20 markets, which is where 80 percent to 90 percent of rides happen,” says Lyft President John Zimmer. “This continues to prove what we said all along, which is once you hit a certain level of scale, it’s a natural duopoly.” Outside of big cities, though, it’s still Uber country. Of 169 million trips booked through Uber worldwide in March, the company says 50 million of those were in the U.S. Lyft says it did 11 million U.S. rides that month, up from 7 million in October. Lyft continues to devise new—and often expensive—ways to expand in the U.S., the only country in which it operates. When a Lyft driver refers someone to sign up as a new driver, both get a $750 bonus in some cities. And Lyft has the capacity to keep spending. Zimmer says the company still has “by far the majority” of the $2 billion it’s raised from investors. “This allows us to control our own destiny. We do not need to raise any additional capital, and it’s just a fantastic position to be in.” Whether Lyft’s gains will stick remains to be seen. Uber says customers lured away by subsidies are the most likely to return if Lyft’s prices go up. “It’s easy enough to buy trips with heavy subsidies for drivers and discounts for riders,” Jill Hazelbaker, a spokeswoman for Uber, wrote in an e-mail. “But to build a successful, long-term business, you need a path to profitability—which Uber has always had.”

• Rocket Internet Drops in Frankfurt Amid $222 Million Loss: Rocket Internet SE, Europe’s biggest startup factory, fell the most in more than two months in Frankfurt trading after reporting a loss of 197.8 million euros ($222 million) for last year. While Rocket-backed companies continued to increase sales, operating losses widened at several of them, including at food delivery startup HelloFresh and e-commerce site Lazada, which drew an investment from Alibaba Group Holding Ltd. this week. Rocket had net income of about 429 million euros the previous year, according to the Berlin-based company’s statement Thursday. The shares fell 10 percent to 26.09 euros at 11:42 a.m. local time after dropping as much as 12 percent, the biggest intraday decline since Jan. 15.

• Whatever Happened to Facebook’s Slack Competitor Facebook at Work? Do you remember Facebook at Work? The version of Facebook specifically built for your office? The one that would send Slack and Yammer and email running for the hills? We almost forgot, too. But hidden among the Internet-beaming drones and 360-degree video cameras Facebook showed off this week at its annual developer conference in San Francisco was a Facebook at Work booth, a small, unheralded reminder that the future of workplace communications is also on Facebook’s radar. Add it to the list. When we last spoke to Facebook about Work, the company was gearing up to launch a freemium version of the software to the masses before the end of 2015. It’s now mid-April 2016, and Facebook at Work is still in a closed beta. So what happened? Is Facebook at Work still part of the game plan? So things are still moving. Just slowly. And that matters because Facebook’s top competition, tech startup Slack, is growing quickly in the interim. Facebook said it has 450 companies using the pilot, up from 100 in August, including some big companies like the Royal Bank of Scotland, which has more than 100,000 employees. More importantly, though, Facebook says it has 60,000 businesses that have signed up for its waiting list. That’s a lot of interested customers, but it’s unclear how many of them would actually pay for Work or use the free model. Slack, for comparison, has more than two million users and more than 675,000 users who pay (or have employers who pay for them). That’s more than 100,000 new paid users since December, the same time we thought Facebook would be out on the open market. Facebook has a tendency to turn small numbers into big numbers very quickly, so it’s not as though a few months’ delay means Facebook at Work can’t ultimately be a hit. But at a conference dedicated to Facebook’s future, Facebook at Work was a side note. And side notes can be hard to remember.

• GoPro’s developer program aims to connect its cameras to cars, toys and apps: GoPro on Thursday very quietly took the wraps off its new developer program, by which it hopes to get its action cameras hooked into as many third-party devices, vehicles and services as possible. The program was announced at a private event in San Francisco, where it showed off the fruits of various partnerships. The Periscope integration announced earlier this year is an example of what the company is hoping to achieve. There was also a snap-on time-code system that you can use to sync your footage (announced last week, but still new), a mount for kids’ toys from Fisher-Price and add-ons for tracking your route and vital statistics when parasailing, skiing and other extreme activities — you get the general idea. Partnerships with BMW and Toyota also suggest more automotive applications in the future. Perhaps the coolest item, shown off at the end of this highlight video, was a gesture-based camera control system for when your motorcycle gloves or [insert extreme garment here] prevent you from operating the app.

Daily Tech Snippet: Thursday, February 4

• Lenovo Tumbles as Sputtering PC, Phone Demand Hammers Sales: Lenovo Group Ltd. plunged in Hong Kong trading after quarterly revenue declined for the first time in more than six years on stalling demand for phones and computers. Shares fell 10 percent in their biggest decline in two years. The world’s largest PC maker said revenue dropped 8 percent in the three months ended December, even as broadening cost cuts delivered a surprise rise in net income. Lenovo is relying on cutting $1.35 billion from annual costs and eliminating 3,200 jobs to shield its earnings from intensifying smartphone competition and a shrinking market for PCs. While it’s expanding into other businesses, the company still gets more than half of revenue from a market that Intel Corp. last month warned was off to a “soft” start in 2016 amid tepid economic growth. Focusing internationally helped Lenovo lift the proportion of smartphone shipments from outside China to 83 percent from 59 percent. Expansion into markets from India to the U.S. helped shore up margins even as its global market share slipped about 1.5 percentage points to 5.1 percent in the period. The company once hailed as a symbol of global ambitions for Chinese corporations now faces the twin challenges of a competitive global smartphone and PC environment and a home country growing at its slowest pace in a quarter-century.

• GoPro forecasts revenue below estimates, names new CFO: GoPro forecast current-quarter revenue well below analysts' estimates on weak demand for its wearable cameras and the company named Brian McGee as its new chief financial officer. GoPro said McGee, who joined the company from Qualcomm in 2015, would succeed Jack Lazar as CFO on March 11. The camera maker's shares fell 10 percent in extended trading on Wednesday. Demand for GoPro's helmet- and body-mounted cameras has been declining as rivals such as China's Xiaomi XTC.UL offer cheaper products and smartphone cameras turn increasingly advanced. GoPro forecast revenue of $160 million to $180 million for the first quarter ending March. The company's revenue fell 31 percent to $436.6 million in the fourth quarter ended Dec. 31, missing the average analyst estimate of $496.1 million. GoPro, which had already released its quarterly numbers last month, reported an adjusted loss of 8 cents per share. Analysts had expected the company to break even on a per-share basis. The company's shares were trading at $9.72 after the bell. Up to Wednesday's close, the stock had fallen more than 80 percent in the past 12 months.

• Cisco to pay $1.4 billion for Internet of Things firm Jasper: Cisco Systems Inc said on Wednesday it was buying Jasper Technologies Inc, a startup that connects devices like cars and medical devices to the Internet, for $1.4 billion in cash and equity awards, its largest acquisition since 2013. Legacy technology companies like Cisco have been trying to find paths for growth while new technology developments, such as the rise of cloud computing, threaten their core businesses. The so called Internet of Things, the area Jasper specializes in, offers Cisco a chance to offer cutting-edge technology to its current customers such as telecommunications companies. Jasper connects devices like cars, jet engines and pacemakers to the Internet and also makes a software platform that helps monitor these devices once they are online. Jasper had been planning an initial public offering and had banks to help it prepare. Its investors such as Singapore's Temasek, Sequoia Capital and Benchmark Capital, will now get a chance to cash out without having to brave the rocky equity markets which have seen no technology IPOs this year. Jasper's chief executive Jahangir Mohammed will stay on with Cisco and run a new Internet of Things Software Business Unit once the deal closes in the third quarter.

