AllThingsD » innovation

Seven Questions for Cisco Systems CEO John Chambers

Arik Hesseldahl — Thu, 09 Feb 2012 21:50:56 +0000

Shortly after he concluded his quarterly earnings conference call yesterday, Cisco Systems CEO John Chambers called me up — upbeat and understandably so.

Cisco appears to have continued its recovery following a painful restructuring. Sales are up and setting records, earnings beat the consensus of analysts, and Cisco’s outlook for the coming quarter is positive, too. Cisco’s even reached a point where it’s at least close to fitting into its old skinny jeans. What a difference a year makes. Last year it was all about gloom and doom and some irritable investors were calling for Chambers to lose his job.

Since then the company has undergone a painful but necessary restructuring, shed thousands of jobs, shut down marginal business units and refocused on its core businesses, and as yesterday’s quarterly earnings report proved, the results are not only starting to show, but starting to stick.

So is the work done? Definitely not. Yes, Cisco is showing some return to its strengths, but there’s still a long way to go. We talked about that, the troubles Cisco’s competitors are facing, his long-held view that companies like Cisco should get a tax holiday to repatriate their cash held outside the U.S. and many other things.

Also Chambers, remembering that I dedicated “How Ya Like Me Now” to Cisco last quarter as it turned the corner on its troubles, asked me what song I might use to characterize its results this quarter. Taking inspiration from the headline of my first story and from his cautiously optimistic tone, I settled on “It’s Getting Better All The Time,” the Beatles track, performed by Paul McCartney and embedded after the Q&A. Enjoy.

AllThingsD: John, I don’t know if you saw the headline I wrote earlier, but I said you fit into your skinny jeans again. Is that fair?

John Chambers: [Laughs] I think it’s fair. We were up about four or five inches there so I think we have an inch or two to go, but we’re getting close.

So let me ask about the quarter. It looks like a solid quarter where a lot of the troubles were starting to get behind you. In broad brush strokes, where were Cisco’s strengths? I know some of your competitors were having their own troubles, but where were you strong in particular?

The strengths were that we appear to be executing on the market transitions that are going on, and we appear to be reinventing ourselves, not just in terms of how we control our costs, but in terms of the productivity we’re getting out of our employees. So if you look at the major transitions going on in the industry from an economic point of view, to how customers buy, to where the high tech industry is going, which I would argue is all connected to intelligent networks, that all appears to be playing out as we had hoped. The other transitions that you think about, like data centers and the cloud, we saw 90 percent growth in an industry that is growing at best in the teens. Our ability to move in collaboration, where we grew 10 percent though I think we could do better — it remained solid for us. In video with set-top boxes up 23 percent to new video technologies growing well and seeing improvement in the margins. There are things we need to do to reinvent Cisco. I think I said this at your own conference a decade ago [Chambers spoke at D5 in 2007, but that is not where he made this comment. -Ed.] that voice will be free. It’s almost there. You could see the trend, and what it meant is that once voice would become a smaller part of the network load, that would be given away in order to make way for the video and the entertainment. The same trends are taking place all over again at multiple speeds and multiple gears, which if we’re right, they all play together. Everything from mobility to cloud to the intelligent network, to wireless to security, to video being pervasive, all of those are coming together at tremendous speed. And we’re pulling them all together pretty well for our customers. Now, this is just the beginning if we execute right, and we have plenty of hurdles in front of us, but this may be the voice-will-be-free trend times 10 in terms of the impact of the transitions going on. We appear to have managed them well; we did what we said we would do, turned in record earnings and record revenues, and earnings per share were up 48 percent. We’ve realigned ourselves and reinvented the company, which I think you have to do every five years. Sometimes it takes a crisis to reinvent. … It’s a journey and we’re just getting started.

What’s the number one hurdle that you want to get over this year, that’s in front of you right now and keeping you up at night?

I want to build deeply into our capabilities, a continued focus on gross margins and effectiveness, from product design to sales all integrated together. You probably know this, but we’re the only company who’s anywhere near this profitable with $45 billion in sales with open standards. It isn’t a mainframe business where everything is proprietary or like in Apple’s situation where it’s a wonderful company but it has an architecture. We do it entirely with open IP, so we can be challenged by a 10-person start-up or a by the biggest giants like Dell or IBM or Hewlett-Packard to come at us. With this type of margin but so low a barrier to entry, we’re doing relatively well. But we still have to reinvent ourselves at a faster pace. We have to do what I call the basic blocking and tackling to participate in the new capitalism that we’re heading into. That’s the attention to gross margins, getting the market transitions right, tying the products together so you can get the price premium on them. But what really keeps me up at night this last year was the realization that this has to be constant reinvention. Average is over. An average high-tech company is headed down. Those above-average companies are going to head down in 3 to 5 years. If as a company you can’t reinvent yourself every 3 to 5 years, you have a problem coming at you.

Does that then imply that Cisco had become complacent or even average? It was and is the biggest networking player, but did Cisco lose its way and try to do too much?

Well, I could give you a long list of things we have to do better. We’re a healthily paranoid company so we always have things we could do better. I do think we were fat. Four to five inches, not just one or two. We’re not back in our skinny jeans yet, as you put it, but we’re within an inch or so of getting there. We missed market transitions at the speed at which they occurred. We should have seen the drop-off in public spending coming at us sooner. Everyone else has still run off the turn, even though they saw what happened to us two to four quarters ago. We should have seen it sooner and reinvented ourselves before it hit us, and made the turn much more effectively, and I’m committed to doing that, and the leadership team is, too. It would have been easy to just cut a billion dollars in expenses, reorganize sales and how customers buy. We realized that gross margins can deteriorate not just because of what competitors do but what we do to ourselves, like what we did on switching. We should have been smarter there.

On the conference call you mentioned the possibility of getting back into the mergers and acquisitions game. Any hints on where you might go or whom you might buy?

I think it’s a fair question. Part of the reason we said that was to explain why we’re building up cash in the U.S. Part of it was for share buybacks because the price was attractive. A lot of people don’t realize that we use M&A deals to gain leadership. We were a routing company, we acquired three switching companies. We were an enterprise and commercial company, we acquired a service provider company in Stratacom. If you look at where it’s going to be, it’s probably in data center, collaboration and video, and combining those with security, bring your own device and mobility. A large part has to do with our government allowing us to bring money back to our country.

That’s always been a big issue of yours. You made some comments about it on the conference call as well. Care to elaborate?

I think that it’s going to happen in the next presidential administration whether the president is re-elected or someone else is. I’ve been disappointed that we haven’t been able to get our message out about this more effectively. Ironically, I was in Europe, the government leaders there look you right in the eye and ask what they need to do to bring jobs to their country and keep the ones they have. They are partnering with business. I think we’re following Europe in the wrong way and following more of what they did to get them in trouble in the first place.

There’s a bit of a disconnect, however, to anyone who sees on one hand a company that wants to bring cash back in a tax-advantageous manner in the name of creating jobs, while the same company just fired so many people in the restructuring. Can you connect those dots for the person who sees the apparent logical disconnect? If it’s about jobs, then why are you firing people in the first place? If you were having lunch with President Obama or any other political leader, they might be confused, so how do you explain it?

They’re related. The first thing you’ve got to do when you hit bumps in the market is find out how much of the damage was self-inflicted and how much was the result of the conditions of the market. It would be a cop-out to say it was all the general market. We had to look at what we were doing internally. Every government leader in the world who’s adding to government payrolls and adding government debt is going in the wrong direction. We have to use technology to deliver services better. You do see most government leaders saying they want to get their own houses in order. The second thing they do is look at ways to generate private sector jobs. I’m a strong Republican, but I think President Clinton got it right with business and knocked the ball out of the park. He partnered with business, he was critical where appropriate, but in six years he generated 22 million jobs, grew GDP on average by 4 percent per year, and he was America’s champion on the Internet. I think that’s a more practical example. He grew private sector employment versus government employment by a ratio of 9 to 1, and created a positive climate for business, and when business got out of line he’d whack ’em. I think it would be a major mistake not to let companies repatriate their cash because whoever is in the Oval Office next year is going to want to get private sector jobs growing again, and there really aren’t very many levers left to pull. We’ve never had this slow a recovery after this deep a recession.
–

Getting Better – Paul McCartney

Sarah Lacy Debuts New Tech Site, PandoDaily -- $2M+ in Funding and Guess Who's Working for Her? (Video)

Kara Swisher — Mon, 16 Jan 2012 17:00:28 +0000

As has been widely reported, well-known TechCrunch columnist and Silicon Valley journalist Sarah Lacy has a new gig: Running her own new tech news site, which debuts today.

(She’s pictured here with another recent adorable start-up of hers, named Eli.)

Not so widely reported? The site, called PandoDaily.com, will feature three of TechCrunch’s most high-profile former bloggers: Michael Arrington, M.G. Siegler and Paul Carr.

That’s right, Lacy is Arrington’s boss this time around — even though his CrunchFund venture firm will also be an investor, in a funding round of more than $2 million for PandoDaily.

Other investors — whom Lacy described as “people I like and respect” — include a panoply of tech movers and shakers, including personal investments from Marc Andreessen, Peter Thiel, Matt Cohler, Jeff Jordan, Josh Kopelman, Zach Nelson, Andrew Anker, Saul Klein, Tony Hsieh and Chris Dixon, as well as seed investments from Greylock Partners, SV Angel, Lerer Ventures, Accel Partners and Menlo Ventures.

