During a commencement address at Bard College at Simon’s Rock in Great Barrington, Mass., Bernanke advised graduates not to worry too much about current economic headwinds or concerns that the current information technology revolution won’t have the same transformative effect on the economy that previous revolutions have.

“As trade and globalization increase the size of the potential market for new products, the possible economic rewards for being first with an innovative product or process are growing rapidly,” Bernanke said. “Both humanity’s capacity to innovate and the incentives to innovate are greater today than at any other time in history.”

And those who fail to recognize that, those who argue that our latest technological revolution in computers and IT will not transform our lives as dramatically as, say, the modern industrial era — well, according to Bernanke, they’re perhaps a little short-sighted. “I’m sure that I can’t imagine all of the possibilities,” Bernanke said. “But historians of science have commented on our collective tendency to overestimate the short-term effects of new technologies while underestimating their longer-term potential.”

Airware, a startup that is creating a software platform for commercial drones, said it had raised $10.7 million in a Series A funding round led by Andreessen Horowitz. Google Ventures also participated. As part of the deal, Andreessen Horowitz partner Chris Dixon will join Airware’s board.

The Newport Beach, Calif., company said it would use the money to expand staff for its universal development platform as the market for non-military drones expands.

Airware founder and CEO Jonathan Downey said that uses of drones will be increasing for a wide range of purposes, from checking infrastructure to monitoring mining operations to preventing poaching.

In an interview, Downey said that he expects to compete with a range of ex-military efforts, but that the most successful companies will be those that provide a platform to allow for the widest range of innovations.

“This is going to be about a lot more than we know or can guess,” he said. “The industry is at its very beginnings.”

Dixon agrees. “Hardware is the new software,” he said about the investment in Airware, which he said he discovered after attending conferences about the fast-moving drones business, noting that the overall field of robotics has “overpromised and underdelivered.”

Airware came out of both the Lemnos Labs and Y Combinator incubators and had raised seed financing from First Round Capital, Firelake Capital, RRE Ventures, Shasta Ventures, Promus Ventures and several Y Combinator partners.

According to sources close to the situation, well-known tech exec Jon Rubinstein will be joining the board of Qualcomm, the San Diego-based chipmaker that has gotten a big boost of late for its role in the explosion of mobile devices.

Rubinstein is an interesting and logical choice for Qualcomm, having been a high-profile player for a long time in the mobile space, beginning with his work on the iPod while at Apple. After he left his last job at Hewlett-Packard last year, though, he has been very low-key.

(Update: Qualcomm confirmed the appointment in a press release.)

For Qualcomm, the selection of Rubinstein to join the board is something to watch, as he is the second exec from Silicon Valley to be tapped by the company recently. In March, Qualcomm hired tech investor Laurie Yoler as SVP of business development, making her “responsible for augmenting existing business relationships in Silicon Valley, as well as developing new strategic business opportunities for Qualcomm in the region.”

Rubinstein has even more experience here and is also familiar with a range of mobile efforts over the years, some of which were successful and others not so much, from his work at Apple, Palm and then HP. He is also a board member of Amazon.

Aside from CEO and Chairman Paul Jacobs, Rubinstein — who has degrees in electrical engineering and computer science — will be the most technically experienced director on the 11-person board.

Qualcomm declined to comment.

Here’s a nice primer on Rubinstein by Arik Hesseldahl, in a report on his leaving HP early last year:

Best known for his work on Apple’s iconic iPod music player, Rubinstein left Apple in 2006 and joined Roger McNamee as a partner in the private equity firm Elevation Partners, following its 2007 investments in Palm.

In 2009 he replaced longtime Palm executive Ed Colligan as its CEO, and oversaw a dramatic restructuring of the company’s products, including a significant rebuild of its smartphone operating system. Gone was the legacy PalmOS that had been used in so many popular devices like the Treo that for a time competed seriously against Research In Motion’s BlackBerry.

PalmOS was replaced by WebOS, which first appeared on the Pre smartphone, then later on the Pixi and Veer devices. After HP acquired Palm, WebOS was also used on the abandoned TouchPad tablet, and is now an open-source operating system overseen by HP.

Rubinstein’s departure is no big surprise. Sources said he hadn’t been seen at HP’s offices following the decision by former CEO Léo Apotheker to get out of the business of making WebOS-based hardware. His future plans have been the subject of speculation for some time.

After HP decided to exit the WebOS hardware business, Rubinstein was assigned to a vaguely described “product innovation role” within HP’s Personal Systems Group during a management shakeup last July. It was an unusual move and one made with little explanation at the time. But sources say it was a preface to Rubinstein’s departure, one intended to lessen its PR impact when he finally left. “That ‘innovation’ gig he was given in July was his first step toward the exit,” said one source, a former Palm exec with close ties to Rubinstein.

Earlier today, Microsoft co-founder Bill Gates discussed technological innovations for vaccines, ahead of a Global Vaccine Summit being held next week in Abu Dhabi.

Set during World Immunization Week, 300 people — including Gates, who is co-chair of the Bill & Melinda Gates Foundation and who will be delivering a keynote address — will gather on April 24 and 25 to talk about what the world community needs to do move forward the effort to vaccinate children, including a plan to eradicate polio by 2018.

It’s an important effort since, according to the Gates Foundation, every 20 seconds one child dies from a disease that could have been prevented by an existing vaccine.

“The key thing to understand is that vaccines are miraculous,” said Gates in a roundtable telephone interview with several reporters, noting that they are low-cost in relation to the huge benefit they provide.

Two key next steps, he said, have to do with a variety of technologies that are being explored to help in the delivery of vaccines, and also finding ways to make them cheaper.

“There is an under-investment in general, particularly in doing things for the poorest,” he said, requiring his private organization and others to pay for the research or to work with big pharmaceutical companies to create technologies that can also be deployed in more lucrative ways in rich countries. “Usually, there is a missing market incentive.”

Still, there is innovation in the sector, even if it is slow.

Gates referenced a “super-thermos” approach that is being field-tested in Senegal that keeps vaccines cold without needing more energy. Another effort is under way to formulate vaccines so that they do not need to be kept cold in the first place. A third is to combine several vaccines together to get the prices down.

Also important are improvements in satellite mapping technology, which allows field workers who deliver the vaccines to better assess where the need is. That’s especially important since a lot of the work is still on the ground, such as the push to eradicate polio in much the same way as smallpox has been. Currently, noted Gates, it is still an issue in just three countries: Pakistan, Afghanistan and Nigeria.

And since reaching near total coverage is critical — “The difference between 85 percent and 90 percent [coverage] can be the difference between success and failure,” said Gates — making sure health workers find the people they are trying to vaccinate is paramount.

“It’s kind of a high-tech thing compared to how it was being done,” said Gates.

But, although there have been great hopes around the use of mobile devices in the field to access and record accurate data on patient visits, immunizations and other health information, it’s still an uphill battle against easier paper solutions.

“The paper-based systems are preferable,” said Gates, because of lack of reliable connectivity and ease of use. “It’s a high threshold to get rid of that and use cellphones.”

Or, as Gates noted in a blog post from a recent visit to Ghana, where cellphone data-keeping is being tested: “Many of us are looking at potential digital strategies for record-keeping, but paper is pretty good.”

(Photo courtesy of the Gates Foundation)

Photo by Asa Mathat

For our readers who are not inclined to constantly hit the refresh button, here’s a quick look back the top 10 stories that drove AllThingsD this week:

1. Yahoo Paid $30 Million in Cash for 18 Months of Young Summly Entrepreneur’s Time
2. iTunes Not Exactly Break-Even Anymore
3. Fired SendGrid Developer Evangelist Adria Richards Speaks Out
4. Another Reason Google Reader Died: Increased Concern About Privacy and Compliance
5. A Smarter Calendar for iPhone
6. BlackBerry’s Million-Smartphone Mystery Partner: Brightstar
7. Facebook’s New Ad Plan Is the Web’s Old Plan
8. New Flipboard: News and Posts Handpicked and Shared
9. Sony’s High-End Xperia ZL Comes to U.S. at a Hefty $719
10. Q&A: Atari Founder Nolan Bushnell on Innovation, the “Next Steve Jobs” and Why Mobile Games Are “Over”

For more of the week in review, you should follow us on Facebook and Twitter.

Atari co-founder Nolan Bushnell, who once employed Jobs shortly before he and Steve Wozniak started Apple, doesn’t have any specific names to answer that question. But what he does have is a new book, out today, to aid in the search: “Finding the Next Steve Jobs — How to Find, Hire, Keep and Nurture Creative Talent.”

And Bushnell should know about the importance of recognizing that talent — during Atari’s heyday, he turned down the opportunity to own one-third of Jobs’s and Wozniak’s nascent company. By 1980, he writes in the book, “I was beginning to think it might turn out to be a mistake.”

