The U.S. company said the settlement underscores its new strategy to minimize litigation and work more collaboratively with users of its technology.

Ron Black, who was appointed chief executive of Rambus a year ago, said the company is determined to distance itself from another breed of licensing companies—sometimes called “patent trolls” by their critics—that buy and sell patents but don’t make inventions of their own. Rambus, by contrast, licenses technology developed by its own engineers.

Read the rest of this post on the original site »

The administration rolled out a package of executive orders and recommendations for legislation Tuesday that takes aim at patent-holding firms, or what critics derisively call “patent trolls” — companies that buy up patents solely to press for licensing deals or payouts in court.

Read the rest of this post on the original site »

According to numerous sources close to the situation, Yahoo has bid from $600 million to $800 million for the premium video site Hulu.

The reason for the wide range is due to the fact that the Silicon Valley Internet giant — similar to most bidders in the new effort to acquire Hulu — has proposed several different prices based on a variety of circumstances. That includes the length of the licensing rights for content and how much control the programming companies selling Hulu have over their media.

At the same time and separately, according to sources inside the company, Yahoo is also contemplating at least two other significant purchases — in the $150 million to $200 million range — each for a mobile and a communications company.

It’s certainly an ambitious and busy M&A agenda for Yahoo’s CEO Marissa Mayer, who just forked over $1.1 billion in cash to purchase youth-skewing blogging site Tumblr last week.

Presumably, she is interested in upping Yahoo’s longtime lackluster video efforts — it famously lost out at the last minute on the acquisition of YouTube many years ago to Google — as the arena becomes more critical to advertisers.

But, said sources, while allowing the bid to proceed, Mayer is more focused on the integration of Tumblr, as well as other acquisitions that will bolster other key product areas.

Thus, sources said that the Hulu effort is being led at Yahoo by Los Angeles-based Ian Weingarten, VP of corporate development, who works for M&A head Jackie Reses.

AllThingsD.com first broke the news of that deal, as well as Yahoo’s initial interest and subsequent bid for Hulu, which is owned by a trio of media giants: News Corp., Disney and Comcast.

The site, which has both a subscription and an advertising business, was on the market in 2011, with the hope for a bid of $2 billion that came with several years of programming rights. The sale was pulled after those higher bids did not materialize.

But Hulu is on the market again in the most advanced effort to sell it so far, with bids coming in from a range of suitors over the last week.

Yahoo’s Mayer and COO Henrique De Castro had met with Hulu’s team earlier this month for a get-to-know-you, just after an effort to buy a large stake in French video site Dailymotion was blocked by the government there.

Besides Yahoo, others interested in acquiring Hulu include: Separate bids from private equity firms KKR, Guggenheim Digital and Silver Lake (in conjunction with Hollywood talent agency William Morris Endeavor); Time Warner Cable; DirecTV; and the Chernin Group.

There could still be others, of course, though a deadline for initial bids has passed. Interestingly, so far, neither Google nor Amazon have made official efforts, perhaps because the pair already have robust video platforms.

Chernin’s bid, as had been widely reported, started in the $500 million range, which is interesting since the longtime media executive was once the COO of News Corp. and was critical to Hulu’s creation. Translation: He’d know just what the video platform is worth and how the place works.

Of course, low bids at the start are part of the normal process; sources close to the owners said that any bids under $1 billion are unlikely to be accepted.

One thing is certain: Now comes what will look a lot like a very noisy game of musical chairs, in which the various groups will vie for one-upmanship, even as they talk to each other about possible joint efforts. Who the most attractive candidate is, of course, will be much debated.

In addition, there is much disagreement over who and how Hulu should be sold by two of its owners, Disney and News Corp., which have squabbled over its direction from the start. (Comcast gave up its management rights as a concession to federal regulators a few years ago, so is sitting on the sideline twiddling its giant cable thumbs and doubtlessly wishing it could be a bidder, too.)

No matter the ceaseless bickering among giants, the trio of media conglomerates are providing Hulu’s most valuable programming, largely television shows from their broadcast networks. And that is the real point of the negotiating, according to many involved.

“Hulu is a very nice brand and technology, but the entire negotiation will be about the control and price of the content,” said one person close to the situation. “It’s the only thing that matters.”

I sent an email for comment to Yahoo, but expect no response.

(Full disclosure: News Corp. owns Dow Jones, which owns this site.)

According to numerous sources close to the situation, Yahoo CEO Marissa Mayer recently met with top execs at Hulu, the premium video service whose big media company owners have been considering selling it for some months.

Sources said Yahoo is “in the process,” although the Silicon Valley Internet giant has not made any kind of formal bid. Other players whom sources said are considering purchasing all or parts of Hulu include: Former News Corp. COO Peter Chernin, who now has a successful and well-funded multimedia and investment company called the Chernin Group; Guggenheim Partners digital arm, which is led by former Yahoo interim CEO Ross Levinsohn; and Amazon.

Sources said Mayer also had an extensive getting-to-know-you meeting, which was apparently not held at Hulu’s offices in Santa Monica, Calif., along with COO Henrique De Castro. The discussion is taking place in the wake of Yahoo’s failed bid — largely engineered by De Castro — to purchase a majority stake in France Télécom’s Dailymotion video service, after a top French government official said Yahoo could not own 75 percent of the company.

Had the deal — which was reportedly valued at $300 million — gone through, it would have been the most significant by Mayer since she took over at the company last July. Thus far, she has limited her purchases to small mobile startup.

