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2020-04-17T05:50:00.001+08:00

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BMW’s Bold Plan to Make a Fully Self-Driving Car by 2021

2016-07-02T06:11:00.000+08:00

AUTHOR: AARIAN MARSHALL.
DATE OF PUBLICATION: 07.01.16.
TIME OF PUBLICATION: 4:55 PM.

BMW, A COMPANY that prides itself on building “the ultimate driving machine,” plans to start producing fully autonomous vehicles by 2021 for ridesharing programs. Think of it as Uber for people who don’t like people.

This is a surprising move, given that the company has said essentially nothing about technology that everyone from Google to General Motors to Tesla is racing to develop. And it marks a radical departure from the slow-and-steady approach of the mainstream automakers, who see the technology rolling out slowly over the next two decades.

Still, ze Germans see themselves surging ahead by relying upon help from Intel and Mobileye, an Israeli firm that dominates the market for the cameras that are key to active safety features like collision warning and lane-keeping. The trio aims to standardize self-driving technology. “It is the only way to make this crucial next step a reality,” Ziv Aviram, co-founder and CEO of Mobileye, said in a statement.

Friday’s announcement was long on promises and short on details. There’s no word on where BMW will deploy the cars, which ridesharing platform it will work with, or what role Intel plays in the partnership. And BMW is well behind the competition, which is led by Google. The company’s fleet of two dozen or so fully autonomous vehicles logs 10,000 to 15,000 miles each week and has covered 1.3 million miles in all.

Still, BMW has a key partner—Mobileye and its comprehensive cartographic capabilities. Mapping is the key to making these cars work. A self-driving car with detailed maps can dedicate far more computing power to identifying and addressing things like cyclists, pedestrians, and other cars, in real-time. That’swhy TomTom still exists, and why BMW, Daimler, and Volkswagen chipped in to buy mapping company Here last year. These companies, and Google, map everything using LIDAR-equipped cars to record everything from the height of traffic lights to the exact location of curbs to the centimeter.

Mobileye relies upon artificial intelligence. Its cameras and systems use machine learning to process information about their surroundings and make complex, nearly instantaneous driving decisions just like human drivers. The system is constantly learning and improving, and cameras are far cheaper than LIDAR—that spinning bucket thing on top of Google’s cars costs about $80,000 right now.

BMW says its autonomous car will debut in geo-fenced areas—thoroughly mapped sites with defined boundaries. That’s more than a safety move. It allows the company to proceed in an uncertain regulatory environment while waiting for consumers to grow comfortable with the idea of robots doing the driving. Geo-fencing is a “scalpel for carving away the tricky areas,” says Edwin Olson, a researcher with the University of Michigan who works on Toyota’s autonomous efforts.

In other words, a controlled test bed for the ultimate riding machine.

Samsung’s Milk streaming music service now available through a free web client

2015-03-10T02:28:00.000+08:00

Michael Brown @brownieshq | Mar 9, 2015 9:00 AM

Samsung is celebrating the first anniversary of its Milk Internet radio service by a web browser client. You’ll still need a Samsung device to use the Milk app on a smartphone, tablet, or television.

The web-browser version eschews the app’s circular touchscreen control mechanism in favor of a more mouse-friendly linear slider. There are also keyboard shortcuts for most of the player’s functions, including volume control, station tuning, favoring a song, and banning one. As with the app version, you can display nine radio stations at once, choosing from 17 broad genres ranging from Pop and Hip-Hop to Rock, Classical, and World music.

The artist bios are displayed over versions of their album art.

You can narrow the focus of each station to bring it closer to your liking. The broader the category, the more splinters you can choose from. I don’t consider myself a country music fan, but I was able to find some great music by tuning into the Americana channel of that genre. I had 13 other variations to choose from, including Bluegrass, Ladies of Country, and Red Dirt Road. Having said that, Spotify’s web client isn’t as pretty or as easy to use as Samsung's, but its Folk & Americana channel offered up nearly 60 variations on that theme.

You can further fine tune a station by using sliders to adjust the mix of popular, new, and favorite tracks the station plays. Slacker—the service that "powers" Milk—has the same feature, with the added options of hearing from the station’s hosts as well as news and sports updates. Milk will also display the names of other artists it considers to be similar to the one you’re listening to at the time, but the names are just displayed—they’re not linked and you can’t even select them to cut and copy into a browser.

You can fine tune a radio station by configuring it to play more music that's popular and new in your genre, as well as tracks you've identified as favorites.

I’m not an LP aficionado—I’m too addicted to the convenience of digital music—but I do miss those big ol’ album covers. So I like the fact that Milk uses almost the entire display to show album art, with its user-interface elements overlaid on top but around the perimeter so they don’t obscure the image.

When you call up other elements such as the artist’s biography, you see other art from the album. Unlike most other streaming services, Milk doesn’t have much in the way of connections to your social networks. You can’t post the song you’re listening to on your Facebook page or Twitter feed, for instance.

The quality of the music, on the other hand, leaves something to be desired as it streams at just 128Kbps. Google Play Music, Rdio, Spotify, and some other services stream at 320Kbps.

Milk is free to use and is free of advertisements, but you’re limited to skipping six songs. Samsung also offers a paid version of Milk ($4 per month) that lets you skip an unlimited number of songs.

Editor's note: This story was updated to confirm that Milk Premium will be available to all subscribers, whether you own a Samsung device or not.

Michael Brown Senior Editor

Michael is the lead editor of IDG's TechHive property, which is focused on the connected-home and home-entertainment markets. He's an early adopter of connected-home technology, having built his own smart home in 2007, which he uses as a real-world test lab when reviewing new products. Michael also reviews home-networking products for TechHive and PCWorld.