“Finding the Next Steve Jobs” is being released by Net Minds, a print/e-book hybrid publishing startup led by former Yahoo exec Tim Sanders. Bushnell said it uses Jobs as a metaphor for the creative iconoclasts who clash with corporate culture and can’t get hired. He sat down with AllThingsD to explain further.

AllThingsD: Just how close were you to Steve after his brief involvement with Atari?

Nolan Bushnell: We’d talk on the phone infrequently, but he’d come up to [my house in] Woodside about once a month, usually on a Saturday or Sunday morning, and we’d go up on the hill and talk. Occasionally, I’d go down to his place, but a lot of the time it was him coming up to my place.

Why are we even looking for the “next Steve Jobs?”

Steve took a failing computer company — and they probably would have never brought him back if they weren’t at the end of their rope — and turned it into the highest-market-cap company in the world. People were always aware that innovative solutions are good for your company. I think this just underscored it in a really powerful way. It wasn’t just through cutting costs or innovative marketing. Though Steve was a pretty good marketer.

But that was when he returned to Apple in 1997. Most of the time when people talk about the “next Steve Jobs,” they’re using that phrase to refer to entrepreneurs who are still early on in their careers. So, are those people really that hard up for work?

I believe there are Steve Jobses all around us. Really, what is happening is that they’re being edited out of importance. Right now, Google is doing some great things, but Hewlett-Packard is trying to commit suicide. Every company needs to have a skunkworks, to try things that have a high probability of failing. You try to minimize failure, but at the same time, if you’re not willing to try things that are inherently risky, you’re not going to make progress.

Speaking of progress, what’s the most exciting thing for you in videogames?

I think the next big game opportunity is Google Glasses [sic]. If I told you all my ideas for it, I’d have to kill you. And the Oculus Rift. The game business reinvents itself every five years. The last five years have been the days of mobile gaming and shortform gaming, exemplified by Rovio with Angry Birds and Zynga with FarmVille. And that is over.

(Nolan’s daughter and PR agent, Alissa Bushnell, quickly jumped in at this point, asking him to clarify what he meant by “over.”)

Most games, by their nature, have a half-life of two years or less. It’s the outlier that has a half-life that’s longer than that. But that doesn’t mean that the marketplace is synchronized. So you have the early adopters coming into something, and they soon encourage the more timid to come in. It broadens the group. But players’ engagement is not lengthened.

But smartphones and tablets continue to be hugely popular, so how are their games “over”?

All the money’s out. Do I really want to do a mobile game that’s one of 300,000, where discoverability is everything? You really have to have a little more sizzle on the steak. I would rather be one of 100 apps for Google Glass than one of 300,000 for iOS and Android.

Does the potential for a new, game-changing entrepreneur exist independently of how these different companies or industries are changing?

I really believe that the future is happening whether we want it or not. The companies that force the future to happen faster will succeed in the next 20 years, and the ones that are stuck in today will lose market share. People say, “I want to be around in 20 years.” I say, “I have no idea. But if you’re not doing 10 different things, if you don’t have four skunkworks, then you’re not going to find the next thing.”

(Clarification: an earlier version of this story said Bushnell employed both Jobs and Wozniak. Although Wozniak was involved with and paid for his work on Atari’s game “Breakout,” he was paid by Jobs rather than Bushnell’s company).

There were, of course, the questions on his famously huge Facebook investment many years ago, and why he’s put money in Y Combinator to spur startup innovation.

But it’s clear from his mainstage interview at the SXSW interactive festival in Austin this morning that high-profile Russian investor Yuri Milner of DST Global has been striving to think much bigger thoughts of late.

While he’s gotten a lot of attention for his big bets in the social networking site, as well as with Twitter, Spotify, Airbnb and many others, he’s slowed his investing in the U.S. considerably to focus more on what he and many others in Silicon Valley are calling “moon shot” ideas.

“Somehow, we have lost interest in big ideas,” said Milner, in an onstage interview with Vanity Fair contributing editor Bethany McLean about shifting away from thinking — which he has funded, in part — that has gotten more short-term and pragmatic. “I think we still have a destiny as human beings.”

That has included starting up his Fundamental Physics Prize, which has now become the priciest academic award, last year. And, more recently — with Facebook co-founder Mark Zuckerberg, Google co-founder Sergey Brin, and Genentech mogul and Apple Chairman Art Levinson, among others — the launch of the Breakthrough Prize in Life Sciences Foundation.

As Mike Isaac wrote when that initiative was announced less than a month ago:

“The first round of prize recipients includes 11 scientists from a range of research disciplines, including studies in genetics, cancer research and neural behavior. Each of the 11 prize winners will receive a $3 million award for their work, and Brin, Zuckerberg, Milner and the rest of the sponsors have agreed to a five-year commitment to awarding prizes.”

Milner, who was a physicist in his early career, said onstage that he has been disheartened to see that not enough younger people choose to go into fundamental science anymore. Thus he is aming to make it more attractive via his prizes.

“We don’t have enough heroes who are admired by a large portion of the population due to their scientific achievements,” he said, noting that it will require rewarding individuals in a “disproportionate manner.”

Still, in the Q&A session, the crowd in the Austin Convention Center wanted to know mostly about more earthbound questions, such as what tech company would last 100 years, as IBM has.

According to Milner: Google, Facebook and Wikipedia, due to network effects.

Another attendee wanted to know what he thought it takes to be an entrepreneur these days.

“It’s almost a heroic effort, and kind of goes against set ways of doing things,” answered Milner.

Then someone wanted to know how the political arena could be similarly transformed.

“That, I don’t know,” said Milner.

Moon shot, indeed.

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Lost in the sauce of the national work-from-home debate of last week that engulfed all things Yahoo, was a fascinating tidbit that several employees passed on to me from a recent Friday FYI meeting at its Silicon Valley HQ.

At the gathering, CEO Marissa Mayer talked briefly about the new telecommuting arrangements for some staffers, including the controversial new work-from-home memo that HR head Jackie Reses had issued that day.

But when Reses — who also wears another corporate hat as head of M&A at Yahoo — spoke she mentioned to the crowd that Yahoo was working on two “significant” acquisitions and about six smaller talent “acqhires.”

“It was kind of odd to telegraph it in such a big forum,” said one employee of Reses’ comments at the meeting in late February.

The revelation was unusual, to be sure, but perhaps not a surprise, given the recent run-up in Yahoo stock, its healthy cash position and, most of all, its need to add meaningful growth to the current efforts at turnaround.

And while some of its recent buys have been interesting and focused on improving its moribund mobile efforts, they have also been very small. And, as one high-ranking exec there told me, they “don’t move the needle in the way we need to in bringing in senior talent or loads of users or serious revenue.”

Indeed, while Yahoo shares have benefited greatly from the impressive performance by Alibaba Group in China, which is clearly on a roll, many think that showing actual improvement in its core business will be critical in the months ahead.

While making changes to Yahoo’s homepage and email, as well as cutting products, has been done, it is not yet clear what the impact is; the changes are aimed more at holding on to consumers rather than exciting them with new offerings.

Yahoo could also create its own new products to wow the masses, but that has been harder for it over the years. (Remember Livestand? Yeah, not so much.) In any case, an innovation infusion of such a large magnitude will take some time, given Mayer has to get the right people into place to do so.

Thus, a big purchase of an exciting new company with prominent leadership seems more likely than not and sooner than later. While Mayer has not articulated her vision for the new Yahoo in anything more than general ways, what she buys will say a lot.

Thus, sources said that Yahoo has been looking at a range of such acquisitions, in a number of categories such as advertising tech, mobile monetization and, of course, consumer “daily delight,” which is a phrase Mayer has used a lot.

It would be bold if Mayer went all out and made a mega-buy that would shake up the competitive landscape. My first choice for that is Pinterest, the scrapbooking phenom that was just valued at $2.5 billion in a new funding round. Mayer has also shown a lot of interest in blogging superstar Tumblr, while at both Google and Yahoo, as well as Foursquare, the well-known location app. Of course, there is also the troubled gaming giant, Zynga.

All are very pricey and would face rival interest, but such a move would be akin to Facebook’s billion-dollar blockbuster purchase of Instagram. Many now think that was prescient and cheap, given how important mobile photos are to the current digital ecosystem.

The list of possible big deals goes on: Hulu (which needs a tasty content element to make sense) as a video play; Millennial Media or Jumptap for mobile advertising; Quora for social answers; Flipboard for social media consumption; Rubicon or PubMatic, for ad targeting; and many more.

But all of those begin at the billion-dollar or more range and I have checked with a number of these and come up peanuts. Still, there are a whole lot of choices for Mayer and Yahoo in the $200 million to $500 million price range.

Here, Yahoo has the financial strength to make at least two of these significant purchases that Reses mentioned, as well as developing a much better reputation for Yahoo to keep real talent interested.

As one prominent startup exec, who had told me he never would consider selling to Yahoo in the past, said recently: “They are no longer complete losers, although Facebook and Google and Apple and Amazon are still cooler.”