While the meetings with Hulu are only preliminary, Yahoo has been to this video rodeo before, having seriously considering buying Hulu when it was previously being shopped by its owners, News Corp., Disney and Comcast. (News Corp. also owns this site.)

Of course, if Yahoo’s interest becomes more serious, Mayer will have to make important visits to top execs at those media giants, since they control the rights to critical content, and thus Hulu’s value.

As Peter Kafka noted in a previous post about Hulu’s possible sale, “much hinges on the licensing rights News Corp., Disney and Comcast would provide for the money-losing site, as well as what happens to the $300 million debt its owners have taken on in the last year.”

Without those rights, Hulu by itself is a very pretty Web site and video platform, but not worth the billions it would be with very long-term television rights, content that attracts users. Currently, sources said its media owners are offering two to three years of rights, with a lot of flexibility over removing content from the site, which is not quite as attractive a deal (to say the least).

But video is a key component of Yahoo’s strategy going forward. Along with mobile efforts, Mayer has explicitly told investors that video was a key to company under her tenure.

Coincidentally, today in an onstage interview at a Wired conference in New York, Mayer broadly addressed the video issue when asked a question about the topic, noting it was important across all of Yahoo’s properties.

“I think video is really important … video is something that we’re all innately designed and born to experience, everyone is born being able to watch and to hear,” she said. “Video is just this amazing format.”

Mayer would know that well, having been at Google when the search giant bought YouTube, ironically snatching it at the last minute from a competing bid by Yahoo, which was then led by Terry Semel. Since then, YouTube has become the most important and powerful player in the space by far.

Yahoo, despite being one of the largest video players on the Web, has mostly been a lackluster competitor in the arena, pinging over the years from creating original content to doing branded deals with media companies, but never establishing a major beachhead with consumers as Hulu did from scratch.

Short of a full acquisition, there may be a way for Yahoo to partner and invest in Hulu, instead of buying it outright that works for all sides — owners get a new owner to foot part of the bill and also increase distribution, and Yahoo can claim that it’s providing users with exponentially more content that would help Yahoo’s long-declining engagement problem.

Sources said News Corp. and Disney have mulled scenarios where one or both companies hang on to the site, while Comcast has no control over Hulu’s fate, having given up its management rights to the site as a concession to federal regulators.

But the strength of the Hulu brand is clear and it has had some success in building a more significant business. While a lot of its video offerings are free, about four million people are paying for a Hulu Plus subscription.

Still, Hulu’s strength might be lagging, especially given after talented founding leader Jason Kilar recently left. Last year, Hulu was a top 10 video site, according to comScore. No longer — in a report in March, it had dropped out of the top 10.

While this likely has more to do with methodology than real decline in Hulu ratings, it does show that while it’s the biggest thing Yahoo could buy or invest in, Yahoo itself has plenty of video views, many more than Hulu.

The question for Mayer then is how much of Yahoo’s multi-billon-dollar cash kitty she wants to bet on a big video play. She might also be considering buying several smaller ones, said sources, with Yahoo having also looked at some smaller video sites, including Blip and Grab Media.

A spokeswoman for Hulu declined to comment and Yahoo PR has not responded to a query for comment (if ever).

The European Commission said Motorola’s actions ultimately harmed consumers, after the company sought court injunctions against Apple over the use of its patents, instead of properly licensing the technology to its rival. Motorola now has eight weeks to reply to the so-called statement of objections.

Read the rest of this post on the original site »

Most notable was Apple’s hit, dropping the company’s share price under $400 for a brief moment — the lowest point since December of 2011 — before rising and hovering just above the $400 mark. Apple’s dive came after multiple negative reports for the company, including a Digitimes report claiming iPad mini shipments could tumble in the June quarter due to lack of demand.

Apple is expected to miss its estimates in its upcoming quarterly earnings report, come April 23.

Cirrus Logic, one of Apple’s components suppliers, noted on Wednesday that it will record a net inventory reserve of $23.3 million for the fourth quarter, citing lower volume of one of the company’s top product shipments as an unnamed customer transitions from one component to another in its products. Investors pounded its stock, sending shares down almost 14 percent.

Apple wasn’t alone in its dip downward on Wednesday afternoon. Shares of Facebook were trading off almost 1.5 percent at around $26.50, while the usually well-performing LinkedIn was down as much as four points at $178, a 2.5 percent drop, before regaining some ground.

Google was also trading down around 1.5 percent this afternoon, following recent news that software giant Microsoft had reached a licensing agreement with Foxconn parent company Hon Hai, which from now on will pay royalties on every Android and Chrome device manufactured by one of its companies.

The Dow was off about 1 percent overall on Wednesday afternoon.

Hewlett-Packard, the world’s leading PC manufacturer, fell by more than 2 percent in the wake of a disappointing earnings report from chipmaker Intel. Cisco Systems fell nearly 2 percent. Chipmaker Advanced Micro Devices fell by more than 1.6 percent. Salesforce.com fell by more than 1 percent.

Google took a hit of more that 1.5 percent this morning, dropping more than $12 to trade at close to $780 per share.

“We are pleased that the list of companies benefitting from Microsoft’s Android licensing program now includes the world’s largest contract manufacturer, Hon Hai,” Horacio Gutierrez, corporate VP and deputy general counsel of the IP group at Microsoft, said in a statement.