There will certainly be questions about all these funders who are also topics of PandoDaily’s posts, which Lacy acknowledged. She said the large number of funders was calculated so that none had undue influence.

Of course, many in Silicon Valley will be watching her carefully for any conflicts of interest or punches pulled. Lacy insisted that there will not be a problem and joked that she will definitely not become a VC, referring to the controversy around Arrington becoming one while at TechCrunch.

That issue blew up like a Roman candle, of course, leaving everyone with powder burns — I called the incident a “giant, greedy, Silicon Valley pig pile.”

Interestingly, Lacy did manage to stay out of the spotlight (she was, in fact, having her baby during the worst of the controversy, which was likely more painful).

Ignoring the delicious epic revenge part of this on AOL — which bought TechCrunch and then promptly presided over a tech version of the War of the Roses (and is, ironically, an investor via CrunchFund) — PandoDaily will focus on start-ups in Silicon Valley and everywhere else that homegrown spirit of innovations reaches.

Here’s a screenshot of the cleanly designed and handsome site:

In an inaugural post, titled ““Why I Started PandoDaily,” Lacy compared the site to a colony of trees in Utah, saying, “We have one goal here at PandoDaily: To be the site-of-record for that startup root-system and everything that springs up from it, cycle-after-cycle.”

Which is kind of like TechCrunch, which she left earlier this year.

“This is not TechCrunch 2.0,” Lacy said to me in an interview last week. “But, of course, we will be compared to TechCrunch.”

Of course, especially because of the presence of its star lineup on PandoDaily — who will write regularly, along with an initially small staff of other writers — and also its plans for conferences and other gatherings.

(An AOL source, by the way, said there were no contractual noncompete issues for PandoDaily to worry about.)

Here’s a longish interview I did about PandoDaily with Lacy, who has written two books focused on entrepreneurs, worked at Businessweek and was founding co-host of Yahoo Finance’s daily show “TechTicker.”

She talks about the site’s unusual name, her wrangling over leaving TechCrunch, and the prospect of now running her own show.

Welcome back, Sarah (and call me if you need help with those dudes, as we have wrangled before).

Here’s the video:

[ See post to watch video ]

Yahoo Intensifies Search for CEO (With Hulu's Kilar as One Dream Unicorn Candidate)

Kara Swisher — Wed, 21 Dec 2011 00:40:07 +0000

Whatever you want to call him or her — a silver bullet, the cure or, as I like to say, the last unicorn — Yahoo’s ever-seeking and never-deciding board has now renewed its focus on finding a new CEO.

Also on the docket: Working on a deal to sell back at least some of its stake in its twin Asian assets — Yahoo Japan and the Alibaba Group — back to the companies. A partial sale of stock back could placate the often tense situation among the partners.

What is clear is that the two bids from private equity firms are now in an undetermined circling pattern — due to a variety of concerns around shareholder unrest (Occupy Yahoo looms for 2012).

Therefore, the idea of bringing in said fantasy leader to perhaps finally be the one to revive the long-troubled company has returned to the forefront of action, according to numerous sources both inside and outside the company.

The concept in short, said people familiar with the situation: Hire some compelling and entrepreneurial CEO to get the company moving again from a product point of view, do a massive organizational overhaul and help settle Yahoo’s thorny Asian issues.

While a number of names have been rumored in reports — such as Google business lead Nikesh Arora, who is actually not likely to leave his top post at the search giant — sources said the board has been targeting a number of candidates, including Hulu CEO Jason Kilar.

Others on Yahoo’s wish list include Juniper CEO Kevin Johnson and online advertising entrepreneur Brian McAndrews, who sold aQuantive to Microsoft. There are several others also being considered.

Sources said Kilar has met with Yahoo board members about the offer, but his hiring would be a long shot.

It’s an interesting — if complex — gambit to bring in Kilar, who has had his own wrangles with the multi-owner structure of the premium video service over the years.

Kilar’s status at Hulu has been in question ever since it was put on the block, then removed and then — well — who knows.

Hulu’s owners — News Corp., Disney and Providence Equity Partners, along with Comcast (which is a now a passive investor) — did not like the offers it got from various bidders, including Yahoo.

While the media giants have made noises about wanting to keep a stake in distribution, their commitment to that remains unclear.

The situation has put Kilar — who already had tense relations with the service’s shareholders — in limbo until a valuation is determined next year. Without going into the complex details, Kilar has a large equity stake that could be liquid in April, related to certain rights held by Providence.

It is well known that Kilar has been concerned the team that built Hulu gets some sort of payout for their work. In fact, many years ago, Hulu was seen as a possible IPO candidate.

What’s not in question is Kilar’s talent at creating a cohesive team and a compelling product — especially with an advertising and media focus — and the need at Yahoo for a vibrant leader to encourage innovation and discourage its rapidly increasing attrition issues.

The search for a new Yahoo CEO — which is being led by director Patti Hart, and is being conducted by Heidrick & Struggles — had been mostly sidelined until recently, as the board solicited bids for a partial investment from PE firms.

Two emerged, from Silver Lake and TPG Capital, which had wanted to pay from $16.50 to $18 a share for a stake of just under 20 percent in what is called a PIPE (Private Investment in Public Equity) arrangement.

But the low price, and worries about lawsuits and even a proxy fight related to such a deal, have slowed down the momentum significantly, said sources.

Instead, Yahoo has told bidders it will get back to them in the coming weeks about the direction it will take. Thus, the focus on lining up CEO candidates and plans related to reviving Yahoo.

Some of those possible execs have put their hand up, while others — like Kilar — are being solicited. In addition, some still think that Yahoo board member David Kenny remains an internal option, especially if the board of Yahoo gets a refresh, despite his recent announcement that he has no intention of seeking the job.

In general, this shift should not come has a surprise for the hurry-up-and-wait board of Yahoo, which has struggled over the years to make good choices for the Silicon Valley Internet giant.

That drift has resulted in a downturn in its prospects, even as other companies have surged.

Those troubles were brought into sharp focus in a recent report by new Goldman Sachs Internet analyst Heath Terry, who strafed Yahoo in his “sell” recommendation.

Among the gems by an analyst whose investment bank is currently an advisor to Yahoo on its strategic options:

Yahoo simply faces too many competitive and structural headwinds to believe any kind of meaningful turnaround is possible. While there is significant asset value on the balance sheet and in the company’s large, though increasingly less engaged user base, we continue to believe, as we have since before the first Microsoft offer, that the segment of management driving the company is intent on trying to revive Yahoo as a company, regardless of the cost to shareholders.

And, noting the need for a new CEO:

We would become more positive if we felt there was a likely event in the near term that might unlock the value of the balance sheet assets at Yahoo. While we believe the aggregate value of those assets is above the value reflected in YHOO, in order to be more positive on the stock we would need some proof that management is willing and able to take the steps necessary to unlock that value either through a sale or distribution to shareholders. Meanwhile, the declining profitability of the core display advertising business is masked by a search business that continues to lose share and relies on artificial support from Microsoft. We would become more positive on the core Yahoo business if the company is able to find a new CEO capable of focusing the business on its core advertising and communications opportunities, rationalizing costs, and driving growth. This would require user growth and especially engagement improvements in both online and mobile, improving monetization of advertising inventory, and stabilizing its search business.

In other words: Wanted, one unicorn to work magic against increasingly troublesome dragons. Ability to sparkle a plus.

Copiers vs. Innovators

Jessica Parks — Mon, 19 Dec 2011 07:59:52 +0000

What’s happening is that we might, in fact, be at a time in our history where we’re being domesticated by these great big societal things, such as Facebook and the Internet. We’re being domesticated by them, because fewer and fewer and fewer of us have to be innovators to get by. And so, in the cold calculus of evolution by natural selection, at no greater time in history than ever before, copiers are probably doing better than innovators. Because innovation is extraordinarily hard.

– Mark Pagel, fellow of the Royal Society and professor of evolutionary biology, in conversation with Edge.org

Here's Gowalla CEO's Non-Denial Denial Email to Investors About Facebook Acquisition

Kara Swisher — Mon, 05 Dec 2011 05:54:43 +0000

Update: Facebook has confirmed it is hiring Gowalla’s core team, while the Gowalla product will be shut down.

Even Gowalla CEO Josh Williams isn’t pretending a deal for Facebook to buy the location-sharing company isn’t happening, as you can read below in an email he sent to his investors.

Both companies declined to comment on a story on Friday and over the weekend. CNN had the scoop about the social networking giant acquiring Gowalla, which I have taken to calling Not-Foursquare.

That’s because — despite its often clever approach and innovation — it never caught up with the leading social location service.

Gowalla, which changed its approach several times, had been for sale for some time, said several sources.

The Austin-based start-up has raised just under $11 million from a range of investors, including Greylock Partners, Shasta Ventures, Alsop Louie Partners and the Founders Fund, along with a batch of well-known angel investors.

But let’s put this one to bed with the email that Williams sent out after the CNN story broke Friday, which was read to me tonight, so I might not have all of it perfectly and it is missing a sentence about I-will-smack-the-leaker):

Subject: Rumors and speculation

CNN just broke the news that Gowalla has been acquired by Facebook. This story was leaked from an unknown souurce.

The ink on the deal is not dry, so our holding pattern is that we do not comment on rumors and speculation. I have another email penned that was ready to send you today, assuming you would get this news before the story was officially released.