Retina MacBook Air Announcement Expected At Apple’s March 9th Event

2015-03-05T02:40:00.004+08:00

By Adnan Farooqui on 03/04/2015

Last week Apple sent out invites to the media for an event on March 9th. It goes without saying that the spotlight will be on the Apple Watch, the first truly new product that the company has launched in years, and it still has a lot of information to reveal about the smartwatch. There were whispers previously that perhaps the much rumored Retina MacBook Air might be unveiled at this event as well. A new report published today reiterates those claims and says that the Retina MacBook Air will indeed be shown off at the March 9th event.

According to The Michael Report, which claims to have exclusively heard from sources familiar with the matter within Apple, that the company is going to unveil this notebook at the same event. The scribe says it has independently verified this information and finds it to be “highly credible.”

This latest information is in line with a recent prediction made by famed Apple analyst Ming-Chi Kuo who said that Apple will launch the Retina MacBook Air in the first quarter of 2015.

There have already been many rumors about the specifications of this notebook but nothing is known for sure right now. The rumor mill believes the Retina MacBook Air is going to have a very slim profile due to its fanless design apart from the high resolution display, which is obviously going to be its main selling point.

Filed in Apple >Computers. Read more about Apple Watch, macbook air

Apple reclaims top spot in movie product placement rankings

2015-03-05T02:37:00.005+08:00

By Roger Fingas

Wednesday, March 04, 2015, 08:54 am PT (11:54 am ET)

Apple has once again, after a three-year gap, taken the Overall Product Placement title in Brandchannel's Brandcameo Product Placement Awards, highlighting the companies inserted most often into Hollywood movies.

According to Brandchannel, Apple products appeared in nine out of 35 movies that topped US weekend box office in 2014, beating out Sony and Coca-Cola by a single film. References ranged in scale from a villain mentioning the iPod shuffle in The Lego Movie to an extended Apple Store scene in Captain America: The Winter Soldier.

Some other blockbusters with Apple products included Ride Along, The Fault in Our Stars, and Gone Girl. Prior to this year's victory, Apple previously claimed the award in 2009, 2010, and 2011.

Apple products also made their way into a number of movies below the first-place threshold as well, including Birdman, Sex Tape, Tusk, and Sabotage.

Product placement in films, television and other media can be controversial. While such placement helps to pay for movies that cost tens or even hundreds of millions of dollars, critics note that it sometimes distracts from the plot or even steers it in a different direction.

Brandchannel has in fact given its latest Worst Product Placement award to Apple's Beats brand for Transformers: Age of Extinction. In one scene, a character able to produce virtually anything with his mind specifically chooses to create a Beats Pill speaker.

Age of Extinction is in fact cited as having the most product placements of any 2014 blockbuster, numbering 55 brands in all. Runners up included Gone Girl (48), Ride Along (37), and 22 Jump Street (32).

Net Neutrality, the Mob and the Man

2015-02-27T19:22:00.005+08:00

Bill Rosenblatt Contributor | 2/26/2015 @ 11:21PM 479 views

The FCC's vote on Thursday to classify Internet service providers as public utilities was ultimately the result of overwhelming popular support on the Internet. In the end, popular support for net neutrality overwhelmed the lobbying efforts of the cable and telecommunications industries that tried to kill or weaken the regulations. This raises one very big question: why did the online public suddenly embrace what, not two years ago, was called “breaking the Internet”?

This behavior ought to scare people. The conventional wisdom has long been that government regulation of the Internet was a bad thing. When the media industry pushed for passage of the SOPA and PIPA anti-piracy legislation back in 2011-2012, massive outcry among the Internet population led to the bill’s rapid demise. Open Internet advocates cried victory, while media industry executives complained about “the mob” and alleged — not without evidence — that the whole thing was an orchestrated campaign among Internet companies like Google GOOGL +2.22%, Wikipedia, and Reddit.

The power of “the mob” to influence legislative and regulatory activity has been growing for years. A scholar and net activist named Bill Herman researched this for his PhD thesis at the Annenberg School for Communication at Penn in 2009. Herman looked at a series of legislation about digital copyright, such as the Audio Home Recording Act of 1992 and the Digital Millennium Copyright Act of 1998, and he traced an arc of the increasing influence of online communication (as opposed to lobbying and the press) in determining the fate of these bills. He predicted that the online crowd’s overwhelming preference for looser copyright would eventually overpower the media industry’s lobbying machine — and he was right. Herman’s rigorous research brilliantly presaged the SOPA and PIPA defeats. It’s available as a book called The Fight over Digital Rights: The Politics of Copyright and Technology.

But this time around, the mob turned against Republican politicians and libertarian think tanks, and called for government regulation. When Sen. Ted Cruz’s grandstanded about the FCC reclassification of Internet services as “Obamacare for the Internet,” his Facebook page was bombarded with negative comments… from his supporters. Think tanks like the Cato Institute, often reliable partners of the tech industry, found themselves howling alone in the wilderness.

Why is this? There are two main reasons. First, not supporting “net neutrality” is like not supporting “freedom” or “peace” or “love.” Second, it’s always necessary to have a “man” to stick it to: this time it’s ISPs like Comcast, Verizon, and AT&T, companies that are even easier to hate than the movie studios and major record labels who were behind SOPA and PIPA. It’s all just a little too simple, especially given the complexity and ambiguity around an issue like net neutrality.

But seriously: since when are Open Internet activists in favor of government intervention? Why aren’t some of them speaking out against it on principle, even while touting net neutrality as an ideal? What happened to the dream of the Internet as something that renders nation-states obsolete? Maybe this is the real reason why Google, usually the 800-pound gorilla of the tech industry’s lobbying presence, decided to stay on the sidelines this time around. (In fact, Google and Comcast both contribute funding to TechFreedom, an obscure think tank whose position is that the FCC’s Title II reclassification breaks the Internet.)

People ought to be looking at what just happened and separating out the substance of the FCC regulation from considerations of why and how the Internet population got so much power and wielded it in what seems like a capricious manner.

For the record, I’m in favor of net neutrality, and I’m glad that the FCC ruled the way it did. I like freedom and peace and love, too.

Bill Rosenblatt runs GiantSteps Media Technology Strategies, a consultancy that focuses on digital media technology, business models, and copyright. Check him out on LinkedIn or Twitter.