• Dropbox May Not Be LeBron James, but It Is Still in the Game: There are no obvious signs of distress at the lavish San Francisco headquarters of the cloud storage company Dropbox, where on any given day, its hallways bustle with upbeat, well-compensated tech workers enjoying the customary trappings of start-up life. Dropbox is not laying off workers or shrinking; it hired nearly 500 people last year, 75 since the start of this year, and it plans to soon move into a sprawling, custom-designed office building for which it has signed a long-term lease. But that isn’t the image of Dropbox you’d encounter in the news media. Two years ago, the company raised a round of financing that valued it at $10 billion, making it one of the most highly prized start-ups of the tech boom. Now it faces a stock market that has turned unfriendly to initial public offerings of tech companies, not to mention stiff competition from publicly traded companies like Microsoft, Google and Box, the similarly named firm in a similar line of business. As a result, Dropbox’s valuation has been battered by a series of “markdowns” from large investors who appear to have turned skeptical about its future. For instance, the mutual fund manager T. Rowe Price now considers Dropbox’s shares to be worth half what they were at the time of the last fund-raising round. So what’s really going on at Dropbox? Is it thriving or dying? Neither one, yet. When you look inside the company, you find something that defies Silicon Valley’s typical straight-up or straight-down narrative: a complicated story of incremental and potentially accelerating success, but one clouded by outsize dreams of yesteryear. It’s a fate that other Silicon Valley start-ups may be facing, especially with the dip in public and private markets for funding tech ventures. Dropbox’s problems have less to do with the strength of its current business than with a delay, so far, in realizing the towering expectations that once surrounded the company. The start-up is like the college basketball star who manages to turn pro but is still regarded with doubt because everyone has now realized he might never be the next LeBron James. What happens to a company once thought to be worth $10 billion when it turns out to be worth only $5 billion, or $2 billion? According to Dropbox’s executives, nothing too terrible — it can just wait out the market freeze and perhaps grow into its $10 billion valuation. In other words, Dropbox can keep working and may yet turn into LeBron. The murkier issue is not whether Dropbox can build a good business, but whether it can ever become the $10 billion goose that investors had once seen it as. Reports of Dropbox’s demise are premature. But so are reports of its comeback.

• Amit Singhal, head of Search, to retire - will be repaced by head of AI: Amit Singhal, the company’s senior vice president for search, and one of the earliest builders of its global computer system, announced that he would retire on Feb. 26. He has been involved with many of the technologies that have made Alphabet an engineering powerhouse and one of the world’s most valuable companies. His replacement, John Giannandrea, currently works in artificial intelligence, or A.I., at Alphabet. A.I. has been increasingly important to Google and other companies like Amazon, as they seek to build products that can do things like respond to voice commands, deliver complex alerts about changes to a user’s schedule, or drive a car. In a post to the Google Plus social network, Mr. Singhal indicated that he wished to spend time with his family and intended to give away some of his fortune. “It has always been a priority for me to give back to people who are less fortunate, and make time for my family,” he wrote. Mr. Singhal, 48, joined Google in 2000 as employee No. 176. A native of India, he has a doctorate in computer science from Cornell and worked at AT&T Labs before Google. One of his earliest jobs at Google was rewriting the initial breakthrough algorithms developed by Google’s co-founders, Larry Page and Sergey Brin. Google was one of many search engines, but it distinguished itself both in the quality of its results and in building features like spell check, which could offer correct answers to misspelled queries. The early engineering team also developed search-related tools for its advertising, which quickly turned into a very profitable business. Unlike some other early Google employees who scaled back their efforts or left the company altogether, Mr. Singhal appeared to remain fully engaged in advancing search. In an interview last summer, he described his job as looking at “what’s beyond the horizon,” particularly in building ways that people can easily get information from mobile devices. Mr. Giannandrea, 50, came to Google from the 2010 acquisition of another company, Metaweb Technologies. He has played an important role in incorporating machine learning into various Google products, like the image recognition in Google Photos and smart replies in Gmail’s Inbox. In addition to Mr. Singhal’s stated philanthropic and family interests, it is likely that his skills in building large computer networks and in A.I. will still be in demand.

Daily Tech Snippet: Thursday, January 14

• Parallels Between Netflix and Amazon: Netflix has grown substantially over the last few years, now claiming more than 70 million subscribers who pay about $8 to $10 a month for access to a large library of movies and TV shows. Last year the streaming service’s stock was the best performing of the Standard & Poor’s 500-stock index, rising 140 percent. And its prospects keep looking brighter: Last week, Reed Hastings, Netflix’s goateed chief executive, announced he would make his movies and TV shows instantly available to almost every country in the world (the big exception, for now, is China). The move nearly doubled Netflix’s potential market — the service is now accessible to more than 540 million households worldwide with broadband Internet access. On paper, Mr. Hastings’s plan to take on the traditional TV industry has long sounded slightly nutty, as delusional as Jeff Bezos’s strategy at Amazon to overrun retailing once seemed. Netflix’s plan is certainly high risk — it is spending billions to create and license content, it is fighting determined media incumbents across the globe, and it owns none of the pipes leading into people’s homes. (Among Netflix’s many competitors is Amazon itself, which has its own growing and well-regarded original-content division) A capacity for surprise is the first and most obvious similarity between Netflix and Amazon. There are lots of others.  Like Amazon, Netflix is amassing a cache of intelligence on what customers want, and it’s using that data to create content that appeals to a wide range of demographics globally. And finally, Netflix, like Amazon, is a flywheel that keeps spinning faster: As it gets more subscribers, it gets more data and more money to fund more content, which in turn helps it bring in more customers, and on and on, ever faster. Netflix barely ekes out a profit now, but the bulls say that as the flywheel spins, it will eventually begin earning enormous sums.

• GoPro Issues Weak Q4 Revenue Estimates, Plans to Cut 7 Percent of Workforce - Stock down 20%: GoPro had a hard time selling cameras in the fourth quarter last year, and there are major layoffs planned at the camera maker and action sports media company. Wall Street did not take the news well. After a brief suspension in trading, the company’s stock is down more than 20 percent in after-hours trading. A release from the company says it anticipated $435 million in Q4 revenue and $1.6 billion in revenue for the 2015 calendar year, coming in way below what was expected. As a result, the company plans to cut 7 percent of its workforce. Additionally, the company’s top media exec, Zander Lurie, is leaving his job and moving onto the GoPro board. In email obtained by Re/code that CEO Nick Woodman sent to GoPro employees, Woodman places the blame for the layoffs on the “launch and pricing” of GoPro’s $399 Hero 4 Session camera last year: "Today’s announcement reflects the issues we faced in 2015, largely related to our launch and pricing of HERO4 Session. While we clearly made a mistake pricing Session at $399 (more specifically I made the mistake, it was my decision), I’m proud of how we responded. We recognized the problem, price adjusted to $299 … recognized that wasn’t enough and price adjusted again to $199 which positioned Session as the best entry-level product we’ve ever made." GoPro’s stock has dropped precipitously over the last year as it has struggled to sell more cameras and develop its media business.

