Business

Former Microsoft CTO builds an iPad-exclusive app

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This is a pretty interesting story, one that goes beyond the headline. Former Microsoft CTO Nathan Myhrvold did indeed build a beautiful cooking app, bypassing Android and, more notably, the Surface, to focus exclusively on the iPad. Makes sense to me. Android is a tough nut to crack and the iPad has that beautiful Retina display.

But there’s more to Myhrvold than that.

In addition to crafting culinary literature, Myhrvold cofounded Intellectual Ventures, a patent acquisition and licensing business that’s earned him the pejorative of “patent troll” from his critics over the past decade.

Yup. Those guys. Here’s a link to the wiki page. Hard to reconcile these pieces. Microsoft CTO, founder of Microsoft Research, founder of IV, and cooking genius who loves the iPad. Who’da thought?

The PS4 is about to make one giant leap forward

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Watch this demo. Ignore the silliness and focus on the quality and content of the demo. To me, this is a huge step forward in bringing forward thinking technologies from the lab and niche apps into the mainstream. The interesting stuff comes in at about 1:20. The app is called Playroom and is built-in to the PS4. The down side is that it requires the PS4 camera (a $60 add-on).

The cynics among you will dismiss this as a ploy to sell the camera (the Xbox One equivalent is included in the box). Perhaps. But no matter the motive, this is still some mighty cool tech.

Renault’s remotely brickable car

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When you buy a car, you expect it to come with a battery. Not with Renault’s new electric Zoe. You have to rent the battery. And, supposedly, if you don’t pay the monthly rental fee, Renault can remotely prevent your battery from charging.

It’s part of a larger product strategy through which the Zoe collects huge amounts of data on your driving and ships it all back to the manufacturer.

I can’t imagine this strategy being successful. Who would buy into this scheme?

Jony Ive book looks good, just lighten up on the marketing

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I think the world of Jony Ive. When I heard that Leander Kahney was working on a book about Sir Jonathan, I got excited. But this marketing approach is over the top. Watch the video trailer below. It ends with this line:

Did we give credit to the wrong guy?

Yeesh. Big splash of cold water. The book deserves better than this.

Samsung admits guilt, but huge gap on what they offer, what Apple asks for

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Last fall, Samsung was found guilty of infringing on five Apple patents. We’re now at the start of the patent damages retrial.

This is what Apple is asking for:

Apple is seeking $113 million in lost profits for 360,000 iPhones the company believes it could have sold without competing against its own work, another $231 million in improper profits collected by Samsung on its own sales, and $34 million in patent royalties for the intellectual property Samsung infringed, a total of $379 million.

And this is what Samsung proposes:

Samsung argued that it earned “nowhere close” to $3.5 billion on the infringing devices, instead stating that it earned only $52 million. “And that, he says, is what Apple should get in damages,” Mintz reported. Additionally, Samsung proposed paying Apple nothing for lost profits and just $28,000 for patent royalties.

Obviously, this is a negotiation. You wouldn’t expect Samsung to play this any differently. Time will tell.

Evan Spiegel, the 23 year old face of Snapchat

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It’s rare for someone to fly under the radar from startup to a billion dollar valuation. Even rarer for a founder who is only 23 years old. Snapchat was started by Stanford students Evan Spiegel and Bobby Murphy in September 2011, in Spiegel’s father’s living room. Spiegel has emerged as the face of Snapchat.

A lot has been written about Snapchat’s supposedly turning $3 billion from Facebook. The headline link takes you to an example. To me, more interesting is the video below, a September 2013 interview with Spiegel at Disrupt SF:2013. Amazing how much Spiegel has matured in just 6 months. He clearly has been getting some excellent advice from his handlers. The big question for Snapchat is, can they turn the corner and generate revenue?

iPad Mini now on sale, not for in-store pickup

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Ran a little Twitter survey this morning. The new Retina mini appears to be available for purchase now in the US, Australia, Canada, Singapore and throughout much of Europe. That’s who I’ve heard from so far. Poll results show shipping in 1-3 days for the WiFi model, 5-10 days for the cellular model, though Belgium, Denmark, France, Luxembourg, Netherlands, Spain, and Switzerland show shipping as 5-10 days for both models. The models range from 16GB up to 128GB.

In the US online Apple Store, as of 6:30 am ET, the 16GB and 32GB WiFi-only models show as ready to ship in 1-3 days and everything else is marked to ship in 5-10 days.

