Last week, Facebook let its longtime dominant gaming partner Zynga out of a long-term contract that will allow the game developer more freedom to create games for other platforms. In turn, it levels the playing field for other developers, and should go a long way toward eliminating the fears of anyone on the platform getting special treatment.

That wooing has apparently included a dinner that Mark Zuckerberg recently hosted for the top brass in social gaming. Also present was Facebook games boss Sean Ryan.

The gathering included some of the top five to 10 social game companies on the platform, such as King.com, Kixeye, Disney’s Playdom, Electronic Arts and Kabam, and was held at the Fuki Sushi restaurant at Facebook’s new Silicon Valley headquarters. Facebook’s largest partner, Zynga, was not present, which is not particularly surprising for a partner it meets with essentially every week. Bloomberg also reported some details about the dinner last week.

A wide range of subjects was on the menu, sources said, with a lot of proposals and ideas floated. Developers did much of the talking, attendees said, with Zuckerberg and Ryan listening but making no promises.

One of the highlights was a discussion about new ways of monetizing games, including different revenue shares. Currently, Facebook charges 30 percent for virtual goods sold inside of games, just like Apple and Google. One idea was to have a sliding scale, so that developers just getting started on the platform would pay a lower rate, while the Zyngas of the world would continue to pay full price.

In other words, game developers would be taxed based on volume versus a flat fee, no matter how popular the game was. Likewise, the game execs argued that the rate structure would provide additional incentive to Facebook to market up-and-coming games.

A Facebook spokesperson was not immediately available for comment, but sources close to the company said that Facebook has no immediate plans to change the revenue share agreement for payments.

But the idea is not so far-fetched, given that most of Facebook’s payment revenue today is coming from a small percentage of large players. Specifically, Zynga contributed seven percent of the company’s Q3 payments revenue, down from 10 percent in Q2. Following that earnings report, Zuckerberg acknowledged: “Gaming on Facebook isn’t doing as well as I’d like.”

One thing Facebook could potentially do is build its own social games, which is now allowed, according to the contract it just signed with Zynga.

However, that idea was immediately shot down by a Facebook spokesperson: “We’re not in the business of building games, and we have no plans to do so. We’re focused on being the platform where games and apps are built.”

If Facebook is truly worried that a lot of its developers are ditching the social network for greener fields on Apple’s iOS or Google Play — and a lot of them are — then the dinner meeting was likely just the beginning.

It’s hard to say how serious this is right now, but Yahoo was ordered to pay $2.7 billion in a lawsuit related to a breach of contract and lost profits of a yellow pages listing service by Worldwide Directories and Ideas Interactivas.

In a statement and a filing with the Securities and Exchange Commission, the Silicon Valley Internet giant said it “believes the plaintiffs’ claims are without merit and will vigorously pursue all appeals.”

We lobbed a call into Yahoo to get more details about the “non-final” judgment from the 49th Civil Court of the Federal District of Mexico City — not that the company’s PR will actually call back on important multi-billion matters — but here is the company’s SEC filing:

SEC-YHOO-1193125-12-487828

The deal was originally agreed to in May 2010, and was partially disclosed when Zynga went public. The terms of the new agreement, which were disclosed in separate filings by Facebook and Zynga, are a lot less onerous for Zynga. It will also free up Facebook to make its own games, if it chooses.

The main points are:

• Zynga will no longer be separately obligated to display Facebook ad units or implement Facebook credits on any Zynga game pages.
• Facebook will no longer be the exclusive social platform for Zynga, allowing it to launch games first on mobile or its own Zynga.com platform (although the games will have to launch shortly after on Facebook).
• Certain provisions related to Web and mobile growth targets and schedules will no longer be applicable, and Facebook will no longer be prohibited from developing its own games. Further, Zynga’s right to cross-promote between games on the Facebook Web site will be governed by Facebook’s standard terms of service.

I’m hearing that the new contract was negotiated between Facebook’s Dan Rose and Zynga’s new Chief Revenue Officer Barry Cottle.

In a statement, Cottle said: “Zynga’s mission is to connect the world through games. In order to do this, Zynga is focused on building enduring relationships with consumers across all platforms from Facebook and Zynga.com on the web to tablets and mobile. Our amended agreement with Facebook continues our long and successful partnership while also allowing us the flexibility to ensure the universal availability of our products and services.”

After reading the documents, it is clear that the new amendments are a reflection of how much the social gaming landscape has changed over the past two years.

Back when the contract was first signed, Facebook needed Zynga to help transition all developers on the platform over to Credits, which required everyone to give Facebook a 30 percent cut of all revenue. It’s now clear that the more important priority is for both Facebook and Zynga to be successful, which means less restrictive terms.

And while Zynga will be required to make any social game it launches available on Facebook concurrently, or shortly following, another launch, there are some exceptions: Provisions around gambling for real money, games in China and Japan, and mobile games due to technical limitations.

The renewal was largely expected, as Mr. Bewkes had said in September he planned to retain the role for another five years.

Read the rest of this post on the original site »

Yahoo and Facebook are not currently in talks about forming a search alliance or building a search engine together, according to my sources, who scoffed about such a deal reported in a thinner-than-tissue-paper post by the Telegraph earlier today.

In addition, Yahoo is not anywhere near ending its search partnership with Microsoft, although new CEO Marissa Mayer has been in touch with the software giant about improving performance that has been less than lackluster over the course of its history so far.

Despite this, it would be nearly impossible for Yahoo to extricate itself from the long-term contract easily — though there are certain, but very difficult, outs. But sources tell me Microsoft would fight any attempt to end it earlier.

Thus, while Yahoo and Facebook have had a very good relationship of late, after the pair stopped warring over patents, and have also had success with its various sharing initiatives, a substantive search collaboration is not now in the mix.

Could the pair do more in terms of sharing among its users? Sure! Could they more tightly integrate services? Yep! Could they do something jointly related to advertising? Why not! But will they build a search engine together? Not likely.

Indeed, I am not even sure what such a thing means, since it would now be nearly impossible to execute, given Yahoo has outsourced its core search technology long ago to Microsoft and has been largely focused on improving search experience since then.

Of course, it’s no secret that Facebook is likely to enter the search arena in a more substantive manner in the future — CEO and co-founder Mark Zuckerberg has said so publicly — because people expect a better experience and users have been asking for years for improvements.

So watch that space, for certain, as it could also be very lucrative for the company and perhaps give search leader Google a bit more of a race.

But the social networking site is likely to work on its own in such an effort — as well as approach the space in much different ways. Hooking up with Yahoo would bring it almost nothing it might need to make it a success.

There are some interesting what-ifs to ponder with the idea of Microsoft, Facebook and Yahoo forming some kind of Avengers-style effort to battle Google, especially if it had a mobile element. But that’s the movie version at this moment.

(Speaking of movies, I am sorry it took me so long to get to this, but I was seeing the final “Twilight” with some All Things Digital staffers. I can report that the sparkly vampires of the film are also not in search alliance talks with Facebook.)

One unusual phrase in the Telegraph article did catch my eye though, which noted that “board members expect the talks to lead to much more substantial collaboration based around Web-based search.”

Such a Facebook search tie-up rumor would certainly do wonders for a Yahoo stock pop tomorrow for all the hedge funds now piling into the Silicon Valley Internet giant, would that it were so.

But it’s not.

It’s been nice to see all the euphoria at Yahoo about free food and Apple iPhones kicking it up a notch.

But, purple people, guess what? Them’s just your basic table stakes in Silicon Valley these days and pretty much everyone else has had such perks for a long while now.

Thus, as nice as it is to drink your coconut water gratis, after two months in charge, it’s long past time to focus on what new Yahoo CEO Marissa Mayer is up to besides making much-needed but obvious cultural changes at the troubled Internet giant.

She’s been busy with the expected listening tour of employees and also outside tech players — such as former Yahoo CEO Terry Semel — which is a textbook stop in the turnaround playbook.

Now comes the hard part: Actually beginning to make the significant decisions about how she’s going to turn around Yahoo and what the key issues of strategic focus need to be.

In a series of recent meetings, according to numerous sources inside the company, Mayer has begun to outline what those are to top staff.

Not surprisingly, they are many of the same thorny issues that Yahoo has been facing for a long time and which center primarily on making the company relevant again in a wide number of ways.

I’ll get to many of them over the next week in a series of What Will Marissa Do? posts — including looking closely at her new hires, when and how Mayer will deal with inevitable layoff decisions facing the company, where the sale of Yahoo! Japan stands and, finally, what she’s cooking up for key Yahoo products.

But the focus has to fall first of all on search and advertising, the two arenas that Mayer has been studying most closely, according to numerous sources close to the situation.

That has included a recent meeting and numerous discussions with Microsoft CEO Steve Ballmer about improving Yahoo’s search advertising partnership, said sources at both companies.