The agreement between Microsoft and Hon Hai effectively means that any Android or Chrome devices — such as handsets or notebooks — created by manufacturers in the Hon Hai group will require royalty payments to Microsoft.

“We recognize and respect the importance of international efforts that seek to protect intellectual property,” Samuel Fu, director of the Intellectual Property Department at Hon Hai, said in a statement. “The licensing agreement with Microsoft represents those efforts and our continued support of international trade agreements that facilitate implementation of effective patent protection.”

Google has long fought Microsoft’s claims that parts of the Android and Chrome software infringe on Microsoft’s vast collection of intellectual property holdings.

But a number of other hardware manufacturers — like HTC, Samsung, LG and more — have already signed licensing agreements with Microsoft to pay royalty fees for each Android or Chrome device manufactured.

New version of a similar story: Hulu’s corporate owners still aren’t sure what they want to do with the site. But they are starting to hear from would-be buyers, anyway.

One of those potential purchasers is Ross Levinsohn, who worked hard to buy Hulu when he was running Yahoo in 2011.

Now Levinsohn is working for Guggenheim Partners, the $160 billion fund manager that owns the Los Angeles Dodgers and media assets like the Hollywood Reporter, and industry sources say he has talked about buying the site again.

Other companies that have kicked tires — or indicated an interest in kicking tires — include Yahoo and Amazon, sources say.

No prospective buyer has made anything like a formal offer, though. And no one can buy anything until Hulu owners Disney and News Corp. (News Corp. also owns this Web site) figure out a plan for the video hub.

They’ve been trying to do that for a couple years, and in the interim there have been some significant changes at the site. Last year early backer Providence Equity Partners sold its stake, and in January CEO Jason Kilar announced his plan to depart.

But Disney and News Corp. still haven’t agreed on whether the site should focus on an ad-supported model or a subscription one, and while both have talked about buying out the other partner, those discussions are still “fluid,” according to people familiar with the negotiations. (Comcast’s NBCUniversal also owns a stake in the site, but gave up its management role a few years ago in a concession to federal regulators.)

And just like 2011, the key issue for any Hulu buyer would be the content licenses Disney and News Corp. are willing to extend to an outsider.

In the past, the two companies were unwilling to offer long-term deals for their content, which meant anyone who bought Hulu was really buying a Web site and a chance to renegotiate for new content deals in a couple years — that is, they weren’t buying much.

Maybe that will change when and if Disney and News Corp. resolve their differences. If not, hard to see anyone buying the site this time around, either.

The verdict from a jury in the U.S. court for Texas’ Eastern District dealt a serious blow to VirnetX, a Zephyr Cove, Nev., company that uses its patent portfolio to seek revenue from licensing fees or court judgments. Most of VirnetX’s revenue has come from a $200 million settlement reached with Microsoft Corp. in 2010, according to research firm ISI Group.

Read the rest of this post on the original site »

“We’re fortunate enough that we got dealt an amazing card, and it’s called Cut the Rope,” Lyalin said of ZeptoLab’s hit series. “But we still have to build up everything else. With one card, you go into the game, and everybody has a hand, and you have nothing.”

That “everything else” includes two other games, Parachute Ninja and Pudding Monsters, which combined with Cut the Rope’s three titles have generated more than 300 million downloads across all platforms since 2010. The company also licenses enough merchandise to choke even Cut the Rope’s voracious star, Om Nom: Toys, apparel, food, board games, a digital comic book and an ongoing animated Web series.

And that list is growing. In an interview with AllThingsD, Lyalin said ZeptoLab is planning four new games for this year: Two new Cut the Rope games and two completely original titles. The company is also working with Sony Pictures Television to develop a TV show, to start airing in 2014.

(Also coming soon to a TV near you: A half-hour animated TV series based on Zynga’s social game FarmVille, not to mention Rovio’s Angry Birds TV shorts, a few of which have already aired on Nickelodeon. Whether the new generation of videogame-related shows can live up to the artistic excellence of the “Super Mario Bros. Super Show” remains to be seen.)

The CEO declined to go into detail about the TV show, other than to say that it would be Cut the Rope-themed.

Lyalin said these sorts of licensed products are now a part of the expected path for game companies that have a hit on their hands.

And that’s telling. Once, the iconic games that were able to command extensive lines of merchandise were only available on a few devices approved by their publishers (think Mario on Nintendo’s consoles or Sonic on Sega’s). Now, stuffed Om Noms are both an extra revenue stream and a form of advertising for the Cut the Rope brand, which freely follows users across different devices and different operating systems.

However, Lyalin stressed the need to keep releasing new games above all else.

“We’re a gaming company, first and foremost,” he said. “That is where our strength is from.”

So, where are those games headed? With its fans primarily on mobile devices, ZeptoLab hasn’t yet tried to break into the troubled home-console market, but Lyalin said he hasn’t ruled it out. In particular, he said, Android-based game consoles (such as the forthcoming Ouya) are “a given,” since the company’s games are already on the Android OS.

His bigger philosophy, though, is refreshingly frank, if not terribly complex: A lot of platforms where ZeptoLab might go won’t survive. But, Lyalin said, if they can attract an audience in the short term and potentially expand Om Nom’s reach, then that’s enough.

The company’s strategy is to gather enough intellectual property around LTE in one pool that device makers can go to to license technology for their products.

However, many big names — and important LTE patent holders — still aren’t on the list. Some key holders, folks such as Ericsson and Qualcomm, are unlikely to join, since licensing is an integral part of their business.