But now it is all over Twitter, so you have likely heard. A longer email will be sent soon. Until then, I am so very grateful for what you have done to make Gowalla a success.

The second confirmation email has apparently not yet been sent, but I will try to get it when it is, along with the price.

So, until the official official yes, here’s a video interview I did with Williams in April of 2010 about the location “wars”:

[ See post to watch video ]

For Yahoo (And Me, Too), Time Is Brain

Kara Swisher — Wed, 23 Nov 2011 22:38:45 +0000

I hate to use a personal story to make a professional point — but when I was in the hospital recently, after suffering from a mini-stroke, I got an important piece of health advice that, oddly enough, applies perfectly to Yahoo, the Silicon Valley Internet icon I cover very closely.

I know, I know, but listen up …

When I was close to going home, one of my doctors told me I had to make sure I paid attention to any signs that might indicate a recurrence. The issue around any possible future ischemic attack taking place, he said, is speed in getting critical care once any unusual symptoms become apparent, such as numbness, tingling, confusion and cognitive difficulty.

That’s because every second of delay translates to increased damage to cerebral cells that could badly impact speech, movement and worse.

“Remember,” the doctor intoned with great and very appropriate gravity. “Time is brain.”

Yes, indeed it is — for me, and also very much so for Yahoo these days.

Leaving aside my own mortality, one of the most important issues going forward for Yahoo’s long-hoped-for revival will be how quickly the company moves in the next month, in what has so far been a lugubrious and rumor-heavy process to figure out its strategic plan in the wake of the firing of CEO Carol Bartz in early September.

That means — going into a major holiday season — Yahoo has about 30 working days to make what has to be a complex and multiparty deal. It is likely to include private equity firms, big companies, Asian partners, investment bankers, major shareholders and scrutiny from the media, in an effort that is approximately akin to herding cats.

This from a board that has often moved with snail-like reflexes in the midst of much more minors crises, and has shown a talent for disaster.

So, while speed is sometimes the enemy of reason, in this case, it is now more necessary than ever before.

There are three key reasons why Yahoo’s leaders have to perform quickly now, each of which could spell even more turmoil for the long-troubled company, if botched.

The first is the possibility — actually, the probability — of a proxy fight that might begin informally just after the new year.

That’s when you could start hearing from someone like activist shareholder Daniel Loeb of Third Point — who has been vocal about ousting Yahoo board members, including co-founder Jerry Yang. Yahoo directors are fully aware that he is eyeing this ugly option, which will include readying an alternate slate of directors.

According to a Yahoo spokeswoman, the earliest nominations for directors can be submitted is February 24 for those “shareholder proposals not intended for inclusion in proxy materials and for nomination of director candidates.”

But while there is a formal process, you will hear it coming long before that, unless Yahoo gives Loeb board seats to quiet him down — which is unlikely but possible.

Such a noisy fight is not one Yahoo can afford to have, and it has already shown some cloddish sensibilities in its response to a recent letter by Loeb — who has many more shares than Yang, and should still be accorded a certain amount of respect, no matter what he says.

Given how badly the last Yahoo shareholder tussle with Carl Icahn went, another proxy battle could be deadly, and might drag on through the first half of 2012. In his Yahoo tussle, Icahn ultimately got three seats on the Yahoo board, but eventually went away with everyone the poorer.

Second, Yahoo will report its fourth-quarter earnings in late January, which will likely continue to show weakness in key sectors of its business. While interim CEO Tim Morse is doing a laudable job given the shaky circumstances, drops in advertising revenue growth, engagement and search are not anything Yahoo can keep making excuses for.

While it is likely the company’s beleaguered operating execs will pull out the stops to make the numbers look better — a new game I like to play is “how many homepage ads can they jam in there at the quarter’s end?” — it’s no panacea for the kinds of dramatic and even drastic changes that new ownership will have to make, sooner than later.

And, speaking of beleaguered, perhaps the most important reason that Yahoo has to get the lead out and clarify its situation is due to one consistent thing about the company: Talent attrition and employee fatigue.

Speaking to one exec after another in recent weeks, it is dead clear that Yahoo is increasingly hard-pressed to hold on to the best of its current employees, or to attract any terrific new ones.

The impact on product innovation, morale and more is obvious.

One exec who has long been one of the more cheerleader types for Yahoo — often calling me out in the past for being too negative on the company’s prospects — has recently turned weary, cynical and even depressed about the future — so much so that I now find myself bucking up the worker.

“You can’t hire anyone, since you can’t tell them honestly who their bosses might be in three months,” said the staffer. “And you can’t look anyone who works for you now in the eye and tell them it will turn out right in the end, either, given the track record so far.”

Indeed. And, more than any other factor that could hurt Yahoo in the competitive tech sector, brain drain is what will always get you in the end.

Adobe Admits It Is Saying Buh-Bye to Flash for Mobile Devices

Kara Swisher — Wed, 09 Nov 2011 18:15:30 +0000

In a blog post by one of its execs, titled “Flash to Focus on PC Browsing and Mobile Apps; Adobe to More Aggressively Contribute to HTML5,” Adobe said what had already been reported: That it would no longer be developing its well-known Flash for mobile devices.

Here’s the key graph:

“Our future work with Flash on mobile devices will be focused on enabling Flash developers to package native apps with Adobe AIR for all the major app stores. We will no longer continue to develop Flash Player in the browser to work with new mobile device configurations (chipset, browser, OS version, etc.) following the upcoming release of Flash Player 11.1 for Android and BlackBerry PlayBook. We will of course continue to provide critical bug fixes and security updates for existing device configurations. We will also allow our source code licensees to continue working on and release their own implementations.”

Last night, reports surfaced that the high-profile software company — whose Flash technology has been a flagship product — was halting development on the mobile version of its browser plug-in.

Now, Adobe will focus its PC Web browser business on tools that allow Flash developers to create mobile apps by packaging their code to run on Adobe’s AIR platform.

The move has big implications for Adobe going forward and also for mobile device makers, such as Google and Research In Motion. But not Apple.

As Ina Fried wrote:

“The move, if true, would be a major blow to Android device makers, who have long touted Flash compatibility as a key competitive advantage over Apple’s iPhone and iPad.

It would also mark a posthumous vindication for former Apple CEO Steve Jobs, who took a controversial stand by not supporting Flash on Apple’s mobile products.”

Turns out Jobs was prescient, as usual.

Here is the full version of the Adobe blog:

Flash to Focus on PC Browsing and Mobile Apps; Adobe to More Aggressively Contribute to HTML5

POSTED BY DANNY WINOKUR, VICE PRESIDENT & GENERAL MANAGER, INTERACTIVE DEVELOPMENT AT ADOBE ON NOVEMBER 9, 2011 5:59 AM IN BUSINESS PROFESSIONALS, CREATIVE PROFESSIONALS, DEVELOPERS, VIDEO

Adobe is all about enabling designers and developers to create the most expressive content possible, regardless of platform or technology. For more than a decade, Flash has enabled the richest content to be created and deployed on the web by reaching beyond what browsers could do. It has repeatedly served as a blueprint for standardizing new technologies in HTML. Over the past two years, we’ve delivered Flash Player for mobile browsers and brought the full expressiveness of the web to many mobile devices.

However, HTML5 is now universally supported on major mobile devices, in some cases exclusively. This makes HTML5 the best solution for creating and deploying content in the browser across mobile platforms. We are excited about this, and will continue our work with key players in the HTML community, including Google, Apple, Microsoft and RIM, to drive HTML5 innovation they can use to advance their mobile browsers.

Our future work with Flash on mobile devices will be focused on enabling Flash developers to package native apps with Adobe AIR for all the major app stores. We will no longer continue to develop Flash Player in the browser to work with new mobile device configurations (chipset, browser, OS version, etc.) following the upcoming release of Flash Player 11.1 for Android and BlackBerry PlayBook. We will of course continue to provide critical bug fixes and security updates for existing device configurations. We will also allow our source code licensees to continue working on and release their own implementations.

These changes will allow us to increase investment in HTML5 and innovate with Flash where it can have most impact for the industry, including advanced gaming and premium video. Flash Player 11 for PC browsers just introduced dozens of new features, including hardware accelerated 3D graphics for console-quality gaming and premium HD video with content protection. Flash developers can take advantage of these features, and all that our Flash tooling has to offer, to reach more than a billion PCs through their browsers and to package native apps with AIR that run on hundreds of millions of mobile devices through all the popular app stores, including the iTunes App Store, Android Market, Amazon Appstore for Android and BlackBerry App World.

We are already working on Flash Player 12 and a new round of exciting features which we expect to again advance what is possible for delivering high definition entertainment experiences. We will continue to leverage our experience with Flash to accelerate our work with the W3C and WebKit to bring similar capabilities to HTML5 as quickly as possible, just as we have done with CSS Shaders. And, we will design new features in Flash for a smooth transition to HTML5 as the standards evolve so developers can confidently invest knowing their skills will continue to be leveraged.

We are super excited about the next generations of HTML5 and Flash. Together they offer developers and content publishers great options for delivering compelling web and application experiences across PCs and devices. There is already amazing work being done that is pushing the newest boundaries, and we can’t wait to see what is still yet to come!

Yahoo's Product Runway: Are You In or Out?

Kara Swisher — Wed, 02 Nov 2011 17:41:24 +0000

I am here at Yahoo HQ in Sunnyvale, Calif., to check out “Product Runway,” which is the Silicon Valley Internet giant’s attempt to show that it can still innovate.