That deal has been largely disappointing since it was struck under the regime of ousted CEO Carol Bartz several years ago.

Many reasons are given for the poor performance of the entire arrangement, including lack of improvement of cost per click and share growth for both parties. That means bid density and numbers of advertisers remain too low, especially compared to Google’s offering of access to a larger, more active and lucrative market.

Simply put, despite massive spending by Microsoft on search, users and advertisers get significantly better results overall with the search leader Google.

(You can read a great piece by Search Engine Land’s Danny Sullivan from last year, which exhaustively looked at the issues until then.)

The irony abounds that it’s up to Mayer to fix this problem of improving revenue per search with Ballmer, since she has been among the executives who have made Google the search behemoth it has become.

Her particular expertise has been on search experience for consumers, which is just the area that Yahoo desperately needs to improve after handing over technology duties to Microsoft.

That move was controversial at the time and some feel it was a big mistake. But, most also think there is no going back at this point, given the enormous cost of running a serious search enterprise.

Such an idea is still being raised inside Yahoo, although it seems more nostalgic than a realistic possibility, given the enormous price and, more importantly, the departure of the company’s core search engineers in recent years.

That doesn’t mean Yahoo under Mayer can’t be key to helping solve Microsoft’s search tech problems. She certainly knows the entire arena, which has already given Yahoo increased credibility among Microsoft’s search engineers.

“None of Yahoo’s many CEOs knew anything about search technology and that’s certainly not the case here with Mayer,” said one person close to the situation at Microsoft. “When she walks in, she instantly has status among the geeks as someone who knows what she’s talking about.”

It still may be a losing battle, due to Google’s overwhelming dominance, but if anyone at Yahoo can spot areas of even small improvement — which can yield big returns — it could be Mayer.

In addition, she can spearhead Yahoo’s own efforts to reverse — or perhaps simply stop — search market share declines via delivering a better consumer offering.

That’s still heavy lifting, no matter the exec, since both Microsoft’s Bing and Google are better equipped to win here, too.

“It hard to imagine we are going to slow down in any way,” said one former colleague of Mayer’s at Google to me recently in a rather ominous tone. “We’re only going to get more competitive.”

Pressure much?

And more: Mayer is under a time limit, since guaranteed payments Microsoft agreed to pay Yahoo for the shortfalls on what was promised will be running out next year. The pair has renegotiated that deal before, and it will likely have to do so again.

Of course, Mayer could try to walk and threaten to take Yahoo’s search business elsewhere, a move that former CEO Scott Thompson was mulling before his ouster.

That’s not a surprising ploy, except it is probably impossible to pull off, a fact acknowledged by top Yahoo execs.

“It might feel good to say we have options in search,” said one person close to the situation. “But that ship sailed years ago.”

Indeed, especially since Google is the only choice of possible alternate partners and such a move is rife with major obstacles.

There is the issue of the contract with Microsoft, which could lead to a potentially explosive legal struggle Yahoo can ill afford.

“They can try to get out of the deal,” said one high-ranking person at the software giant. “But that’s a lot easier threatened than done.”

And, there is the clear regulatory hairball any search hook-up between Google and Yahoo would lead to.

That’s happened before, which Mayer knows well since she was a top exec in Google’s business when it tried to partner with Yahoo as a way to prevent Microsoft’s hostile takeover bid for the company.

While times might have changed, Google is currently facing a likely battle with the Federal Trade Commission over its powerful search business, and trying to get Yahoo’s business now is a non-starter.

Thus, finally fixing the Microsoft partnership is key to Mayer’s success since it represents a little over one-third of revenue of Yahoo (see the chart below).

The bigger part of Yahoo’s business, as you can also see from the chart, has been display revenues. And that, too, has been a sorry tale of declines and ever more disappointing results.

A report by eMarketer on display market share had this depressing chart for Yahoo:

As is clear, the march downward for one-time leader Yahoo has been swift, and the prospects for the future are worse as Google and Facebook vie for leadership.

The reasons for this have been myriad, but Mayer has apparently decided that it’s been due in large part to the broken Yahoo ad tech platforms and their ever weaker performance.

As we have previously reported, she has determined that it’s now time to invest in improving them, both by funding internally and external acquisitions.

For that, she has formed a tight group of execs to scan the landscape for tasty and innovative treats for Yahoo to gobble up.

That includes: Scott Burke, SVP of Yahoo’s advertising and data platforms; Brian Silver, who runs the company’s Right Media Exchange; Xuhui Shao, a key engineering VP under Burke; and Mark Morrissey, the longtime tech exec who previously ran the company’s search business and was key to integrating the Microsoft search deal into place.

The cerebral Burke especially has been pushing ad platform improvement for a while and finally seems to have won the battle against detractors of the big and possibly grandiose plan by appealing to Mayer’s interest in not giving up.

Thus, the tabling of plans by Thompson, as well as interim CEO Ross Levinsohn, to outsource some of the automated parts of the display business to Google.

Those talks were very serious, as well as others to sell off Right Media, but they are done for now.

One major issue — the people in charge of the ad platform turnaround could also be seen (and most definitely are) as mired in Yahoo’s legacy of lackluster results and poor performance.

“It is kind of funny that the guys responsible for the decline now have the responsibility for fixing it,” said one source at Yahoo.

It’s a fair point to be made.

But that’s water under the bridge, apparently, since the group has been making the rounds, helped by Yahoo’s M&A execs, with a wide range of companies in many different ad tech area being considered (and some dismissed), including: Mediaocean, Turn, Criteo, PubMatic and Millennial Media.

Millennial is the most interesting, because it is a mobile ad play, where Yahoo is exactly nowhere (to be fair, less than nowhere) after years of botched efforts.

As with other companies, this is a critical arena for Yahoo, and yet one more that Mayer needs to focus on.

Lastly, Mayer has to make sure Yahoo’s premium display business remains strong. This is much more based on relationships with large advertisers than on major sponsorship and branding offerings, as well as creating consumer products and content that is appealing to marketers.

This area is now headed up by former Google exec Michael Barrett, who has publicly said he was staying put for now at Yahoo as its chief of revenue.

In fact, because he is in charge of all sales, he occupies the second slot under Mayer on Yahoo’s now strangely configured, punctuation-impaired and information-free management page.

But numerous sources inside and outside Yahoo said Barrett has also told many people that he is still not fully committed to staying in the role for the long haul.

If he eventually gets a lucrative exit package — something the new boss is not being very generous with overall, said sources — that will mean Mayer will need a high-profile and well-regarded ad exec to replace him; sources said Mayer has already begun reaching out to some candidates.

The pickings are slim, with only a few names on the list of those capable of taking on such a job. That includes: Demand Media’s Joanne Bradford, who was also a former top Yahoo exec; Microsoft’s Yusuf Mehdi; OWN’s Kathleen Kayse; MLB.com’s Bob Bowman; and any number of Google execs.

In that regard, as with all the other search and advertising overhaul efforts at Yahoo, it is a matter of attracting serious talent into the company going forward.

More on that — and more — to come.

Stephanie Tilenius, the eBay exec who Google hired away to jumpstart its commerce and mobile payments efforts, is departing the company to become an executive-in-residence at Kleiner Perkins Caufield & Byers.

“The pace of innovation is so unprecedented, especially in social and mobile,” she said in an interview this morning. “I wanted the ability to help scale a few start-ups, instead of building products in a large company.”

Tilenius has much experience in both arenas, having co-founded and led PlanetRx.com in Web 1.0, as well as working at software start-up Firefly, AOL and Intel before that. She holds a BA and MA from Brandeis University and an MBA from Harvard.

Tilenius joined eBay in 2001 and worked across a wide variety of its businesses, including running the merchant service group of its powerful PayPal payments unit and also on its key Marketplace offering.

Tilenius took an even more prominent operating role when she joined Google and ended up shepherding Google Wallet, one of the search giant’s most significant efforts in commerce. Tilenius’s first job at Google was leading its commerce efforts and in product search, but she founded Google Wallet as a kind of skunkworks within the company.

It is now part of an integrated offering, in which users have a one-payment account to cover purchases across Android Market, YouTube, Google+ Games and other of the company’s properties.

“We have built one wallet in the cloud,” she said.

Tilenius was one of the main executives to unveil Google Wallet at an event in New York last year. She also demonstrated the product at our D: All Things Digital conference in 2011.

Tilenius had also been the key player in Google’s unsuccessful attempt to buy Groupon. After that, Google then launched Google Offers to compete with the daily deals site.

The various payments initiatives by Google also attracted controversy, when PayPal filed suit against Tilenius – as well as Osama Bedier, Google’s VP of payments and former PayPal executive. The payments unit of eBay claimed they and Google misappropriated trade secrets and violated contracts involving recruiting agreements.