But Via hopes to get enough of the rest of the big patent holders to make its pool attractive to device makers.

Via won’t say if any companies have actually yet licensed the patents.

Although China Mobile and Deutsche Telekom aren’t seen as among the top holders of LTE-related patents, Via hopes they could inspire others to sign up.

Via Licensing CEO Roger Ross said that he is hopeful that companies such as Huawei, LG or Apple might decide to join the patent-licensing pool.

“I don’t want to be overly optimistic,” he said, but added, “I think we are going to get some of those very large patent holders.”

In a ruling issued late Monday, U.S. District Judge James F. Holderman held that the aggressive licensing strategy used by Innovatio IP Ventures LLC against Cisco customers is protected by the U.S. Constitution. Companies such as Innovatio, more formally known as patent-assertion entities, buy up patents and seek to earn money from them through licensing and litigation.

Read the rest of this post on the original site »

According to CEO Thorsten Heins, RIM is not married to the idea of OS exclusivity, nor is a deal to license BlackBerry 10 beyond the realm of possibility. In other words, nothing is off the table, and the company is keeping its options open. “The main thing for now is to successfully introduce BlackBerry 10,” Heins told Die Welt. “Then we’ll see.”

This isn’t anything new. It’s a variation on what Heins has been saying for months now with varying degrees of specificity. Last June, he even volunteered a theoretical scenario. “You could think about us building a reference system, and then basically licensing that reference design, have others build the hardware around it — either it’s a BlackBerry or it’s something else being built on the BlackBerry platform,” Heins said.

Then, in an August interview with the Telegraph, Heins appeared to be sketching out just what a BB10 licensing model might look like. “We don’t have the economy of scale to compete against the guys who crank out 60 handsets a year,” he said. “To deliver BB10, we may need to look at licensing it to someone who can do this at a way better cost proposition than [we] can do it.”

A few weeks later, Heins made an even more definitive statement. “QNX is already licensed across the automotive sector,” he said, referring to platform on which BB10 was developed. “We could do that with BB10 if we chose to. The platform can be licensed.”

Now, none of these remarks are confirmation that RIM will license BB10. But they’re a pretty clear indication that it would do so if the right financial and strategic incentives were there — and if there were a willing licensee, of course.

But to find a willing licensee, BlackBerry 10 must first prove itself in the market. And ensuring it does so successfully is RIM’s priority at the moment.

“Thorsten Heins has made it very clear that we are focused on the delivery of BlackBerry 10, which we will launch with events around the world on January 30th,” RIM spokeswoman Amy Jones told AllThingsD. “As he said on our most recent results conference call on December 20th, we continue to examine all available options to ‘create new opportunities, focusing on areas where we will be more effective partnering rather than going it alone, and ultimately maximizing value for all stakeholders.’ We do not have anything new to report on our Strategic Review at this time.”

Netflix will be able to stream complete previous seasons of several Warner Bros.-produced shows, including several that debuted this season, starting a couple of months after each season ends. These include “Revolution,” a hit show on NBC, and less successful shows such as “666 Park Avenue,” which ABC recently canceled. The deal also includes “The Following,” whose premiere episode won’t air until later in January on Fox.

Read the rest of this post on the original site »

The jury found that Apple’s iPhone infringed three patents related to mobile-device technologies owned by MobileMedia Ideas LLC. Two of those patents came to MMI from Nokia and the third from Sony.

Read the rest of this post on the original site »

The dust-up between the two companies involves a 2003 licensing agreement that allowed RIM to use some of Nokia’s standards-essential patents. The BlackBerry maker insists that Nokia’s Wi-Fi patents were included in that deal, reasoning that they should be part of any agreement related to standards-essential patents. But in Nokia’s mind they were not, and the two companies soon began sparring over the issue. Last year, they went into arbitration. And now the tribunal that heard their arguments has determined that Nokia’s Wi-Fi patents were not covered by that 2003 agreement.

This is a huge problem, because RIM is already selling a bunch of hardware that uses them, and has been for years. And now Nokia has filed cases in the U.S., Britain and Canada to enforce the arbitrator’s ruling.

An unfortunate turn of events for RIM, and one that couldn’t come at a worse time. The company is scrambling to launch a new platform and portfolio of handsets that it hopes will help it regain traction in the market it helped pioneer. To have those devices — and its current ones, as well — suddenly pulled from major markets would be a crippling blow.

Which is not to say that RIM is without options here. It could attempt some sort of workaround. It could fight things out in court. Or it could simply roll over and pay the licensing fee Nokia is asking. Of the three, the last seems the most likely option, given the circumstances. As Jefferies analyst Peter Misek told AllThingsD, “We think RIM has to settle, likely a royalty rate of $2 to $5 per handset …”

RIM and Nokia declined comment.

Maybe, but not archrival Samsung, which says that just because HTC managed to resolve its long-running legal dispute with Apple doesn’t mean that it’s interested in doing the same.

Asked today if Samsung might follow the trail blazed by its Taiwanese competitor, J.K. Shin, head of Samsung’s mobile and IT division, said, “We have no such intention. … HTC may have agreed to pay 300 billion won (US$276 million) to Apple, but we don’t intend to [negotiate] at all.”