WhatsApp makes web client compatible with Firefox and Opera

2015-02-26T19:51:00.000+08:00

Next time you have to access WhatsApp on your desktop, you won't need to fire up Chrome if it's not your preferred browser. The messenger's web client now works on both Firefox and Opera, giving you more choices on the computer, though you'll still obviously have to settle if you're a Safari fan.

That's pretty much all that's changed: the sign up process remains the same, so you will be prompted to scan a QR code with the mobile app in order to start using the web client like we mentioned when the product launched. Unfortunately, that also means iPhones still don't have the capability to scan that QR code (Windows Phone, BlackBerry and Android devices can), forcing faithful iOS users to stick to their mobile devices.

Source: WhatsApp (Twitter)
Tags: app, firefox, mobilepostcross, opera, whatsapp

Microsoft donates $1 million to help fund a tech exhibit at the US Diplomacy Center

2015-02-26T19:48:00.001+08:00

Microsoft Diplomacy

By Rich Edmonds | Thursday, Feb 26, 2015 at 4:27 am EST

Microsoft has donated $1 million to help fund the construction of a high-tech interactive exhibit at the US Diplomacy Center (USDC), which is set to open in Washington DC in 2017. The center itself will serve as a next-generation museum and education resource that will showcase areas surrounding American diplomacy.

Numerous Microsoft products will be on display at the USDC, including the Surface Hub, Skype Translator and Bing Maps. Microsoft essentially plans to "gamify" diplomacy with the hope to really bring exhibits to life and engage visitors. From peace talks to natural disasters, those who visit the center will learn and experience how the nation's diplomats engage in international diplomacy.

It makes sense for Microsoft to get involved, especially given how technology - much like diplomacy in many ways - aims to connect people distances apart. Interested to learn more? Head to the USDC website for more details.

Source: Microsoft

WSJ: YouTube isn't making money, even with a billion viewers

2015-02-26T19:45:00.003+08:00

by Timothy J. Seppala | @timseppala | 5 hrs ago

Despite "Gangnam Style" having over two billion views, hosting countless other viral clips and netting over a billion users per-month, YouTube can't seem to turn a profit. How's that? Well, after paying for the infrastructure that makes Google's video empire possible (and its content partners), The Wall Street Journal says that YouTube didn't contribute to Mountain View's earnings. The culprit, apparently, is that most users arrive at videos via links, rather than daily visits to the YouTube homepage where Google could charge a premium for ads. WSJ also reports that the site's reach isn't very wide either, with one source's estimate that nine percent of viewers account for a whopping 85 percent of online-video views. That makes it a much less appealing audience for advertisers than traditional TV programming, despite the outfit's increasing investment in original content.

Google's hoping that the Music Key subscription service, among other ideas, can hold the tide of red ink back and turn that sea black. Another method is with targeted ads, so you can get inundated with sales pitches for stuff you've recently browsed on Amazon. WSJ's sources say that those might be a bit harder to add than Google previously expected, though, and thankfully could take some time to roll out. At least there's some form of silver lining here.

Source: The Wall Street Journal

Tags: ads, google, hdpostcross, Internet, profit, StreamingVideo, video, WallStreetJournal, youtube

Microsofts pulling Facebook, Google chat from Outlook.com

2015-02-26T04:04:00.001+08:00

Ian Paul @ianpaul | Feb 25, 2015 6:05 AM

Pretty soon chats in Outlook.com are going to be all Skype, all the time. Microsoft is pulling the plug on Google Talk and Facebook chat in Outlook.com. The company recently sent out email notifications to Outlook.com users to let them know about the change.

Microsoft doesn’t explain why it has decided to end Facebook Chat integration. For Google Talk, however, Microsoft blames it on “Google’s decision to discontinue the chat protocol used by the Google Talk platform.”

Google started moving away from Google Talk in favor of Hangouts in May 2013—ironically the same month that Microsoft added Google Talk to Outlook.com. Unlike Talk, which uses the open XMPP protocol, Hangouts is proprietary and unavailable to multi-chat clients. However, Google has continued to support Talk and has yet to announce when it might shut down the XMPP-based service.

Facebook is also discontinuing its use of XMPP.

Microsoft added Skype integration to Outlook.com in August 2013.

Microsoft’s email to Outlook.com users about the end of Google Talk and Facebook chat integration.

The impact on you at home: Microsoft says the end of Google Talk and Facebook chat in Outlook.com will happen “within the next couple of weeks.” The end of third-party chat will not impact Microsoft’s People apps online, or in Windows 8.1 and Windows Phone. Microsoft allows users to integrate Facebook and Google accounts (among others) to add social updates and contact information from other services to your Microsoft contacts list.

All about Skype

To compensate for the end of Facebook and Google integration, Microsoft is encouraging users to switch to Skype. It’s hard to imagine anyone who is using Outlook.com wouldn’t also be a big Skype user. But users may have some contacts who are on Google Talk or Facebook and don’t use Skype.

For Microsoft, dumping Facebook and Google also highlights how valuable Skype integration is with Outlook.com. Not only can use the platform to send text chats, but also voice and video calls. That’s an important feature given that competitors, like Google’s Hangouts platform integrated into Gmail and Google Talk before it, offer similar features.

How to clear search and location history in Google Maps on the web

2015-02-22T14:17:00.003+08:00

DO NOT TRACK | BY ANDREW MARTONIK | Saturday, Feb 21, 2015 at 1:16 pm EST

It takes some time, but you can completely control the location history Google collects from your devices.

We've already covered how to remove individual locations and history items from Google Maps on Android, but when you need to access and manage all of your location history, you need to hop onto the computer. As the old saying goes, "knowledge is power" — and we're going to give you all of the tools necessary to know what information Google knows about your location, and how to clean it up or stop further reporting.

Accessing and managing your Google location history

First thing's first, you'll need to make sure you're signed into your Google account and go to the Google Location History dashboard on the web. On this page, you'll see every bit of history Google has logged for where your Google-connected devices have been located, so long as you have opted in to location reporting on the device.