In January, Tilenius shifted roles to oversee Google’s commerce efforts internationally.

Perhaps by coincidence, since the firm has been talking about bringing her in for months, Tilenius is the second major hire of a woman at the well-known Silicon Valley venture capital firm, in the wake of a gender discrimination lawsuit filed by a woman partner, Ellen Pao. A month ago, Kleiner hired former Square product exec Megan Quinn as a partner to focus on consumer Internet investments.

Kleiner recently filed an answer to Pao’s legal action, maintaining it was her own performance that kept her from advancing at the firm.

Tilenius declined to comment on the case.

At Kleiner, Tilenius will be working closely with a number of partners, although she will be focusing on late-stage companies in its $1 billion Digital Growth Fund. She also might be incubating some ideas of her own, she said.

Kleiner partner Ted Schlein said Tilenius would be a “tremendous resource” for the firm.

“When talent becomes available to focus on different opportunties in portfolio, we jump at that,” he said. “Stephanie has the experience in some of the largest scaling of businesses in the Valley, as well as an entrepreneurial background, so it is ideal for us.”

Tilenius said the move was “less about Google than working on the next generation of companies.”

She said she had some ideas in mobile commerce, especially given her experience at Google and eBay, as well as in the healthcare area.

“I think it is really early days in mobile and retail is going to be transformed,” said Tilenius. “There are a lot of players, but it is a marathon.”

Indeed.

Here’s a video of Tilenius in action, showing off Google Wallet at D9:

]]> http://allthingsd.com/20120622/exclusive-google-commerce-exec-tilenius-departs-for-kleiner/feed/ 0 http://allthingsd.com/20111012/eager-upgraders-will-spike-iphone-4s-sales/ http://allthingsd.com/20111012/eager-upgraders-will-spike-iphone-4s-sales/#comments Wed, 12 Oct 2011 10:55:21 +0000 John Paczkowski http://allthingsd.com/?p=131248 If the iPhone 4S is, as some have suggested, intended to appeal to early-generation iPhone users at the end of their carrier contracts, how many of them can we expect to upgrade?

Short answer: Lots.

Piper Jaffray analyst Gene Munster estimates that 18.8 million iPhone 3GS users will likely upgrade to the iPhone 4S, accounting for about 18 percent of Apple’s fiscal 2012 iPhone sales.

“We believe the number of iPhone 3GS units sold before the launch of the iPhone 4 serves as a conservative proxy for iPhone users that will likely upgrade to the iPhone 4S,” says Munster. “Note that our Aug-11 survey shows that among existing iPhone users, 94 percent expect to buy another iPhone as their next phone; Apple has built an annuity of smartphone buyers.”

Indeed. And Munster’s estimate includes only 3GS upgraders. It doesn’t account for existing users of the original iPhone, iPhone 3G, or even the iPhone 4. In other words, it’s likely that upgrade sales will be even greater than Munster predicts.

We’ll see. Currently, Munster is calling for 25 million iPhone units to be shipped in calendar Q4 of this year, a number he has already conceded may be too low.

]]> http://allthingsd.com/20111012/eager-upgraders-will-spike-iphone-4s-sales/feed/ 0 http://allthingsd.com/20110916/what-was-behind-the-timing-of-yahoo-ceo-carol-bartzs-abrupt-ouster/ http://allthingsd.com/20110916/what-was-behind-the-timing-of-yahoo-ceo-carol-bartzs-abrupt-ouster/#comments Fri, 16 Sep 2011 21:31:52 +0000 Kara Swisher http://allthingsd.com/?p=121210

In the end — the bitter end, that is — there really is no good time to fire someone.

But the timing of the ouster of Carol Bartz as CEO of Yahoo is one of the more curious things about the corporate mishegas at the Silicon Valley Internet giant of late.

That included drastically moving up the clock on Bartz, which was not part of a plan until recently. In fact, several sources were told only last month by Yahoo board members that evaluation of her status — her contract ended at the beginning of 2013 — would not take place until the end of 2011.

That obviously changed.

And, because it is Yahoo — which never met a crisis situation it could not hopelessly complexify — there are numerous and conflicting accounts about the reasons it was done so quickly and abruptly.

They include the board’s feeling that Bartz had not responded to their requests for a credible strategic plan; worries that she would not ever meet annual performance goals, including improving its stock price; upcoming weak third-quarter numbers, which will continue a troublesome downward trend in Yahoo’s key advertising business; and, perhaps most intriguingly, the need to make a move before it was revealed that another activist investor, this time Third Point’s Daniel Loeb, had decided to target Bartz and the Yahoo board.

One thing is certain: The firing of Bartz was messier than it needed to be, mostly because several sources said she was caught unawares.

“She did not know it was happening, even if she probably should have seen it coming,” said one person familiar with the situation. “And she had no allies at the company to warn her, either.”

Indeed, at the time Bartz was fired over the phone by Chairman Roy Bostock — who had until late this summer been her fervent supporter — she was set to appear at a high-profile Citigroup investor conference in New York.

“It had to happen then, because you can’t put a CEO in front of investors and analysts and then fire her soon after,” said one person close to the situation.

Actually, former Yahoo CEO Terry Semel stepped down only days after appearing at the company’s annual meeting and telling the gathering he was in for the long haul.

The Loeb problem also played a part. According to several sources, while Loeb did not surface until after Bartz’s firing, several directors and Silicon Valley players were aware of his plans to target Yahoo.

While Loeb was not the more heavyweight threat that activist investor Carl Icahn had been in the past, sources said he was planning to call for Bartz’s firing, as well as a board re-do.

The large part of the reason for letting her go finally, of course, centered on not meeting performance goals set by the board.

While the overhaul of a hairball of systems and a rejiggering of staff was quickly done by the longtime and experienced manager, the turnaround and renewed product innovation promised by Bartz was slow in coming.

In addition, advertising sales results had worsened and recent quarterly reports showed little progress.

To remedy the situation, directors had asked Bartz to present a strategic plan earlier this year, which she did with the help of top execs. It further underscored the idea of Yahoo as a top-level digital media company.

But the board pressed for more details and felt Bartz was not the right exec to carry out the kind of dramatic renewal of Yahoo that is needed.

Looming, too, was the third-quarter earnings results on October 18, which sources said will show continued weakness at Yahoo.

For that, it’s likely the fired Bartz will get the blame, giving the board — which is also being criticized by large shareholders and others — a bit of breathing room as it figures out what to do next.

In other words, with no good news to report, the Yahoo board decided to deliver some bad news to Bartz.

(In related news, according to an 8-K filing by the company, interim Yahoo CEO and also CFO Tim Morse got a small bump in base salary from $600,000 to $750,000, effective September 15, 2011.)

And here is a video I did on WSJ.com’s Digits show yesterday about the buyer interest in Yahoo I previously wrote about, as well as its weak board:

]]> http://allthingsd.com/20110916/what-was-behind-the-timing-of-yahoo-ceo-carol-bartzs-abrupt-ouster/feed/ 0 http://allthingsd.com/20110628/exclusive-skype-employees-were-briefed-in-plain-english-the-internal-equity-incentive-plan-deck/ http://allthingsd.com/20110628/exclusive-skype-employees-were-briefed-in-plain-english-the-internal-equity-incentive-plan-deck/#comments Tue, 28 Jun 2011 20:14:21 +0000 Kara Swisher http://allthingsd.com/?p=92265 I have largely stayed away from opining about the he-said-he-said over what or what not Skype employees were told about the treatment of their stock options.

Some employees are alleging they were duped via complicated legalese and double-talk in employment contracts about how their shares would be handled upon termination or voluntary departure from the Internet telephony giant.

That matters, since Skype was recently sold to Microsoft for $8.5 billion, well above previous valuations. Thus, those who were, as a Skype PR person said, not in it to win it, um, lost.

Dramatic stuff, to be sure. But, even with all the fervor around the employment contract issue, the handwringing about what it means for compensation issues in Silicon Valley and a whole big dose of how private equity companies (in this case, a firm that had bought Skype called Silver Lake) are evil, it’s struck me as little more than an insider read-the-legally-obtuse-contract dispute.

And, although I love Reuters’ Felix Salmon’s epic tsk-tsking posts, that’s why I like to see real documents as proof of what people knew and when.

Apparently, a lot and rather clearly from this PowerPoint that was given to employees of Skype as of December 2009 as part of its changing ownership, after Silver Lake and other investors bought it from eBay.

While it’s not proof of what employees got it — typically, it is standard HR policy to hand this stuff out to everyone — and who read it (no accounting for slaggards!), it is pretty clear on what happens upon leaving Skype, either by a firing or quitting.