Hey, it’s a compliment, even if it’s a back-handed one, so it will be interesting to see who finds Yahoo cool enough.

Image copyright iQoncept

Last year’s ruling against Samsung in its legal battle against Apple has demonstrated that the Korean electronics giant has been more capable in the latter than the former. An article in the New York Times highlights Samsung’s unique ability to move quickly from product concept to production to distribution. Anyone who has followed its mobile phone and tablet launches has probably noticed how short its release cycles are — so much so that most of the products banned by the ruling are no longer being sold.

But even with its wide-ranging portfolio of offerings, Samsung has never generated a game-changing product, even as it has aggressively dominated several consumer product categories — from mobile phones to flatscreen TVs. Whether or not you agree that Apple should be able to patent a rectangle with rounded corners, the indictment on Samsung’s lack of imagination is clear.

Why should this be the case for a company that is the cultural equivalent in Korea of Apple in the U.S.? One possibility could be an aversion to making mistakes, which skews the personal risk calculation involved in putting forward new ideas. Innovation happens in areas where there is no right answer, because no one has even asked the question yet. It requires that Jobsian knack for ignoring what people think they need and giving them what they want before they know they want it. It requires courage and knowing that you’re right.

Image: http://appleinsider.com/articles/12/08/24/jury_reaches_verdict_in_apple_v_samsung_trial

What’s particularly telling about this picture is not even the obvious relationship between the iPhone and the Samsung products after 2007. It’s that you can see clear echoes of Nokias, Blackberrys and Palm Pres in the models before.

Samsung, like many other companies, has played it safe, and this is the greatest temptation for all companies that have achieved some level of success. It’s easier to tweak existing operational machinery to achieve incremental but predictable improvements. Greater efficiency in development or manufacturing processes, lead acquisition or customer onboarding — these all help the bottom line and provide a sense of forward progress, of results that match the effort put forth. But it’s the “nobody gets fired for buying IBM” kind of activity that minimizes chances of disaster, and also prevents companies from experiencing major breakthroughs.

It doesn’t have to be that way. In my work in the open source software industry, I’ve also seen this sort of focus on incremental, operational benefits. Open source development methodologies can more quickly bring to market software that is more reliable and secure than proprietary alternatives, and we’ve been keen to demonstrate that with measurable results.

But this highly collaborative and open way of writing software can also lead to a lot of new ideas, and we’ve experienced this as well. Because our software is freely downloadable, Liferay’s ecosystem of users, partners and customers grew very large, and some used our products in ways they weren’t designed for. Because our source code is open, people have found new solutions to old problems themselves, instead of waiting for us to fix things. So it turns out that what’s best for operational efficiency and what spurs innovation can be aligned.

Here are a few of the principles we’ve discovered along the way:

• Architect your product and your ecosystem for innovation. There are a lot of great ideas out there, and sometimes the best thing you can do is give people space to innovate and quietly move out of the way. Create a space for innovation in some area(s) of your product (or organization) where people have complete freedom and independence, but which won’t risk the success or integrity of your most strategic product areas.

  At Liferay, we designed our main product so people can easily build complementary modules that add a lot of value to our platform without adding complexity or maintenance burdens to our engineering team. This model gives people freedom to try new ideas and solve new problems. If they’re successful, our Marketplace rewards their innovation by giving them a place to sell their apps to the Liferay ecosystem.

• Listen to your customers’ needs, not their feature requests. The truly groundbreaking products are those that address real pain points for real people, so it’s tempting to think that means implementing whatever they ask for. But customers usually make feature requests from the vantage point of an existing product, so they ask for incremental improvements thinking they can’t get anything immensely better than what they have today.

  But if you step back and understand why they want that feature in the context of their work, you will have a greater chance of designing a new solution from the ground up that gives them exactly what they need, in a totally unexpected way.

• Focus on the total experience. There’s no single feature in Instagram that makes it an extraordinary application. But the overall result is the equivalent of an “Easy Button” for being hip. Sure, the designers probably thought in terms of features (i.e., location mapping, comments, photo-taking, filters), but it’s how they put it all together for the specific purpose of sharing cool photos with friends that made Instagram a runaway success.
• Identify good ideas quickly. It’s popular to say, “there’s no such thing as a bad idea,” but we’ve all experienced otherwise, and no one has the time and resources to go after all of them. Gustav Mahler quipped, “I don’t let myself get carried away by my own ideas — I abandon 19 out of 20 of them every day.” Learn from the design team at Google and put a priority on having a process to rapidly iterate through different product possibilities, reject the ones that don’t work and refine the ones that do.
• Think beyond the suburban office park. The long flight from our urban centers is over. Today’s enterprise workers increasingly live and work in dense urban cores. More importantly, they’re conducting business inside and outside the office; they’re getting work done in cafes, at home, on the plane or over lunch. The great technologies of recent years — cloud and mobile — are enabling all this and our products should almost be redesigned from the ground up for this new reality.

Better yet, if you can live and work in an urban center, these experiences will be all the more real to you, and put you in the right context to solve these new challenges.

Finally, remember that innovation is not just about new ideas; it’s about applying the right ideas in new ways for new situations. After all, even Apple has been known to borrow an idea or two.

Bryan Cheung is CEO and co-founder of Liferay, Inc., the leading open source provider of enterprise portal platforms. Drawing on his passion for innovation and open source development philosophies for technology and business, Bryan steers the company’s strategic direction and worldwide business development efforts.

Earlier today Yahoo reported fourth-quarter earnings that beat analyst estimates, on still-flattish revenue.

Still, up is up, even if it is not really that much up, so Wall Steet bid up shares of the Silicon Valley Internet giant in after-hours trading.

Now it’s onto the conference call with investors for CEO Marissa Mayer:

2:02 pm: Before the call, you can hear Mayer complaining about the goofy music played during the pre-conference call waiting time.

“We have to get better music,” she says to some minion. “This is not good music.”

Music to my ears! I say we get Beyoncé, lipsyncing or not.

The call starts quickly after that, with the ever-eager Mayer leaping right in with the fourth-quarter news, which is not all that bad.

It’s the first full year of growth in a while — though not the first quarter-to-quarter increase — even if it is only a very modest two percent increase.

That compares to industry-wide gains in revenue of many, many, many times that, but for Yahoo this is cause for a parade. A small parade, with good music, but a parade nonetheless.

“It’s hard to believe this is only my first full quarter here at Yahoo,” says Mayer in an upbeat tone.

She notes that her focus on product excellence and user experience was continuing, with some “early positive trends” in both products and people.

Mayer then list a series of moves, from the free food and better smartphones for employees to the addition of well-regarded entrepreneur Max Levchin to the board to the refreshes of Yahoo Mail and Flickr to the acquisition of some sassy new mobile startups.

Mayer also notes that the company under her purview had removed “385 of highest priority obstacles,” although she did not name any specifics.

I imagine what No. 332 is: Switching out the iceberg lettuce at the URL cafeteria on Yahoo’s Sunnyvale, Calif. HQ campus with some tasty organic mesclun as they have at Google, from whence Mayer came.

Better roughage means better returns!

2:14 pm: Mayer turns the call over to CFO Ken Goldman, also a newbie. As usual, he runs through the numbers that are already in all the releases already. But I am enjoying his New England accent, hoping he will say the slight increase in revenue was “wicked” good.

Goldman, in fact, calls the revenue increase “modest,” which is true, although it sounds like “mah-dist.”

What’s not mah-dist is how much stock Yahoo has bought back, using its windfall from the recent sale of assets in China. It’s $1.45 billion, with more that that left to use for more share buybacks. That should keep Yahoo’s stock up nicely.

Goldman also talks about increases in the company’s search business, although notes that the Microsoft relationship is still not the most fantastic.

He speaks more effusively of Yahoo’s Asian partners, including Yahoo! Japan and China’s Alibaba Group. It’s deserved, since they have been the company’s treasure trove against its meh core performance in recent years.

Not so tasty is the problem Yahoo has with a big-money contract dispute in Mexico, which Goldman reiterates is “without merit.”

2:28 pm: Goldman moves onto Yahoo’s cash position, which is strong and which he says is going to be used to make the company better.

Mayer is back on board, talking about key focuses over multiple years.

She says Yahoo needs a “chain reaction of growth,” which needs to be fueled by a dozen new products that become a daily habits for consumers to increase usage and other metrics.

A nuclear bomb explosion is not exactly the best metaphor for a company’s turnaround, but in Yahoo’s case it is probably a pretty good one, given how stubborn its decline has been.

Mayer then switches the metaphor to one she recently used about “returning to the roots” of Yahoo.

Actually, mixing the metaphors, Yahoo has to blast some significant roots that have gotten in the way of its innovation over the years.

“The best is yet to come,” promises Mayer, in what she says will be a multi-year effort.

Now onto questions from the analysts!