Google Maps

You can go day-by-day through the history using the calendar on the left side of the screen, with the map on the right populating the information collected on that day. Red dots are places that your devices have been, and Google does its best job at coordinating timestamps to show where you moved throughout that day. If you have more than one Android device turned on with location reporting, your map will be far less useful for determining where you went — Maps thinks you constantly bounce back and forth between the location of the two devices.

If you don't want Google to remember data from a specific day or set of days, use the drop-down menu under the calendar to select a time period — 1, 2, 3, 5, 7, 14 or 30 days — and then click the Delete history from this time period link below it. A pop-up window will ask you to confirm, and explain that it may take up to 24 hours for the data to be deleted completely from the dashboard.

If for some reason you wish to delete all location data Google has from your devices — which may not be a bad idea from time-to-time if you want to keep things fresh — you can simply click the Delete all historylink on the left. Again you'll be asked to confirm, and it may take up to 24 hours for everything to be cleared out. But once you do it, Google will no longer have any of that data.

Double check your phone's location history settings

If looking at your location history is a bit of a shocking experience as to how much location data is being stored from your devices, you may want to consider looking at the location history settings on your devices. Though the interface may look slightly different depending on your phone, everyone can access the location history settings by going into their app drawer and opening the Google Settings app (it's a grey icon shaped like a gear). You can then tap Location, which will launch you into your phone's location settings screen.

Once there, look for an entry called Google Location Reporting and tap it. You'll then see all of your active Google Accounts on the device listed, and two entries under each: Location Reporting and Location History. You can turn either one or both off, but it's important to first understand what each one does.

Location Reporting is the service that lets Google know where your phone is right now, which will let Google apps like Google Now and Google Maps know roughly where your phone is so it can offer up location-based information. This feature is what helps you quickly get located on a map without first locking on GPS, or gives location-based information when you walk by certain stores or areas. If you were to turn off this setting your phone wouldn't give its current location to Google apps, but it will still keep that location history when you view it from the Google Location History Dashboard.

Location History is the setting that lets Google create a long-term log of places where your phone has been. When you have Location History turned on Google will aggregate location data of your device(s) and use it for things like commute time predictions in Google Now and better search results in Google apps. Location history is kept private and you can access it any time you wish, as we've shown above. You can turn off this Location History setting at any time without deleting your history, but if you wish to delete all location history you can do so from this setting or from the web, as we've shown.

Photoshop may be 25 years old, but it still manages to stay fresh

2015-02-22T14:03:00.001+08:00

By Les Shu — February 21, 2015

While Adobe is well known for its many different graphics applications, perhaps none is more famous than Photoshop. For creatives, medical professionals, and scientists, it’s the go-to digital imaging program. To the general public, it’s the software you use to superimpose a person’s head onto another’s body. In fact, the word Photoshop has become a verb that’s now part of our vernacular – even for those who have never used it. For Adobe, it’s the flagship that’s tied to the rest of its ecosystem of design programs. In fact, Photoshop as a brand may even be bigger than Adobe itself. This week, Adobe not only celebrates Photoshop’s 25th year, but also the anniversary of one of computing’s most important milestones. Among the celebratory activities to take place this year, the company is launching a new advertising campaign during Academy Awards on February 22, 2015 (Photoshop has been used in the film industry, starting with The Abyss in 1999, and in recent films like Avatar, Gone Girl, and How to Train Your Dragon 2), and is inviting young artists to participate in a Adobe Behance competition to showcase their Photoshop masterpieces.

The first boxed version of Photoshop. Inside were floppy disks and documentation.

Adobe Systems Inc.

So, how did this venerable computing program get to where it is today? As the story goes, Photoshop traces its roots to two brothers, Thomas and John Knoll. While studying at the University of Michigan in the late 1980s, Thomas, as a hobby, was writing a program that could display a grayscale image on a black-and-white monitor. Collaborating with John, who was then working in special effects at Industrial Light and Magic, they added tools and features that turned it into a digital image-processing program. Called Display, the Knoll brothers pitched it to Adobe in 1988, demoed the software’s editing features using an image called “Jennifer in Paradise” (Jennifer in the photo was John’s future wife); Adobe acquired the program in 1989, renamed it Photoshop, and released version 1.0 in 1990. Adobe thought it would sell 500 copies a month – not really anticipating it to be a moneymaker. Of course, Photoshop would not only go on to become lucrative, but it would become a de facto program used by anyone who needs photo-editing tools.

When Photoshop launched for Macintosh, the features included the Magic Wand selection tool, color correction, and level adjustments. As the program evolved, Layers was introduced in version 3, a revolutionary feature that allows users to edit and “make mistakes” while leaving the original image intact. Windows compatibility came in version 4, which opened the program to move users. But it wasn’t just photographers who embraced Photoshop.

Zorana Gee, Photoshop’s senior product manager, has been with the team since 2000. Like her colleagues, few leave the team because the “product has been so amazing.”

Adobe Systems Inc.

“We have so many ranges of people and industry types that use our products, from photographers to designers, down to astronomy and NASA, medical industries, forensics,” says Zorana Gee, senior product manager for Photoshop. Gee came to Adobe not as a photographer or designer, but with a science background and using Photoshop to create research publications. “Basically, you name it, any industry that has to deal with digital imagery has used Photoshop in some way. Even to this day, for me, I am still continually shocked and surprised by how people use Photoshop.”

As the years went on, Photoshop continued to add features that accommodated the demands of users’ every-changing workflows, such as the ability to save to Web as more users were moving toward Web production. With every introduction of new digital cameras, Photoshop would be updated to support them. Recently, Photoshop added support for 3D printing and tools like smart content selection, camera shake reduction, Focus Mask, and Perspective Warp. Looking ahead, it’s adapting to mobile devices. Interestingly, the most popular tools used today are the same tools that were introduced in the beginning, Gee says. And, if you’re looking for a way to slim down a person in an image or crop a head and put it onto another person’s body, Photoshop is still the way to go.