• The big fund manager mistake of 2015? Being de-FANGed:  Missing out on the hot technology stocks known as the "FANG" group last year came back to bite some well-known mutual funds. Funds that avoided Facebook, Amazon.com, Netflix and Google - now Alphabet – dramatically underperformed peers that loaded up with the fast-rising tech stocks, according to a review by Thomson Reuters’ Lipper unit. In fact, despite a volatile year in which active managers faced shifting trends in many sectors, it seems that simply choosing to overweight the FANG group was the path to beating the market. Without them, the S&P 500 Index would have declined 2.7 percent last year; instead it fell 0.7 percent, according to Goldman Sachs Global Investment Research. For the year, among 228 funds reviewed by Lipper, those that had less than 5 percent exposure to the FANG group fell 1.3 percent on average; funds with more than 10 percent exposure rose 6.4 percent. Shares in Amazon and Netflix more than doubled last year as both added more content and subscribers to their competing video-on-demand-services. Facebook rose 34 percent as the social media giant continued to increase mobile ad revenue, while Alphabet also increased revenue and showed more cost discipline, boosting its shares 47 percent. Of the four, all but Amazon have outperformed the S&P 500 so far in 2016 through Tuesday, although it is far too soon to say if the group will repeat its performance for investors in 2016.

Daily Tech Snippet: Friday, December 11

• Twitter Aims to Show Advertising to Much Wider Audience: Twitter has long argued that its reach and influence extends far beyond the 320 million people who log into its social media service at least once a month. Tweets are embedded on thousands of other websites and apps, emailed, displayed on television and published in newspapers. Now the company plans to start making money from the vast number of people who are not signed in to the service but may click on a tweet they find through a web search or that is sent to them via email or text — an audience Twitter estimates at more than 500 million people worldwide. In a blog post on Thursday, the company said it has begun showing advertising to some of those casual viewers when they click on the link to a tweet or visit a Twitter user’s profile page. About 60 advertisers are participating initially, with the ads, known as promoted tweets, aimed at people in the United States, Britain, Japan and Australia. But the program, which has been in development for more than a year, is expected to ramp up quickly. These ads, which will be on the desktop web version of Twitter at first, won’t be quite as finely targeted as typical Twitter ads, relying on context, like other pages people have recently browsed, for targeting. Twitter estimates that each of these “logged out” users could be worth $2.50 a year to advertisers, compared with about $4 a year for active users. Wall Street, which has been focused mostly on Twitter’s lack of growth in active users, sees lots of potential in the program, and Twitter’s stock rose almost 7 percent on Thursday.

• GoPro's First Drone, Due Out in 2016, Will Be Called 'Karma': GoPro recently said it will debut its first drone in early 2016, and now the company has announced the brand name—Karma. On Wednesday, the company made the revelation by pushing a one-minute YouTube teaser. The video is a cut-up of the unbranded two-minute clip that GoPro uploaded to the video site on Oct. 28, when it originally disclosed its latest hardware. The longer spot has garnered nearly 4 million views since then. There's not much information about the drone—in terms of what it looks like or how much it will cost—in the video or on its dedicated website. But developing and marketing the product makes a lot of sense since so many GoPro enthusiasts have been attaching the high-def camcorders to drones made by other hardware companies. There are literally thousands of videos from such productions on YouTube.  

• Facebook to Publish Designs for `Big Sur' AI Computer Hardware: Facebook’s use of artificial intelligence, which ranges from tools for image recognition to the filtering of the news feeds for its social network, demands special computing infrastructure. The company recently began building custom servers for its artificial intelligence workload and Thursday announced it would release the designs for that powerful hardware to the world -- for free. The company said the plan to open-source the blueprints of the servers -- called “Big Sur” -- would help other companies and researchers benefit from the incessant tweaking of Facebook’s developers. This follows  Google’s release last month of a software tool for building AI systems named TensorFlow. The servers are built around graphical processing units from Nvidia Corp. GPUs are widely used in artificial intelligence because the chips have far more individual processing cores on them than traditional processors produced by Intel Corp., making them adept at the dumb-but-numerous calculations required by AI software.

• Wal-Mart adds to mobile wallet frenzy with 'Walmart Pay': Wal-Mart launched its own mobile payment service Walmart Pay on Thursday, potentially dealing a sharp blow to the ambitions of a mobile wallet the company had been co-developing with a consortium of retailers. The mobile payments space in the U.S. has seen a flurry of new launches and partnerships in the past year but has failed to gain traction as customer and merchant adoption have been sluggish. CurrentC - whose developers included Wal-Mart, Target and Best Buy among others - was likely to prove strong competition to Apple's Apple Pay because it was developed as a single payment solution that could be used at many retailers and integrate their loyalty programs. But years of delay, a data breach and management changes hurt its prospects. An increasingly bigger worry for CurrentC is the end of its exclusive partnership with most of its members, which means they can now accept other mobile payment options at their stores. A survey released by data firm InfoScout found Apple Pay use to be at its lowest rate since the firm started tracking it. Shoppers used it this past Black Friday for only 2.7 percent of eligible transactions.

• Rovio’s CEO Steps Down After Just Over a Year: Last August Pekka Rantala took over the role of Rovio CEO from co-founder Mikael Hed, but just over a year later he’s already stepping down. He’s to be replaced by Kati Levoranta, former chief legal officer for the Angry Birds maker. Rantala says that “I feel now the time is right for me to step aside and move on to new challenges.” Despite being in the role for a relatively short period, Rantala presided over a tumultuous time for the game developer. Last October the company laid off 130 employees, and followed that up with 260 more job cuts in August, more than 30 percent of its workforce. The initial, unexpected success of Angry Birds caused the company to expand in many directions, yet it never managed to follow up Angry Birds with another big hit.

Daily Tech Snippet: Thursday, October 29

• Flipboard's Fanfare Fades as Executives Exit, Sale Talks Stall: Flipboard Inc. debuted in 2010 with the kind of fanfare any startup would envy. The news-reading app piggybacked perfectly on the debut of Apple’s iPad tablet and Steve Jobs’s promise of a new era for digital media. Critics loved Flipboard’s magazine-like layout, created by one of the first software designers of the iPhone, and investors poured money into the company. Almost five years later, Flipboard is struggling to live up to the praise. Several senior executives have departed, including co-founder Evan Doll, and talks to sell the company haven’t reached the finish line, according to people familiar with the plans, who asked not be named discussing private matters. Flipboard’s woes are indicative of a larger malaise gripping startups across the technology landscape as questions emerge about the sustainability of the tech-investment boom. Flipboard is performing well enough -- and, after raising more capital earlier this year, is at no risk of going out of business -- but is no longer a breakaway hit. People are finding media through their Facebook or Twitter feeds, limiting the need for a stand-alone application like Flipboard. Meanwhile, advertising rates -- the company’s main revenue stream-- have been in decline. While Flipboard’s reading app was a showpiece for the iPad five years ago, the company is now working to adjust to a changing digital-news market and live up to its $800 million valuation. Other companies facing similar questions about whether they can make good on early investor expectations -- and lofty private-market valuations -- include online storage service Dropbox Inc., note-taking company Evernote Corp., music-streaming service Deezer SA and blood-testing company Theranos Inc., said Anand Sanwal, chief executive officer of CB Insights, a firm that tracks startup investing. The companies face a challenge in that they could be too expensive for another company to buy, yet may not have the business fundamentals to justify their valuations to public investors through an initial public offering, he said.