Amazon and USPS to offer Sunday delivery

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This is huge news, both for Amazon and for the US Postal Service. Starting with LA and New York, Amazon Prime customers will now get package delivery on Sundays at no extra charge.

Amazon prime customers – who pay a $79 annual charge – will now be able eligible for free two-day shipping on millions of items, and can receive their packages on Sunday. The company announced on Monday that it has teamed up with the U.S. Postal Service and plans to roll the service out to a large portion of the U.S. in 2014 including Dallas, Houston, New Orleans and Phoenix.

USPS has really been struggling, with 7 consecutive quarters in the red.

The semi-independent government agency has suffered in recent years with the introduction of email and the drop in sales from stamps as well as a 2006 congressional mandate to prefund up to 75 years of its future retirees’ health care.

Earlier this year, Postmaster General Patrick Donahoe made pleas to lawmakers to allow the financially troubled Postal Service to switch to a five-day delivery schedule for first-class mail in an effort to reduce costs to return the organization to financial stability.

Package deliveries – which was never part of this plea – continues to grow and Donahoe said in the press release on Monday that the Postal Service is very happy to offer shippers like Amazon the option of Sunday deliveries. Research on the websites of rivals FedEx and UPS suggest that the two companies do not currently offer a Sunday delivery service. Both were not immediately available for comment when contacted by CNBC.

The internet and e-commerce have been tremendously disruptive to the Postal Service. This plan will help the USPS find a financial model that allows them to prosper instead of fade. A real win/win.

The evolution of the iPhone

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Interesting infographic. Take a look, see if it all looks right to you, then read the comment below it.

BlackBerry board rejects break-up proposals from Apple, others

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According to Reuters, BlackBerry’s board has had discussions with Apple, Microsoft, Cisco, Google, Lenovo and others about selling BlackBerry intellectual property, similar to the patent purchases from bankrupt Nortel back in 2011.

An ex-employee’s perspective on Amazon and the “profitless business model” fallacy

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Eugene Wei worked for Amazon from 1997-2004. The linked blog post explores Amazon’s push for revenue growth while forsaking profits, at least for the short term.

Does Amazon lose money on sales of some individual items? For sure. The first Kindle ebooks that were priced at $9.99 when Amazon had to pay more than that per copy to publisher were one example. Giant, heavy electronics items that Amazon sometimes ships for free when the shipping cost is clearly non-trivial and cost more than the usual thin margins on such goods are another.

But those represent a tiny fraction of the whole:

The vast vast majority of products Amazon sells it makes a profit on. Over time, more of these products that inadvertently sell at a loss will be corrected so that no longer happens, and what remains will be products Amazon intentionally uses as loss leaders.

And then there’s Marketplace sales:

The platform of Amazon is profitable, too. When other people sell products on Amazon Marketplace the gross margin is huge. I sell a used book on Amazon, it takes a cut of the transaction, I am the one packing and shipping that item to the buyer. You don’t have to be a financial whiz to understand the cost of that transaction to Amazon is minimal.

If Amazon tends to make money on the vast majority of its transactions, why doesn’t it generate boundless profits?

Because Amazon has boundless ambition. It wants to eat global retail.

Given that giant mission, Amazon has decided to continue to invest to arm itself for a much larger scale of business. If it were purely a software business, its fixed cost investments for this journey would be lower, but the amount of capital required to grow a business that has to ship millions of packages to customers all over the world quickly is something only a handful of companies in the world could even afford.

Fascinating read.

Beautiful Kickstarter redesign of ice cream scoop

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Dr. Karl Ulrich, Vice Dean of Innovation at the Wharton School, is an ice cream scoop collector. He turned his attention to designing the perfect scoop, and I think he got it right.

The big picture on Samsung’s smartphone sales

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Thoughtful analysis on the nature of Samsung’s smartphone sales.

In a meeting with its concerned investors on Wednesday, the head of Samsung Mobile revealed numbers illustrating that the company sold fewer high end smartphones than Apple this year, and that only about a third of the company’s total “smartphone” shipments are of a class really comparable to the iPhone.

This is a problem for Samsung. They are seeing the beginning of market saturation for their high-end smartphones, are relying on older/lesser model sales to bolster revenues. With minimal exceptions, all of Apple’s phone sales are high-end smartphones. And that’s where the margins are. Hard for Samsung to keep this going, especially without making inroads on battery life and processing power (still no 64-bit devices).