On the eighth slide, as you can see above, it says, in part:

“Good Leaver”: someone who gets fired without “Cause”

* Gets the fair-market value of their currently vested options

“Bad Leaver”: someone who resigns, or is fired for “Cause”

* Skype buys back their options at the lower of fair-market value or strike price

* This provision lapses post-IPO

It seems pretty buyer-beware clear, but check it out for yourself:

Skype – Employee Presentation

]]> http://allthingsd.com/20110628/exclusive-skype-employees-were-briefed-in-plain-english-the-internal-equity-incentive-plan-deck/feed/ 0 http://allthingsd.com/20110406/exclusive-aol-fires-moviefone-editor-who-offered-fired-freelancers-the-chance-to-work-for-um-free/ http://allthingsd.com/20110406/exclusive-aol-fires-moviefone-editor-who-offered-fired-freelancers-the-chance-to-work-for-um-free/#comments Wed, 06 Apr 2011 20:28:30 +0000 Kara Swisher http://kara.allthingsd.com/?p=42399

Yesterday, AOL’s Huffington Post Media Group got into hot water after the top editor at its Moviefone unit sent a memo to freelancers it was in the midst of firing, offering them an opportunity to “contribute as part of our non-paid blogger system.”

Today, that exec–Moviefone Editor-in-Chief Patricia Chui–was fired by the company, which is in the midst of drastically rejiggering its stable of writers.

Many of those were freelance bloggers under contract to AOL, who are now getting the boot in favor of reallocating staff back to largely paid journalists.

Thus came the controversial email from Chui, which read, in part:

“We will, indeed, be moving away from a freelancer model and toward one relying on full-time staffers. Sometime soon-–this week, I believe–-many of you will be receiving an email informing you that your services as a freelancer will no longer be required. You will be invited to contribute as part of our non-paid blogger system; and though I know that for many of you this will not be an option financially, I strongly encourage you to consider it if you/d like to keep writing for us, because we value all of your voices and input.”

Oh dear. Really, oh dear, especially since the Huffington Post has had its own share of controversies over not paying some bloggers (although it never quite ever offered up a doozie that this letter was).

Sources said Chui was terminated by John Montorio, the HuffPo Media Group’s culture, entertainment and lifestyle editor. Arianna Huffiington is head of all content at AOL, which recently paid $315 million to buy the Huffington Post.

Since she took over, Huffington has tried to stress a return to journalism over more algorithmic content creation. The unloading of its freelance writers was part of that effort.

Thus, Chui’s missteps did not help matters.

But it was not the first time recently that she had made an ill-advised editorial judgment.

Sources said the firing is also due to an incident several weeks ago, in which Chui appeared to defend a marketing employee who sent an email to TechCrunch writer Alexia Tsotsis, asking her to soften a review of “Source Code” due to studio relationship considerations.

AOL bought TechCrunch, a well-known tech news site, last fall. At the time, its CEO Tim Armstrong promised editorial independence and no meddling over advertising concerns.

Instead of taking this minion to task, on Moviefone’s own blog Chui said, in part:

“The reality of our situation is that, as a movies site, we work with movie studios every day, and it is in our best interests to stay on good terms with them. Staying on good terms with studios means that we will relay information if asked. It does not mean that we would ever force a writer or an editor to edit their work for the sake of a studio–or anyone else.”

Even with the last line, it is not exactly a profile in courage, because it was clear violation of the traditional separation of church and state in force at most media organizations.

Typically, editors are supposed to come down on any such communication. That has certainly been my experience in journalism over the years at the Washington Post and Dow Jones–including during its News Corp. ownership. In fact, I have often been shielded from such requests to pass such complaints onto me and only found out much later of advertiser discomfort about my reporting.

At the time, TechCrunch quite clearly called for Chui’s firing and that happened today.

Here is Chui’s full memo to freelancers, as well as the one about TechCrunch, neither of which were apparently cleared with higher-ups:

From: Chui, Patricia
Sent: Tuesday, April 05, 2011 11:26 AM
To: MoviefoneWriters
Subject: Moviefone/Cinematical–Status of Writers

Dear Moviefone/Cinematical Writers,

I know there’s been a lot of uncertainty regarding the future of freelancers and your status as a writer for the site. I personally apologize for the lack of communication, but I’ll tell you what I can.

We will, indeed, be moving away from a freelancer model and toward one relying on full-time staffers. Sometime soon–this week, I believe–many of you will be receiving an email informing you that your services as a freelancer will no longer be required. You will be invited to contribute as part of our non-paid blogger system; and though I know that for many of you this will not be an option financially, I strongly encourage you to consider it if you’d like to keep writing for us, because we value all of your voices and input.

Some of you have indicated interest in applying for full-time writer and editor positions, and the status of those positions are also part of discussions that are ongoing right now. I cannot at this point, however, tell you how many positions there are, or what the exact nature of those positions will be.

Despite the move toward a full-time staff vs. freelancer model, I’m told that there will be room for “exceptions”–for example, in the cases of writers who specialize in certain subjects. Again, what these exceptions are for Moviefone, and what the budget for them would be, is still being discussed.

As for Cinematical, the resignation of Erik Davis is certainly a loss. But I am continuing to have conversations with the editorial leadership here, and I am hopeful that we will still be able to maintain the Cinematical brand and voice going forward. Again, I will share with you any pertinent information as I have it.

In the meantime, those of you who already have assignments, please do continue to work on them unless you hear otherwise. If you’re uncertain of the status of your assignment, check with me. It may take me a while to get back to you, so please be patient–but I will respond.

I am sorry that I don’t have more specific details to give you, but I promise that I’ll keep you as well-informed as I possibly can. Don’t hesitate to reach out if you have questions or concerns.

Best,

patricia

By now you may have read the recent post in TechCrunch regarding that site’s SXSW coverage of the film “Source Code.” A representative from Moviefone, who set up the interview with Summit Entertainment, received some feedback from the studio and passed it along to TechCrunch (our sister site here at AOL). That email has now caused something of a Internet kerfuffle.

Here is the email–reprinted in the post–that was sent to the TechCrunch writer.

Hey Alexia,

Hope you’re having a good time at SxSW and that it’s not been too crazy busy for you!

First wanted to thank you for covering Source Code/attending the party, etc. But also wanted to raise a concern that Summit had about the piece that ran. They felt it was a little snarky and wondered if any of the snark can be toned down? I wasn’t able to view the video interviews but I think their issue is just with some of the text. Let me know if you’re able to take another look at it and make any edits. I know of course that TechCrunch has its own voice and editorial standards, so if you have good reasons not to change anything that’s fine, I just need to get back to Summit with some sort of information. Let me know.

Thanks!

TechCrunch’s issue with Moviefone is that by sending this email, we, in their words, “asked us to change our post. It’s not just sad, it’s wrong.”

I wanted to take this opportunity to clarify a few things.

1) The person who wrote that email was not acting in an editorial capacity. That person’s job is to act as an intermediary between the studios and editorial–not to dictate content, nor to weigh in on the content of Moviefone or any other AOL site. In fact, the presence of a person with that role is just one means we have of ensuring editorial integrity on Moviefone.

2) This is important: We never told TechCrunch to change the post in any way. A publicist at Summit reached out asking if we could convey the studio’s feedback to TechCrunch. We did so. If the editors had responded that they declined to edit the post–which, naturally, is entirely their call–we simply would have conveyed that information back to Summit.

The reality of our situation is that, as a movies site, we work with movie studios every day, and it is in our best interests to stay on good terms with them. Staying on good terms with studios means that we will relay information if asked. It does not mean that we would ever force a writer or an editor to edit their work for the sake of a studio–or anyone else.

We take editorial integrity seriously at Moviefone, and it’s painful to be depicted as a pawn of the studios when that is emphatically not the case. You may think it unseemly for a studio to request changes in an article; that’s certainly your right. But the accusation of pandering on our part or crossing an editorial line is, to my mind, completely unfair, and I would hope that a reasonable reader would be able to recognize the situation for what it is–overblown and unwarranted.

Patricia Chui
Editor-in-Chief, Moviefone

]]> http://allthingsd.com/20110406/exclusive-aol-fires-moviefone-editor-who-offered-fired-freelancers-the-chance-to-work-for-um-free/feed/ 50 http://allthingsd.com/20110223/motorolas-xoom-starts-tablet-wars-with-ipad/ http://allthingsd.com/20110223/motorolas-xoom-starts-tablet-wars-with-ipad/#comments Thu, 24 Feb 2011 02:01:36 +0000 Walter S. Mossberg http://ptech.allthingsd.com/?p=1785 After months of speculation, the tablet wars begin in earnest this week. Motorola is releasing its Xoom tablet on Feb. 24, and I consider it the first truly comparable competitor to Apple’s hit iPad. That is partly because it is the first iPad challenger to run Honeycomb, an elegant new version of Google’s Android operating system designed especially for tablets.