2:40 pm: The first question is about commercialization of its products. Mayer answers she is both pro-advertising and anti-ad — meaning they are good when they add to user experience and bad when they do not.

There will be slight margin declines due to this, which is the real point of the query, which Goldman says will not be too impacted.

The next question is on the weaker performance in display ads and whether mobile ads can ramp up quick enough or not.

Yahoo is not breaking out mobile revenue numbers as yet — it’s not impressive as yet, so that’s what’s going on there — although Mayer points to the number of mobile users increasing to 200 million now.

As to the declines in display, Mayer gives a non-answer, but it is likely due to big changes that new Yahoo COO Henrique De Castro has put into place in the way it sells ads and which AllThingsD.com previously reported on. Mayer earlier in the call had confirmed those changes.

The fact of the matter — which is just what the analyst was asking about — is that Mayer simply has to improve display revenue, which is Yahoo’s core business.

Mayer then addresses the issue of not providing usage metrics anymore. Yahoo has withheld a lot of them since she has taken over, and she says it is because they are not indicative of metrics that, well, she thinks you need to know.

Instead, Mayer points to other metrics that she feels are better, such as number of ads sold and price per click on search.

Speaking of search, the next question is about that. What can Mayer say — and she does — but that Yahoo must also improve in that area. Indeed, it is lucrative low-hanging fruit for the company.

Here comes an interesting observation she makes based on a question of mobile versus desktop, which Mayer says should not be separated as two areas as consumers don’t think that way.

Yahoo is tuning up a dozen products, she says, having started with Yahoo Mail and its Flickr photo-sharing app.

2:54 pm: Mayer is not saying which of this dirty dozen is next to get a makeover.

“We’re investing in small, nimble, excellent teams,” says Mayer, who then tries to reference a famous Margaret Mead quote, but ends up mangling it a bit.

It is, for the record: “Never doubt that a small group of thoughtful, committed, citizens can change the world. Indeed, it is the only thing that ever has.”

This is true, which might make some Yahoo staffers nervous, since Mayer’s recent stack ranking of them means she can start on employee layoffs anytime she likes to separate the wheat from the chaff.

3:01 pm: Whoo-whee, this is going long and I am getting weary. Mayer has to be some kind of digital Energizer Bunny — she just flew in from the World Economic Forum in Davos, Switzerland and moved right into the prep for the Q4 earnings.

Tomorrow, she is presumably off to Las Vegas, where Yahoo’s global sales conference will start and she will doubtlessly be making an appearance.

I am exhausted simply by walking up and down the stairs at my house.

The next question is about third-party publishers and ad tech on mobile.

“Mobile monetization is new for everyone,” she says correctly, making the point that no one knows what is going to shake out.

She uses — as she has used — the example of when people thought search was not a moneymaker until Google proved otherwise.

The problem is, of course, that Google is Yahoo’s biggest rival in this new mobile ad arena, along with Facebook and many others. And Google, as its recent results showed, does know how to make money compared to Yahoo.

The next question is about mobile monetization eating into desktop revenue.

Mayer notes that Yahoo has hired 120 people with computer science degrees in the quarter to work on that area.

In other words, get ready for a symphony of geeks to return Yahoo to relevance.

Would they can pull it off, as that would be a tune worth listening to.

Speaking of something worth listening to, here is a video of Diana Ross’ song, “Chain Reaction,” to enjoy:

Background image copyright kentoh

For the uninitiated, the former president is referring to the fact that there are few to no American communities that are hubs of the kind of world-leading bandwidth sufficient to drive next-generation innovation in our economy. He’s referring to the fact that, though international studies differ, the United States does not enjoy bandwidth that is nearly as fast as our peer countries. He’s referring to the fact that, for the first time since American ingenuity birthed the commercial Internet, we do not have a single national wireline provider with plans to deploy a better, faster and bigger network. For most Americans, five years from now, the best network available to them will be the same network they have today. As a result, the best networks — along with the innovations and economic power they enable — will live in other countries as well.

But we should not give up on American ingenuity; as Tom Friedman detailed in a recent New York Times op-ed, upgrading the broadband network in Chattanooga, Tenn., to world-leading gigabit speeds has transformed the community from a “slowly declining and deflating urban balloon” to the fastest growing city in Tennessee, attracting “a beehive of tech startups that all thrive on big data and super-high-speed Internet.” That’s what Gangnam bandwidth can do in America.

That’s why a recent announcement about big bandwidth from Seattle is also big news. The city just announced a plan to bring gigabit service to a dozen of its neighborhoods. Over 100,000 Seattle residents, as well as health care and educational institutions, will have access to world-leading speeds. Not only is the scale of Seattle’s effort impressive, the path it took — smart policies involving rights of way management and dark fiber — can be replicated by other communities that wish to control their own bandwidth destiny.

As America’s National Broadband Plan concluded in 2010, our country needs a critical mass of communities with world-leading networks for us to continue to have the kind of environment that fosters the cutting edge innovations necessary to develop the next generation of world-leading broadband applications. Seattle is not alone in recognizing that bigger bandwidth is an economic development tool. Just as in decades past, when communities had to learn how to benefit from new modes of power or transportation — with electrical, train or air terminal facilities — so it is now with bandwidth. Officials in Kansas City, Kansas and Missouri worked with Google, offering streamlined processes and regulatory efficiencies. Mayor Emanuel in Chicago and Mayor Bloomberg in New York have both recently launched initiatives to enhance their cities’ digital future. Thanks to efforts by their local leadership and a commitment to next-generation networks, residents in Bristol, Virginia; Chattanooga, Tennessee; and Lafayette, Louisiana can already get gigabit speeds. And Gig.U, a consortium of universities and communities looking to accelerate next-generation connectivity in their regions, has, in addition to the Seattle project, helped catalyze ultra-high-speed broadband projects in the past few months: in Orono and Old Town, Maine; Cleveland, Ohio; Gainesville, Florida; East Lansing, Michigan and Champaign-Urbana, Illinois.

Not every community has Seattle’s assets, particularly the strong information, communications, apps development economy and committed local leaders like Mayor McGinn. But Seattle has created a model that every community can follow in improving the environment for the private investment necessary to create a new generation of American broadband leadership. Mr. Friedman proposed a $20 billion fund to bring gigabit connectivity to 200 American cities, arguing that these networks would lead to “a ‘melt-up’ in the United States economy.” While, unfortunately in our view, such a program may not be in the realm of the politically achievable, ironically, it might be the actions of individual cities to catalyze such networks that leads to the kind of growth, debt reduction and surplus that could enable the federal government to once again consider big programs to drive growth and American economic leadership. And this is the kind of policy innovation America deserves.

Blair Levin became Communications & Society Fellow with the Aspen Institute after serving as Executive Director of the National Broadband Planning effort. He is currently Executive Director of Gig.U, a project within the Institute that seeks to accelerate the deployment of next generation networks and services by using university communities as test-beds.

The University Community Next Generation Innovation Project, or Gig.U, is a broad-based group of over 30 leading research universities from across the United States. Drawing on America’s rich history of community-led innovation in research and entrepreneurship, Gig.U seeks to accelerate the deployment of gigabit-speed networks to leading U. S. universities and their surrounding communities. Improvements to these networks drive economic growth and stimulate a new generation of innovations addressing critical needs, such as health care and education. Visit Gig.U online at www.gig-u.org.

This week in Las Vegas, the new management team running Yahoo — including CEO Marissa Mayer — is at International CES to schmooze with big advertisers and convince them that Yahoo is the place to put large chunks of their marketing budgets.

One of the longtime selling points of the company is the sheer size of its audience, especially for the key money-making parts of the site — the homepage, Yahoo Mail and search.

But private stats from comScore show that those three areas have continued their longtime decline over the last year, in some cases dropping significantly. In November and December, for example, compared to the same two months a year ago, U.S. search was down 28 percent and 24 percent respectively, while mail was down 16 percent and 12 percent.

This matters a great deal, since the troika of homepage, mail and search have been the critical driver of the Yahoo value ecosystem for advertisers.

The impact of those drops is felt all over Yahoo, whose music, movie, games and travel site have also seen massive drop-offs in traffic year over year in those same months.

Stopping the decline is critical for Yahoo, since Mayer herself has underscored the need for size in her pushing for new businesses at Yahoo that are 100 million users in size and/or have revenue prospects of at least $100 million.

While this is a lofty vision, the reality of traffic falloffs on key properties is a vexing issue, especially since they remain its main source of revenue and also an important element in launching future products Mayer is promising will turbocharge the company.

It’s not that Yahoo is not huge, especially compared to most sites on the Web.

As one of the top Internet brands, according to a recent Nielsen report, the average number of total monthly unique visitors for the longtime Silicon Valley Internet company in 2012 was 141.6 million, No. 3 behind Google and Facebook in the U.S. market. Similar rankings were reported by comScore, which placed Yahoo at the No. 2 spot after Google, with 171.4 million monthly visitors in November.