First and foremost is the launch of Livestand, a personalized news reader that is similar to Flipboard and a variety of other rivals, including — soon — Google.

It’s Yahoo’s attempt to present a business-as-usual feel — amidst a long and agonizing and very public strategic overview that might also include the sale of the company (or not!), in the wake of the recent firing of its last CEO, Carol Bartz.

It has caused a lot of trauma inside Yahoo, which can’t help with innovation.

But we press on!

In other words, despite the three-ring circus going on outside, Yahoo wants you to know it is still hard at work.

We begin:

10:35 am: As the strains of U2 die out, Yahoo Chief Product Officer Blake Irving takes the stage, which is actually set up in the company’s cafeteria. I can smell lunch being made nearby and I am hungry.

Apt — Yahoo certainly needs to show off a lot of cool stuff or its fate will be cooked.

No pressure, Blake!

“Personally, I am more bullish on Yahoo today,” he said. “What is Yahoo? Simple. It’s the premier digital media company. Period. Stop.”

Oh, if it were only that easy.

10:46 am: Irving pulls out his favorite slide, which looks like a chemistry test. It lists the various elements of the product strategy, with things like personalization, mobile, premium.

Now to Livestand, which is available on the Apple iTunes app store right now.

Don’t all rush at once!

Irving notes that Livestand is more than just an app — it is a platform.

In other words, Yahoo wants to help publishers publish online. Kind of a Facebook of content.

If Yahoo can pull it off, that is. (And, of course, unless Facebook decides to do the same.)

10:50 am: Livestand is an HTML5 “personalized living magazine.”

“This is the way Web pages are going to look,” declares Irving. Which is to say, heavy on photos, swoopy navigation, a television screen-like interface.

Irving uses the example of Surfer magazine, which is a good idea since waves always look pretty. Especially in a video-in-frame with Kelly Slater in Hawaii.

But, in essence, for anyone who has used Flipboard for years now, none of this is entirely different.

10:54 am: The look of what would be the Yahoo News page is actually much more interesting, since it is clearly a whole lot better than the Web page.

Irving also shows off a “living ad” — in this case, an unusually snuggly couple on a couch. It is cool, but creepy.

When launched, the ad has tap points. Irving — naughtily declaring about what is an ad, “I’ll tap that” — taps the lady’s butt, which would also have been my move. We learn about the jeans, of course.

10:58 am: Irving then shows off the ability to add feeds.

Next, something called “Cocktails.” First up, a developer tool called Yahoo Mojito and Yahoo Manhattan, which is a hosting service. The company will open-source both the technologies in 2012.

Irving brings up Mike Kerns, VP of Personalization & Social, who came to Yahoo when it bought the innovative sports fan site called Citizen Sports.

“We like to ship sh#t,” he notes. I like Mike Kerns immediately.

Kerns intros C.O.R.E. No, it is not a secret government organization that takes out fussy bloggers, who might be more critical than Yahoo execs would like.

In fact, it stands for “content optimization relevance engine.” Of course it does.

Simply put, C.O.R.E. is trying to link the right content or whatever to the right consumers and who likes what. Ladies like this, dudes like this. Apparently, “men of multiple ages” enjoy stories about golden chicken.

11:11 am: Kerns is moving on to social, especially its integration with Facebook. While much touted, sources tell me it has gone slower than expected in terms of use, but that it is improving.

Kerns talks about the idea of matching content to conversations to interests and, well, you know — the now exhausting world of modern media consumption.

The world in which you can no longer simply read an article and enjoy it — you must comment, share, discuss, parse, tweet.

Does anyone remember when you read something cool and just kept it to yourself?

Forget it, pal! It is a full-information society now and you better get on board and start poking your friends about every little thing.

(Personally, I plan on becoming a hermit in 3 … 2 … 1.)

11:18 am: Now Tim Parsey, who is Yahoo’s design head. He is hands down the most delightful exec the company has had in a while, mostly because he loves to smirk adorkably.

He shows off Yahoo’s first original design, which was a dull list. And then another really bad logo. But Parsey loves it! It’s kitschy!

Smirk attack!

Parsey moves into what has to happen now, which is to deliver a much more emotional experience and a much better designed one. He uses words like “humanism.”

Say what? He is right — Yahoo has for too long completely ignored design as an important part of the experience.

That’s why Flipboard was so quickly touted — it was pretty and fun. And it is why everyone is simply forced to love Apple products.

11:22 am: Parsey even has a code for it, called REM — for rational, emotional and meaningful.

He shows off a weather app. People take photos and they can be used in the app. Then Yahoo Mail for the iPad, whic is also handsome with photos and video. Livestand, also pretty.

“Great way to differentiate,” says Parsey. He calls it “one Yahoo!” Indeed.

11:35 am: I’ll admit it. After Parsey-fest, I zoned out for a sec when IntoNow dude, Adam Cahan, comes up.

Donut emergency!

Back to IntoNow, it’s the television indexing service that Yahoo bought in April.

Essentially, more ways to watch the media — in this case, video — and do 53 other things at the very same time. Memo to humanity: We will all be paying continuous partial attention for the rest of eternity.

Like I said: Hermitage!

11:41 am: Product dude Irving is back, making a point that, despite all the public mishegas, Yahoo has been busy at innovating.

A redo of email, better search, social “Facebar” with Facebook, Flickr for Google Android.

Irving is correct — Yahoo’s engineers have been hard at work and deserve kudos for doing so, even with attrition issues, stock declines and questions about the company’s very future being debated daily.

The problem is that too many of these improvements are mostly incremental and essentially table stakes for tech companies, most of whom have introed many more significant innovations in the same time frame as Yahoo has.

Google did Android, Google+ (as well as some notable failures). Microsoft did Kinect, Windows Phone, Windows 8. Amazon did Kindle Fire. Facebook did a range of major updates, as it has grown like a weed.

And there’s Apple. You might have heard of the iPhone and the iPad.

You get my point. Yahoo’s Product Runway today is well done, but what it really needs to be is just the beginning of a take-off.

11:48 am: Now Q&A time.

The first question is what took so long to get Livestand out, the second is why should people use Livestand since Flipboard and others have already been around for a dog’s age.

I ask about design — mostly because I want Parsey to use the word “delicious” a lot — and also about all the turmoil around the company and its impact on product creation. (I decide not to mention that Yahoo blew its acquisition of the bookmarking site, Delicious, and then sold it.)

Parsey delivers on the delicious scale, noting that Yahoo must have one design experience and yet has a lot of different interfaces. In other words, it cannot be Apple, but it can feel a lot more cohesive.

Irving talks a little bit around the obvious elephant in the room — the future of Yahoo — noting that the product staff was trying to focus and forget the storm going on outside.

“We have dreams about what this company can be,” says Irving.

You and me both, brother.

12:04 pm: More questions that are too detailed for my tastes, since they have delivered lunch and I can see it and I am ravenous.

As Parsey might say: It looks deliiiiiccccious.

Now, let’s hope Yahoo can do even more tasty stuff.

Out of the Factory

Evan Ramstad and Loretta Chao — Wed, 26 Oct 2011 22:18:07 +0000

Asia’s place in the global high-tech industry has broadened and become more sophisticated, a shift from its decades-long role as a cheaper builder of gadgets and software than North America and Europe.

U.S. companies such as Apple Inc., Google Inc., Amazon.com Inc., Microsoft Corp. and Facebook Inc. are driving the tectonic change from personal computers to mobile ones, chiefly in the shape of smartphones and tablets. But Asian companies are in the forefront of innovation, designing and building the devices and many of their key components, from chips to screens.

Read the rest of this post on the original site »

Yahoogle Redux? Why "Project Porcupine" Means Someone Is Definitely Going to Lose an Eye This Time.

Kara Swisher — Tue, 25 Oct 2011 13:07:20 +0000

Please see this disclosure related to me and Google.

You gotta hand it to those geniuses over at the Googleplex, thinking up adorkable names for all their various plots and schemes.

And for its latest look-see of the Yahoo situation, it has revived an old one: “Project Porcupine,” presumably from the old joke about how you hug a porcupine.

Very carefully.

Or maybe you don’t hug it at all, which is why all the rumors about the search giant hooking up with some unnamed private equity firms have been so unclear and, well, hard to grab ahold of.

According to sources, there are three clear aspects of what is actually going on:

1. Interest in using Google’s vast cash hoard as part of an investment it would make in a deal — meaning the company was approached, which it is, often.

2. Desire of Google’s crafty Chief Business Officer Nikesh Arora to perhaps find a clever way to get ahold of Yahoo’s display inventory to add to Google’s own fast-growing DoubleClick display advertising subsidiary — meaning Arora has been making the rounds at Yahoo to gauge interest.

3. Pure enjoyment in messing with Microsoft execs — who are now allied with Yahoo via its Bing search technology — as well as getting up any price the software giant would have to fork over to be part of any consortium that will be cobbled together in what is sure to be a hopelessly complex deal.

Whether incoming or outgoing or just an early version of Mischief Night, any one of these options — while interesting to contemplate — is certainly fraught for Google.

Remember the trouble three years ago when Google tried to do a simple search-advertising partnership with Yahoo, in order to pull it out of the clutches of Microsoft?

That effort ended with a resounding oh-no-you-don’t by the Justice Department, which promised an antitrust lawsuit was awaiting such a move to bring together the No. 1 and No. 2 search services.