Digital imaging manipulation is commonplace today, but we take for granted how complex and time consumer when things were analog. “In the photo retouching world, a lot of the fundamental techniques we do in Photoshop, you were able to do in the darkroom – dodging, burning, even some basic swapping heads and putting on another image, and things like that,” Gee says. “People spent hours, if not weeks and months, figuring those things out – we just made it faster and easier to do.” Which puts into perspective why Photoshop was so revolutionary in the early 1990s.

Skip ►

While the Photoshop team has grown since the Knoll brothers (Thomas is still with Adobe), surprisingly, it’s relatively small at around 50 people – given Photoshop’s scope. Gee, who has been on the Photoshop team since 2000, says many of her colleagues, including Adobe’s creative director, Russell Brown, have been working on Photoshop since the beginning (click here to watch the first four Photoshop pioneers – the Knoll brothers, Brown, and Steve Gutman – talk about the beginnings, five years ago). For Gee, she has stayed with the team because “product has been so amazing,” she says.

“We don’t have a lot of movement,” Gee adds. “We have a lot of developers who have been here since the beginning, and they continue to stay here for many of the same reasons.”

Russell Brown, Adobe creative director, showing the new software to attendees at Adobe’s 1990 Photoshop Invitational. Adobe didn’t have high expectations for Photoshop at the beginning, thinking it’d only sell 500 copies a month.

Doug Menuez/Stanford University Libraries/Contour by Getty

Photoshop isn’t – and was never – the only photo-editing option, but it continues to retain users, due in part to new enhancements, familiarity, and, as Gee puts it, Photoshop’s early start in the game. With users dedicating so much time to learn it (the program has a steep learning curve) and the resources to run it (it’s a power-hungry application), it’s understandable why users would stick with it. But a big reason why users stay with Photoshop is that it has every tool one needs to design whatever it is he or she wants to make.”

“It’s a blessing and a curse, the fact that Photoshop does so many things,” Gee says. “But it’s a toolbox that has every tool that you need.”

“Any industry that has to deal with digital imagery has used Photoshop in some way.”

However, as creatives are increasingly adopting mobile devices in their workflow and using smartphone cameras to capture images for publication, Adobe has had to adapt, creating various apps (many bearing the Photoshop name, but are different from the main program) and opening a software development kit (SDK) to third-party app developers. Adobe has also launched a lower-price Photoshop subscription (Adobe has moved its programs to a cloud-based subscription model, and no longer sells as boxed versions) in an effort to attract a new group of users, as there are plenty of photo-editing tools – many of them free or built into operating systems, desktop software, and mobile apps – available to them. It’s engineering challenges like these, Gee says, that Photoshop will work on in the next few years.

“We are taking advantage of the many new opportunities presented to us,” Gee says. “With multiple devices, we are thinking about Photoshop in a different way, in being able to access the technology from whatever device it is that you are on.

“Going forward, it’s really about proliferating the brand and the technology and the workflow in the platform that makes sense for our customers,” Gee adds. “Aside from the 25 years, our engineers are really excited about the cloud [because] it’s getting them to rethink Photoshop.”

But for an application that has seen major transitions in its 25 years – analog to digital photography, print to Web publishing, desktop to mobile computing – adaptation may be Photoshop’s biggest strength.

Zuckerberg’s Wealth Soars $3.8 Billion as Facebook Surges

2013-07-26T14:12:00.002+08:00

By David De Jong - Jul 26, 2013 2:01 AM GMT+0400

Mark Zuckerberg’s fortune soared $3.8 billion yesterday as shares of Facebook Inc. (FB), the world’s most-popular social-networking service, rallied 30 percent to the highest level since May 2012.

Surging demand for mobile advertising helped profit and revenue top analysts’ estimates in the second quarter Wednesday. The earnings may quell concerns, voiced by analysts and investors since Facebook’s initial public offering last year, that the rising popularity of smartphones and tablets is outpacing its ability to make money selling promotions to mobile users.

Enlarge image

Mark Zuckerberg, chief executive officer of Facebook Inc., in Menlo Park, California. Photographer: David Paul Morris/Bloomberg

1:02

July 25 (Bloomberg) -- Emily Chang reports on today's top news headlines on Bloomberg Television's "Bloomberg West." (Source: Bloomberg)

“Very few people saw the pace at which the entire activity of the planet’s Internet connectivity was going to move toward mobile,” said David Kirkpatrick, author of “The Facebook Effect,” a history of the company, in a telephone interview. “It’s clearly under way now.”

The gain pushed Zuckerberg, Facebook’s 29-year-old co-founder and chief executive officer, ahead of Microsoft Inc. CEO Steve Ballmer and Dell Inc. (DELL) chairman Michael Dellon the Bloomberg Billionaires Index. Zuckerberg is No. 42 on the ranking with a net worth of $16.8 billion. His fortune is up 37 percent year-to-date.

Revenue rose 53 percent to $1.81 billion in the latest quarter, the company said in a statement Wednesday. Profit excluding certain items was 19 cents a share. Analysts had projected profit of 14 cents on sales of $1.62 billion on average, according to data compiled by Bloomberg.

Boosted Projections

Facebook closed at $34.36 in New York yesterday. The Menlo Park, California-based company traded at 149 times earnings as of today’s close, more expensive than 99 percent of the companies in the Standard & Poor’s 500 Index, according to data compiled by Bloomberg.

Analysts at Goldman Sachs Group Inc. increased their target price to $46 from $40, and at least 10 others also boosted projections, according to data compiled by Bloomberg.

“They’ve really done a 180-degree shift toward mobile, even if it was somewhat belatedly,” said Kirkpatrick.

In December, Zuckerberg donated almost $500 million in Facebook stock to the Silicon Valley Community Foundation. The gift to the nonprofit group, which had $2 billion in assets in 2011, is to “lay a foundation for new projects,” Zuckerberg said in a statement posted on his Facebook page.