Bold words from a company that was ordered by a U.S. jury in August to pay Apple $1.05 billion in damages for illegally copying some features from the iPad and iPhone. Samsung, of course, has appealed the ruling. And at this point, it has little to gain from a settlement. It’s slugging it out with Apple in more than 10 countries. And with this battle dragging on, it can continue selling its allegedly infringing devices for some time.

The networking-equipment maker has captured the attention of patent experts and lawyers across the country by filing strongly worded legal claims against two companies that buy up patents and seek to make money from them through licensing and litigation.

Read the rest of this post on the original site »

Matt Chatterton

“We’re pleased that the court has dismissed Apple’s lawsuit with prejudice,” Motorola said in a statement to AllThingsD. “Motorola has long offered licensing to our extensive patent portfolio at a reasonable and non-discriminatory rate in line with industry standards. We remain interested in reaching an agreement with Apple.”

An Apple representative declined to comment. The company is seeking to have the dismissal made “without prejudice,”–a legal term that essentially means that the matter could be heard later.

The suit is one of many legal disputes raging between Apple and Google, and within the broader mobile industry. This one was set, in part, to perhaps determine what might constitute fair and reasonable licensing terms by which Apple could license Motorola’s industry-standard wireless patents.

Microsoft and Motorola have a similar question set to go before a Seattle federal court next week. The Federal Trade Commission is also said to be weighing whether to sue Google over the handling of such patents.

In one of the other high-profile battles, a San Jose, Calif.-based jury ordered Samsung to pay Apple more than $1 billion over various patents related to its Android-based devices. Samsung has vowed to fight the verdict, as well as any injunctions against its products.

According to sources close to the situation, Yahoo will officially close the multi-billion-dollar sale of half its assets in China’s Alibaba Group in one week.

Sources said the deal is set to be announced next Wednesday, in which the Chinese Internet giant will pay the Silicon Valley company $7.6 billion to buy back 20 percent of Alibaba. Yahoo still owns another 20 percent.

Yahoo will get $7.1 billion in the transaction, as well as a $550 million payment related to the ending of licensing fees that Alibaba has paid annually to Yahoo.

It’s a huge return from when Yahoo co-founder Jerry Yang led a $1 billion investment in the then-fledgling Alibaba seven years ago, with a belief in its CEO and co-founder Jack Ma.

But once-cordial relations between the companies became tense in the ensuing years, as Ma sought to lessen Yahoo’s 40 percent ownership.

After many public kerfuffles, Yahoo finally agreed earlier this year to sell half its stake. It still holds 20 percent, which could eventually reap even larger returns once the fast-growing Alibaba goes public in several years. Yahoo is required to sell 10 percent at that IPO and must sell the rest after that.

Still, Yahoo is getting a pile of money now. After taxes, that gives new CEO Marissa Mayer about $4.5 billion to use in some as yet undetermined way. But it will most likely be for a series of acquisitions to try to reinvigorate the long-troubled company.

Yahoo’s board and later its CFO Tim Morse had promised to return the money to shareholders by way of a stock buyback. But, last month — in a move that quickly depressed Yahoo’s shares and angered major investors — the company filed a statement saying that Mayer was reevaluating that move and could keep the money for other strategic reasons.

Given what a huge windfall it is getting, it will be interesting to see if the board of Yahoo — which is meeting next week, sources said — will choose to return a portion of the Alibaba money to shareholders. A recent similar move by AOL — using money it got from selling patents — was partially the reason for the recent run-up in its stock.

Yahoo could also presumably also give a special dividend to shareholders, but that is less likely.

That will be the question once Yahoo gets its cash in the kitty, which is no small feat.

The complicated transaction spans the globe, given the size of the borrowing — $8 billion, which will value Alibaba at $43 billion — that the company is doing to regain some control from Yahoo. The deal includes debt, as well as the sale of both convertible preferred and common shares, and includes a wide range of players.

That includes current investors, such as Silver Lake, DST Global and Singapore’s Temasek Holdings, as well as many others.

“This is a lot of money flying around the world to complete this,” said one person close to the situation.

Speaking of more money, it’s still unclear where Yahoo is in its long and very drawn out negotiations with its other Asian partner, SoftBank, over selling its stake in Yahoo! Japan.

Sources said the deal was proceeding well right before Mayer was hired, but that she slowed down the talks to reevaluate the prices being discussed. Since then, shares in Yahoo! Japan have appreciated strongly, while shares in Yahoo itself have lagged.

It’s a good thing that Yahoo has both its Asian assets — the value of them now makes up most of the company’s valuation.

Until, of course, Mayer figures out a way to turn the money Yahoo is getting into more gold.

An Alibaba spokesman declined to comment and Yahoo’s PR spokeswoman never speaks as per usual.

CEO Jeff Bezos should take the stage shortly after 10:30 am PT to begin the presentation.

Speculation is running wild about what Amazon plans to announce. Rumors range from an updated e-reader to new color tablets that rival the iPad to a video box for the living room. Some speculate that Amazon may even unveil the smartphone it is believed to be developing.

What we know for sure is that the retailer will be showing off a new line of e-readers, including one with an electronic ink display that lights up to make reading easy in the dark. Amazon will also announce an update to the year-old Kindle Fire tablet, the details of which are entirely unknown.

Regardless, the event will be a defining moment for Amazon, which is still primarily known for shipping goods in the mail, and for selling music, video and books electronically. 

By hosting the event today, Amazon gets a week in the spotlight before Apple debuts its next-generation iPhone..

Earlier:
10:13 am: Taking our seats and getting ready for the announcements. First celeb sighting was Jon Rubinstein, current Amazon board member and former Apple and Palm exec.