Lots to absorb, worth a read.

Apple to build sapphire glass manufacturing plant in Arizona

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Apple is repurposing this First Solar facility to create sapphire glass:

Apple will build a new 700-employee manufacturing facility in Mesa, Arizona, to make sapphire glass, according to releases from the State of Arizona and GT Advanced, a New Hampshire-based materials manufacturing company. Apple purchased the vacant manufacturing building from First Solar, and has contracted with GT Advanced to “own and operate furnaces and related equipment” at the facility.

Question is, how will Apple use sapphire glass. An alternative to Corning’s Gorilla Glass 3 for smart-phones? As a crystal for a smart-watch? Time will tell.

Nike Move+ app goes live, takes advantage of iPhone 5s M7 motion chip

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First shown off in October’s iPhone 5s rollout, the Nike Move+ app went live yesterday. If you’ve got an iPhone 5s, you can take advantage of the app to see where and how much you move during the day. I suspect this is the first of many such apps that will take advantage of the M7 motion coprocessor. Another marketing discriminator for the iPhone 5s.

BlackBerry scraps bid to find buyer, replaces CEO, gets $1 Billion investment

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BlackBerry has given up trying to sell itself on the open market, instead turning to debt sale to keep the doors open.

The company said that rather than bid for the company, Fairfax Financial will lead a group of investors pouring $1 billion into the troubled handset maker with its CEO Prem Watsa, becoming lead director. Former Sybase CEO John Chen will serve as interim CEO and executive chairman once the investment is completed, which BlackBerry said should be within the next two weeks.

Anti-hacking checklist for other folks in your company

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This is a useful starting point if your company does not yet have an anti-hacking security procedure in place. Even if you know every one of these, odds are good that there are plenty of folks you know who have never given these steps a first thought, let alone a second.

Any suggestions for additions/changes to the list?

T-Mobile and the confusing iPad rollout

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I applaud T-Mobile’s efforts to make their way into the already crowded iPhone and iPad space. But this iPad rollout just strikes me as ham-handed:

T-Mobile CEO John Legere tweeted today to clarify his company’s free 200MB monthly plans for iPads on its network. He reiterated that “everyone” gets 200MB of free data with no strings attached.

Earlier today, customers trying to buy iPads on T-Mobile were told they would have to pay a $10 monthly fee to access the “free” data, contradicting an offer from last week.

That is a sure way to squander any good-will gained. If your plan is to buy your way into the market using the iPad data plan as a loss-leader, then get the word out to your staff, make sure everyone is on the same page.

Apple consortium owned “Rockstar” goes after Google, others in patent war

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When Canadian telecom Nortel went bankrupt in 2009, there was a bidding war between Google and a consortium called Rockstar Bidco for more than 6,000 Nortel patents. Rockstar, which is owned by Microsoft, Apple, RIM, Ericsson, and Sony, won the auction for $4.5 billion.

This afternoon, Rockstar filed suit against Google for patent infringement. You can read the complaint here.

From the complaint:

On August 1, 2000, United States Patent No. 6,098,065 (the “‘065 patent”) was duly and legally issued for an invention entitled “Associative Search Engine.” Rockstar is the assignee of the ‘065 patent and has granted an exclusive license to NetStar, who holds all rights and interest in the ‘065 patent. A true and correct copy of the ‘065 patent is attached hereto as Exhibit A.

Google has infringed and continues to infringe the ‘065 patent by its manufacture, use, sale, importation, and/or offer for sale of systems, methods, products, and processes for matching search terms with relevant advertising and/or information based on those search terms and other user data, including but not limited to Google’s process of receiving search requests from a user, using its search engine to generate search results based at least in part on the search request, selecting—through Google’s AdWords and/or any other products, methods, systems, or services Google uses to store and choose relevant advertising—a relevant advertisement based on the search request and/or user data, and providing the search results together with the particular advertisement to the user; and additionally Google’s systems, methods, products, and processes of using other user data aside from the search request to help select the search result and/or advertisement; and additionally and alternatively its contributing to and inducement of others to manufacture, use, sell, import, and/or offer for sale infringing systems, methods, products, and processes in the manners described above. Google is liable for its infringement of the ‘065 patent pursuant to 35 U.S.C. § 271.