The billionaire and his wife, Priscilla, have committed the majority of their wealth to charity.

Gates, Slim

Microsoft Corp. (MSFT) co-founder Bill Gates, 57, remains the richest person in the world with a net worth of $72.2 billion.

Mexico’s Carlos Slim, 73, is $5.5 billion behind Gates. The telecommunications tycoon’s fortune has plunged $8.5 billion this year as his main holding, a 44 percent stake in America Movil SAB, the largest mobile-phone operator in the Americas, has fallen 11 percent.

No. 3 on the Bloomberg ranking is Berkshire Hathaway Inc. (BRK/A) chairman Warren Buffett. Shares of the Omaha, Nebraska-based company are up 31 percent this year, elevating the 82-year-old’s fortune to $59.8 billion.

To contact the reporter on this story: David De Jong in New York at ddejong3@bloomberg.net

To contact the editor responsible for this story: Matthew G. Miller at mmiller144@bloomberg.net

Facebook Profit, Sales Beat Estimates on New Ad Formats

2013-07-25T05:13:00.001+08:00

By Douglas MacMillan & Brian Womack - Jul 25, 2013 12:34 AM GMT+0400

Facebook Inc. (FB) reported sales and profit that exceeded estimates as the operator of the world’s most popular social-networking service lured more advertisers to its mobile services, sending shares up as much as 19 percent.

Second-quarter revenue rose 53 percent to $1.81 billion, the company said in a statement today. Second-quarter profit excluding certain items was $488 million, or 19 cents a share. Analysts had projected profit of 14 cents on sales of $1.62 billion on average, according to datacompiled by Bloomberg.

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A pedestrian walks past the Facebook Inc. 'like' logo displayed on a sign at the entrance to Facebook headquarters in Menlo Park, California. Photographer: David Paul Morris/Bloomberg

Mobile made up 41 percent of advertising dollars in the second quarter, up from 30 percent in the previous period. Chief Executive Officer Mark Zuckerberg’s push to make advertising for smartphones and tablets a priority is starting to pay off, as users increasingly access Facebook on mobile devices.

“Finally the blowout quarter that Facebook bulls have been waiting for,” said Paul Sweeney, an analyst at Bloomberg Industries. “Among many impressive data points, I think investors will focus on the percentage of revenue from mobile of 41 percent, which was well above consensus.”

Shares of Facebook, based in Menlo Park, California, climbed as much as 19 percent in extended trading. The stock advanced 1.5 percent to $26.51 at the close in New York, leaving it down 30 percent since an initial public offering last year.

Mobile Push

Facebook is projected to take 13 percent of the global mobile-advertising market this year, up from 5.4 percent last year according to EMarketer Inc. Still, the company remains a distant No. 2 to Google Inc. (GOOG), which is expected to grab 56 percent of the market in 2013.

“This quarter represents a strong validation that we’re effectively navigating the shift to mobile,”David Ebersman, Facebook’s chief financial officer, said in an interview. “All the investments we’ve been making in the business have been paying off.”

Net income attributable to shareholders was $333 million from a loss a year earlier.

Facebook has stepped up efforts with its mobile services, including updates to its smartphone applications and a new video feature for photo-sharing service Instagram. Investors’ concern that the company wasn’t shifting its focus fast enough toward wireless devices weighed on the shares in the four months following its market debut.

The number of mobile users expanded 51 percent to 819 million during the quarter. The total number of Facebook members was 1.15 billion, compared with 1.11 billion in the earlier period.

Marketing Tools

Facebook is also making improvements to its advertising tools for marketers. The company said last month it intends to cut its 27 ad units by more than half, making the promotion-buying process more simple and efficient.

The social-networking provider has been wooing more large advertisers. In April, Facebook won back General Motors Co. as a customer almost a year after the automaker said it was pulling ads off the service.

“They’re getting better on their execution in the business of selling advertising,” said Martin Pyykkonen, an analyst at Wedge Partners in Greenwood Village, Colorado. “There’s a long way to go, but things are going in the right direction.”

To contact the reporters on this story: Douglas MacMillan in San Francisco at dmacmillan3@bloomberg.net;

Brian Womack in San Francisco at bwomack1@bloomberg.net

To contact the editors responsible for this story: Pui-Wing Tam at ptam13@bloomberg.net;

Nick Turner at nturner7@bloomberg.net

Kazuo Okada Under Criminal Investigation, U.S. Says

2013-04-10T14:34:00.002+08:00

By Edvard Pettersson & Yuki Yamaguchi - Apr 10, 2013 8:31 AM GMT+0400
Related video: http://www.bloomberg.com/video/henry-sy-sr-from-sardines-to-53rd-richest-man-s10GHw1ASESlLc_W6RgPag.html

Universal Entertainment Corp. (6425) Chairman Kazuo Okada faces a U.S. criminal investigation related to his Philippine casino project, sending the gaming company’s shares down as much as 18 percent.

The U.S. asked to intervene in a lawsuit brought by Wynn Resorts Ltd. (WYNN), which accused Okada of making improper payments to Philippine gaming regulators. The Justice Departmentsaid in an April 8 filing in state court in Las Vegas that it doesn’t want the civil case to disrupt its criminal investigation into the same underlying allegations.

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Kazuo Okada, former director of Wynn Resorts Ltd. Photographer: Jerome Favre/Bloomberg

Okada has pushed to expand in the Philippines where the government is setting up a new casino center that would compete with Macau, where Wynn Resorts gets most of its revenue. Okada, who became a billionaire selling machines for Japanese pachinko parlors, won one of four provisional gaming licenses awarded for the Manila hub in 2008. New resorts could help the Southeast Asian nation’s gaming market expand five fold to $10 billion by 2017, its chief regulator estimates.

Wynn Resorts last year forcibly redeemed Okada’s 20 percent stake in the Las Vegas-based company and sued him for breach of fiduciary duty. Okada, who resigned as a director of Wynn Resorts in February, was being probed by the U.S. Federal Bureau of Investigation regarding his Philippine casino permit, the Asian country’s gambling authority said in January.