Ina Fried and I are here to give you all of the updates as they happen.

10:25 am: It has been almost five years since the original Kindle came out, and a year since the Kindle Fire was announced onstage. The devices are getting progressively smaller, sleeker and more functional. If history is any indication, we’ll see more progress on both of those fronts.

The presentation is expected to begin at 10:30. Right now, we’re just sitting back under the glow of blue lights.

10:36 am: While you’re waiting: Amazon jumped the gun yesterday and provided a glimpse of some of its new devices in a TV commercial that ran during the NFL season opener.

Interestingly, the company’s hardware inspiration comes out of Labs126, its research and development facility in Cupertino, Calif. That’s essentially the same neighborhood as another large phone and tablet maker.

10:42 am: Lights just went out, and we are seeing the commercial that aired last night.

And, Jeff Bezos, founder and CEO, is now onstage, saying thank you for joining us in Santa Monica.

“I hope you enjoyed the new TV spot, and I hope it conveys the spirit of Amazon. We love to invent. We love to pioneer. We even like going down alleys that are blind alleys.”

Bezos is now reading emails that he gets from customers. This one is from Ryan, about how much he loves Amazon Prime, the $79 subscription service that provides free two-day shipping and access to video. “You keep adding more, but not charging more. So, thanks again for all the additions.”

Back to Bezos: “Last year, there were more than two dozen Android tablets launched, and no one bought them. Why? Because they are gadgets, and people don’t want gadgets anymore. They want services.”

“Kindle Fire is a service.”

10:47 am: He’s going on about all the services they offer, like the Kindle Lending Library, which allows you to borrow books for free.

“Hardware is a critical part of the service; it’s absolutely essential.”

He’s showing a chart for Amazon book sales over time, versus Amazon Kindle book sales. The Kindle book-sales line is like a hockey stick, versus a much less vertical, but still rising, line for the company’s original book business.

10:50 am: Amazon is playing a video, showing off the new Paperwhite device, using first-person stories from customers.

Announcing Kindle Paperwhite: A smaller, sleeker-looking cousin to the Kindle Touch.

Bezos lists the features: 25 percent more contrast, 212 pixels per inch, and 62 percent more pixels. The device has a new capacitive touch (old models had infrared). Essentially, there’s a ton of technology packed into that very thin device.

10:56 am: Bezos is demonstrating all the new features, which Ina has written about here. One cool one is that in the bottom left-hand corner, you can see how much time is left before the end of the chapter. The minutes are calculated based on your own reading speed.

Most important of all, the price: $119. Order today, and it ships Oct. 1. With 3G, it’s $179, and that also ships Oct. 1.

Bezos said they are keeping the old Kindle Touch, which was $79. Now they are going to price it at $69, and it ships Sept. 14.

Bezos: “People are going to love these.”

So, to recap, the new Paperwhite at $119 or $179, and the new Kindle Touch at $69.

I’m assuming that all of these will come with “offers,” but that hasn’t been mentioned yet. But customers are quite willing to sign up for offers in exchange for a cheaper device.

(Here’s more on the technology behind the Kindle Paperwhite.)

11:03 am: Bezos says that their publishing group is working: “Could we invent something to help, another route to find readers? It’s called Kindle Direct Publishing. (Authors) publish for free, they keep their rights, and they receive way more royalties.”

Another video with authors describing their experiences. Lots of stories about being rejected, and about how traditional publishing houses don’t gamble on new authors.

A huge round of applause for all the KDP authors in the audience today.

11:07 am: A funny thing about media, Bezos says. Magazines work, and books work, but what about stuff in the middle? He says that works, too, with the invention of Kindle singles: 3.5 million have sold, 35 reached have reached the Kindle Top 50, from authors like Stephen King. Now there are Kindle Serials, which will include paying once to get all future episodes as authors write them.

Amazon is starting with eight titles, like “Downward Facing Death,” a yoga-themed murder mystery. Bezos jokes, “I think that will be a whole new genre.”

To kick off the program, they’ll be reissuing two Dickens books in the same serial format in which they were originally published.

11:11 am: Talk turning to Kindle Fire.

11:11 am: Bezos says: We are keeping the Fire, doubling the RAM, making it 40 percent faster, plus adding longer battery life. It’s $159, and ships Sept. 14. That’s down from the $199 original price.

This year, we want to have the best tablet at any price, says Bezos, emphasizing “any.”

Announcing the Kindle Fire HD in two sizes.

“We decided to go big!” Bezos says. “Our large display tablet is an 8.9-inch display. It’s stunning.”

A true wide polarizing filter, which is more expensive, but totally worth it, he says.

There’s 25 percent less glare because of some fancy laminated touch sensor, which was more expensive, “but totally worth it.”

Because an HD tablet requires larger-sized files, you have to seek balance. “You want balance, proportion. It all has to work together cohesively.”

Bezos says it’s going to be smooth and snappy because of great processing power. What about good sound? They’ve added dual stereo speakers. “Is it harder? You bet.”

This is the first tablet with Dolby Digital Plus. It’s the same one in high-end living-room systems.

No one likes to wait for stuff as it buffers. Wi-Fi is crucial, and other tablet makers aren’t paying enough attention to Wi-Fi.

11:18 am: The 2.4 GHz band has been around forever, and it’s gotten incredibly crowded. Amazon has added 5GHz, which is much cleaner because it’s not crowded with baby monitors and cordless phones. They’ve also added two antennas.