This is going to get messy.

Novel legal theory poses threat to patent acquisition firms

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Seven years ago, Intellectual Ventures paid $750,000 for a patent. They are now suing Symantec and Trend Micro for infringing the patent for about $310 million.

The two companies are asking a federal judge to bar IV from seeking such large licensing fees on the grounds that a patent acquired for so little couldn’t possibly be worth so much. That’s on top of more traditional arguments that Symantec and Trend Micro do not violate IV’s patents in the first place.

In court filings and at a hearing in August, Symantec and Trend Micro lawyers argued that the law prohibits IV from calculating such a high royalty. A patent license is, by definition, less valuable than outright ownership of a patent, Symantec and Trend Micro lawyers said.

If this argument succeeds, this will change the game for patent trolls, especially if the Supreme Court allows defendants in patent battles to recover attorney fees.

Apple’s R&D expenditures grew 32% in fiscal year 2013 to $4.5B

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If there’s one company in the world I want spending more on R&D, it’s Apple.

Apple’s investments in research and development continue to grow, surging another 32 percent in fiscal 2013 to reach $4.5 billion — its highest-ever sum spent in a 12-month span.

I see this growth as responsible (it’s in line with the increase in net sales) and a great predictor of innovation to come.

Claim forms emailed for iPad 3G unlimited data lawsuit

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Yesterday, emails went out to all customers who ordered a 3G-enabled iPad on or before June 7, 2010:

If you purchased or ordered an iPad with WiFi + 3G on or before June 7, 2010, you could be entitled to $40 from Apple under a class action settlement.

Note the use of the word “could”.

You may be entitled to a $40 payment from Apple under a settlement that has been reached in class action lawsuits titled In re Apple and AT&T iPad Unlimited Data Plan Litigation. The United States District Court for the Northern District of California authorized this notice. The Court will have a hearing to consider whether to approve the settlement so that the benefits may be provided.

You may be entitled to a $40 payment. Here’s the claim:

The lawsuits claimed that iPad 3G purchasers were not provided with access to an “unlimited” data plan in the manner originally advertised. Apple and AT&T deny all allegations and are entering into this settlement to avoid burdensome and costly litigation. The settlement is not an admission of wrongdoing.

And here’s the kicker:

You must submit a valid Claim Form by February 3, 2014. The Claim Form will require you to affirm that the ability to switch in and out of the “unlimited” data plan was a factor in your decision to purchase an iPad 3G.

I’ve seen this sort of language before, but I always find it a bit odd. I need to affirm that the ability to switch in and out of the unlimited data plan influenced my decision to buy an iPad 3G. I can honestly say, I would have bought an iPad no matter what. I guess there’s no $40 for me. Ah, well. Wonder who gets my $40.

iPad Air Geekbench scores show 90% multi-core score increase over last year’s model

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Pretty impressive results. John Poole, founder of Primate Labs, shared these thoughts:

The iPad Air’s A7 processor is running at 1.4 GHz, 100 MHz faster than the iPhone 5s’ A7 processor. It’s not clear if the iPad Air processor runs at a higher speed thanks to a larger battery (providing more power), a larger chassis (providing better cooling), or some combination of the two. I expect the new iPad mini’s A7 processor will run at 1.4 GHz as well.

The iPad Air is over 80% faster than the iPad (4th Generation), close to the 2x increase promised by Apple.

The iPad Air is over 5x faster than the iPad 2, yet is only $100 more expensive. I do not understand why Apple kept the iPad 2 around, especially at a $399 price point. What market are they targeting?

Mossberg, Darlin, and Pogue on the iPad Air

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Three reviewers, three positive takes.

Walt Mossberg reviewed the iPad Air for the Wall Street Journal:

In my tests, the iPad Air far exceeded Apple’s claim of 10 hours of battery life. For over 12 hours, it played high-definition videos, nonstop, with the screen at 75% brightness, with Wi-Fi on and emails pouring in. That’s the best battery life I’ve ever recorded for any tablet.

I’ve been testing the iPad Air for about a week and found it a pleasure to use. This new iPad isn’t a radical rethinking of what a tablet can be, but it’s a major improvement on a successful product. It is the best tablet I’ve ever reviewed.