Wynn Resorts gets more than 71 percent of its annual revenue from Macau, the world’s largest gambling hub.

Wynn’s License

The possible violations of the U.S. Foreign Corrupt Practices Act by a controlling shareholder could threaten Wynn Resorts’ gaming license in Nevada and other jurisdictions, the casino operator has said in court filings.

The Justice Department said in its filing that it contacted lawyers for Okada and Wynn Resorts about its request to halt evidence gathering related to Okada’s activities in the Philippines.

Okada’s lawyers have said they would probably oppose the request “in whole or in part,” according to the filing. Wynn Resorts won’t oppose its request, the Justice Department said.

The U.S. request to stay the case with regard to any overlap with its investigation is scheduled to be considered April 16 by Clark County District Judge Elizabeth Gonzalez, according to the court’s docket.

Shares Fall

Universal Entertainment, after falling as much as 18 percent to 1,620 yen, was trading at 1,681 yen at 1:28 p.m. in Tokyo today.

The company has been denying the wrongdoing, “so it hadn’t been fully reflected in the stock price,” Kenichi Hirano, general manager at Tachibana Securities Co. in Tokyo, said in a phone interview. The report on the investigation caused the stock to plummet, he said.

Michael Weaver, a spokesman for Wynn Resorts, and Michael Passman, a Justice Department spokesman, declined to comment on the government’s filing.

Nobuyuki Horiuchi, a Universal Entertainment spokesman, declined to comment on the filing, saying the company hasn’t yet confirmed facts. Eric Andrus, an outside spokesman for Okada with RLM Finsbury in New York, also declined to comment on the investigation.

The FCPA bars companies or individuals regulated or based in the U.S. from paying bribes to foreign officials to win business. Foreign companies and nationals also can be prosecuted if their corrupt acts were committed in the U.S.

$40 Million Payments

Universal Entertainment, based in Tokyo, said Feb. 5 that a third-party committee was investigating payments made through its U.S. unit, Aruze USA Inc., in the Philippines. The committee was looking at $40 million in payments, according to the statement.

The FBI is examining Okada’s pursuit of his Philippine gaming license, any tax benefits he received and the flow of funds involved, Cristino Naguiat, chairman and chief executive of the Philippine Amusement & Gaming Corp., the gambling authority, said in January.

The case is Wynn Resorts v. Okada, A-12-656710-B, Clark County District Court, Nevada (Las Vegas).

To contact the reporters on this story: Edvard Pettersson in Los Angeles at epettersson@bloomberg.net; Yuki Yamaguchi in Tokyo at yyamaguchi10@bloomberg.net

To contact the editors responsible for this story: Michael Hytha at mhytha@bloomberg.net; Stephanie Wong at swong139@bloomberg.net

Facebook Puts Pals First, Google Last: Rich Jaroslovsky

2013-04-10T14:21:00.003+08:00

By Rich Jaroslovsky - Apr 10, 2013 5:00 AM GMT+0400

Back when Microsoft was still Microsoft, it wouldn’t announce to its competitors, “We want to crush you.” Instead, its soothingly stated goal was to “embrace and extend” whatever the other guy was doing.

That’s what Facebook (FB) is trying with Facebook Home, the new software it’s launching this week for mobile phones running archrival Google’s Android operating system. Instead of taking on Google directly, Home aims to co-opt Android by covering it with a layer of Facebook content and services.

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Facebook Home is a sort of mega-app that provides its own user interface atop Android. Photographer: David Paul Morris/Bloomberg

2:09

April 10 (Bloomberg) -- Bloomberg's Rich Jaroslovsky reviews Facebook Inc.'s Facebook Home, the new software that creates a homepage for mobile devices running Google Inc.'s Android operating system. (Rich Jaroslovsky is a Bloomberg News columnist. The opinions expressed are his own. Source: Bloomberg)

I’ve been using the new software since last week and find it useful and attractive. At the same time, it’s somewhat overbearing in controlling how you interact with your phone.

Facebook Home is a sort of mega-app that provides its own user interface atop Android. For the time being, it has no advertising, but the company made clear that ads will be part of its future.

The software will be available for free from the Google Playstore April 12 and will also come pre-installed on some phones. I tested it on the appropriately named HTC (2498) First, which goes on sale in the U.S., also April 12, for $100 from AT&T. (T)

Cover Flow

The Home experience starts with -- and in many ways is built around -- a feature called Cover Flow that commandeers the home screen.

Instead of the usual Android interface, or the customized versions that manufacturers like Samsung (005930) install, you see a scroll of photos from your friends, with their latest status updates superimposed.

I enjoyed being able to quickly flip through a series of updates, registering Facebook “likes” simply by double-tapping the screen. Once in a while, I’d open a comment box to type out a quick message without the need to launch a separate Facebook app.

Meanwhile, I received a stream of notifications as friends registered likes of my posts or shared new links and photos.

This people-centric approach resembles the “live tiles” Microsoft features in its Windows Phone operating system. But on Windows Phones your friends’ activities are just one element of the home screen; on Facebook Home, they’re the only element.

Absent Apps

Where are all the Android apps?

They’re still there. But to get at them, you first have to tap your own picture on the home screen, then select Home’s app launcher. Not surprisingly, Facebook gets prominent placement here too, though you can add your own favorites as well.

While you can still summon a fuller display of apps with a finger swipe, the net effect is to diminish their importance by making them less visible and accessible. Facebook Home isn’t about running apps; it’s about running Facebook.

Even when you’re running another app, Facebook is never far away, thanks to an oddly named feature called Chat Heads. These are text-message alerts that you can read and respond to without leaving whatever app you happen to be using at the moment.

At least on my test phone, Facebook didn’t completely smother Android. For example, I still received pop-up notifications from my Google (GOOG) Now app about traffic conditions between my home and office.