But, for many years, traffic to those important consumer destinations of Yahoo has been on a clear and unstopping decline, statistics (usually from comScore) that the company nonetheless always dutifully puts in its earnings slides — see below — for investors to get some idea of the major and vexing issues facing the company.

That was suddenly ended in the last quarter with the engagement slide removed from Yahoo’s public deck entirely. Not all companies include such stats, so when I inquired as to why the company had made the change, Yahoo PR never returned my phone call.

But it’s not hard to guess the reason for the shift — the numbers were not good and they called more attention to Yahoo’s glaring challenge, which is getting users reengaged with its products by creating what Mayer has dubbed several times “delightful” experiences.

According to numerous sources, that has also been the case within the company too, with the new regime restricting an internal transparency initiative pushed by former Chief Product Officer Blake Irving that shared product performance numbers with the top 100 leaders at Yahoo.

And while it’s an interesting strategic choice, several sources inside the company this week urged me to get ahold of increasingly worrisome numbers from comScore — available to its private clients — comparing November 2011 to November 2012 and also December 2011 to December 2012 at home and work in the U.S.

So I did, getting the same stats from numerous sources — numbers that a spokesman for comScore confirmed were correct.

And, as promised, they are worrisome indeed.

In November 2012, compared to November 2011, the monthly unique visitors to the homepage declined 17 percent to 91.8 million from 110.9 million; Yahoo Mail dropped 16 percent (from 92 million to 77.7 million); and Yahoo search dropped 28 percent (from 93.3 million to 66.9 million).

Also off significantly for all three areas, often by one-third, were a plethora of other stats: Percentage of reach, total minutes, total page views, total visits and more.

One of the only bright spots for Yahoo was the relatively small Flickr sites, which were up 37 percent — 26.7 million versus 19.4 million — in unique monthly visitors year over year. The photo-sharing site — which has been getting a much-needed refresh — was also up in all other stats.

But Flickr — which Mayer (pictured here) has laudably touted and supported after years of inexplicable neglect — is not a money-maker for Yahoo, even if its return does burnish the company’s tech and innovation cred.

In December 2011 to December 2012, the homepage was more stable, gaining four percent in monthly uniques from 109.4 million to 114.2 million, but with other key stats both rising and falling. Total visits were up 14 percent, for example, while average minutes per visit was down 13.6 percent.

But the trouble for mail or search continued, off 12 percent (89.9 million to 78.7 million) and 24 percent (88.7 million to 67.4 million) respectively in monthly uniques, with similarly major declines in all other stats.

Mail recently got a refresh too under Mayer, despite some recent security glitches, so new stats will show if that will help stem the declines. Search is another story all together, with Yahoo in what can only be described as a dysfunctional partnership with Microsoft that numerous sources tell me Mayer is seeking to end.

The homepage, too, is undergoing a redo, with a design that has a decidedly more mobile and social feel, and pushing an ethos of Yahoo becoming a hub for content discovery. It is hoped the new look will boost traffic relatively quickly from its current downward trajectory.

To be fair, there can be lots and lots of reasons for these declines, although most of Yahoo’s competitors are, at worse, seeing a flattening of growth and not outright declines.

And sometimes Internet sites complain that services like comScore undercount, although Yahoo had previously used the firm in its public documents. More to the point, as multiple sources within the company note, the stats are directionally correct in that they closely track with internal Yahoo numbers.

Which is to say, traffic is going down rather than growing. That is clearly why Mayer has loudly stressed mobile since arriving at Yahoo, an area not included in these numbers that many sources said has strong growth to about 70 million monthly unique visitors via its apps and mobile-enabled Web offerings.

But unlike the homepage, mail and search — which push and pull traffic all over Yahoo and are responsible for most of its current monetization — mobile also makes very little money now. And Yahoo — unlike Facebook, which recently did — does not break out mobile results.

So, it will be interesting to see if the company does so when it reports fourth-quarter earnings on January 28 and also if it says anything about continued traffic declines of its traditional Web business in the period and the impact on revenue.

Still, there are lots of ways to counter declining or flat revenues, even with declining traffic — via cost cuts, efficiencies, charging more and selling assets (as Yahoo did in the last quarter). And Yahoo has ably managed to keep its operating margins growing over the years, despite both the declines in traffic and moribund growth in its revenue.

But the real and only fix is the drastic fix to existing tentpoles Yahoo has and the creation or acquisition of products that excite consumers and, therefore, advertisers.

It’s not an easy thing, of course, as well-known venture capitalist Ben Horowitz recently wrote in his blog about the need to focus on products over building and improving culture — one of Mayer’s other big initiatives at Yahoo.

Wrote Horowitz in what I consider one of the clearest articulations of what it takes to win for startups, as well as big companies like Yahoo:

“The primary thing that any technology startup must do is build a product that’s at least 10 times better at doing something than the current prevailing way of doing that thing. Two or three times better will not be good enough to get people to switch to the new thing fast enough or in large enough volume to matter. The second thing that any technology startup must do is to take the market. If it’s possible to do something 10X better, it’s also possible that you won’t be the only company to figure that out. Therefore, you must take the market before somebody else does.”

If you want to take a gander, here are some more of those old Yahoo quarterly engagement slides, which were recently eliminated from its presentations:

(Note: I reached out to Yahoo’s outside PR firm — since they do respond to queries — and also some company execs to get a comment on this story, but so far there has been none.)

When I asked him to talk to me about why he decided to finally became a director at Yahoo after what was a very long mulling that started even before former Google exec Marissa Mayer became CEO, Max Levchin alerted me earlier today to a very solid post he did on the subject on his blog, which is called “too long to tweet.”

I now remember why I really like that Max Levchin: He blogs! (Also because he is an unapologetic coffee snob.)

In his essay, he breaks down the reasons into three parts: Personal, business and sentimental.

Noting his longtime admiration of Mayer, he noted “her decision to take the top role at Yahoo! was a very ballsy move, and when she asked for my help, I was excited about working with her.” Levchin, a well-known tech entrepreneur, also wrote that he hoped for a strong Yahoo, since it was a “massive net-positive for the Silicon Valley ecosystem, the market in general, and the US economy.”

Most of all, he said, Yahoo “showed me that computer geeks can start companies that create that future. I’d love to do my part in helping the company that inspired me.”

Levchin also emailed me to add: “If she gets the place into shape, it will be the absolute greatest turnaround in Valley’s recent history, possibly ever.”

Indeed.

Sources close to the situation told me that Mayer convinced Levchin to join the board by convincing him that he’d be able to help her inject entrepreneurial vigor into the company.

That would be good, and Levchin’s post is actually one of the best recitations of the kind of spirit Yahoo needs to revive itself that I have read in a long while.

It also tracks exactly on many conversations I have had with Levchin in the past about Yahoo’s troubles. He has long been intrigued by the opportunity despite management woes, innovation doldrums and the relentless talent exodus.

But judge for yourself — here’s the whole thing:

As announced by Yahoo! this morning, I have been asked and agreed to join its Board of Directors. It is an honor to be asked, in and of itself. There are three key reasons I accepted:

Personal: I’ve long respected Marissa’s talent and tenacity. Her decision to take the top role at Yahoo! was a very ballsy move, and when she asked for my help, I was excited about working with her.

Business: a stronger, fast-growing Yahoo!, with its tremendous resources is a massive net-positive for the Silicon Valley ecosystem, the market in general, and the US economy.

Sentimental: Yahoo! was one of the first true giants created by this amazing new thing, the Web. Before Google or Facebook, before almost everything there was Jerry’s Guide, right up there with What’s New page in Mosaic. Through amazing luck, I was a Computer Science freshman at UIUC in ’93, which gave me a glimpse into the fantastic future we are now living. Yahoo! showed me that computer geeks can start companies that create that future. I’d love to do my part in helping the company that inspired me.

A lot of companies have innovation departments, and this is always a sign that something is wrong when you have a VP of innovation or something. You know, put a for-sale sign on the door.

–Apple CEO Tim Cook, in an interview with Bloomberg Businessweek’s Josh Tyrangiel

While it is one of the largest consumer electronics and mobile companies in the world, Korea’s Samsung has a relatively quiet profile in Silicon Valley.

In fact, while it has had a longtime facility in San Jose for two decades, its execs are not well known to many except the top echelons of the tech sector here and Samsung’s interactions with the entrepreneurial culture have been decidedly low key.

No longer, it seems.

Besides a previously announced new 8.5-acre campus in Mountain View for its U.S. research and development center, slated for completion in 2014, sources said the company is close to signing a deal for a prominent venue in downtown Palo Alto that will house a start-up accelerator.

The location that the company is now negotiating is the second floor of the former Borders Books space on University Avenue. The historical property has a splashy movie marquee, since it used to house the Varsity Theatre.

It’s not quite Oppa Gangnam Style, it is a big move for Samsung.