And if it was a no-no then, any formal relationship or even arm’s-length investment in Yahoo by Google would inevitably be more closely scrutinized this time around.

In fact, what I wrote in 2008 applies a dozen times more emphatically today:

“It is bad for advertisers, it is bad for consumers, it is bad for innovation, no matter how well-intentioned Google is.”

Fast forward to today, after Google has already played a worrisome game of chicken with regulators over a number of acquisition deals — which makes trying to bring back Yahoogle akin to reaching for the third rail.

But that’s not what it’s going to do, in truth, because — even though Yahoo is still a tempting target — there is usually only one outcome to hugging a porcupine.

Ouch.

What Bubble? SurveyMonkey's Dave Goldberg, Joyus's Sukhinder Singh Cassidy and Airbnb's Brian Chesky

John Paczkowski — Thu, 20 Oct 2011 05:52:02 +0000

If you don’t want to call it a “bubble,” that’s up to you. But it’s clear that what’s happening in Silicon Valley is different from what’s happening just about everywhere else: The optimism of the start-up economy seems endless, and investors will throw money at new companies just as quickly as they’re founded.

Three of the area’s most interesting entrepreneurs join us to share their take on the Valley’s culture and commerce, and how they’re trying to export that as they venture into Asian markets.

Dave Goldberg had already built a successful company — Launch — before selling it to Yahoo; now he’s trying for a second act with SurveyMonkey’s very profitable self-serve surveys. Sukhinder Singh Cassidy traded a high-flying job at Google for a chance to build her own company at Joyus, a new take on e-commerce. And Brian Chesky’s Airbnb has become one of the era’s iconic success stories: the vacation rental service seems to have moved from concept to billion-dollar hit overnight.

1:52 pm: Peter Kafka takes the stage followed by SurveyMonkey’s Dave Goldberg, Joyus’s Sukhinder Singh Cassidy and Airbnb’s Brian Chesky.

“This is relaxing because I don’t have to ask you whether you’re buying or selling Yahoo,” Peter quips.

1:53 pm: A first question about the bubble in Silicon Valley: Why are so many people throwing money at companies like the ones you people run? Are you aware that what’s going on in Silicon Valley doesn’t really look like the rest of the world?

Airbnb’s Brian Chesky’s fields this one, but answers it with a pitch for Airbnb.

Peter circles back and puts the question to him again.

Another non-answer from Chesky.

1:57 pm: Peter moves on to Joyus’s Sukhinder Singh Cassidy who seems more willing to answer the question at hand.

“There is a tremendous amount of revenue traction against companies who are getting premium valuations,” she says. “Look at Groupon, Zynga … their revenue traction is real. People are spending money on those services … But what’s most interesting is that when you have that many companies innovating and growing, you end up with a talent war and what you really see is a bubble around talent. That’s more what concerns me. I don’t look around and say wow, people who are non-substantive are getting funded, I look around and say wow, I’m competing for talent with Google and Facebook.”

2:00 pm: SurveyMonkey’s Dave Goldberg jumps in. “I think the difference with companies being created now is that not only are they getting revenue traction very quickly, but they have great margin structures. So they will be quite profitable, when they choose to be. … A lot of the the valuations are real. I think people are going to be surprised by how many big businesses are being created right now.”

2:03 pm: Sukhinder Singh Cassidy: “If there is a lot of capital available, you do want to take it and you take more than you need. But the rate at which you spend it is a fundamentally different question. … the glory of a high valuation is a means to an end. It’s more about saving for a rainy day.”

2:05 pm: Question for Airbnb’s Brian Chesky: Is anyone counseling you to scale back your rounds?

Chesky says no. Talks a bit about investing ahead of growth.

Peter circles back, “What do you use the money for?”

Chesky explains that Airbnb is opening lots of local offices around the world. The company is also investing quite a bit in product and in marketing as well.

2:07 pm: In the first bubble, the idea was to go public. That phenomenon doesn’t exist anymore. Does the fact that there really isn’t an IPO window anymore affect your planning?

Goldberg: “If you’re building a long-term business, you don’t really need to worry about the IPO window. People are building businesses that don’t need to go public. It’s a huge headache to run a public company. I think a lot of people could go public today, but they’re choosing not to.”

2:09 pm: Do you think we’ll see a boom in start-ups in Asia, or do you think there’s something special about Silicon Valley?

Chesky believes we will. He notes that there are start-up cultures emerging abroad, in Berlin for example.

Sukhinder Singh Cassidy says she sees huge pockets of innovation in lots of emerging markets. But she notes that many of the entrepreneurs in those markets got their “sea legs” in Silicon Valley.

“What I see now is people who’ve lived in the Valley moving back to these emerging markets and bringing their experiences back with them,” she says.

2:16 pm: Can a guy in a garage still build a successful company?

Sukhinder Singh Cassidy: “I think there is always that possibility. If you’re smart enough, you can make it happen.”

2:19 pm: On to the Q&A …

2:19 pm: Question for Chesky: Can you extend your business model into other categories?

Absolutely, says Chesky. He talks a bit about how Airbnb has already expanded to more categories (whole-home rentals, sublets, boats, cars etc.).

Chesky’s next vertical? He won’t say. “We’re going to take cues from the community.”

2:24 pm: How do you bring your success in Silicon Valley to Asia?

Goldberg says it’s all about talent: It’s hard to hire people locally and it’s even harder to hire them abroad. So really, you need to tap into the entrepreneurs around you. … It’s a real challenge in places like China. It’s definitely not easy.

2:30 pm: That’s it. Up next, a demo from Kibot.

Silicon Valley’s Entrepreneurs

All Eyes on Yahoo's Q3 Earnings Tomorrow, With Results Under Pressure

Kara Swisher — Mon, 17 Oct 2011 22:23:03 +0000

Tomorrow, after the markets close, Yahoo will announce its third-quarter earnings, perhaps one of its more important reports in recent years.

Wall Street analysts are expecting the Silicon Valley Internet giant to report earnings of 17 cents per share on $1.07 billion in revenues.

But whether or not Yahoo has beat expectations will be less scrutinized than information about the state of Yahoo’s key search and display advertising businesses, as well as other user metrics.

It is at those numbers that a range of players — including major shareholders, possible bidders and media — will be looking to see just how badly the company’s business has fared with all the turmoil of late.

That has included the firing of its CEO Carol Bartz, a massive strategic review that includes the possibility of a sale to a range of mostly private equity buyers, a persistent attrition problem and a worry that the company continues to drift in its product innovation, even as others have surged.

Last week, I reported that Yahoo had finally selected an executive search firm to help it find a new CEO, which many think is a difficult task given the uncertain situation.

A series of worrisome trends across its ad businesses over several recent quarters has some looking at the company for possible purchase with some skepticism.

“What if it is too broken to fix, what if trends to Google’s and Facebook’s premium offerings is too overwhelming?” said one potential bidder for Yahoo. “There are a lot of what-ifs at Yahoo.”

By comparison, Google posted impressive earnings last week.

Yahoo stock closed at $15.70 today, down 1.3 percent.

2011 Technology Innovation Awards

John M. Leger — Mon, 17 Oct 2011 20:10:00 +0000

If you think start-ups have a monopoly on innovation, think again. Some of the world’s biggest companies are among the winners of The Wall Street Journal’s Technology Innovation Awards this year.

The winners include such big names as International Business Machines Corp., Novartis AG, Intel Corp., Abbott Laboratories, Xerox Corp. and runners-up Hewlett-Packard Co. and Yahoo Inc.

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Exclusive: Yahoo Hires Heidrick & Struggles for CEO Search

Kara Swisher — Thu, 13 Oct 2011 23:53:18 +0000

According to sources close to the situation, Yahoo has hired Heidrick & Struggles for its CEO search.

It will be a dicey job, since the effort is on a separate track than the Silicon Valley Internet giant’s wide-ranging strategic review, which is looking at a range of options including the sale of the company.

That’s why many see the move as window-dressing for Yahoo’s board, rather than any real interest in hiring a new leader.

Sources said that will make the search a difficult one for Yahoo, since any CEO candidate would be coming into a very volatile situation. In addition, Yahoo has been struggling — Struggles, struggling, get it? — to recharge its advertising and search business and also its product innovation cycle.

That’s the reason — among several others — that the board of Yahoo suddenly fired its former CEO Carol Bartz last month.

Heidrick has worked for Yahoo previously, in the now ill-conceived placement of Bartz by partner John Thompson. A different partner will be handling this assignment, sources said.

The pool of possible CEOs to lead Yahoo is not a large one, but could includes execs such as Juniper Networks CEO Kevin Johnson, Chegg CEO Dan Rosensweig, Skype CEO Tony Bates, John Pleasants of Disney’s Playdom, Hulu CEO Jason Kilar, Facebook COO Sheryl Sandberg and any number of top Google execs, as well as Yahoo board member and Akamai President David Kenny.

(I am, of course, waiting by the phone for the call.)

A Yahoo spokeswoman declined to comment.

Groupon's Third (And Quieter) Co-Founder Brad Keywell Talks About Chicago Ideas Week (Video)

Kara Swisher — Thu, 13 Oct 2011 21:00:24 +0000

I was in the Windy City earlier this week to appear at a panel on the future of news for a newly-born citywide event called Chicago Ideas Week, which is the brainchild of Brad Keywell.