Both Motorola’s hardware and Google’s new software are impressive and, after testing it for about a week, I believe the Xoom beats the first-generation iPad in certain respects, though it lags in others. Like the iPad, the Xoom has a roomy 10-inch screen, and it’s about the same thickness and weight as the iPad, albeit narrower and longer. And, like the iPad’s operating system, Honeycomb gives software the ability to make good use of that screen real estate, with apps that are more computer-like than those on a smartphone.

The Xoom has a more potent processor than the current iPad; front and rear cameras versus none for the iPad; better speakers; and higher screen resolution. It also can be upgraded free later this year to support Verizon’s faster 4G cellular data network (though monthly fees may rise.)

Motorola is taking aim at the iPad just as Apple is expected to announce, next week, a second-generation of its tablet. Little is known about this second iPad, but it’s widely expected to take away at least one of the Xoom’s advantages over the original iPad—cameras—and is rumored to be thinner and lighter, since weight was one of the most common complaints about the generally praised first iPad.

The iPad has way more tablet-specific apps—around 60,000 versus a handful—and, in my tests, much better battery life. Plus, whatever the specs say, it’s a fast device with a beautiful screen that delights people daily. But, overall, the Xoom with Honeycomb is a strong alternative to the original iPad, and one that will only improve over time.

The Xoom’s screen is long and narrow, good for widescreen video.

Unfortunately for consumers looking for iPad alternatives, the Xoom has an Achilles’ heel: price. While iPads come in a range of models priced all the way up to $829—none of which requires a cellphone contract—Apple’s entry price for the iPad is just $499. By contrast, the base price of a Xoom without a cellphone contract is $800—60% more. And even with a Verizon two-year contract at $20 to $80 a month—depending on the data limit you choose—the least you can pay for a Xoom is $600, or 20% more before counting the contract costs.

In fairness, the iPad model with the same memory as the Xoom and a 3G cellular modem like the Xoom’s is $729, which is a closer comparison. But it is still less than $800, and consumers still focus on that $499 iPad entry price (for a Wi-Fi-only model.)

As much as I like the Xoom and Honeycomb, I’d advise consumers to wait to see what Apple has up its sleeve next before committing to a higher price for the Motorola product.

Meanwhile, here’s what I found in testing the Xoom.

Hardware

Though it works fine in portrait, or vertical, mode, the Xoom is mainly designed as a landscape, or horizontal, device. The screen is long and narrow, proportioned to best fit widescreen video. The HD screen boasts a resolution of 1280 by 800, versus 1024 by 768 for the iPad.

It felt heavier than the iPad, though the weight of 1.6 pounds is the same as on the cellular version of the Apple product. Overall, it has a solid, high-quality feel. There aren’t any physical buttons except for an on-off switch at the rear and volume controls on an edge. The common Android home, back and other buttons are rendered in the software. The glass on the front is surrounded by a relatively thin black border.

I found it generally comfortable to hold, except when I was reading for long periods in vertical mode, where the long, thin shape and weight made it feel a bit unbalanced.

I performed the same battery test on the Xoom as I have on other tablets. I played video constantly with the connectivity turned on and the screen at almost full brightness until the battery died. Alas, while the Xoom claims up to 10 hours of video playback, I got just 7 hours and 32 minutes. By contrast, on the same test, the iPad, which also claims 10 hours, logged 11.5 hours, or four hours more.

I also tested the Xoom’s front-facing 2-megapixel camera by performing a video chat with a Motorola employee using Google Talk software. The chat broke up or froze several times over Verizon’s network, but we eventually got it to work pretty well on Wi-Fi.

The Xoom’s battery is sealed, and it only comes with 32 gigabytes of memory, versus a range of between 16 and 64 GB for various models of the iPad. However, it has a slot for a memory card that Motorola says will work after a software upgrade to add more memory. There is also a removable back and a SIM card slot that would be used only if you chose to upgrade to 4G in the second quarter of this year.

Software

Perhaps even more impressive than the hardware is the Honeycomb software, which, for now, Google won’t offer on cellphones, only tablets, of which the Xoom is the first.

I’ve always felt that Android had a rough-around-the edges, geeky feel, with too many steps to do things and too much reliance on menus. But Honeycomb eliminates much of that. Actions like composing emails, or changing settings are much more obvious and quicker. The smart but cluttered notification bar has been moved to the lower right and simplified. A tap on it pops up relevant information.

There is still a separate email app for Gmail, as opposed to other email services you may use. But, now, as on the iPad, email is presented in multiple columns and is more attractive and easier to use.

The browser is especially impressive, with PC-like features, such as visible tabs for open pages and the ability to open a private browsing session. Apps like Maps and YouTube have 3-D views. There’s a movie-editing app and live widgets for the home screens that show email previews or video frames.

There are some downsides. The ability to play Flash video—a big Android selling point—won’t work on the Xoom at launch. It will take some weeks to appear. And I found numerous apps in the Android Market that wouldn’t work with the Xoom. I couldn’t locate a working video download or rental service, though Google says these will be available soon.

Some apps for phones, like the popular game Angry Birds, filled the screen beautifully and worked fine.

Bottom line: The Xoom and Honeycomb are a promising pair that should give the iPad its stiffest competition. But price will be an obstacle, and Apple isn’t standing still.

Find all of Walt Mossberg’s columns and videos at the All Things Digital website, walt.allthingsd.com. Email him at mossberg@wsj.com.

]]> http://allthingsd.com/20110223/motorolas-xoom-starts-tablet-wars-with-ipad/feed/ 0 http://allthingsd.com/20110216/analyst-cheaper-iphone-would-be-a-bonanza-for-apple/ http://allthingsd.com/20110216/analyst-cheaper-iphone-would-be-a-bonanza-for-apple/#comments Wed, 16 Feb 2011 22:47:49 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=57961 For Apple, a smaller, cheaper iPhone may be more than a means of entering the market for lower-end phones currently dominated by Android and Symbian–it could be the final step in the company’s global smartphone dominance.

That’s the theory put forth today by Bernstein analyst Toni Sacconaghi, who believes Apple’s market-share aspirations for the iPhone are a lot like those for its iPod business. Sacconaghi sees an iPhone Nano or Mini as an inevitability, one that would dramatically expand Apple’s addressable market.

“We are surprised that Apple hasn’t moved sooner to introduce a lower priced offering that could help secure a more dominant installed base,” Sacconaghi said in a note to clients today. “After all, the smartphone world is a platform war, where first mover advantage and scale matters. The dual facts that (1) iPhone has not been available at several very important global carriers and that (2) it carries a very high price point have contributed to creating an opportunity for Android that has been successfully exploited. Particularly with Android now outselling iOS, the imperative for Apple to expand its installed base has never been higher.”

A scaled-down version of the iPhone with a cheaper data plan–or one that required no data plan at all–is one very obvious way of doing that. Roll out a device like that with a street price that falls somewhere between $149 and $199, says Sacconaghi, bring it those carriers that don’t yet offer the iPhone, and mass-market adoption will follow. Serious mass-market adoption.

“It is difficult to estimate the size of a market for a product that we don’t yet know the form-factor or timing for. But as a rough guide, we estimate that at an end-user price of $150-$200 and no data plan contract, Apple could address potentially all of the remaining smartphone segment, the non-smartphone postpaid segment, and about 15 percent of the non-smartphone prepaid segment. This would amount to an incremental 700M+ units and $90 billion in revenue in terms of market opportunity; even if Apple succeeded in capturing just 5 percent of these incremental units, it would add $12+ billion in revenues and $4.50+ in EPS.”

]]> http://allthingsd.com/20110216/analyst-cheaper-iphone-would-be-a-bonanza-for-apple/feed/ 10 http://allthingsd.com/20110216/motorola-atrix-android-phone-laptop-review/ http://allthingsd.com/20110216/motorola-atrix-android-phone-laptop-review/#comments Wed, 16 Feb 2011 22:37:55 +0000 Walter S. Mossberg http://ptech.allthingsd.com/?p=1768 Today’s best smartphones are really hand-held computers. They run a vast variety of applications, from productivity programs to games, that mimic what laptops do. Their biggest limitations for serious work, gaming, Web surfing and multimedia are their small screens, cramped keyboards and tinny speakers.

So, what if you could use the brains and connectivity of such a hand-held computer to drive a laptop-size screen, keyboard and speakers, thus overcoming these limitations? Well, Motorola Mobility has devised a new phone and accessory that aim to do just that: to make the phone the only computer you need.

I’ve been testing this new phone, the Atrix 4G, an Android device that will cost $200 with a two-year contract and will run on AT&T’s network. It’s slated to be available by March 6. I’ve also been testing its unusual and clever accessory called the laptop dock, which looks like a large netbook, with an 11.6-inch screen, full keyboard, touch pad, and stereo speakers. This dock, the price of which depends on when you buy it, has no processor, no file storage and no connectivity of its own. It’s dormant until you plug the Atrix into a slot behind the screen.