• Samsung Deploys Cash Pile With $10 Billion Buyback, Capex Boost, As Phones Fail To Revive Growth: Samsung Electronics is tapping its $50 billion cash pile to buy back shares and invest in its components business after struggles in the smartphone division battered investors. Shares surged. The company will buy back and cancel 11.3 trillion won ($10 billion) of shares and boost capital spending by 14 percent this year, Samsung said Thursday. The announcements came after the company posted profit that trailed analyst estimates. Capital expenditure will rise to 27 trillion won this year as the company invests in chips and display plants.  Samsung is struggling for an answer to Apple Inc. in high-end smartphones, trying price cuts, a $120 rebate program and new models to tempt consumers from buying iPhones. That has prompted a renewed focus on making components for earnings growth, with new semiconductor and display plants to get its parts into other vendors devices. Samsung said it will increase capital spending after posting profit that missed analysts’ estimates as price cuts on new Galaxy S6 smartphones failed to sway consumers from buying iPhones. Capital expenditure will rise 14 percent to 27 trillion won ($24 billion) this year, the company said Thursday. Net income, excluding minority interests, was 5.31 trillion won ($4.7 billion) in the third quarter with profit to fall in the current period, Samsung said. Increased marketing spending, including a $120 rebate program, hasn’t sparked sales of the premium devices that generate fatter profit margins. Samsung is investing in computer chip plants as it tries to revive Galaxy smartphone demand through a new mobile payment service and by releasing larger devices at least a month before the new iPhones to recapture market share from Apple Inc. Shares of Samsung rose 4.9 percent in Seoul, the highest since May. The rally erased their decline for the year.

• Ebay Exceeds Expectations While Paypal Flops: PayPal CEO Dan Schulman defended his strategy of inking deals with big merchants and smartphone applications and offering free peer-to-peer payments as investors sent shares down on concerns the efforts are hurting the company’s quarterly profit. PayPal, in its first quarter as a stand-alone company separate from EBay Inc., said it added 4 million accounts to reach 173 million users. Its total payments volume gained 20 percent to $69.7 billion from a year earlier. But investors reacted to the company’s declining take rate, a measure of how much money PayPal keeps from each payment made on its platform. That metric fell to 3.24 percent in the third quarter from 3.39 percent a year earlier, the company reported Wednesday in a statement, and shares dropped as much as 7.8 percent in extended trading. The goal of the July split with EBay was to make sure that each company could focus on their main businesses. EBay last week reported quarterly profit and sales that topped analysts’ estimates and raised its outlook, sending shares up the most in 10 years. PayPal’s strategy is to attract more customers and merchants and offer them expanded services as competition in the payments industry intensifies with startups Square Inc. and Stripe Inc. as well has Apple Inc. and Google Inc. who are trying to create digital wallets. Even JPMorgan Chase & Co., entered the digital payments race Monday. PayPal is processing more payments in stores like Macy’s and on popular smartphone applications like Uber and Airbnb. But PayPal keeps less money from each transaction because the clients that bring bigger volume to the payments company also have the leverage to negotiate lower rates. The downside of that strategy was on display when Square disclosed its money-losing relationship with Starbucks Corp. The challenge for Schulman is to differentiate PayPal as competition intensifies. Among the additional services the company offers is a merchant cash advance program called PayPal Working Capital, which gives preapproved loans to businesses that process payments through PayPal. PayPal also is getting into the international money-transfer business by purchasing Xoom Corp. for $890 million in a deal announced in July.

• Yelp - struggling so far this year - beats Street expectations on revenue sending shares up 7%: Yelp reported a bigger-than-expected 40 percent jump in quarterly revenue as more local businesses advertised on Yelp.com, its consumer review website. Shares of the company, whose website and app allow users to rate restaurants and a variety of other businesses, rose about 7 percent after the bell on Wednesday. To Wednesday's close of $22.07, Yelp's stock had fallen nearly 60 percent this year. San Francisco-based Yelp, which gets about four-fifths of its revenue from local advertisers, said the number of local advertising accounts rose about 37 percent to 104,200 in the third quarter. Yelp has been investing to grow its website beyond user reviews by investing in services such as restaurant reservations, food ordering and delivery. The company reported a net loss attributable to common stockholders of $8.1 million, or 11 cents per share, for the quarter ended Sept. 30, compared with a profit of $3.6 million, or 5 cents per share, a year earlier. Revenue rose to $143.6 million from $102.5 million.

• Verizon says Internet of Things revenue at $500 million year-to-date. Aimed at connecting to the Internet everything from household devices to industrial machines, the business is growing at a "double-digit" rate, Mike Lanman, senior vice president of enterprise products at Verizon said at an event in San Francisco. "A large portion of our revenue comes through connectivity but a significant part of it comes from the application layer already," he said in a phone interview after introducing a platform to help customers develop applications in healthcare, agriculture, utilities and connected cars. Last year, Verizon's annual revenue from the business totaled $585 million. The global Internet of Things market is expected to grow to $1.7 trillion in 2020 from $656 billion in 2014, according to market research firm IDC. Examples include Verizon's fleet management tracking application and a partnership with Intel Corp (INTC.O) to provide water management sensors in vineyards, Lanman said. At the event, Verizon also unveiled a chip that Lanman said halves the cost of connecting low data usage devices like dog trackers to high-speed networks. AT&T has also been working on growing its "Internet of Things" business and previously launched initiatives such as a cloud-based data-analytics platform for companies and a global SIM card for connected cars. AT&T said last week it added 1.6 million connected devices including 1 million connected cars in the third quarter of 2015.

• Alphabet, Indonesian companies to expand Web access via balloons: Alphabet, the new holding company for Google, has teamed up with three Indonesian telecommunications companies to expand Internet access in that country using solar-powered balloons. Alphabet officials, including co-founder Sergey Brin, and representatives from Indonesian companies Telkomsel, XL Axiata Tbk PT (EXCL.JK) and Indosat Tbk PT (ISAT.JK) signed an agreement Wednesday to bring so-called Project Loon to the nation of 250 million people. The project sends solar-powered balloons 16,000 feet (5,000 meters) into the air to deliver Internet access through radio frequency signals to antennae connected to buildings on the ground. The balloons use algorithms to find the best winds to carry them along their charted course. Project Loon is part of Alphabet's secretive X division, where the company experiments with far-off technologies dubbed "moonshots" such as its self-driving car technology. Alphabet and its partners will deploy hundreds of balloons in 2016 over the country of more than 17,000 islands in an effort to determine where gaps in service lie as part of the tests before full-scale service is launched. The U.S. tech company has already tested the project in Brazil, New Zealand and Australia but with only a single carrier. Project Loon Vice President Mike Cassidy said the Indonesian partnership marks the first time it will send signals from multiple telecommunications companies through a single balloon, and that it will be the service's largest deployment to date and could eventually reach 100 million users. Cassidy said the effort is also a model for how Alphabet will move the product into the commercial market. He said the telecommunications companies will use the trial period to determine pricing and billing while Google works out technical issues.