Never heard of Keywell? That’s perhaps because he is the third founder of Groupon and — kudos to him! — the one who has not made some oh-no-he-didn’t controversial statement during the daily deal start-up’s ongoing rocky IPO process that has landed it in hot water with regulators.

That would be Keywell’s other founders, CEO Andrew Mason and Chairman Eric Lefkofsky, with whom Keywell built Groupon into the powerhouse social buying site it has become.

While on the Groupon board, Keywell plays a less prominent role there than the other two. He is busy at his and Lefkofsky’s investment firm, Lightbank, as well as engaged in a lot of civic efforts.

That includes the first Chicago Ideas Week, a massive, citywide event that Keywell pushed for and has also been funding, to bring the city more than 100 prominent speakers on a wide variety of weighty topics.

As it describes itself, the undertaking is a “celebration of ideas, innovation, and community designed to ignite, inspire, connect, and catalyze our community around great ideas and great people.”

In other words, put Chicago on the innovation map — it’s no surprise that tech topics are woven all through the talks, which end Sunday.

Here’s Keywell discussing the effort, as well as the struggle to create a significant tech ecosystem away from the Death Star of Silicon Valley.

He is an energetic speaker himself, as you will see below, just not about Groupon:

[ See post to watch video ]

Steve Jobs, in His Own Words

John Paczkowski — Thu, 06 Oct 2011 02:20:10 +0000

Steve Jobs was many things — an innovator and visionary, an oracle of consumer behavior, and an insanely great showman. He was also a masterful orator, known for his skill in turning a phrase.

Below, a collection of some the more memorable ones.

“If Apple becomes a place where computers are a commodity item, where the romance is gone, and where people forget that computers are the most incredible invention that man has ever invented, I’ll feel I have lost Apple. But if I’m a million miles away, and all those people still feel those things … then I will feel that my genes are still there.”
“Sometimes when you innovate, you make mistakes. It is best to admit them quickly, and get on with improving your other innovations.”
“Be a yardstick of quality. Some people aren’t used to an environment where excellence is expected.”
“My job is to not be easy on people. My job is to make them better.”
“When you’re a carpenter making a beautiful chest of drawers, you’re not going to use a piece of plywood on the back, even though it faces the wall and nobody will ever see it. You’ll know it’s there, so you’re going to use a beautiful piece of wood on the back. For you to sleep well at night, the aesthetic, the quality, has to be carried all the way through.”
“People think focus means saying yes to the thing you’ve got to focus on. But that’s not what it means at all. It means saying no to the hundred other good ideas that there are. You have to pick carefully.”
“My position coming back to Apple was that our industry was in a coma. It reminded me of Detroit in the ’70s, when American cars were boats on wheels.”
“Design is a funny word. Some people think design means how it looks. But of course, if you dig deeper, it’s really how it works. The design of the Mac wasn’t what it looked like, although that was part of it. Primarily, it was how it worked. To design something really well, you have to get it. You have to really grok what it’s all about.”
“Simple can be harder than complex: You have to work hard to get your thinking clean to make it simple. But it’s worth it in the end because once you get there, you can move mountains.”
“Being the richest man in the cemetery doesn’t matter to me. Going to bed at night saying we’ve done something wonderful, that’s what matters to me.”
“Innovation has nothing to do with how many R&D dollars you have. When Apple came up with the Mac, IBM was spending at least 100 times more on R&D. It’s not about money. It’s about the people you have, how you’re led, and how much you get it.”
“Innovation … comes from saying no to 1,000 things to make sure we don’t get on the wrong track or try to do too much. We’re always thinking about new markets we could enter, but it’s only by saying no that you can concentrate on the things that are really important.”
“I grew up in Silicon Valley. My parents moved from San Francisco to Mountain View when I was five. My dad got transferred and that was right in the heart of Silicon Valley so there were engineers all around. Silicon Valley for the most part at that time was still orchards–apricot orchards and prune orchards–and it was really paradise. I remember the air being crystal clear, where you could see from one end of the valley to the other…It was really the most wonderful place in the world to grow up.”
“Your work is going to fill a large part of your life, and the only way to be truly satisfied is to do what you believe is great work. And the only way to do great work is to love what you do. If you haven’t found it yet, keep looking. Don’t settle. As with all matters of the heart, you’ll know when you find it. And, like any great relationship, it just gets better and better as the years roll on. So keep looking until you find it. Don’t settle.”
“When I was 17, I read a quote that went something like: ‘If you live each day as if it was your last, someday you’ll most certainly be right.’ It made an impression on me, and since then, for the past 33 years, I have looked in the mirror every morning and asked myself: ‘If today were the last day of my life, would I want to do what I am about to do today?’ And whenever the answer has been ‘No’ for too many days in a row, I know I need to change something.”
“Your time is limited, so don’t waste it living someone else’s life. Don’t be trapped by dogma — which is living with the results of other people’s thinking. Don’t let the noise of others’ opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary.”
“My model for business is The Beatles.There were four guys who kept each others, kind of, negative tendencies in check. They balanced each other, and the total was greater than the sum of the parts. And that’s how I see business. You know, great things in business are never done by one person. They’re done by a team of people.”
“I get asked a lot why Apple’s customers are so loyal. It’s not because they belong to the Church of Mac! That’s ridiculous. It’s because when you buy our products, and three months later you get stuck on something, you quickly figure out [how to get past it]. And you think, ‘Wow, someone over there at Apple actually thought of this!’”
“Apple has a core set of talents, and those talents are: we do, I think, very good hardware design; we do very good industrial design; and we write very good system and application software. And we’re really good at packaging that all together into a product…We’re the only people left in the computer industry [who] do that. And we’re really the only people in the consumer electronics industry [who] go deep in software in consumer products. So those talents can be used to make personal computers, and they can also be used to make things like iPods.”
“Our children are our hearts running around outside our bodies.”
“Remembering that I’ll be dead soon is the most important tool I’ve ever encountered to help me make the big choices in life. Because almost everything — all external expectations, all pride, all fear of embarrassment or failure — these things just fall away in the face of death, leaving only what is truly important. Remembering that you are going to die is the best way I know to avoid the trap of thinking you have something to lose. You are already naked. There is no reason not to follow your heart.”

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What Was Behind the Timing of Yahoo CEO Carol Bartz's Abrupt Ouster?

Kara Swisher — Fri, 16 Sep 2011 21:31:52 +0000

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:

Bring in the Suits: Yahoo Hiring Strategic Advisers to Plot Next Moves

Kara Swisher — Wed, 07 Sep 2011 03:54:46 +0000

Yahoo is preparing to hire investment bankers and other strategic advisory firms, said sources close to the Silicon Valley Internet giant, as it seeks to figure out what to do next at the company.

The board of Yahoo, which ousted its CEO Carol Bartz today in a unanimous decision, is exploring a range of possible strategies to turn around its moribund growth, including possible acquisitions, shedding units, bringing in new investment partners and even taking the company private or selling it.

A sale is the least likely of options, said sources close to the situation, but — given today’s news — Yahoo might attract a lot of attention from investors seeking to take advantage of the company’s powerful but troubled assets.

“It is all on the table,” said one source close to the company.

Independent board member David Kenny, president of Akamai, is heading the strategic options committee in charge of managing the process, sources said.

No adviser has been selected yet, but sources said Yahoo is likely to hire Allen & Co., which advises many tech and media firms. It is currently advising AOL, for example.

Other candidates would likely be the typical panoply of choices, including big investment banks like JPMorgan Chase, Goldman Sachs and Morgan Stanley, and smaller boutique firms such as Qatalyst Group and Code Advisors.

Sources said whoever is hired will be charged first with doing an extensive review of the company that is more intensive than has been done before.

“There is a potential for enormous growth that the company has not been capitalizing on and should,” said another source. “The board needs to get this company on a trajectory for growth.”

Indeed, it does, as it has not under the leadership of Bartz. Revenue growth has stalled and product innovation has lagged.

The company will also be conducting a search for a CEO, which will be difficult because any new top exec will want to be part of such a companywide review.

Yahoo’s choice of an executive search firm has also not been determined, but is likely to be one of the big companies that specialize in the arena.

One thing is certain, said multiple sources: Yahoo will continue to focus itself as what it has previously called a “premier digital media company.”

What that means now, of course, will be determined in the months ahead.

Exclusive: Carol Bartz Out at Yahoo; CFO Tim Morse Named Interim CEO

Kara Swisher — Tue, 06 Sep 2011 22:55:35 +0000

According to sources at the company, Yahoo’s Carol Bartz is no longer CEO of Yahoo. CFO Tim Morse has been named interim CEO.

The situation around what is clearly an ouster is uncertain, but Bartz has had a very rocky tenure in her 32 months at the company.

[UPDATE: Yahoo confirmed the departure of Bartz in a press release outlining a reorganization.]

Bartz also sent a stunning email to staff, saying she had been ousted:

To all,

I am very sad to tell you that I’ve just been fired over the phone by Yahoo’s Chairman of the Board. It has been my pleasure to work with all of you and I wish you only the best going forward.

Carol

Several sources said the board, specifically Chairman Roy Bostock and Co-founder, as well as director Jerry Yang, acted today, informing Bartz by phone of the need to make a change.

What the next steps will be are unclear, but Yahoo needs desperately to explore a range of strategic changes to bring it back to its former glory.

But Wall Street liked the move, with Yahoo stock up more than six percent already in after-hours trading.

Sources said Morse held a call with Yahoo’s senior staff this afternoon, telling them Bartz was out and that a search for a permanent CEO will be commencing.