That isn’t just because of its slimmer, lighter design, but because Apple boasts 475,000 apps optimized for tablet use—far more than any other tablet platform. (The iPad also can run all of the million or so apps available for the iPhone.) By contrast, the vast majority of apps available for rival Android tablets are just stretched versions of phone apps.

Damon Darlin reviewed the iPad Air for the New York Times:

It easily runs for 10 hours on a charge, just as Apple promises — despite the battery’s smaller size and the increased demands put on it. In my test of pretty heavy use, it downloaded and played three hourlong episodes of “Game of Thrones” and a few hours of music. I scrolled through Twitter and Flipboard, played games and perused the web. That’s almost a typical day for me and my iPad. It will get you through a normal day and then some with no worries.

The iPad Air also sports two antennas to pull in Wi-Fi signals faster than the old one did. Called MIMO for multiple-input and multiple-output, these antennas make a noticeable difference when your fast Wi-Fi signal is weakest, like in a back bedroom or the basement. (You’ll have to have a recent MIMO compatible router to see the magic, though.)

Finally, David Pogue reviewed the iPad Air on his Tumblr, as he makes the transition from the New York Times to his new digs at Yahoo. Pogue points out much of the same things, but also made this point:

This time around, there’s no gotta-have new feature—nothing on the level of the Retina screen, Siri voice recognition, or even a fingerprint reader (like the one on the iPhone 5s).

That big public yawn must drive Apple’s engineers crazy. The thing is, making the iPad smaller, lighter, and faster without sacrificing battery life or beauty is a tremendous achievement.

Of course, if you haven’t already, be sure to read Jim Dalrymple’s personal take on the iPad Air, too.

Stanford startup builds prototype circuit that doubles wireless bandwidth

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Currently, all wireless broadcasting uses two frequencies, one for transmit, and one for receive.

The underlying technology, known as full-duplex radio, tackles a problem known as “self-interference.” As radios send and receive signals, the ones they send are billions of times stronger than the ones they receive. Any attempt to receive data on any given frequency is thwarted by the fact that the radio’s receiver is also picking up its own outgoing signal.

For this reason, most radios—including the ones in your smartphone, the base stations serving them, and Wi-Fi routers—send information out on one frequency and receive on another, or use the same frequency but rapidly toggle back and forth. Because of this inefficiency, radios use more wireless spectrum than is necessary.

The technique behind the startup is similar to that used in sound canceling headphones.

To solve this, Kumu built an extremely fast circuit that can predict, moment by moment, how much interference a radio’s transmitter is about to create, and then generates a compensatory signal to cancel it out. The circuit generates a new signal with each packet of data sent, making it possible to work even in mobile devices, where the process of canceling signals is more complex because the objects they bounce off are constantly changing.

Not sure if this technology is a game changer all by itself. This is useful when there’s a lot of back and forth, but not so much when receiving or sending large chunks of data. But I suspect it represents the overall direction of WiFi and cellular evolution.

Why Apple’s first retail store in Brazil is such a big deal

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First, there’s the timing.

The opening of Apple’s first store in Rio de Janeiro will come just in time for the 2014 FIFA World Cup, which promises millions of tourists. Apple opened its first store in China in 2008 just ahead of the 2008 Beijing Olympics.

More to the point, opening an Apple Store in one of the economic centers of South America is a real challenge.

Several South American countries, including the two largest economies—Argentina and Brazil—heavily tax electronics that aren’t at least partially manufactured locally. The hope is that such taxes will coerce companies to set up local factories, but so far few have obliged. Apple has perhaps been the most stubborn of the lot; it makes no components of its products in the region. The result is that its devices suffer an enormous mark-up, between 60% and 70%. iPhones sell for as much as $3,500 in Argentina, and iPad prices are scarcely any more reasonable; South America is the worst place to buy an iPad.

Worth keeping an eye on the economics of this move.

The importance of a local paper

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Om Malik on the importance of keeping the local newspaper around. John Henry bought the Boston Globe. Jeff Bezos bought the Washington Post. Will the risk associated with billionaires owning a prominent local voice be balanced by the value of keeping those voices around?

Best Buy reportedly showing more than 30% return rate on Galaxy Gear watch sales

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A return rate greater than 30%. If this is true, that is a telling statistic.

Samsung has found that more than 30% of Galaxy Gear purchases are returned in Best Buy locations, and they have asked that Samsung employees on site help try to figure out why this is.

Read some of the reviews. Might be a clue there.