• GoPro Plunges 15% After-Hours Following Q3 Earnings Miss: GoPro took a dive Wednesday after releasing Q3 financials that disappointed street expectations. At the market’s close, GoPro reported a miss on its Q3 earnings, posting an adjusted $0.25 per share on $400.3 million non-GAAP revenue during the period. Those figures compared to street expectations of a $0.29 per-share profit, and revenue of $433.6 million. The action camera maker’s $400.3 revenues represented a 43% year-over-year increase from $280.0 in Q3 2015, with EPS also up significantly from $0.12 in the corresponding quarter last year. The company shipped 1.6 million camera devices in Q3, up 46% from Q3 2014, but still less than the street had expected. Interestingly, GoPro emphasized how important foreign markets, specifically China, had been to the company’s growth. Sales outside of the U.S. reportedly made up more than 50% of the company’s revenue. The company said China was “the fastest growing market in GoPro’s history.”

Daily Tech Snippet: Monday January 19

• "The toll road into China": Customs pre-approval, forex handling part of Alibaba's major push to connect American retailers with Chinese consumers: Anchored by Alipay, the dominant Chinese electronic payments system that works closely with Alibaba and is controlled by its executives, the world's largest Internet retailer is using the calling card of China's consumers to attract U.S. partners, two sources close to the company told Reuters. Long seen as the most potent threat to Amazon.com Inc (AMZN.O) with $300 billion in global sales, the moves add up to a conservative approach to expanding in the United States, contrary to industry speculation that the company may be plotting a direct assault on U.S. soil. At the heart of its push are Alibaba's and Alipay's trial deals to handle Chinese sales, payment and shipping for some of the biggest names in U.S. retail from Neiman Marcus Group [NMRCUS.UL] to Saks Inc. Both confirmed the agreement but would not talk about how the pilots are faring. The Chinese companies will also work with U.S. startup Shoprunner, an online mall for U.S. retailers in which it owns a stake, and retail services provider Borderfree Inc (BRDR.O) to court Chinese consumers. And Alibaba is preparing a marketing campaign to raise awareness among U.S. businesses of its global business-to-business wholesale platform, Alibaba.com, so they can buy and sell to and from global suppliers. Alipay and a logistics-partner network that took years to assemble are central to Alibaba's U.S. effort. Major brands, such as Nike, that have a large physical presence in China already sell directly on Tmall. But Alipay's effort directly connects American merchants with China, without the need for investment in a physical presence. It also allows U.S. retailers and Chinese consumers to avoid difficulties associated with foreign exchange. Chinese consumers pay in yuan; U.S. companies get paid in dollars. Alibaba's and Alipay's program for U.S. companies is called ePass. It includes a customs pre-approval process, a sort of "fast lane" that shaves days off delivery. Daiwa analysts John Choi and Alex Liu call that capability Alibaba's biggest advantage over rivals such as JD.com (JD.O). Alibaba and Alipay have made pilot agreements to handle payments and shipping to China for department stores Neiman, Saks, Macy's Inc (M.N), Macy's Bloomingdale's chain, Ann Taylor, luxury fashion site Gilt, and apparel label Aeropostale (ARO.N), according to Borderfree. The companies declined to comment, although Neiman, Saks and Ann Taylor confirmed the deal. If a Chinese consumer bought a pair of shoes from Saks, for instance, Alipay would handle the financial transaction. The shoes go to a U.S.-based Alipay facility that handles the transfer to China. After clearing customs, a local partner typically would handle final delivery. "They own the toll road into China"

• Verizon's "supercookies" - injected into customers web traffic - are being used by an ad targeting firm that works with Google and Facebook on audience targeting: Back in November, privacy experts warned that a new kind of tracking technology called "supercookies" could allow Verizon Wireless customers to be monitored wherever they went on the Internet -- even if they took steps to protect their anonymity. Verizon downplayed those concerns. But now privacy researchers say they've uncovered an advertising company that is using the supercookie to help track the online activities of Verizon Wireless customers. Turn, an online advertising company that works with Google and Facebook, uses a unique identifier Verizon Wireless injects into its customers' Web traffic to collect data that makes it easier for advertisers to place targeted online ads, according to the researchers. Verizon, which developed that supercookie, a string of characters known as "Unique Identifier Header" or UIDH, to use for its own online advertising program, said it was looking into the issue. "We are evaluating how third parties are using the UIDH in this evolving ecosystem and considering any appropriate response," Verizon Wireless spokesperson Adria Tomaszewski told The Post in a statement. Turn says it is "reevaluating" its methods and will suspend the respawning cookie. Verizon began tracking its retail customers -- those not on government or business contracts -- with this supercookie in November 2012. Customers can opt out of having their demographic data shared with Verizon's advertising partners, but they cannot opt out of having the supercookie attached to their Web traffic. Turn's use of the identifier highlights how data about someone's online tracking practices can sometimes be deployed beyond its original intent -- making it harder than ever for consumers to control who has knowledge about their online activities. According to research by Jonathan Mayer, a Stanford graduate student and privacy expert, Turn uses Verizon's identifier as a signal to "re-spawn" or bring back traditional cookies that customers have taken steps to remove. That conclusion was confirmed by ProPublica. Turn's general counsel and chief privacy officer, Max Ochoa, confirmed Mayer's analysis of how its program worked in an interview with The Post. In a blog post, Ochoa defended the company's practices, arguing that clearing cookies does not necessarily indicate that users did not want to be tracked. Verizon defended the supercookie in the face of criticism, posting a message on its Web site saying "it is unlikely that sites and ad entities will attempt to build customer profiles for online advertising" and noting that the identifier "changes frequently." Researchers and privacy advocates weren't convinced. Unique codes that are associated with consumers online activity often get shared in the larger advertising ecosystem in a process known as "de-anonymizing" which allows Web sites, advertisers and data brokers to piece together more complete portraits of the users they hope to target, experts say. "A tracking technology like this could be used to build a comprehensive list of everywhere an individual is going online," said Moy. That could reveal information about a person's health, religion, family status, sexual preferences, and other highly intimate aspects of your life, Moy said.

• Seed funding is stagnant, but Series A and later rounds are still hot, analysis of VC funding data indicates: New data published today by Mattermark CEO and co-founder Danielle Morrill concerning the venture capital industry paints a relatively stiff picture: Seed rounds are taking it on the chin. More precisely, according to Mattermark, the number of seed rounds in 2014 fell compared to 2013, and the trend is accelerating. Bear in mind that the total dollar amount of money flowing into seed deals barely declined, so, of course, we are seeing the average seed deal increase. All this should square with your gut. It has felt for some time that the number of yahoos picking up a million dollars to build flipmeat for Yahoo has been declining. At the same time, the seed round your friend raised was almost a Series A. The data agrees. So has the seed bubble popped? I think it’s fair to say that it has despite the only slight decline in the total dollar amount that is being invested at the level. That’s due to the fact that we’ve become too loose with what counts as a seed round. So if we used an older measuring stick, the downtick would be more accelerated.