Why Yahoo’s board did not name a new leader immediately is curious and might indicate a larger deal around Yahoo is in the offing.

As I wrote earlier today, when the Internet giant announced on January 13, 2009, that it had hired longtime Silicon Valley tech veteran — who was well-regarded for her tenure at running Autodesk — to replace outgoing CEO and co-founder Yang and turn around the company, there was much hope.

At the time, she presented a take-no-prisoners image and was touted as someone with a reputation as a professional manager who could clean up the place.

Not so, as it has turned out.

While Bartz has streamlined certain areas and made some strong management hires, her performance has been decidedly bumpy and mostly downhill.

The share price has settled in at about $12.50 (just about where it was when Bartz took over), Yahoo’s recent financial results have been weak, its key advertising business is struggling, its attrition rate among engineers and others is startlingly high and its product innovation cycle seems stopped up.

Add to that: Weak relationships with key Asian partners, a pricey but failed marketing effort and a proclivity for embarrassing verbal gaffes by Bartz.

Still, given that Yahoo’s Internet traffic, top media sites and brand remain huge, the going-sideways situation has again caused some investors — including powerful private equity firms and other monied investors — to pull out their spreadsheets about a variety of scenarios related to Yahoo.

The players who have sniffed around of late are powerful, sources said, including Silver Lake Partners, Andreessen Horowitz, former News Corp. exec Peter Chernin and Providence Equity Partners, among others. Also in the Wall Street rumor mill recently are large companies: AT&T, News Corp. and Verizon.

All the schemes are different — ranging from taking it private to making a large investment to splitting it into parts — although they all seem to require cooperation with Yahoo to get done.

And while there is no serious effort afoot as yet, there have been increasing signs of late that Yahoo’s board is ready to listen to any serious offers, said multiple sources, especially as the company has continued to drift under the leadership of Bartz.

While board chairman Bostock has publicly backed Bartz — after all, he was her biggest champion at the time of her hiring — multiple sources said he had started to become more involved at looking at the management issues at the company and its challenges.

Yang — still a key figure at Yahoo — has also become more active, said sources, and tensions between him and Bartz have increased over the last few months.

The increasing pressure on the directors of the company from its major shareholders to act has gained in recent months, said sources.

Thus, Bartz is gone and the next chapter in Yahoo’s corporate drama begins.

[Photo credit: Asa Mathat for All Things Digital]

As Yahoo Continues to Wobble, Investors (And Board) Eye Options

Kara Swisher — Tue, 06 Sep 2011 18:09:11 +0000

When Yahoo announced on January 13, 2009, that it had hired longtime Silicon Valley tech veteran Carol Bartz to replace outgoing CEO and co-founder Jerry Yang and turn around the company, there was a sigh of relief.

At the time, she presented a take-no-prisoners image and was touted as someone with a reputation as a professional manager who could clean up the place.

Not so, as it has turned out.

While Bartz has streamlined certain areas and made some strong management hires, her performance has been decidedly bumpy and mostly downhill. (Update: And this afternoon that ride took her straight out the door.)

Consider: The share price has settled in at about $12.50 (just about where it was when Bartz took over), Yahoo’s recent financial results have been weak, its key advertising business is struggling, its attrition rate among engineers and others is startlingly high and its product innovation cycle seems stopped up. Add to that: Weak relationships with key Asian partners, a pricey but failed marketing effort and a proclivity for verbal gaffes by Bartz.

“It’s hard to ignore all that value sitting there and not being managed properly,” said one person who is considering a variety of investing options related to Yahoo. “And it’s not like AOL, whose assets are so weak, so it seems like an opportunity.”

All the schemes are different — ranging from taking it private to making a large investment to splitting it into parts — although they all seem to require cooperation with Yahoo to get done.

And while there is no serious effort afoot as yet, there are increasing signs that Yahoo’s board is ready to listen to any serious offers, said multiple sources, especially as the company has continued to drift under the leadership of Bartz.

While board chairman Roy Bostock has publicly backed Bartz — after all, he was her biggest champion at the time of her hiring — multiple sources said he has started to become more involved at looking at the management issues at the company and its challenges.

Yang — still a key figure at Yahoo — has also become more active, said sources, and tensions between him and Bartz have increased over the last few months.

While this might, as often happens at Yahoo, lead nowhere, what’s clear is the increasing pressure on the directors of the company from its major shareholders to act.

“You watch an asset like that degrade and it makes you furious,” said one investor. “After a while, you hope it makes the board at Yahoo feel the same.”

Yahoo declined to comment (but so would I).

Master of "Biz" Returns to School

Melissa Korn and Amir Efrati — Thu, 01 Sep 2011 14:36:14 +0000

Twitter Inc. co-founder Christopher “Biz” Stone dropped out of college — twice, from Northeastern University and the University of Massachusetts, Boston — yet this fall he’ll be advising M.B.A. students at the University of California at Berkeley’s Haas School of Business on topics such as entrepreneurship and innovation.

In an interview with The Wall Street Journal, Mr. Stone, who left day-to-day operations at the microblogging service in June but is still an adviser, discusses teaching creativity and entrepreneurship. (Mr. Stone will serve as an Executive Fellow at the Haas School for one year.)

Read the rest of this post on the original site »

Is Innovation at HP Dead?

John Paczkowski — Mon, 22 Aug 2011 22:30:14 +0000

Hewlett-Packard CEO Léo Apotheker once said he hoped that “one day people will say ‘this is as cool as HP,’ not ‘as cool as Apple.’” But now that the company has abandoned its webOS hardware business and begun “exploring strategic alternatives” for its PC business, that day will never come.

Not that it would have ever come, anyway. Because HP is no longer the innovator it once was. In fact, some would argue that innovation at HP is dying — if it’s not dead already.

“The market worries about the precise fate of HP’s PC business,” says Christopher Marlett, CEO of boutique investment bank MDB Capital, which specializes in intellectual property. “But the real story with HP is that it’s no longer an innovative company.”

According to Marlett, innovation at HP has been in decline for years now, gutted by leadership that tried to bolster profits by cutting R&D. According to some reports HP’s research and development budget used to be 9 percent of revenue. These days it’s more like 2 percent. So much for those “7 Immutable Laws of Innovation” …

“Look at the number of patent applications that HP has filed in the past five years,” he says. “The company has really just fallen off the cliff as far as innovation is concerned. And it cannot afford to do that. It has to innovate, because you can’t buy your way to relevance in this industry.”

HP certainly couldn’t. As Apotheker said last week the ramp-up on the webOS hardware business it acquired from Palm was far too long and the hundreds of millions of dollars in losses it was generating was a real drag on the company.

“HP’s hardware business is eroding; the brand is losing relevancy,” says Marlett. “Frankly, HP should probably shoot its hardware division in the head and bury it … or sell it to Dell.”

In other words, it’s no longer “HP Invent,” it’s “HP Divest.” HP’s hallowed culture of innovation is a skeleton of what it once was.

Thank God for the printer business, right?

Maybe. Marlett worries about that as well.

“The printer business is eroding too,” he insists. “Not only is there competition, but HP can’t maintain the same margins on ink cartridges that it has in the past. Then there’s new technology being developed that will revolutionize the entire printer space. But again HP hasn’t been innovating, so they’ve really got nothing in the pipeline. Don’t get me wrong, the printing business is a good business to focus on, but HP needs to work hard to protect that franchise. Really, it’s desperation time for them. They’ve got to begin innovating, because they’ll never acquire their way to shareholder value.”

That’s a bleak assessment of a once great technology icon and one that Marlett says is a good lesson for the industry. “The lack of a robust product pipeline, the acquisition spree that they are trying to rationalize — this is what happens when innovation stops. This is the big story.”

Perhaps. Or perhaps it’s just a bad chapter in a longer one.

Gartner analyst Michael Gartenberg maintains that all is not lost on the HP innovation front and that in the end, things may not be quite as bleak as they seem.

“There’s been a lot of consumer innovation at HP, driving forward initiatives such as touch on Windows 7, working on new categories such as living room PCs and services such as mobile printing,” Gartenberg observes. That said, he concedes that there is uncertainty around HP’s strategy going forward. “As HP transitions, it does raise questions about what their role will be in the growing consumer technology marketplace.”

[Image credit: Chart courtesy MDB Capital]

Who's to Blame for Yahoo's Q2 Revenue Rout? The Line Forms Around Back…

Kara Swisher — Tue, 19 Jul 2011 21:02:54 +0000

Yahoo turned in another weak performance in the second quarter, with yet another decline in revenue.

This time it was five percent, compared to last quarter’s six percent. In other words, at least things are looking up as they go down!

While earnings per share rose smartly, Wall Street is still looking for strong sales growth from the Silicon Valley Internet giant, which seems unable to provide it.

Blamed most this time for the revenue fall: Yahoo’s changes in its display sales operations in the key Americas region, reasons for which were largely unspecified in the initial company press release. (You can see the damage in this slide deck from the company here.)

Maybe Yahoo CEO Carol Bartz will explain it all in its upcoming conference call with analysts (or she could try the I-don’t-know approach taken by News Corp. CEO Rupert Murdoch in PhoneGate hearings in Britain earlier today!).

2 pm PT: It starts with the usual regulatory blah-blah, which I always enjoy.

Bartz gets right into it, opening with the key problems with China’s Alibaba Group, as well as its display and search revenue weaknesses.