There’s one more really state-of-the art technology. It’s MIMO (multiple-input and multiple-output). The example: If you are shouting at a friend in a mountain pass, it’s difficult because of the echo. What MIMO does, you can turn the echoes upside down, and turn it into an opportunity.

We are talking about really big nerd stuff now, oh boy!

The summary: Kindle Fire HD will be the first tablet to have MIMO.

He’s comparing it to new iPad and the Nexus 7. The iPad does have two bands for Wi-Fi.

That’s 41 percent faster Wi-Fi, and 54 percent faster than the Nexus 7. If you are going to have really big HD content, you have to have this, Bezos says.

Bezos is now addressing storage. For an HD device, eight gigabytes is dead on arrival. “We are starting Kindle Fire HD at 8GB.”

But invention doesn’t stop at the hardware, he says. Now we are getting to content: They’ve added thousands of audiobooks.

Now there’s Whispersync for voice, which allows you to start a book on one device, and then pick it up where you left off on another.

11:27 am: Going to require some new rights from publishers, I think.

Samuel L. Jackson is reading an audio book to the audience to show off bimodal reading. It’s sort of like karaoke; you listen to the audiobook while following along in the book.

Another new feature: X-Ray for movies. Something that would have been impossible without IMDb as part of the Amazon family.

And games: I’m amazed by how many games we’ve sold on the Kindle Fire. There’s one very annoying thing about games. You get 30 levels, and then, for whatever reason, you have to reinstall, and you lose all your levels. “We thought we’d solve that with Whispersync for games.”

Connectivity: We put a dedicated team on Microsoft Exchange, and we’ve built the best exchange integration of any tablet. Facebook built a custom app for us. Skype built a custom app to take advantage of the front-facing camera.

11:30 am: Bezos said he has four kids, and parents have the strange notion that they should do something else, like go outside. He’s talking about the negotiation. To help, they’ve built Kindle FreeTime. You can set separate time limits for different things. Unlimited time for books, but 30 minutes for TV, and 30 minutes for apps.

Demo time!

Enough talking. Bezos is showing off how fast and smooth it is to scroll left and right, past images of books, albums, magazines and apps.

The user interface doesn’t look at all like the original Fire, and definitely nothing like Android. He’s showing off “The Hunger Games” movie, and checking out the X-Ray feature to find out more about Jennifer Lawrence, who plays Katniss Everdeen. Did you know she was also in “X-Men” and “Winter’s Bone”?

A short music demo lets us hear the quality of the audio. Sounds great through the speakers here.

Bezos is now showing off Activision’s Skylanders, which he says Amazon worked closely with Activision on.

He taps on a treasure chest in the game, and it’s for a physical toy — delivered by Amazon — but he is also getting a virtual character in the game.

11:41 am: While not very sexy-sounding, fast Wi-Fi is super important. Original Kindle owners love the convenience of 3G, and yet there’s really no great way of packaging 3G together with tablets for large files, like movies and music. Perhaps providing very good Wi-Fi will be a way that Amazon will continue to deliver the best experience possible.

Now for the most important part of the announcement: The price. The seven-inch with 16GB HD tablet will cost $199. It ships Sept. 14.

The 8.9-inch device is $299. That one will ship in November.

Bezos addresses the elephant in the room. How can they offer these prices when Apple charges so much more?

He says the Amazon doctrine calls for customers to get the best price possible.

“How does this philosophy apply to hardware devices? It’s simple: We want to make money when people use our devices, not when they buy our devices. That is better alignment. If someone buys one of our devices and puts it in a desk drawer and doesn’t use it, we don’t deserve to make money.

“For example, we don’t need you to be on the upgrade treadmill. We are happy that people are still using Kindle 1s that are five years old. That’s good for us.”

11:50 am: Bezos says that the most popular price point for a tablet is $499. He says: “There’s so much room. What else could we add?”

The only thing that could justify that price would be the ultimate tablet feature: 4G/LTE wireless.

This is an unbelievable amount of work. The modems for 4G would not fit in our 8.8mm package, so we had to engineer our own modems. It’s dual-antenna, all 10 bands.

Kindle Fire HD with 4G LTE is only $499 with 32GB. But what about the data plan?

For 150MB of data access a month from AT&T, and 20GB of cloud storage from Amazon, it costs $50 a year.

It ships Nov. 20, and you can order today.

We aren’t building the best tablet at a certain price; we just built the best tablet at any price. We want to have the best hardware, the best content, the best interoperability and the best customer service.

11:55 am: That’s it for the formal presentation. Just to recap, there was no phone, no big, splashy content deals — as some thought, based on the L.A. location.

The focus was all on the Kindle Fire HD. It’s coming in two sizes, and is a much more refined product compared to the one rushed out last year. What’s more, it starts to solve connectivity issues. People want the device and the access without the big data costs.

Amazon is clearly willing to sacrifice its margins for providing that. In return, it is betting that it will see more usage, which is what it saw with the original Kindle and how much more customers read when they had constant access to more books.

12:00 pm: That’s it for the liveblog. Ina and I are now heading out to get our hands on the products, so stay tuned for more coverage.

Update: Here’s Ina and the Wall Street Journal’s Greg Bensinger going over the highlights of the event:

Red Robot’s Co-Founders Pete Hawley (left) and Mike Ouye (right) standing in front of the company’s booth at PAX.