• Facebook releases pattern recognition software to open source; potential applications include inferring the intent behind an internet search: Facebook said Friday that it was donating for public use several powerful tools for computers, including the means to go through huge amounts of data, looking for common elements of information. The products, used in a so-called neural network of machines, can speed pattern recognition by up to 23.5 times, Facebook said. The tools will be donated to Torch, an open source software project that is focused on a kind of data analysis known as deep learning. Deep learning is a type of machine learning that mimics how scientists think the brain works, over time making associations that separate meaningless information from meaningful signals. Companies like Facebook, Google, Microsoft and Twitter use Torch to figure out things like the probable contents of an image, or what ad to put in front of you next. “It’s very useful for neural nets and artificial intelligence in general,” said Soumith Chintala, a research engineer at Facebook AI Research, Facebook’s lab for advanced computing. He is also one of the creators of the Torch project. Aside from big companies, he said, Torch can be useful for “start-ups, university labs.” Certainly, Facebook’s move shows a bit of enlightened self-interest. By releasing the tools to a large community of researchers and developers, Facebook will also be able to accelerate its own AI projects. Mark Zuckerberg has previously cited such open source tactics as his reason for starting the Open Compute Initiative, an open source effort to catch up with Google, Amazon and Yahoo on building big data centers. Torch is also useful in computer vision, or the recognition of objects in the physical world, as well as question answering systems. Mr. Chintala said his group had fed a machine a simplified version of “The Lord of the Rings” novels and the computer can understand and answer basic questions about the book. “It’s very early, but it shows incredible promise,” he said. Facebook can already look at some sentences, he said, and figure out what kind of hashtag should be associated with the words, which could be useful in better understanding people’s intentions. Such techniques could also be used in determining the intention behind an Internet search, something Google does not do on its regular search.

• Palantir raised money at $15B recently, and is looking for more: Palantir Technologies Inc. raised money at a $15 billion valuation late last year and is now looking for more funding, according to people with knowledge of the situation, as the data-analysis software startup seeks to expand its business. Palantir raised the money in late 2014 because investors were eager to invest, said one of the people with knowledge of the matter, who asked not to be identified because the details are private. The round totaled $500 million and was completed in November, said another person, who added that Palantir is currently raising even more financing. A Palantir representative declined to comment. The Wall Street Journal earlier reported Palantir’s $15 billion valuation and current funding plans. The new valuation is up from the $9 billion that Palantir was valued at in late 2013 and underscores the soaring values of startups across Silicon Valley. Uber Technologies Inc., a San Francisco-based mobile car-booking company, reeled in two financings exceeding $1 billion each last year and was valued at $40 billion last month. Investors have been pumping money into U.S. startups, to the tune of $48.3 billion last year, the most since 2000, according to the National Venture Capital Association and PricewaterhouseCoopers. Palantir got its start building software that helped tie disparate databases together to make it easier to search and analyze information. The technology was a hit among police agencies and intelligence services that wanted to illuminate patterns of behavior among individuals and manage large volumes of data more efficiently. Wall Street firms have since emerged as Palantir’s biggest customers, using the company’s software to detect fraud and evaluate loans, among other things. Last March, hedge fund SAC Capital Advisors LP hired Palantir to boost surveillance.

• GoPro's stock dropped 12% after Apple patent, possibly because past Apple patents foretold gamechangers: Patents are granted all the time, but when Apple gets one, companies often shudder at the prospect that the tech giant may try to muscle into their industry. GoPro's stock dropped 12 percent after the iPhone maker got a patent for a remote control system to take photos. In 2005, Apple filed a patent for "hand held electronic device with multiple touch sensing devices." About two years later, the company unveiled its first iPhone, and people walking down the street never looked up again. In May 2005, the U.S. Patent and Trademark Office granted Apple a design patent vaguely titled "electronic device." But the images clearly resembled what would be revealed five years later: the iPad. If there was any doubt that Apple was going to replace Google Maps with its own app on the iPhone, that should have been put to rest in May 2012, when the Cupertino, California, company filed a patent for "system and method for navigation guidance with destination-biased route display." As you might have guessed, about two weeks later, Apple announced at the Worldwide Developers Conference that it was kicking Google's app to the curb in favor of its home-cooked alternative. Before Apple Pay was announced last September, a number of the company's patents had pointed to its interest in providing a mobile payment service. One of them, filed in March 2011, was for a "method and system for payment and/or issuance of credits via a mobile device." Apple's interest in biometric security is an example where companies in that industry didn't shudder. Instead, they were elated by the attention paid to them by Apple and its rivals. Other phone makers, some of which had rudimentary fingerprint sensors predating the iPhone 5S, were less enthused. Apple showed its interest in incorporating an embedded authentication system back in this patent filed in 2008. In 2013, the iPhone 5S came with a fingerprint scanner on the device's home button.

• Virtual reality goggles, drones and data centers are all driving a hiring spree at Facebook Inc (FB.O) that is set to swell its ranks as much as 14 percent in the near term, according to a review of job listings on the company's website. Oculus Rift, the maker of virtual reality headsets that Facebook acquired in a $2 billion deal last year, is among the key areas slated for growth, with 54 jobs listed on its website, according to a review by Reuters of listings. Among the roles that Facebook needs to fill for the Oculus business are managers to oversee logistics, procurement and global supply chain planning - a sign, some analysts say, that the product is nearing its commercial release. Facebook’s ambitious effort to build its own satellites and drones capable of delivering Internet service to remote regions of the world is another important area for hiring: the program has Facebook searching for specialists in areas such as avionics, radio frequency communications and thermal engineering. Atlas, the online advertising technology that Facebook acquired in 2013, is another big area of hiring, with more than 20 open positions listed. Facebook had 8,348 full-time employees at the end of September, far fewer than Google’s roughly 55,000 employees or Microsoft Corp’s (MSFT.O) roughly 127,000 (Microsoft announced in the summer that it plans to cut 18,000 jobs). At the same time, Facebook gets more out of each employee, according to calculations using company revenue figures. Facebook’s revenue works out to roughly $384,000 per employee in the third quarter of 2014, versus $300,000 for Google and $183,000 for Microsoft.

• Uber plans to introduce background check procedures for its drivers in India, the company said Thursday evening, in a move that comes weeks after a driver was charged with rape there. The episode prompted wider scrutiny of the ride-hailing service that is now banned in some parts of the country. The company started operating in the Delhi region of India in late 2013, but has not screened those drivers, according to local Uber executives. Previously, Uber accepted new drivers if they presented proof of insurance, a driver’s license and a commercial permit to drive a taxi. That will soon change. Uber will run a series of more stringent checks on its drivers, which include a formal background check, verification of character by the local police and checks to detect fraud in driving and vehicle permits. Since the rape, Uber has pointed out the difficulty of screening drivers in hundreds of cities across the world, an argument that the company has also used in the United States to support its background check procedure. “This unfortunate incident has highlighted challenges in the systems due largely to nondigitized record-keeping and the lack of a centralized database for criminal offenders,” Ms. Delivala said. “To ensure verifications are legitimate and reliable, more needs to be done at the ground level.” In the United States, background checks for Uber are conducted by Hirease, a third-party service, which checks city, state and federal records. Lawmakers in many states, including California, Colorado and Illinois, have contested this approach, citing the more stringent checks required of taxi and limousine drivers.