When you dock the phone, the faux laptop comes alive. It duplicates the phone’s screen on its larger display and lets you use its connectivity and apps. It also contains a battery that charges the phone. The image of the phone’s screen, and any of its apps you run, can be actual size or blown up to use the dock’s larger screen.

With Motorola’s Atrix 4G smartphone, the laptop is the accessory. The phone shown docked to the laptop dock.

Full-Screen Firefox

Even more interestingly, the dock gives you access to a full, and full-screen, PC version of the Firefox Web browser. Firefox is tucked away inside the Atrix but is available only when the phone is plugged into the laptop dock or a second, smaller dock that’s meant to connect to a TV or desktop monitor. The smaller dock lacks a built-in keyboard, battery or screen.

The laptop dock costs $500, but AT&T will knock the price down to $300, after rebates, if you buy it at the same time you buy the phone. That brings the combined price of both devices to $500—the same as the separate price for the dock. The smaller dock, called the multimedia dock, costs $190.

In my tests, the Atrix and the laptop dock performed mostly as advertised. The phone had no trouble driving the larger screen or the full Firefox browser.

I was even able to insert a flash drive into one of the dock’s two USB ports and copy songs, photos, videos and documents into the phone’s internal memory using the keyboard and touch pad. I edited and wrote text in an app called Quickoffice on the phone using the laptop dock’s keyboard, and ran various other apps, including the popular game Angry Birds, on the larger screen.

The Firefox browser worked as normal, using either the phone’s cellular or Wi-Fi connections to access the Internet. And both the phone itself and Firefox can run Flash videos, which mostly played fine.

But the combination of the phone and dock wasn’t as fast, smooth or versatile as having a real laptop, even though to use them you’re essentially carrying around a light laptop (the dock weighs 2.4 pounds). Many apps on the phone aren’t as polished or powerful as typical PC apps, and I found them clumsier to use with the keyboard and touch pad, as opposed to the touch screen for which they were designed.

Installation Issue

Also, other than Firefox, you can’t install PC programs. You can use Web apps inside Firefox, such as Google Docs or the stripped-down Web versions of Microsoft’s Office apps. For email, you can either use the program based in the phone or any Web-based program via the Firefox browser, such as Gmail or Yahoo Mail. But you can’t, say, install iTunes, or PC-based games, or the full versions of Outlook or Microsoft Word.

And there is only a primitive file system, limited to the capacity of the phone, which is just 16 gigabytes, with an option to expand to 48 gigabytes.

The dock’s screen required a lot of scrolling when using Firefox, partly because the browser has a lot of menus and toolbars. To address this, Motorola lets you convert Web pages to versions with the Firefox controls stripped out, so you just see the content.

There’s another problem with the laptop dock. When you make or receive a voice call while the phone is docked, you must rely on the phone’s microphone and speakers, hidden behind the screen of the dock. As a result, calls sounded muffled on both ends, even though the phone automatically switches into speakerphone mode. Motorola says it is working on this issue.

Despite the drawbacks, some folks will surely be attracted to this innovative combination.

If you mostly do your computing tasks on a phone or a PC Web browser, storing files in the cloud and using phone or Web-based apps, Motorola has you covered. And the fact that the dock can charge the phone is a big plus.

Motorola’s Atrix 4G

The Phone Side

What about the phone itself?

Well, it’s one of the nicest smartphones I’ve tested. Its processor makes it fast, and it has a 4-inch, high-resolution screen—almost as high as the iPhone 4′s, though not quite as sharp to my eye. It runs an older version of Android, but Motorola is promising an upgrade.

The phone also has good battery life. It lasted a full day while I was testing it and Motorola claims up to nine hours of talk time. Photos and videos I took with the phone were sharp, and it has a front camera for video calls.

The Atrix also has two other notable features. First, it can take advantage of AT&T’s souped-up 3G network, which the carrier calls 4G because it can supposedly achieve 4G data speeds.

In my tests, in the D.C. and New York areas, the speed wasn’t especially impressive, averaging just a bit better than 3G speeds on other AT&T phones I’d tested.

There is also a fingerprint sensor built into the phone, which you can use instead of a pass code to secure the phone. It worked fine for me.

Overall, this is a very nice Android phone that can imitate a limited version of a laptop. That may be enough for some folks, but fall short for others.

Write to Walter S. Mossberg at walt.mossberg@wsj.com

]]> http://allthingsd.com/20110216/motorola-atrix-android-phone-laptop-review/feed/ 0 http://allthingsd.com/20110214/apple-and-samsung-hammering-out-7-8-billion-display-deal/ http://allthingsd.com/20110214/apple-and-samsung-hammering-out-7-8-billion-display-deal/#comments Mon, 14 Feb 2011 15:32:46 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=57765 With demand for its iOS devices growing, Apple is once again moving to secure vast storehouses of parts with which to build them. Cupertino is said to be finalizing a massive component contract with Samsung, one that would make it the company’s single largest customer.

Worth about $7.8 billion, the deal is believed to include liquid-crystal display panels for the next iteration of the iPad, as well as mobile application processors and NAND flash memory chips used for the U.S. company’s iPhones and iPads.

One unknown: Whether the displays reportedly included in this deal are the rumored Super PLS panels that offer not just a wider viewing angle, but superior visibility outdoors. Another: Whether this deal is somehow related to the $3.9 billion component supplies and capacity contract Apple COO Tim Cook mentioned during Apple’s first-quarter earnings call.

“In the past several quarters we’ve identified another area and come to some recent agreements that [CFO Peter Oppenheimer] talked about in his opening comments, in that these payments consist of prepayments and capital for process equipment and tooling,” Cook said back in January. “And similar to the flash agreements, they’re focused in that area we feel is very strategic. And so I’d prefer not to go into more detail about what specific area it’s in, but it’s the same kind of thinking that led us to those deals that led us to the flash deal.”

PREVIOUSLY: Apple Using Cash to Secure Cache of Components

]]> http://allthingsd.com/20110214/apple-and-samsung-hammering-out-7-8-billion-display-deal/feed/ 0 http://allthingsd.com/20110213/apple-works-on-line-of-less-expensive-iphones/ http://allthingsd.com/20110213/apple-works-on-line-of-less-expensive-iphones/#comments Sun, 13 Feb 2011 17:00:52 +0000 Yukari Iwatani Kane and Ethan Smith http://voices.allthingsd.com/?p=36307 Apple Inc. is working on the first of a new line of iPhones and an overhaul of software services for the devices, people familiar with the matter said, moving to accelerate sales of its smartphones amid growing competition.

One of the people, who saw a prototype of the phone late last year, said the device is intended for sale alongside Apple’s existing line. The new device would be about half the size of the iPhone 4, which is the current model.

The new phone would be available to carriers at about half the price of the main iPhone repertoire. That would allow carriers to subsidize most or all of the consumer’s cost, putting the iPhone in the same mass-market price range as rival smartphones, the person said. Apple currently sells iPhones to carriers for $625 apiece on average. With carrier subsidies, consumers can buy iPhones for as little as $199 with a two-year contract.

Read the rest of this post on the original site »

]]> http://allthingsd.com/20110213/apple-works-on-line-of-less-expensive-iphones/feed/ 0 http://allthingsd.com/20110210/sprint-manages-first-subscriber-gain-since-2007/ http://allthingsd.com/20110210/sprint-manages-first-subscriber-gain-since-2007/#comments Thu, 10 Feb 2011 14:45:26 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=57532 Good news for long-suffering Sprint Nextel investors: Customer retention has finally improved to the point where the carrier is able to report actual gains in postpaid subscribers, rather than losses.

Posting fourth-quarter earnings this morning, Sprint said it added 1.1 million total wireless subscribers, 58,000 of them two-year contract customers. Quite a milestone for a company that hasn’t seen a gain in postpaid subscribers in 13 quarters and a sign that Sprint may finally be turning a corner. Another good sign: Postpaid churn fell to 1.86 percent from 2.11 percent in the third quarter, and prepaid churn fell to 4.93 percent from 5.32 percent. And another: For the quarter, Sprint added almost 1.1 million wireless subscribers, its best showing in nearly five years.

All welcome news, even if Sprint is still losing money. The company reported a fourth-quarter loss of $929 million, or 31 cents a share, on revenue of $8.3 billion, up from $7.9 billion a year ago. Analysts polled by Thomson Reuters most recently forecast a loss of 30 cents a share on $8.15 billion in revenue. Said Bernstein analyst Craig Moffett, “Sprint CEO Dan Hesse might be forgiven for the temptation to hang a “Mission Accomplished” banner on the aircraft carrier that is Sprint. To his credit, he expressly declined to do so. Still, the company has at last achieved post-paid and total subscriber growth, customer service levels have improved, churn rates have been brought under control, and revenues were up.”