The fight with Alibaba is over its Alipay payments unit, which was spun out of the Chinese company without Yahoo’s say-so. Yahoo is a big shareholder.

Bartz says that the company was working on a settlement night and day.

But she quickly gets onto how display did not perform as expected in its key Americas arena. “Obviously, I am not happy,” she said.

Obvi! Neither are shareholders, Carol.

She says it was not about new competitive development. It was not about the economy. It was not about engagement.

So what was it? Changes in its sales leadership and organization, says Bartz, which has included talent walking out the door in droves.

A lot more than Yahoo expected, but no surprise to anyone who has been paying any attention to the brain drain at the company.

Bartz promises a new approach to sales, part of its endless turnaround, which is beginning to feel like a digital version of “Waiting for Godot.”

Search revenue, though, says Bartz, was better than expected.

2:11 pm: CFO Tim Morse is on now, running through the numbers and the display shortfall in the Americas region.

“We simply did not have appropriate coverage,” says Morse, noting consumer products, tech and autos as weak spots in the advertising market.

Thank goodness, then, for the guarantees from search revenue in the Microsoft partnership deal.

More numbers and then it is back to Bartz to talk about search, which is going better than the last quarter, when it was the culprit for the revenue decline.

She says that Microsoft and Yahoo were working together to improve the issues.

“We’d like to be further down the road,” says Bartz about the goal of search revenue per search growth, as well as settling all the other problems, such as the Asian issues.

And, by further, I am presuming she means actual forward movement, which is what roads are actually for.

2:27 pm: Q&A time, the part of our program where Wall Street analysts do not ask the questions that need asking (and where I win fancy journalism awards for pointing this delta out!).

Therefore, Bartz is first thanked for providing “color” about the display disaster and is not asked about more specifics of the disaster itself.

The second question still does not get to it either, but she does note Yahoo’s sales force has to sell beyond “Gee, we’re big” and come up with better ad solutions.

“The issue is we did not have enough sales people in front of the big clients,” says Bartz.

That’s because all those former Yahoos are now working at Groupon, LivingSocial, Facebook and on down the line and now in front of big clients for those hotter companies.

2:34 pm: Question about its Asian assets. Yahoo’s talks with Yahoo! Japan and Alibaba are separate, says Bartz, although I would add that they have non-movement in common.

And also a question about Yahoo’s interest in the acquisition of the Hulu premium online video service.

Bartz winks verbally and says nothing, which translates into: Of course, it is interested.

More on the reasons for the display fall-off, which Bartz makes clear is not due to big competitive threats, but internal issues.

Maybe she’s saving big competitive threats as the reason for a revenue decline in the third quarter!

I look forward to the quarter I get the finger pointed at me for causing revenue to fall, due to my snarky posts.

Now, we are into softball questions about improvements in engagement. It’s up, but no one asks why Yahoo is still not doing anything very cutting edge in product innovation compared to competitors.

I believe Google has launched at least 14 new social networks since this Sunday, along with its strong quarterly performance last week. And Apple, well, blew away its quarter today as it is about to release more cool new stuff later this week.

And that might be the crux of the issue for Yahoo, which might not solve its woes by throwing a more focused sales army at the issue.

That’s because Yahoo’s products are simply not nearly has social as Facebook or even Google right now, which might be the true problem as old customers move on to new advertising solutions.

Whatever the reason, Yahoo clearly needs a refresh of its ad products and how it sells them, especially in its fast-growing mobile, video and communications products.

Bartz talks about getting better expertise, a tighter regional focus and other issues of going to market, which is perhaps something she might have realized many, many quarters ago.

After all, she’s been in charge for a while, and these issues are not new.

In fact, in an earlier quarter, Bartz was stressing “tentpole” events and anchor media properties and the power of the size of Yahoo as a selling point.

This was in April, in fact, in the first quarter of this year.

As I wrote then:

“CEO Carol Bartz excited was the Silicon Valley Internet giant’s traffic gusher for big tentpole events such as the Super Bowl and the Oscars. In fact, Bartz practically sounded like a gushy “Entertainment Tonight” flunky when talking to Wall Street analysts about Yahoo’s Oscar news, games and other offerings. She proudly noted the site’s efforts generated more than a billion pages views.”

Now big is out! Moving on!

The last question is another about Yahoo’s talks with its Asian partners.

“It’s complex,” says Bartz.

You can say that again.

It's Exclusive Internal Memo Time: Juniper's David Yen Heads to Cisco to Run Servers Business

Kara Swisher — Mon, 09 May 2011 16:31:01 +0000

According to an internal memo from Juniper Networks, which you can see below, one of its top tech execs, David Yen (pictured here), is departing immediately.

Sources said Yen is headed to Cisco to run its servers business, but the networking giant has not returned a request for comment.

Yen had most recently been EVP and GM of Juniper’s fabric and switching technologies unit. He joined Juniper in 2008 as EVP of emerging technologies.

But Yen was better known for his previous 20-year stint at Sun Microsystems. His last job there was running its chip division.

The impetus for Yen’s departure might have been the formation of the Platform Systems Group, run by Stefan Dyckerhoff, which is prominently mentioned in the memo from Juniper CEO Kevin Johnson. Dyckerhoff was elevated to the job in late January.

Sources said Yen did not get that job and was unhappy with the move.

But read into it yourself:

Team Juniper:

In February, we announced the evolution of our business groups to better position us to focus on two core business models: Systems and Software.

A key element of that strategy was the formation of the Platform Systems Group (PSG) under the leadership of Stefan Dyckerhoff. The mission of PSG is to optimize systems and silicon development across the full range of Junos-based platforms to accelerate our growth.

As part of the next phase of PSG’s growth, R.K. Anand, who leads QFabric development and our Data Center Business Unit (DCBU) and Alex Gray, who leads our Campus and Branch Business Unit (CBBU), will join PSG and report directly to Stefan. This move positions us to drive a fully integrated approach to our end-to-end systems strategy, as we continue to leverage the synergies across our breakthrough innovations in the core, the edge, the data center, and the campus and branch environment. Under Stefan’s leadership, PSG is now positioned to drive the go-to-market focus we have around domain-focused solutions that incorporate systems products from across PSG.

As part of this transition, David Yen is leaving Juniper effective immediately. David has a desire to return to his roots in servers that he gained during his nearly 20-year career at Sun Microsystems. We appreciate David’s contributions.

We are successfully accelerating momentum and adoption of our systems offerings. The response to both our QFabric data center architecture and to the Converged Supercore–two disruptive innovations unveiled in the quarter–has been overwhelmingly positive. These two offerings represent the best of Juniper innovation in systems, software and silicon.

As demonstrated by our strong performance over the past year, we continue to execute on our multi-year growth agenda, driven by our innovation roadmap. The new network is here, and we are delivering on our vision to capture the opportunity before us. Together with our partners, we will transform the economics and experience of networking for our customers.

Thank you for your hard work and dedication. I look forward sharing in Juniper’s continued success with you.

Regards,

Kevin Johnson

Liveblogging Demand Media's Q1 Earnings: Perky Perfecting!

Kara Swisher — Thu, 05 May 2011 21:13:31 +0000

Today, after Demand Media beat Wall Street expectations, its execs got on the horn with investors to explain how it plans to beat the Panda.

That would be the beastly name for Google’s rejiggering of its search algorithm, in order to rid search results of poor quality content.

Along with many other sites, Demand has gotten smacked by its raging paw.

Still, the Santa Monica, Calif.-based company reported revenue of $79.5 million and six cents a share in adjusted net income.

Wall Street was expecting the company to report about $69.6 million in revenue for the three months, with four cents a share in adjusted profits.

On a GAAP basis, net loss per share was 13 cents compared to 94 cents a year ago.

Here’s the liveblog of the conference call:

2 pm PT: Demand’s investor relations dude came on and I immediately tuned out until CEO Richard Rosenblatt got on the line to talk about the results.

He was as perky as ever, launching right into the meat of the situation–how Demand was going to pretty up its offerings, such as a redesign of its flagship eHow site and its new editorial arrangement with another perky person, food lady Rachael Ray and the also perky fashionista/talk show lady Tyra Banks.

Gone will be user-generated content that Demand used to let people post at will on its eHow site that was, well, less than good.

As in, bad.

Instead, it’s “curation,” “editorial innovation” and feedback cycles.

We old-timers like to call that journalism and copyediting, complete with mean old editors who spiked said copy when it was crappy.

“Let me be clear,” said Rosenblatt, the Google changes did negatively impact Demand’s traffic. But Rosenblatt said the company dug into its content and has been improving it since.

2:17 pm: Now it was CFO Charles Hillard reading the results themselves. I am sorry, Mr. Finance Guy, but I can read it myself, so this is always the time in earnings calls when I check out and spend my time improving my content.

So when I heard words such as “stock-based comp,” I moved on to fixing all the typos that a very nice reader alerted me to, since I was writing too quickly.

Then, I briefly considered writing a high-quality post for eHow on how to write earnings and fix typos at the same time. I am that good.

2:30 pm: The CFO dude finished up and the Q&A with analysts started.

All Panda questions, natch!

Rosenblatt seemed calm, cool and collected.

“We think on this one, they did a very good job,” he said of Google’s search-fixing efforts, trying to soothe the savage beast. “We all continue to evolve.”

Which translated to: Google says jump and we say: “How high?”

Which is then followed by: “Please sir, can I have some more (traffic)?”

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