• Evernote's new app turns smartphones into scanners via image-to-text conversion software: Scannable, an app from the note-taking service Evernote, turns your smartphone or tablet into a scanner by simply taking a picture of the document you want to record. Using recognition software, the app can then identify the words on the documents you’re scanning, so that you can search for keywords later. It will scan business cards and let you create new contact cards on the iPhone or iPad straight from the app — no typing required. The app doesn’t pick up every thing on a document, particularly if papers have been folded or crumpled. If you’re working on something for an official application or document, you may still want to opt for the old-fashioned scanner. But if you’re looking to keep quick notes or add contacts to your address book in a pinch, it’s reliable, free and easy to use. Free, for iOS devices.

Daily Tech Snippet: Wednesday January 14

• Instacart raises another $220M, valued at > $2B; Pinterest like UI, nimble org drive 10x growth in 2014: Instacart announced it had closed a $220 million round of venture capital from Silicon Valley investors like Kleiner Perkins Caufield and Byers, Sequoia Capital and Andreessen Horowitz, among others. The new round brings the total amount of funding raised to $275 million, and values the company at a whopping $2 billion, according to two people familiar with the matter, who spoke on the condition of anonymity because of continuing ties to the company. It is an ambitious bet on the future of how we think about grocery shopping and delivery services. The company, which was founded in 2012, allows customers to peruse the online catalogs of their favorite grocery stores — like Whole Foods, a major Instacart partner — and schedule deliveries directly to their homes. The user interface is akin to other consumer tech start-ups, like Pinterest, and lays out everyday grocery items in a simple-to-browse grid. Instacart is currently available in 15 American cities. The concept is not entirely new. Competitors like Fresh Direct, which operates primarily in New York, have offered local grocery delivery services for more than a decade. And even larger technology giants like Google, eBay and Amazon — companies with much more money and vastly greater resources than Instacart — have tried to play in the space with their own same-day delivery services. Apoorva Mehta, Instacart’s chief executive, said his company’s size and structure is why it is likely to succeed. “We have the ability to try new things in a very quick way,” Mr. Mehta said in an interview. “We don’t hold inventory, we don’t own warehouses, we don’t own trucks. The changes we make are software changes.” That, Mr. Mehta said, is in stark contrast to companies like Google and eBay, which are much larger and offer a wider range of delivery items. Ebay Now, eBay’s same-day service, touts its ability to deliver anything from big-screen TVs to hammers and nails from companies like Best Buy and Home Depot. He said Instacart’s focus on one particular type of product, groceries, allows the company to be more nimble than its competitors. The proof, Mr. Mehta said, is in the growth numbers. Instacart would not provide specific financial information, but it said that its revenues grew by more than a factor of 10 in 2014, and doubled in the final quarter of last year alone. While the company employs only around 100 employees, it has more than 4,000 contract employees who do its shopping and delivery.

• IBM Introduces z13, a mainframe with potential eCommerce applications: more coverage here IBM has designed the latest version of the mainframe, which is being introduced on Wednesday, with the smartphone in mind. The new mainframe, the z13, has been engineered to cope with the huge volume of data and transactions generated by people using smartphones and tablets. IBM spent $1 billion to develop the z13, and that research generated 500 new patents, including some for encryption intended to improve the security of mobile computing. Much of the new technology, Mr. Rosamilia said, is designed for real-time analysis in business. For example, he said, the mainframe system can allow automated fraud prevention while a purchase is being made on a smartphone. Another example, he said, would be providing shoppers with personalized offers while they are in a store, by tracking their locations and tapping data on their preferences, mainly from their previous buying patterns at that retailer. These real-time applications, according to Donna Dillenberger, a distinguished engineer at IBM’s Watson lab, can be done in a mainframe environment. They are not yet possible on clusters of smaller, industry-standard computers, she said. But there are several open-source software projects, like Apache Spark, that focus on real-time data processing across large numbers of computers.TechCrunch reports: IBM claims this machine has the ability to process 2.5B transactions per day, the equivalent of 100 Cyber Mondays every single day, or so they say. Mike Gilfix, who is director of enterprise mobile at IBM said with its latest model, the company paid particularly close attention to the growing complexity around mobile transactions and designed the system to handle the intricate interplay between systems, while maintaining security with what they are calling “real-time mobile encryption,” and providing high-end analytics on the fly. As an example, he talked about a single eCommerce transaction on a mobile device. When we touch Buy, he explained, it requires a bunch of different systems to communicate including credit card transactions, inventory control and shipping — and they all have to work in tandem. He said when you extrapolate that out into billions of transactions moving across conventional networks, the power of the z13 can eliminate much of the lag. Gilfix suggested that the majority of sales would probably come from existing customers in finance, large retail customers and healthcare, and others who have a large investment in data stored on mainframes already. Still, the company is hoping that the mobile nature of this system will attract buyers who might not have considered a mainframe in the past. One scenario Gilfix suggested is using the z13 as a private cloud and running OpenStack on it, which is certainly an interesting idea.

• Alibaba buys controlling stake in digital marketing firm AdChina: China's e-commerce giant Alibaba Group Holding Ltd said on Wednesday it had bought a controlling stake in online marketing company AdChina, an investment aimed at bolstering its advertising business. Alibaba did not close the size of the deal or the stake it would take in AdChina, a Shanghai-based firm founded in 2007. The internet marketing firm, which generated $51 million in sales in 2011, had filed for a $100 million initial public offering in Feb. 2012, but pulled the listing a year later. The deal is the first Alibaba has disclosed this year, after spending more than $6.2 billion on acquisitions in 2014, the same year as its record-setting $25 billion New York listing. The AdChina investment is geared towards improving Alibaba's online and mobile advertising efforts through Alimama, the group's advertising arm. This unit sells marketing to merchants using Alibaba's e-commerce sites like online marketplace Taobao and online retail platform Tmall.com.

• GoPro plunges on Apple patent win: GoPro shares plummeted 12 percent, their steepest decline since August, after Apple was granted a patent for a remote-control camera system. The stock dropped to $49.87 at the close in New York. The plunge followed Apple gaining a patent today from the U.S. Patent and Trademark Office for a system that lets consumers control a digital camera remotely. Investors are concerned that the patent will let Apple, the world’s largest company by market valuation, make products that are similar to what GoPro offers, said Charlie Anderson, an analyst at Dougherty & Co. Apple sold more than 270 million units of its various products in fiscal 2014, according to data compiled by Bloomberg. GoPro, which went public in June and is trading at more than twice its initial public offering price of $24 a share, has been volatile in recent months. The world’s biggest maker of wearable cameras used by surfers and sports enthusiasts to record their exploits is facing questions about its ability to create a media business around the videos that consumers post online using their GoPro devices. About half of the company’s outstanding shares will also become available on the market on Feb. 17 when a lock-up lifts on employees and other insiders’ shares, Anderson said.