“Gamers are lazy,” said Pete Hawley, Red Robot Labs’ co-founder and chief product officer. “You can’t expect them to get off the couch.”

A year ago, the Mountain View, Calif., company attended the Penny Arcade Expo (a.k.a. PAX) in Seattle to launch its first game, Life is Crime. That weekend, three Red Robot employees hustled to make the convention a virtual game board, getting attendees to virtually commit more than 20,000 “crimes,” in addition to hospitalizing more than 1,000 people and stealing $35 million from real places.

The company is back at PAX this weekend with a much larger presence — 15 employees. It also secured a very small kiosk, which you practically need a map to find, given its far corner location behind Sony’s massive PlayStation booth.

But despite the company’s larger presence on the show floor, location-based gaming is still in its infancy, with many of today’s concepts still centered around checking into locations, like Foursquare. But Red Robot co-founder and CEO Mike Ouye said the company believes that there will be a much larger opportunity in the future for what they call “playing the planet.”

This year, Red Robot is here to show off its new fantasy game, Life is Magic, which will be launching soon for free on Android and iOS. In the fantasy land, players pan around a map of the U.S. to discover dungeons, where they must fight monsters. To purchase armor or new weapons, they virtually visit shops that exist in the real world, even if the stores — say, Best Buy or a candy shop — wouldn’t normally sell those items.

Given what Red Robot has learned over the past year, the game has two elements that the company believes are very important.

The first is to make it appear as if the player is in an actual fantasy land, while using real-world geographic data. Red Robot Labs does not use Google Maps. Rather, it has taken some of the underlying data found on maps, like lakes, rivers and mountains, and then places a fantasy-land overlay over that. Players may still feels like they are in Seattle because of the geographic layout, but also like they have escaped to a different land.

The second important aspect of the game is solving for gamer laziness.

In Life is Magic, players can travel to anywhere in the U.S. — without actually getting on a plane, taking a bus, or walking. Even if they aren’t really at the Starbucks on the corner, they can still interact with other players there. But the farther away the player goes from their real-world location, the more energy points they will need to conduct a task (those energy points can either be earned or purchased).

“It’s less about where you are, and more about where you can go,” Hawley said, given that 50 percent of mobile gaming happens in the home.

Ouye added that Red Robot is also licensing its technology to other game developers, including its maps, 3-D rendering capabilities, and points-of-interest database. Ultimately, he envisions having enough data from those games to make a “location interest graph.” A location interest graph would be able to reveal such data as the most popular app or the best gamers for a given area.

Three companies are currently licensing Red Robot’s technology, and the company has two internal games in the pipeline that will launch by the end of the year, including Life is Magic.

Red Robot has raised $15.5 million in capital from an impressive list of investors, including Benchmark Capital, Shasta Ventures, Rick Thompson, co-founder of Playdom, and Chamath Palihapitiya, a former Facebook executive.

In an interview with The Telegraph earlier this month, RIM CEO Thorsten Heins said the company is investigating different options for licensing BB10.

Now he’s gone ahead and suggested to Bloomberg that the company has determined that it is indeed possible to license the OS the same way it does the QNX platform on which it was developed.

“QNX is already licensed across the automotive sector — we could do that with BB10 if we chose to,” Heins said. “The platform can be licensed.”

That’s as definitive a statement on the BB10 licensing issue as we’ve heard yet. And while it’s certainly not confirmation that RIM will license BB10, it’s a pretty clear indication that it plans to — assuming it can find someone interested in licensing it.

And that’s the likely purpose of this steady string of licensing patter appearing in the media: A fishing expedition for possible licensees. After all, who might possibly be interested in the as-of-yet unreleased and unproven OS? Nokia has cast its lot with Microsoft’s Windows Phone OS. And Motorola, Samsung and HTC have all cast theirs with Google’s Android OS. Both platforms have broader and stronger app ecosystems than RIM’s.

That’s the word from Jefferies analyst Peter Misek, who believes that RIM’s strategic review will culminate in a decision to license its BB10 operating system, and that Samsung is the company most likely to be interested in licensing it.

“Given recent management comments in the press, it now appears that RIM is realizing what Wall Street has been saying for some time: they are a subscale manufacturer and desperately need a partner,” Misek wrote in a note to clients. “We believe RIM is attempting to revive discussions with Samsung regarding a BB10 licensing deal.”

That’s a bit of a leap, but not an entirely unreasonable one. Just last week, RIM CEO Thorsten Heins acknowledged that licensing BB10 was an option under serious consideration at the company.

“We don’t have the economy of scale to compete against the guys who crank out 60 handsets a year,” Heins said. “To deliver BB10, we may need to look at licensing it to someone who can do this at a way better cost proposition than [we] can do it.”

But is that “someone” to which Heins refers most likely to be Samsung? Misek certainly thinks so — and this isn’t the first time he’s floated the theory. It’s his view that Samsung, through an acquisition of RIM, would gain access to the company’s vast subscriber base and a means of tempering its dependence on Google’s Android OS.

“We believe Samsung is considering ramping up its internal OS [operating system] development efforts, licensing BB10, or buying RIM,” he wrote. “We think any acquisition is unlikely until after BB10 launches.”

Reached for comment, Samsung dismissed speculation that it’s interested in RIM for any reason. “Samsung Electronics has not considered the acquisition of Research in Motion or licensing BB10,” a company spokesperson told AllThingsD.