AllThingsD » financial crisis

AOL Poaches Another Google Exec

John Paczkowski — Thu, 04 Feb 2010 19:00:24 +0000

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Sun CEO: Parting Is Such Tweet Sorrow

John Paczkowski — Thu, 04 Feb 2010 12:30:03 +0000

Sun CEO Jonathan Schwartz was the first CEO of a Fortune 500 company to put up his own blog. Late Wednesday night, he became the first CEO of a Fortune 500 company to step down from that position via Twitter.

“Today’s my last day at Sun,” Schwartz tweeted. “I’ll miss it. Seems only fitting to end on a #haiku. Financial crisis/Stalled too many customers/CEO no more.”

Fitting to end with a haiku broadcast to a microblogging service? Really? Seems a bit…precious. As Stowe Boyd observes, “Twitter can be used productively for many things, but resigning by haiku is not one of them.”

Schwartz’s departure, an inevitability if there ever was one, follows Sun’s (SUN) takeover by Oracle (ORCL) and the end of a nearly three-decade run as an independent company.

No word yet on what Schwartz plans to do next. But he’s leaving the company with a very fat chunk of change, so he’s likely in no rush to find something new. According to Sun’s definitive proxy statement, Schwartz stands to earn about $12 million from the severance package he negotiated, plus another $5.1 million or so for the shares he still holds in the company.

FURTHER READING:

CIOs: The Econalypse Ate Our 2009 Budgets

John Paczkowski — Wed, 10 Jun 2009 18:30:04 +0000

No surprises here. The econalypse has sent IT managers scrambling to redraft their already diminished 2009 budgets. About 42 percent of chief information officers have cut their budgets to grapple with the souring economy, according to a new survey by Gartner (IT). However, 54 percent have kept their budgets flat and an enviable four percent have actually raised them. Gartner reports that in March and April of this year, budgets declined by a weighted average of 4.7 percent. That’s quite a bit different from the firm’s earlier prediction of generally flat spending for the first quarter of 2009. As Gartner’s Mark McDonald told Forbes, “It’s almost as if Jan. 1 started on April 1. [CIOs] re-did their plans in the first quarter once they understood what the global financial crisis would mean to them.”

Interesting. So, given the continuing volution of the financial crisis, can we expect further budget adjustments in the future? McDonald doesn’t think so. “CIOs gave us every indication that the budgets they have now are the budgets they will have for the rest of the year,” he said. “The number who have a contingency plan is only about half, and most of those CIOs don’t believe they’re going to have to execute those contingency plans….Of the CIOs we surveyed, 38% expect to see a recovery by September 2010, and another 32% expect a recovery by March of 2010. Only 24% said it would be beyond September 2010.”

Psyonara, Redux

John Paczkowski — Tue, 26 May 2009 17:51:43 +0000

Interesting turn of events in the Apple-Psystar spat. Psystar, the unauthorized Mac clone maker, has filed for bankruptcy. Seems the company’s acrimonious legal battle with Apple and the souring economy have had a deleterious effect on its finances. “Due to the weakened economy, Debtor has had no alternative but to commence these Chapter 11 proceedings,” Psystar explained in its Chapter 11 filing. “Debtor sales have been greatly affected by the decrease in consumer spending. The financial crisis has also caused creditors to tighten up their terms and become more demanding for immediate payment. Debtor’s vendors due to their own financial problems are not being able to supply all necessary items to allow Debtor to produce their product, thus, forcing Debtor to pay higher prices for parts in order to fulfill customer orders in a timely manner and to assure satisfaction with the product. These factors seriously contribute to the Debtor not being able to turn a significant profit in each sale.”

Also: Debtor is suffering under mounting legal costs as it is steadily beaten into submission by Apple (AAPL) and its notoriously vicious legal team.

Pystar’s bankruptcy declaration will delay Apple’s copyright-infringement suit against it, but only temporarily. In the meantime, the company will be allowed to continue to do business and perhaps, strengthen its defense. But on June 5, the date of its bankruptcy hearing, things could get nasty. Psystar will almost certainly be forced to reveal its financial backers, and if they are the nefarious Svengalis that Apple claims, there may be hell to pay.

New From Activision: Guitar Hero III–World Recession

John Paczkowski — Fri, 12 Dec 2008 13:35:48 +0000

In a month when some 533,000 jobs were lost nationwide, Americans bought an astonishing amount of videogame paraphernalia–$2.91 billion worth, according to market research outfit NPD Group. That’s a 10 percent increase over November 2007. Shipments of Nintendo’s Wii for the month totaled 2.04 million, while those of Microsoft’s (MSFT) Xbox came in at 836,000. Sony’s (SNE) PlayStation 3 ranked a distant third, with shipments of just 378,000 units. Said NPD analyst Anita Frazier, “With $16 billion realized for the year so far through November, the industry is still on pace to achieve total year revenue of $22 billion in the U.S.”