At $4.41, Sprint shares are up 1.15 percent in early trading as I write this.

]]> http://allthingsd.com/20110210/sprint-manages-first-subscriber-gain-since-2007/feed/ 1 http://allthingsd.com/20110209/the-streak-7-bargain-tablet-from-dell-is-no-real-deal/ http://allthingsd.com/20110209/the-streak-7-bargain-tablet-from-dell-is-no-real-deal/#comments Thu, 10 Feb 2011 02:01:23 +0000 Walter S. Mossberg http://ptech.allthingsd.com/?p=1759 If you could get a tablet for the price of a smart phone, and if it also worked on one of the new, faster, 4G-class cellular networks, you’d jump at the chance, right? Dell and T-Mobile hope so, and that’s why they’ve brought out the Dell Streak 7, at just $200 with a two-year service contract.

The Streak 7, Dell’s second effort to compete with Apple’s $500 iPad, is the least expensive tablet I’ve seen from a major manufacturer, and claims to be the first capable of 4G cellular speeds (it also has Wi-Fi). Like many planned iPad competitors, it runs Google’s Android operating system. It’s also the first I’ve tested using a fast new processor from nVidia, the Tegra 2, which will power a number of new tablets this year.

Unfortunately, after a week of testing, I found the compromises Dell made to get to that low price make it impossible for me to recommend the Streak 7. Its screen, battery life, and software are all disappointing, and vastly inferior not only to the iPad’s, but also to those on the Samsung Galaxy Tab, a high-quality Android tablet about the size of the Streak 7 released late last year. In other words, you get what you pay for.

Like the Galaxy Tab, the Streak 7 has a 7-inch screen, measured diagonally, or less than half the size of the iPad’s. But it’s large enough to be properly called a tablet, unlike Dell’s first Streak, an odd tweener device with a 5-inch screen—more like a big phone—that was released last year to a tepid response.

Dell concedes it wasn’t trying to build “the Cadillac of tablets” with the Streak 7, but was aiming for budget-conscious families and home use. Dell notes it has plans for a range of tablets with different prices, screen sizes and specs.

The Streak 7′s screen, battery life, and software are all disappointing. In other words, you get what you pay for.

The Streak 7 has some strengths. Like the Tab, it’s smaller and lighter than the iPad, so easier to hold in one hand. It plays Flash videos, which the iPad can’t. And it has front and rear cameras, unlike the iPad. It can also be used, unlike the iPad, as a Wi-Fi hot spot.

Also, I found its cellular data speeds impressive. In tests I conducted in Silicon Valley, the Streak averaged 4.63 megabits per second in download speed on T-Mobile’s souped-up 3G network (which it calls 4G because it claims similar speeds). That was nearly twice as fast as the download speeds provided by my hotel’s Wi-Fi network. Cellular upload speeds were a bit slower than Wi-Fi, but still averaged about 1.2 mps.

But, in my view, the Streak 7′s minuses outweighed its pluses. Let’s start with battery life. In my tests, the Streak 7 conked out after a pathetic two hours and 10 minutes of watching movies. That compares with about 11.5 hours of continuous video playback for the iPad and just under seven hours for the Galaxy Tab, when I tested them. In a more mixed-use pattern, including Web surfing, game playing, music, email and social networking, with some short videos thrown in, the Streak 7 lasted between 5.5 and 6.5 hours, still underwhelming for a tablet.

Dell says its target audience will use the Streak 7 plugged into wall outlets and TVs through an extra-cost dock, but I wouldn’t buy a tablet with battery life this poor.

Screen resolution also was so low as to be fuzzy at times, especially in reading small type, and viewing the screen at an angle often reduced the image to a ghostly outline. The Streak 7′s screen has a resolution of 800×480, below the much smaller iPhone screen, and well below the resolution of the iPad or the Galaxy Tab. While the internal chips drove video fine—as long as the batteries lasted—it looked worse than on the other two, as did photos.

The software also is a problem. It’s an older version of Android, called 2.2, which was never intended for tablets, and whose core apps—such as email, contacts and calendar—were designed for the smaller phone screens. Months ago, Samsung used the same version of Android on the Tab, but compensated by rewriting key apps to take advantage of the tablet screen, with more PC-like designs. Dell has done none of this on the Streak 7. All it added was a thin user interface called Stage featuring big, blocky widgets that group things like contacts and social updates, an old concept. It preloaded some kid-friendly and family-friendly apps, but some are mere come-ons that require downloading the full app.

Worse, the Streak 7 appears shortly before the true tablet-optimized version of Android, called Honeycomb, and Dell can’t promise that Streak 7 buyers can upgrade to Honeycomb. The company says the device has been designed to accommodate an upgrade, and is hopeful that it’s possible. But there is no guarantee. Buyers might get stuck with the old version built for phones.

Even on a tight budget, the Streak 7′s deficiencies might not make it worth the price. You’ll pay T-Mobile $30 or $50 a month for a capped data plan for two years. By contrast, the base iPad requires no payments to a cellular carrier, as it’s Wi-Fi only. Even if you buy the iPad with cellular connectivity from AT&T, there is no contract. You pay $15 or $25 a month and end the cell service at will, with no penalty.

You can buy the Streak 7 without a contract, but then it costs $450, too much for a device with its drawbacks, and only $50 less than the far superior base iPad. Even the Streak 7′s subsidized price of $200 is only $50 less than what its carrier, T-Mobile, charges for the better Galaxy Tab with a two-year contract.

Dell is serious about competing in the tablet wars, and it may produce a winner yet. But its first efforts, in my view, missed the mark.

Find all Walt Mossberg’s columns and videos at the All Things Digital website, walt.allthingsd.com. Email him at mossberg@wsj.com.

]]> http://allthingsd.com/20110209/the-streak-7-bargain-tablet-from-dell-is-no-real-deal/feed/ 0 http://allthingsd.com/20110207/whats-better-than-one-screen-two-sprint-unveils-kyocera-echo/ http://allthingsd.com/20110207/whats-better-than-one-screen-two-sprint-unveils-kyocera-echo/#comments Mon, 07 Feb 2011 23:57:40 +0000 Tricia Duryee http://emoney.allthingsd.com/?p=2495 Ahead of Apple’s iPhone launch on Verizon later this week, Sprint unveiled the Kyocera Echo, a dual-touchscreen smartphone. The Android phone, which looks a lot like a Nintendo DS, is being positioned against tablets because of better multitasking capabilities. It allows people to watch videos on one display while browsing on another. The Echo will be available this spring for $200 with a new contract. Monthly plans start at $80 for unlimited text, talk and data.

]]> http://allthingsd.com/20110207/whats-better-than-one-screen-two-sprint-unveils-kyocera-echo/feed/ 2 http://allthingsd.com/20110207/liveaol-explains-its-huffington-post-deal-to-wall-street/ http://allthingsd.com/20110207/liveaol-explains-its-huffington-post-deal-to-wall-street/#comments Mon, 07 Feb 2011 13:55:58 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=29429 Tim Armstrong and company spent yesterday explaining their $315 million Huffington Post purchase to the press. Now they’re doing the same for Wall Street, via a conference call.

AOL CFO Artie Minson prepped investors for the call with a memo laying out expectations. Short version: AOL thinks HuffPo will earn about $10 million on revenue of $50 million this year (as long as you’re okay with using “adjusted OIBDA” as a proxy for “profit”). It also thinks the purchase will save it $20 million a year, but it’s going to spend around $20 million on restructuring charges when the deal goes through.

I’ll liveblog the call below:

8:02 am: Greetings! About to start now.

8:03 am: On the call: Tim Armstrong, Arianna Huffington, Artie Minson.

8:03 am: Armstrong makes a Super Bowl joke that I can’t quite follow, and I like football. But now praising Arianna, co-founder Kenny Lerer and outgoing AOL CEO Eric Hippeau.

“The Huffington Post is one of the best properties on the Internet.” Armstrong, Huffington and Minson are all BlackBerry users.

8:06 am: On revenue: This gives an opportunity to serve more brand marketers, who are “very interested” in the scale this gives us.

8:07 am: Spending next 30 days on integration. “Really synergies to be had.”

Next steps: Next 72 hours communicating with employees, talking to partners. 1,500 AOL workers on the phone this morning explaining deal to others.

“This may be the smallest disruption” internally of any deal I’ve worked on. Majority of integration done within 35 to 40 days.

8:09 am: We’ve looked at a bunch of companies, though we’re mainly going to concentrate on organic growth. But Arianna is great [many superlatives] and she “also happens to be a woman.”

8:10 am: Here’s Arianna.

8:11 am: “Amazing” how aligned two orgs are.

8:11 am: HuffPo was profitable last year. We were thinking about bringing in additional investors last year, and an IPO down the line. But this made perfect sense.

8:12 am: This deal provides a “dramatic acceleration” for the plans we already had.