• France’s BlaBlaCar comes to India with ride-sharing between cities; its first expansion outside Europe: While taxi apps like Uber and Ola find themselves in a regulatory quagmire in Indian cities, a new car pooling service has just come in for rides from one city to another. France-based BlaBlaCar launched in India today, its first stop in Asia. This follows the arrival late last year of Tripda from Brazil, another ride-sharing marketplace. “India, with its young, highly connected population, and multiple major urban hubs separated by long distances, has great potential for ridesharing. Chronically overcrowded transport infrastructure forces travellers to book their train or bus tickets weeks in advance, while the high price of fuel makes long-distance car travel often unaffordable. BlaBlaCar will make last-minute city-to-city travel both available and affordable. Car-owners will be able to offer seats to co-travelers, so they can travel together and share fuel costs,” says Nicholas Brusson, co-founder of BlaBlaCar. BlaBlaCar connect drivers who have empty seats in their cars for a long distance ride with co-travellers. The charge for the co-traveller is limited to sharing the fuel and running costs; so it’s not meant to be a profit-making avenue for drivers. The company usually takes a 10 percent cut from what the co-traveller pays or driver receives. BlaBlaCar had a US$100 million funding round last year, and operates in 13 countries in Europe. India is its first market outside Europe. BlaBlaCar will initially operate out of Delhi and its satellite town of Gurgaon, connecting cities in north India. Delhi is where Uber got into trouble last month after the arrest of a driver for raping a young woman, and still faces a ban as regulators insist on compliance with their rules. Car pooling services like BlaBlaCar, however, have yet to come under that kind of scrutiny. BlaBlaCar’s co-founder makes a distinction between a marketplace model and a taxi app. “At Uber, you don’t choose your driver,” says Brusson. “At Blablacar, there’s a two-way community where you need acceptance from both sides.”

• App Annie raises $55M in series D: App Annie, an app analytics service for developers, revealed today that it has secured US$55 million in series D funding. The investment eclipses the previous US$17 million round in May 2014, which was accompanied by news that it had acquired competitor Distimo for an undisclosed sum. App Annie’s newest input comes from Institutional Venture Partners (IVP), with participation from existing investors Sequoia Capital, Greycroft Partners, and IDG Capital Partners. App Annie claims it doubled its team to 300 employees in 2014 and tripled its revenues.

• Flipkart reports some marketplace stats: Flipkart today said it aims to help over 10,000 sellers generate business worth Rs 10 lakh through its platform this year. “In 2014, Flipkart helped over 2,000 sellers become millionaires through Flipkart sales. December 2014 alone saw over 500 sellers doing an average business of Rs 10 lakh each, while 50 sellers did an average of Rs 1 crore each,” Flipkart said in a statement. With a year on year growth of close to 30 per cent, apparels and consumer electronics categories have the most number of sellers who have crossed the millionaire mark followed by sellers of home decor, jewellery, handicrafts and large appliances. Nearly 60 per cent of millionaire sellers came from metros (Delhi, Mumbai and Bangalore) and the rest from the non-metros, it said. “2015 projections estimate that the numbers from the latter will double,” the statement added.

Thursday, November 6, 2014

• Amazon is experimenting with (i) deliveries by taxi in the US, and (ii) tying up with newspaper vendors as pick-up locations at scale in the UK: US Taxi-Delivery Experiment: Amazon.com Inc is testing deliveries via taxis in San Francisco and Los Angeles, according to the Wall Street Journal, as the Internet retailer explores alternative modes of delivery to speed up shipments while restraining cost. Amazon is using the taxi-hailing mobile app, Flywheel, to ship parcels via licensed cabs, studying the feasibility of using taxi fleets more broadly as a delivery avenue, the Journal cited people familiar with the matter as saying. In its latest test, Amazon summoned cabs through Flywheel to distribution centers, from where they picked up as many as 10 packages bound for the same location at about $5 per package, the Journal reported. The deliveries usually took place early in the morning, when taxi traffic was low and the competition unlikely to notice, the paper cited the people as saying. UK Tie-up with news wholesaler for in-store pick-up: In October 2014, Amazon announced a partnership with Smiths News, a leading UK newspaper and magazine wholesaler, to offer customers same-day pickup service via the newsagent’s new subsidiary, Pass My Parcel, which will deliver Amazon packages to its select retail locations. Pickup locations are available in more than 6,000 locations throughout the UK, but same-day service is available for only 500 of them. During online checkout, buyers may see a "Pickup is Available — Choose from XX Locations Near You” message, which lets them select a delivery and pickup site. With the Pass My Parcel delivery service, the delivery process is expedited through Smiths News’ twice-daily distribution schedule. Orders made by 11:45 a.m. can be available for same-day pickup at 4 p.m., and orders made by 7:45 p.m. can be available for pickup by 6:30 the next morning in these select retail locations.

• ~5% Audience Engagement: That's what GoPro, Disney have on Instagram: The most successful brands on Instagram get up to 5% audience engagement. GoPro, for instance has 3.3M followers, 163K likes, and 2K comments: the study defines audience engagement as total user actions (likes + comments) as % of follower base. The highest benchmarks were set by advertisers in Consumer Electronics and Travel; Leaders in Retail (Foot Locker) and Fashion (NYX Cosmetics) had engagement of 2.5%; Autos (Mercedes Benz) stood at 2.9%.

• Twitter completes one - not very successful - year as a public company tomorrow: Twitter Inc. (TWTR) is celebrating its one-year anniversary as a public company tomorrow with a stock that’s soared 55 percent from its debut. Its performance by many other measures is less stellar. After jumping 73 percent to open at $45.10 on its first trading day, Twitter’s share price today is lower at $40.37, and the company currently has a record-low enterprise value of 19.4 times trailing 12-month sales, according to data compiled by Bloomberg. The San Francisco-based company also continues to bleed money, with losses widening faster than sales gains. Twitter’s profitability has been pushed out to 2017 from 2015 at the time of its initial public offering, according to analysts’ estimates compiled by Bloomberg. The data underline how Twitter has fallen short as the rocket-ship growth stock it billed itself as during the run-up to last November’s IPO. The microblogging service touted its global reach and potential during its pitch to investors, asking them to focus on monthly user numbers that ended up slowing. Now Chief Executive Officer Dick Costolo is dealing with the backlash, even as the company’s digital-advertising business booms. The disconnect between what people thought would happen with Twitter’s trajectory and what actually happened make this one of the bigger “misfires” in technology stocks, said Francis Gaskins, research director at financial-media site Equities.com. “It’s been a round-trip ticket.” Jim Prosser, a spokesman at Twitter, declined to comment. Twitter went public last Nov. 6 at $26 a share.

• Audience-targeting reaches HR; used to predict attrition, budget overspends: Workday, a leading maker of cloud-based software for running corporate human resources and financial operations, has announced it is putting into its products the kind of data analysis that Netflix uses to recommend movies, LinkedIn has to suggest people you might know, or Facebook needs to put a likely ad in front of you. One version of the Workday predicts which high-performing employees are likely to leave a company in the next year; it then offers possible actions (more money, new job) that might make them stay. In another instance, expense reporting software can predict which employee populations are most likely to exceed their budgets.