While it is unclear if the new office will focus on making investments in start-ups or incubating its own innovation, sources said it will be aimed at linking Silicon Valley entrepreneurs and other players more closely with Samsung.

Sources said the move is being spearheaded by a relatively new hire by Samsung: David Eun, who became its EVP to lead a new push to create more media offerings in December. Previous to Samsung, Eun has been an exec at both Google and AOL.

Eun is well known in the Valley already, but a new location that will focus Samsung’s digital efforts should raise the company’s profile with the digerati here.

Also on the docket to do that is Samsung’s other new major facility. In September, right in the middle of its high-profile patent trial with Apple, the company announced that Samsung Information Systems America, its U.S. R&D Center, would expand and relocate to a new campus.

“The R&D Center will provide a state-of-the-art campus that can support the current rapid growth in the organization, and also provide the infrastructure to support Samsung’s open innovation and university collaboration activities,” Samsung said in a press release at the time. “Construction is anticipated to start in the second half of 2013 on the company’s two new six-story class-A office buildings totaling approximately 385,000 sq. ft. and two 5-6 story parking structures, with occupancy expected in 2014.”

In other words, Apple: Samsung is now officially in the house in Silicon Valley.

We want to build an Internet treasure.

– Zynga CEO Mark Pincus, at Fast Company’s Innovation Uncensored Conference

A large group of tech luminaries — including LinkedIn’s Reid Hoffman, Path’s Dave Morin, JLab’s Judy Estrin, Dropbox’s Drew Houston, Craigslist’s Craig Newmark and Box’s Aaron Levie — are part of the launch of a series of online videos today aimed at talking up U.S. innovation and, in the process, touting the reelection of President Barack Obama.

The slick “Innovator Series” of about two dozen videos comes out of Technology for Obama — or T4O, for short — and plans to feature daily short interviews with entrepreneurs and tech execs. Along with touting the need for innovation, the group talks about their “personal lessons of success and failure,” which then sidles politically into “their views on why they believe President Obama is the right leader for increasing innovation and moving the country forward.”

The patter is in that vein, such as this quote from Hoffman:

“Innovation is our key differentiator in terms of competitive business model of the U.S. in the world. We need to continue to attract the best people to build interesting businesses, products, services here.”

CNET co-founder and former CEO Shelby Bonnie, who recently joined investment firm Allen & Co., did most of the interviews for the T4O effort.

“Each of us was looking at what we could do and found that this group had a deep-seated belief in the importance of innovation and ability to innovate in this country,” he said of the video offerings, which were shot mostly out of the Obama campaign offices in San Francisco. “The consistent theme we wanted to get out is that President Obama gets that and believe in innovation.”

No word yet on what GOP geeks — such as Hewlett Packard’s Meg Whitman or Cisco’s John Chambers — are up to for former Gov. Mitt Romney — but until then, here is a sizzle reel of the T4O interviews:

]]> http://allthingsd.com/20121019/how-many-techies-does-it-take-to-elect-a-president-t4o-launches-innovator-series-videos-for-obama/feed/ 0 http://allthingsd.com/20120825/after-verdict-prepare-for-the-apple-tax/ http://allthingsd.com/20120825/after-verdict-prepare-for-the-apple-tax/#comments Sat, 25 Aug 2012 19:00:52 +0000 Spencer Ante http://allthingsd.com/?p=245048 Get ready for the Apple tax, at least in the short term.

After its stunning victory against rival device-maker Samsung Electronics Co., experts say consumers should expect smartphones, tablets and other mobile devices that license various Apple Inc. design and software innovations to be more expensive to produce.

Read the rest of this post on the original site »

]]> http://allthingsd.com/20120825/after-verdict-prepare-for-the-apple-tax/feed/ 0 http://allthingsd.com/20120825/sweet-mayer-declares-that-its-peanut-butter-jelly-time-at-yahoo/ http://allthingsd.com/20120825/sweet-mayer-declares-that-its-peanut-butter-jelly-time-at-yahoo/#comments Sat, 25 Aug 2012 17:05:37 +0000 Kara Swisher http://allthingsd.com/?p=245062

Remember the infamous “Peanut Manifesto,” in which former Yahoo exec Brad Garlinghouse likened the company’s innovation process to peanut butter?

In it, he wrote:

“I’ve heard our strategy described as spreading peanut butter across the myriad opportunities that continue to evolve in the online world. The result: A thin layer of investment spread across everything we do and thus we focus on nothing in particular. I hate peanut butter. We all should.”

Not new Yahoo CEO Marissa Mayer, who has cooked up a new recipe for the longtime company albatross by sweetening it up.

Thus, yesterday, she sent out a new memo announcing a new sandwich topping to get the Silicon Valley Internet giant moving again: PB&J.

That stands for “Process, Bureaucracy & Jams,” and it is kind of like a city’s pothole alert line, except with more geeky pep.

Wrote Mayer and Patricia Moll Kriese — the ex-Googler who is now senior director of corporate projects at Yahoo — in a memo to employees, in part:

“Do you see a problem and know how to solve it? Want to brainstorm with colleagues about what to fix and how to fix it? Give us your ideas. Or be heard loud and clear by simply voting.”

In the missive, the pair also noted that besides the free food and new Friday FYI staff meetings, both of which I have previously reported on, the new leadership of Yahoo has been busy with some other stuff.

That apparently now includes: Turning off the turnstiles in building D at its Sunnyvale HQ, removing parking lot barriers, eliminating mandatory orientation at the gym.

(Yahoo really has been hopelessly bureaucratic, if it is requiring engineers to get schooled on how to work an exercise bike.)

In any case, it’s another interesting idea from Mayer to instill more ease and transparency to logistical aspects of running Yahoo (except when it comes to talking to media, of course — in that case, it’s awfully dark in here!).

These are important culture changes, of course, but the real rubber hitting the road will be what major execs Mayer brings in from elsewhere to really foment managerial change and innovation.

Sources say that at least one big hire is happening soon, with Mayer looking at candidates from “outside the box” from the regular suspects in the industry.

She has certainly been active in buttonholing important tech players on the subject over the last month, said sources, and asking for their input — from Facebook COO Sheryl Sandberg to former Yahoo CEO Terry Semel to a variety of others.

So far, her outside hires have been from Google, including Kriese (pictured here). While she had been listed as a project manager at Google, several sources said her last contracted job there was primarily to organize the annual trip to the World Economic Forum in Davos, Switzerland, for top execs at the search behemoth. Apparently, Kriese is a whiz with a spreadsheet in marshaling the tetchy potentates of Google, so PB&J seems right up her alley.

Here’s the full memo:

From: Marissa Mayer
Sent: Friday, August 24, 2012 10:00 PM
To: [All Yahoo]
Cc: Patricia Moll Kriese
Subject: Announcing PB&J — Process, Bureaucracy, & Jams!

YAHOO! PROPRIETARY AND CONFIDENTIAL INFORMATION — DO NOT FORWARD

Process blocking your success?

Bureaucracy getting you down?

Jammed by problems and see a solution? We are looking at how to streamline process, reduce bureaucracy, and remove jams — PB&J!

We’re launching PB&J today to gather your feedback on how to make Yahoo! the absolute best place to work. Share your ideas on what would make your job easier, boost your productivity and help solve problems.

What’s on your wish list for our corporate culture and work environment?

For example:

* GitHub for Code Review

* Dogfooding Yahoo! Mail & Calendar

* SSD’s (Solid State Drives) for faster machines

* Mi-Fi’s (mobile wi-fi cards)

We have done a few things already — free food, FYI, turning off the turnstiles in building D, removing parking lot barriers, eliminating mandatory orientation at the gym, etc. However, we know there’s more we can do!

Do you see a problem and know how to solve it? Want to brainstorm with colleagues about what to fix and how to fix it? Give us your ideas. Or be heard loud and clear by simply voting.

PB&J is available globally on Backyard: http://allhands.corp.yahoo.com/qna/pbj/latest

We will review your ideas and votes, reporting back in FYI each month on
actions taken. August PB&J starts now — and look forward to an update at
the next FYI in early September!

Questions/concerns/suggestions around PB&J, please contact Patricia Moll
Kriese, who’s our lead on PB&J.

Marissa & Patricia

And here is my fave depiction of PB&J, in the fantastically addictive “It’s Peanut Butter Jelly Time” dance:

]]> http://allthingsd.com/20120825/sweet-mayer-declares-that-its-peanut-butter-jelly-time-at-yahoo/feed/ 0 http://allthingsd.com/20120824/on-one-year-of-anniversary-of-jobs-stepping-down-as-ceo-karmas-a-patent-victory-for-apple/ http://allthingsd.com/20120824/on-one-year-of-anniversary-of-jobs-stepping-down-as-ceo-karmas-a-patent-victory-for-apple/#comments Fri, 24 Aug 2012 23:28:42 +0000 Kara Swisher http://allthingsd.com/?p=244819

If anyone had any question what irony is exactly, consider this: Today is the one-year anniversary of the day Steve Jobs stepped down from his job as the charismatic and legendary leader of Apple, as well as the very moment that the company he co-founded has largely won an epic legal battle with Samsung over patent infringement.