A remarkable metric, given the economic downturn. How is it that gaming is thriving at a time when the global financial crisis is squeezing wallets? “There are a couple of reasons,” Ron Meiners, director of community for the Hollywood Interactive Group, recently told News.com. “One is the traditional value of entertainment during tough economic times. Like the great fantastic musicals in the 30s. Movies did great, because they took people’s mind off of the troubles they were facing. [And] videogames have great value as entertainment. The number of hours of solid entertainment that comes from a videogame purchase is much greater than a movie, for example, for very comparable cost.”

Got Any Networks Without So Much Spam in Them?

John Paczkowski — Thu, 13 Nov 2008 19:00:21 +0000

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Oh, Sun's "Preconfigured for the Downturn," All Right …

John Paczkowski — Tue, 21 Oct 2008 09:32:26 +0000

We are preconfigured for the downturn.”

– Sun CEO Jon Schwartz, Oct. 13, 2008

The econalypse is weighing heavy on Sun Microsystems. Its business sullied by the financial crisis, the company warned of a much larger-than-expected quarterly loss on lower revenue after market close Monday afternoon. Sun (JAVA) said it expects to post revenues of $2.95 billion to $3.05 billion when it reports full financials on Oct. 30. Analysts had been looking for $3.14 billion and a loss of $0.01.

Sun’s ugly news just seems to be getting uglier. “The company continues to miss its targets,” said Edward Jones analyst Bill Kreher. “There’s a lack of confidence in management, given continued shortfalls. … They are just not well-positioned … [Sun] has an uncertain future.”

Oh, Sun's "Preconfigured for the Downturn," All Right …

John Paczkowski — Tue, 21 Oct 2008 09:32:26 +0000

We are preconfigured for the downturn.”

– Sun CEO Jon Schwartz, Oct. 13, 2008

Economic Crisis Drives Notebook "Rightsizing"

John Paczkowski — Wed, 15 Oct 2008 13:30:02 +0000

At first glance, the growth of the global personal computer market during the third quarter would seem to belie any notion of a vast economic downturn. Despite the financial crisis gripping Wall Street, PC shipments increased 15 percent from the third quarter of 2007 to the third quarter of 2008, according to Gartner (IT).

Still, the PC industry is feeling the effect of the economic meltdown. “The U.S. home market saw definite softness,” said Gartner analyst Mika Kitagawa. “The global PC market finally felt the impact from global economic downturn.”

The fastest growing computer segment in the quarter: mini-notebooks. “The mini-notebook segment experienced strong growth in the global PC, led by robust growth in the Europe, Middle East and Africa (EMEA) region,” said Kitagawa. “In the North America market, the economic crunch created more interest in the sub-$500 segment. Because the mini-notebook is still a new segment, it is too early to determine if the emerging segment created new market opportunities or if it cannibalized lower priced systems.”

Seems the volatility in the world’s economy hasn’t undermined interest in new PCs so much as refocused it on a new category.

One last point worth noting here, in light of Tuesday MacBook event. Apple (AAPL) continues to exceed industry growth in laptop sales. As Apple COO Tim Cook noted yesterday, “Several quarters in a row, we’ve been growing two to three times the market growth.”

Economic Crisis Drives Notebook "Rightsizing"

John Paczkowski — Wed, 15 Oct 2008 13:30:02 +0000

Seems the volatility in the world’s economy hasn’t undermined interest in new PCs so much as refocused it on a new category.

$22-a-share? What a Bunch of Yahoos …

John Paczkowski — Fri, 10 Oct 2008 18:00:06 +0000

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Ballmer Finds Leak in Tech Industry Inner Tube

John Paczkowski — Tue, 30 Sep 2008 22:27:29 +0000

Oh, we’re in trouble now. Microsoft CEO Steve Ballmer seems to have lost his optimistic outlook on the current economic collapse. And when a guy with a pay package valued at about $1.35 million loses his faith in the tech industry’s “buoyancy,” as Ballmer likes to call it, well, you know things are getting really ugly.

In a Tuesday interview with Reuters, Ballmer said it’s reasonable to assume that the ongoing financial crisis will affect Microsoft (MSFT). “Financial issues are going to affect both business spending and consumer spending, and particularly … spending by the financial services industry,” Ballmer said. “We have a lot of business with the corporate sector as well as with the consumer sector and whatever happens economically will certainly affect Microsoft. I think one has to anticipate that no company is immune to these issues.”