8:13 am: Some praise for Patch, AOL’s local strategy.

8:14 am: Can’t wait to start!

8:14 am: Alrighty, then. Here’s Artie Minson with some nuts and bolts.

Actually, it’s some color on the deal. But a lot of it is in the prepared remarks he put out earlier this morning.

8:15 am: Again, $20 million in cost savings here. And again, we’ll have to pay up for restructuring: $20 million for cuts, and $10 million for purchase price.

8:17 am: Still basically reading from prepared remarks. Some bookkeeping talk re: compensation accounting.

8:18 am: Remember, display ad growth coming will finally start showing up second half of this year.

8:19 am: Q&A:

Q: Talk about content strategy. Does HuffPo become hub for content going forward? Does it replace Seed? And how long is Arianna’s contract?

A: “The press” has been talking about our content strategy, so let me be clear–we’re focusing on premium content. Things like Seed and StudioNow are platforms–you can do whatever you want with them, different quality levels, at different types of scale.

And then the other thing that is important about those platforms is the ability they give us to work with advertisers.

One of our main interests in HuffPo is their technology and publishing system. So now we have multiple systems [which he is saying is a good thing]. “Our content strategy hasn’t changed.” The “stuff that was out in the press about the AOL Way” was just one way of doing things. [This is not very convincing]

Arianna, tell us how long you’re going to stay.

8:24 am: Arianna: “I’ve told Tim I want to stay here forever. I want this to be the last act of my life.” Anything I want to do I can do here.

[Sorry, missed next part but it was a defense/explanation of content strategy.]

8:26 am: Armstrong: Arianna has a multiyear contract, but it’s open-ended.

8:27 am: Arianna: By the way, we’re going to bring back commenting to AOL stories, and socialize them.

8:28 am: Q: Why buy instead of partnering? Were there other bidders? Also, how will HuffPo politics affect AOL?

8:28 am: Armstrong: We do partnerships where there is “limited upside to those arrangements” so ” we can really spend time on the areas we want to win”–i.e., we don’t care about sports, we do care about women.

“Arianna is somebody we’d rather have inside our building than outside our building.”

“If there were or weren’t bidders on the other side,” I think we got the right price.

8:30 am: Arianna. “As we’ve said, again and again, Huffington Post was not for sale….Nobody was in a hurry to cash out, everybody believed that we could do an IPO down the road.” It’s just that Tim gave us a great offer. [hrrrm.]

On politics–we used to be all about politics, now we’re not. Just 15 percent of our traffic. We have a divorce section now.

Talking up AOL’s “college” section.

8:33 am: Q: For Arianna: More on Patch, please. What do think about what AOL’s done with it, and what you can do with it?

8:33 am: [Every time Arianna says "local level" I think she's saying "locker level." It's happened at least twice, maybe more, on this call.]

There’s a “greatest person of the day” feature we have, and I think Patch should use that. [Or maybe vice-versa, sorry.] I also like their five percent “giving back” rule, cause marketing, etc.

8:35 am: Armstrong: Again, we can do national and local. That’s important. NFL rights are important, and so are local news stories.

8:36 am: Q: Who’s going to sell what? And can you talk about pricing disparity between AOL and HuffPo?

8:37 am: Armstrong: “We would like to maintain all the people from both sales forces [except for Greg Coleman!]. I think we will end up with a large-scale, large-property organization–I don’t know exactly what that’s going to look like, though.

On sell-through rate: Slightly lower at HuffPo, because they’ve been ramping up traffic, and sales force. On CPM, same story. So we can bring up sell-through rate and CPM, and have a larger sales force. [This is pretty much the best argument for the deal that Armstrong can make.]

[BTW: Good back-channel discussion on Twitter right now about AOL's SEO skills, and the people behind it. None of that coming up during this call right now.]

[Sorry, I meant HuffPo's SEO skills, much of which stem from blueprint BuzzFeed CEO Jonah Peretti set out.]

Q: Why not use equity for this deal?

A: Because our equity is priced too low, essentially. But HuffPo employees did roll over 25 percent of deal consideration into AOL options. So as that equity gets more valuable, they’ll get upside.

8:45 am: Q: In your statement, you talked about OIBDA growth in 2013. More on that please.

Minson–probably going to stick to my prepared remarks on that one.

8:46 am: Last Q: Your acqusitions have been about toolsets or content. As you think about others going forward, what else do you want?

Armstrong: We have long-term vision. On plumbing: We’ve wanted to get platforms and plumbing straightened out, and we’re doing that now. Think about the bones or foundation of a very large property. That’s why we’ve been doing infrastructure, like with video–5Min and GoViral and StudioNow.

Going forward, we’ll be doing infrastructure. And we’ll continue to look at “media properties and media brands” that fit our strategy. [Remember, Web site owners: HuffPo just got 10x revenue.

8:50 am: Minson: But we're very price sensitive and we've walked away from deals.

8:50 am: Arianna: And we like women!

8:51 am: Armstrong sums up: Success "in the Internet space" requires vision and execution. That's this deal. And remember, content and brands become more valuable as tech gets faster, more advanced. And "expect us to stay on strategy and on point" going forward. "We're going to overcommunicate" with both sets of employees as we integrate. [You've been warned!]

And we’re done. Thanks for reading.

[Photo credit: Arianna Huffington]

]]> http://allthingsd.com/20110207/liveaol-explains-its-huffington-post-deal-to-wall-street/feed/ 5 http://allthingsd.com/20110207/boomtown-will-have-what-greg-colemans-having-huffpo-ad-sales-head-scores-big-bucks-twice-from-aols-armstrong/ http://allthingsd.com/20110207/boomtown-will-have-what-greg-colemans-having-huffpo-ad-sales-head-scores-big-bucks-twice-from-aols-armstrong/#comments Mon, 07 Feb 2011 12:00:35 +0000 Kara Swisher http://kara.allthingsd.com/?p=40398

AOL CEO Tim Armstrong is the gift that keeps on giving–at least to Greg Coleman.

He’s the Chief Revenue Officer at the Huffington Post, for which the Internet giant just forked over $315 million to acquire.

Sources said Coleman, who has run advertising sales at the privately held news and opinion site since the fall of 2009, will get a multimillion dollar payday from the deal, even though he is not staying on after it closes, since AOL has its own top ad guy.

Except that this is the very same Greg Coleman who had been running ad sales for AOL for only two weeks when Armstrong took over from ousted CEO Randy Falco in February of 2009.

Coleman was gone from AOL by the end of April, replaced by Armstrong with current ad sales head Jeff Levick.

And for those three months of work Coleman got paid out his entire three-year AOL contract.

Not bad work if you can get it.

Actually, many credit Coleman’s energetic work at the Huffington Post for turbocharging its ad sales revenue to $31 million in 2010 and projected revenue upward of $60 million in 2011.

Coleman is an experienced online ad exec who was at Yahoo for seven years, responsible for all advertising revenue worldwide. He came to Yahoo from Reader’s Digest.

But Coleman ran into Yahoo’s management buzz saw after trouble hit the company in 2007. He was one of the first in a long line of execs to leave the troubled company, departing in one of its many controversial reorganizations.

But Yahoo’s ad business did grow strongly under him and former Yahoo ad exec Wenda Millard.

Before AOL, Coleman ran a Los Angeles-based start-up called NetSeer, which focused on ad targeting.

Memo to soon-to-be unemployed Greg: You’re definitely buying lunch next time I see you, and keep in mind that BoomTown is feeling partial to caviar.

]]> http://allthingsd.com/20110207/boomtown-will-have-what-greg-colemans-having-huffpo-ad-sales-head-scores-big-bucks-twice-from-aols-armstrong/feed/ 0 http://allthingsd.com/20110203/att-to-push-atrix-4g-to-counter-verizon-iphone/ http://allthingsd.com/20110203/att-to-push-atrix-4g-to-counter-verizon-iphone/#comments Thu, 03 Feb 2011 18:49:02 +0000 Shayndi Raice http://voices.allthingsd.com/?p=35887 AT&T Inc. is cozying up to Motorola Mobility Holdings Inc. as the carrier seeks to bulk up its smartphone portfolio running on Google Inc.’s Android operating system in the wake of losing its exclusive hold on Apple Inc.’s iPhone.

To attract new customers, AT&T Mobility Chief Executive Ralph de la Vega said the forthcoming Motorola Atrix 4G will be the carrier’s leading device in its portfolio. Mr. de la Vega wouldn’t say how much money the carrier will spend on marketing the device, but he said it would receive amounts similar to campaigns for the iPhone or its previous hit phone the Motorola Razr.

On Thursday, the second largest U.S. wireless carrier by subscribers said it will start selling the Motorola Atrix 4G on March 6 for $199.99 with a two-year contract. Presales will begin Feb. 13.

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