The late Apple co-founder was particularly vocal at various times on the issue of copying innovations that he felt his company had pioneered.

That’s been especially true related to Google Android operating system that Samsung and many other device makers are using.

In a quote by Jobs from Walter Isaacson’s biography of him, he famously said:

“I will spend my last dying breath if I need to, and I will spend every penny of Apple’s $40 billion in the bank, to right this wrong. I’m going to destroy Android, because it’s a stolen product. I’m willing to go thermonuclear war on this.”

And that has certainly been at the center of the landmark trial over who stole what in the aggressive race to dominate the market for popular smartphones and tablet devices, including Apple’s iPhone and iPad.

Right now, the verdict from a California jury — who deliberated for less than 24 hours — is being read in a San Jose courtroom.

And, so far, it is largely favoring the Silicon Valley-based Apple over the South Korean consumer electronics giant on the wide-ranging patent infringement case.

As The Verge’s liveblog of the verdict noted: “Apple didn’t win everything — not by a long shot — but it won enough to make this a very important day.”

Indeed.

Those wins include patents related to touchscreen features, such as zooming, as well as on designs.

In addition, so far, Samsung has been ordered to pay Apple $1.05 billion in damages.

The jurors determined that Samsung violated six of seven patents and found that it willfully infringed in five instances. Also: The jury said that all seven of Apple’s patents were valid, which Samsung had contested.

The findings in the complex case are still being read in court, because it involves many patent infringement allegations on both sides related to dozens of devices.

Legions of lawyers for Apple and Samsung went back and forth on who invented what and whether it was a matter of copying or simple inspiration.

Samsung, naturally, said the various devices might be similar, but not the same. Apple begged to differ.

Jobs would have been in agreement, too, had he lived to see the verdict — he died of pancreatic cancer in October of last year, only months after stepping down.

But, in his resignation letter a year ago, he wrote about the importance of innovation:

“I believe Apple’s brightest and most innovative days are ahead of it. And I look forward to watching and contributing to its success in a new role. I have made some of the best friends of my life at Apple, and I thank you all for the many years of being able to work alongside you.”

---

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• Apple to Samsung: You Give Us $2.5 Billion and We’ll Give You a Half-Cent-a-Unit Royalty
• Apple vs. Samsung: Another Patent Slapfight, Another Exasperated Judge

]]> http://allthingsd.com/20120824/on-one-year-of-anniversary-of-jobs-stepping-down-as-ceo-karmas-a-patent-victory-for-apple/feed/ 0 http://allthingsd.com/20120822/competing-views-of-competition-in-apple-samsung-trial/ http://allthingsd.com/20120822/competing-views-of-competition-in-apple-samsung-trial/#comments Wed, 22 Aug 2012 21:30:52 +0000 John Paczkowski http://allthingsd.com/?p=244092

Paramount Pictures

There were many disparate arguments put forth during Tuesday’s summations in the Apple-Samsung patent struggle, but there was one in particular that was made by both sides: My rival’s behavior is anticompetitive. As Samsung attorney Charles Verhoeven told the jury, “It’s a very important decision you have to make. It could change the way competition works in this country.”

That remains to be seen. But make no mistake, the jury’s decision in this landmark case will almost certainly have some bearing on the evolving definition of anticompetitiveness in fast-changing fields like the mobile device industry.

Samsung’s view is that Apple has behaved anticompetitively by using its intellectual property to hamstring rivals. “Rather than compete in the marketplace, Apple is seeking to gain an edge in the courtroom,” Verhoeven argued. “It’s seeking to block its biggest and most serious competitor from even attending the game.” If Apple should prevail in court, he warned, the tech industry will become a collection of “giant conglomerates, armed with patent arsenals, that block competition and reduce choices for consumers.”

Given the sheer amount of litigation in the mobile device industry these days, Verhoeven’s argument does ring somewhat true. But it doesn’t really account for companies that legitimately need to protect their hard-won innovations from others that might feel entitled to borrow or emulate them.

And that was the point Apple hammered home again and again in its closing arguments: It isn’t the anticompetitive player here; Samsung is. And by allegedly copying Apple’s designs, Samsung has paved the way for others to do the same, robbing those designs of their uniqueness.

“Apple took five years to bring the iPhone revolution to us,” Apple attorney William Lee said in his closing. “Samsung took three months to copy it. … We have to protect our investment in these innovations. Because if we don’t, we won’t have people like Apple spending five years in a room coming up with a device that revolutionizes the mobile phone.”

In other words, companies should compete on the strength of their own innovations, not those of their rivals. And that argument, too, rings true. After all, where’s the incentive to innovate if you’re certain to see your innovation ingested by a competitor and used against you?

Two reasonably compelling arguments, and it’s obviously impossible to predict how they’ll play with the jury weighing the case. As Stanford law school professor Mark Lemley told AllThingsD, there’s merit in both.

“Apple presented the intellectual property view of innovation — we created it, we own it, you can’t use it,” Lemley said. “Samsung presented the competition view of innovation — everyone should make great products and let consumers choose. IP law generally sides with Apple at this broad level, though there is a pretty good argument that it is competition, not monopoly, that drives great innovation in the IT space.”

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Apple versus Samsung Full Coverage

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• Apple to Samsung: You Give Us $2.5 Billion and We’ll Give You a Half-Cent-a-Unit Royalty
• Apple vs. Samsung: Another Patent Slapfight, Another Exasperated Judge

]]> http://allthingsd.com/20120822/competing-views-of-competition-in-apple-samsung-trial/feed/ 0 http://allthingsd.com/20120816/exclusive-yahoo-conducting-a-search-for-a-coo-as-no-2-to-mayer/ http://allthingsd.com/20120816/exclusive-yahoo-conducting-a-search-for-a-coo-as-no-2-to-mayer/#comments Thu, 16 Aug 2012 22:12:09 +0000 Kara Swisher http://allthingsd.com/?p=242414

According to several sources, Yahoo is now on the hunt for a COO — with special emphasis on someone with turnaround experience — presumably to be a worker-bee No. 2 to product-guru CEO Marissa Mayer.

Several Silicon Valley execs and others outside of tech have been contacted by Spencer Stuart, the executive talent firm that is working on a number of other exec searches for Yahoo.

It is not clear if Mayer is on board this plan for a COO and other sources said she has different ideas for the management organization at Yahoo, including an elaborate general manager system that is similar to that at Google. Mayer, who come to Yahoo from the search giant, has put a lot of practices from her former employer in place, from free food to weekly all-hands meetings to more stringent hiring.

In any case, those candidates contacted recently have been told that the company is looking for a top exec with a focus on restructuring and also finance. Presumably, in this scenario, Mayer will focus on product and innovation — her strengths — while the COO would perhaps be responsible for making the trains run on time on the business side of Yahoo. A plethora of employees who have met with her have stressed her intense interest in products, which is mirrored by much less attention to more mundane business issues.

Perhaps the highest profile COO hire of a similar sort has been Facebook’s Sheryl Sandberg, who was brought in at a dicey time for the social networking site to work on the business while co-founder and CEO Mark Zuckerberg focused on its product.

Such an exec could be a good idea, since — despite the wide latitude Mayer has been given to make changes — Yahoo can not afford much damage to its current operations as Wall Street investors wait for her strategy to reinvigorate the company.

In fact, a recent filing in which Yahoo said Mayer was rethinking its promise to return a $4 billion-plus cash windfall from the sales of assets in China to shareholders caused the stock to drop quickly, largely due to a decided lack of information about what she planned to do with the money.

It will be interesting to see who would be intrigued by the mammoth job of helping fix Yahoo, since most think the process will inevitably include major layoffs.

Spencer Stuart’s Jim Citrin worked on the troubled tech giant’s recent CEO search, which ended up in the hiring of the high-profile Google exec. Mayer’s hiring was a public relations coup for Yahoo’s board, especially its large shareholder Dan Loeb of Third Point.

Mayer herself has also been reaching out to her extensive circle of colleagues at Google and elsewhere in tech to come help her turn around Yahoo. Most recently, she has been trying to hire a former Googler Katie Jacobs Stanton, who once worked with Mayer and now runs international efforts for Twitter.

At the same time, several top execs have left Yahoo since Mayer arrived as she conducts a house cleaning and puts her own team into place. That has included its former interim CEO Ross Levinsohn and HR head David Windley. More such departures are expected.

Mayer has also kept execs, including making interim general counsel Ron Bell the permanent one last week. She has also relied heavily on Yahoo co-founder David Filo.

But her new hires have mostly been lower-level ones, made up of staff who had been close to her at Google.

I would ask for comment from Yahoo, but one of those Mayer newbies at Yahoo — Anne Espiritu, who appears to be a ghost — is still sitting on a number of my and other reporter’s requests to comment on various issues that have been completely unanswered. I have now decided to move onto the other two — Patricia Moll Kriese and Andrew Schulte — to see if they disappear too.

]]> http://allthingsd.com/20120816/exclusive-yahoo-conducting-a-search-for-a-coo-as-no-2-to-mayer/feed/ 0 http://allthingsd.com/20120807/samsungs-2010-report-on-how-its-galaxy-would-be-better-if-it-were-more-like-the-iphone/ http://allthingsd.com/20120807/samsungs-2010-report-on-how-its-galaxy-would-be-better-if-it-were-more-like-the-iphone/#comments Wed, 08 Aug 2012 02:12:40 +0000 John Paczkowski and Ina Fried http://allthingsd.com/?p=238924 As part of its case against Samsung, Apple has shown snippets of an internal Samsung document comparing the original Galaxy S phone with the iPhone.

On Tuesday, Apple managed to get the whole 132-page document admitted into evidence. And it’s a doozy.

The 2010 report, translated from Korean, goes feature by feature, evaluating how Samsung’s phone stacks up against the iPhone.

Authored by Samsung’s product engineering team, the document evaluates everything from the home screen to the browser to the built-in apps on both devices. In each case, it comes up with a recommendation on what Samsung should do going forward, and in most cases, its answer is simple: Make it work more like the iPhone.

In short, the evaluation report makes the case that the Galaxy (identified here as the “S1″) would be better if it behaved more like the iPhone and featured a similar user interface. And it appears to play directly into Apple’s charge that Samsung “slavishly copied” the iPhone.

Samsung has been trying to make the case that the arrival of powerful capacitive touchscreens pushed the whole industry toward something like the iPhone. This document helps show how one can have a similarly sized slab of glass and still come up short — as Samsung itself concludes it did, initially.

Of course, to win its case, Apple will have to prove not just that Samsung made its phones more iPhone-like, but that it either infringed on the specific design and utility patents at issue, or that it infringes on specific design elements of the iPhone and iPad — what’s known in legal terms as “trade dress.”

In court on Tuesday, Apple called a number of experts to testify that the similarity of Samsung’s products to Apple’s is more than coincidence and constitutes infringement.

Samsung is arguing both that its products don’t infringe, and that Apple’s designs and functions weren’t patent-worthy in the first place.

Anyway, have a look for yourself and you’ll see why Samsung wasn’t too keen on this getting in front of the jury. Here’s a direct link to the document if the embed below isn’t working properly.

Reached for comment, a Samsung representative told AllThingsD that this document isn’t nearly as damning as it might appear: “Samsung benchmarks many peer companies,” the rep said. “In fact, these are typical competitive analyses routinely undertaken by many companies in many industries – including Apple. Samsung stands by its culture of continuous improvement and innovation. We are very proud of the product innovations driven by our more than 50,000 designers and engineers around the world who have made Samsung’s products the products of choice.”

44_iPhone_GalaxyS1_review

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Apple versus Samsung Full Coverage

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• Apple-Samsung Juror Tells CNET Debate Was “Heated”
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• Apple to Samsung: You Give Us $2.5 Billion and We’ll Give You a Half-Cent-a-Unit Royalty
• Apple vs. Samsung: Another Patent Slapfight, Another Exasperated Judge

]]> http://allthingsd.com/20120807/samsungs-2010-report-on-how-its-galaxy-would-be-better-if-it-were-more-like-the-iphone/feed/ 0 http://allthingsd.com/20120719/mayer-to-get-40-million-in-overall-compensation-for-yahoos-top-job/ http://allthingsd.com/20120719/mayer-to-get-40-million-in-overall-compensation-for-yahoos-top-job/#comments Thu, 19 Jul 2012 21:25:47 +0000 Kara Swisher http://allthingsd.com/?p=232094

Yahoo revealed in a regulatory filing that it could be paying its new CEO Marissa Mayer a total of close to $60 million to turn the company around.

The mega-sum includes salary, equity grants, stock options, a make-whole payment for the Google shares she left behind and, perhaps most remarkably, a $30 million one-time retention award.

The amount, which is a whole lot more than what the last two Yahoo CEOs — Carol Bartz and Scott Thompson — were paid is, um, rather large.

One Yahoo board member had characterized the pay package to me as “big, big bucks,” as I reported earlier today.

I would say so!

(Side note: Mayer is already extraordinarily wealthy from her stint at Google, where she was its 20th employee.)

Here’s the breakdown of the largely performance-based compensation:

The salary amount is typical at $1 million, with an annual bonus of up to 200 percent of the base salary, which is $2 million. But, according to Yahoo’s employment letter, she could also get up to a 400 percent bonus, dependent on exceeding targets, which is $4 million.

Mayer also gets an equity award for 2012 of $12 million in stock ($6 million) and options ($6 million) that vests over three years. (She could get another similar grant annually, but I did not include that in the overall number, which is $12 million annually or more if she exceeds targets.)

The really big number is a huge up-front, one-time retention award, vesting over five years, of $15 million in stock and $15 million in options.

Finally, there is a make-whole payment of $14 million for the stock she left behind at Google.

Overall, that means about $5.4 million for the rest of this year and could add up to $20 million each year to come.

The pay package was hotly debated by the board as to whether the high-profile exec was worth the huge amount.

While Mayer is considered a talented techie, a very strong decision maker and adept at product innovation, some of the board’s directors raised concerns about her and paying so much to retain her.

One issue: She had been notably passed over by Google CEO Larry Page for one of the major unit jobs in his reorganization of the company, while others in her peer group had been promoted.

That said, since such company ups and downs happen all the time, others argued that Mayer was just the kind of disruptive agent of change that Yahoo needs, especially because she could inspire its engineers and also attract much needed talent.

The enormous compensation was pushed through, said several sources, by Dan Loeb, the one-time activist shareholder who now appears to be the puppet master of the Yahoo board. He owns about six percent of the Silicon Valley Internet giant.

(Another side note: Multiple sources tell me that Loeb has been making calls to all kinds of Internet figures this week, looking for high-fives for his landing of Mayer, a hiring that was largely engineered by him.)

Her appointment has surely garnered a lot of attention for Yahoo, with massive media coverage of the dynamic young exec. Some of the coverage has focused on her being a woman and also on the fact that she is currently pregnant.

But much of it is focused on how Yahoo — a deeply troubled company that has been trying to revive itself for many years now without success and with a lot of management mishegas — has been able to attract such a high-profile and impressive-resumed leader to goose both its products and its stock.

Let’s hope Mayer can do just that, because Yahoo is surely paying up big-time for the privilege.

Please take a gander here at the filing, directly from the Department of the Internet Rich Get Richer:

YHOO-20120719-8K-20120715

Please see this disclosure related to me and Google.

]]> http://allthingsd.com/20120719/mayer-to-get-40-million-in-overall-compensation-for-yahoos-top-job/feed/ 0 http://allthingsd.com/20120719/big-big-bucks-yahoo-set-to-release-what-it-paid-to-hire-marissa-mayer/ http://allthingsd.com/20120719/big-big-bucks-yahoo-set-to-release-what-it-paid-to-hire-marissa-mayer/#comments Thu, 19 Jul 2012 19:16:08 +0000 Kara Swisher http://allthingsd.com/?p=232013

Later today, Yahoo will release what is likely to be a very juicy regulatory filing about what it paid to get former Google exec Marissa Mayer to become CEO.

While I could not obtain the exact numbers — the compensation plan is being protected like the crown jewels of England — a source on the board of the Silicon Valley Internet giant said it is “big, big bucks.”

So big, apparently, that the discussion over the money — which is a combination of cash and stock — was hotly debated by the directors as to whether the high-profile exec was worth the large amount.

While Mayer is considered a highly competent tech exec, a very strong decision-maker, adept at product innovation, some of the board raised concerns about her, too. One issue: She had been passed over by Google CEO Larry Page for one of the major unit jobs in his reorganization of the company, while others in her peer group had been promoted.

That said, others argued that Mayer was just the kind of disruptive agent of change that Yahoo needs, especially because she could inspire its engineers and also attract much needed talent.

Also of importance, a vision she presented to the board of doubling down on Yahoo’s once mighty advertising technology and search businesses.

In a rapid-fire series of meetings with small groups of Yahoo staffers this week, Mayer has grilled the employees on a range of issues in what everyone I spoke to described as a no-nonsense and cut-to-the-point manner.

“She is incredibly smart and has already shaken up the thinking by calling people out,” said one person who has attended the meetings. “But she has also not suffered fools.”

One refrain she made in a number of the gatherings was that Yahoo needed more technical staff.

“We need more engineers,” said she said to several groups.

Such talk has been greeted with glee by the product side of Yahoo, which has long felt that they have been neglected.

“The geeks could not be more thrilled she is here,” one Yahoo employee said.

We’ll soon see how much that glee is going to cost.

Please see this disclosure related to me and Google.

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