Facebook Only

But it turns out I could only see those alerts because Home had been pre-installed on the phone I was using. Facebook says users who install it themselves on one of the phones that will support it -- Samsung’s Galaxy S3, S4 and Note 2, and HTC’s One, One X and One X+ -- will only receive Facebook notifications, not alerts from other apps.

In the end, Facebook addicts will probably love Home for the same reason that non-Facebook addicts won’t: its single- minded focus on interacting not with apps but with friends.

Whether and how much you’ll like it will be directly proportional to your level of engagement with your social network.

(Rich Jaroslovsky is a Bloomberg News columnist. The opinions expressed are his own.)

Muse highlights include Ryan Sutton on dining and Patrick Cole on philanthropy.

To contact the reporter on this story: Rich Jaroslovsky in San Francisco a trjaroslovsky@bloomberg.net. On Twitter: www.twitter.com/richjaro.

To contact the editor responsible for this story: Manuela Hoelterhoff atmhoelterhoff@bloomberg.net.

The Beatles vs. the Taxman: A Former Manager Recalls Yesterday

2013-03-25T08:10:00.000+08:00

By Eric Roston - Mar 22, 2013 11:38 AM GMT+0400

Hulton Archive/Getty Images

July 6th, 1964 -- Ringo Starr, Paul McCartney, John Lennon (1940-1980), and George Harrison (1943-2001) of the Liverpudlian pop group The Beatles with their manager Brian Epstein (1935-1967) at the premiere of their first film "A Hard Day's Night."

The small, framed photograph might not strike visitors to Peter Brown's Manhattan home as noteworthy. It features indiscernible figures lounging about a grassy estate under a high sun. But those figures -- which include the four Beatles, their significant others, plus their personal assistant Neil Aspinall and Brown -- are captured in repose at the peak of the band’s creativity and influence.

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Rock and roll band "The Beatles" performs onstage at the Cavern Club in February 1961 in Liverpool, England. (L-R) George Harrison, Paul McCartney, Pete Best and John Lennon. Photographer: Michael Ochs Archives/Getty Images

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The Beatles with music publisher Dick James in Studio 2 at Abbey Road in London, recording the single "She Loves You" on July 1, 1963. L-R Dick James, Paul McCartney, George Harrison, producer George Martin (in background), John Lennon (writing) and Ringo Starr. Photographer: Terry O'Neill/Getty Images

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The Beatles proudly show off their MBE (Member of the Order of the British Empire) awards at a press reception held at the Saville Theatre after an Investiture at Buckingham Palace, London on October 26, 1965. Photographer: Central Press/Getty Images

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The Beatles--clockwise from top left: Ringo Starr, George Harrison (1943-2001), John Lennon (1940-1980) and Paul McCartney promote their new album "Sergeant Pepper's Lonely Hearts Club Band." Photographer: John Pratt/Keystone/Getty Images

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Peter Brown, former Beatles manager, attends the $500,000 Simulate A Better World Challenge Winner Celebration at Brasserie 8 1/2 on October 10, 2012 in New York City. Photographer: Ben Hider/Getty Images

The picture was taken in July 1967 at Kingsley Hill, the country home of manager Brian Epstein in Sussex. The album Sgt. Pepper's Lonely Hearts Club Band had been released six weeks earlier. The single "All You Need Is Love," which the band had performed live three weeks earlier during the first global television broadcast via satellite, would be released in the U.S. within days.

The Beatles and their inner circle gathered for the weekend of July 15 to begin planning what to do with their wealth and their future, a rare undocumented moment in the band’s biography. The photograph shows a moment of tranquility, just before the storm clouds gathered. They would soon become aware of the many shortcomings of deals that had nonetheless made them rich. The band’s management agreement with Epstein was itself due to expire toward the end of the year. That increasingly weighed on him, though there was little reason to suspect they would drop him.

After its release on June 1, 1967, " 'Pepper’ had kind of exploded the world, and Brian was very conscious they had to have a plan for the future," recalled Brown, Epstein's assistant and friend, and later an executive of the Beatles’ company, Apple Corps. Ltd. "One of the problems was this enormous amount of money" in back royalties they were to get from EMI "and what should they do with it to avoid paying taxes -- prohibitive taxes -- on it."

The boys never got down to business that weekend. "I think they were proud of what they'd done, and it was a very special moment," said Brown, 75. It was meant to be a "a quiet weekend."

Within six weeks of snapping the photograph, Epstein, who had catapulted the Beatles from a popular, rambunctious Liverpool foursome to towering global celebrity, had died of an accidental drug overdose, at the age of 32. The act he had discovered was left rudderless; they knew virtually nothing about their own business affairs.

Brown, who is chairman and CEO of the strategic communications firm BLJ Worldwide, described his role in the Beatles empire in The Love You Make: An Insider’s Story of the Beatles, the bestselling 1983 tell-all he published with journalist Steven Gaines: "I supervised and conducted all of their business affairs, from getting their signatures on contracts to getting them out of jail. I helped marry and divorce them. On my desk was a red phone to which only they had the phone number, and locked in a desk drawer I kept their passports."

Brown had granted an exclusive interview to mark the 50th anniversary of the start of the Beatles recording career. The album Please Please Me was released on March 22, 1963. He and I met twice, in October and January.

My main question for Brown: What was the Beatles’ business model?

Looking back, two themes prevail: Doing whatever they could to get contracts, and doing whatever they could to make the most of tiny royalty percentages and avoid the U.K.’s "super-tax" on wealthy people.

And the answer? There was no business model.

"Everything we did was unknown territory," said Brown. His measured speech suggested an elder statesman. "What Brian did was unknown territory."

In the Beginning

Young merchant seamen who sailed from Liverpool, a port city of about 745,000 people in 1961, brought back firsthand encounters with popular culture abroad. "They used to come to America on the ships," Brown said. "So they heard rock and roll. They heard rhythm and blues. They heard country music. The knowledge that Liverpool had of the contemporary music scene in America was unique."

As manager of the record store his family owned, NEMS, Epstein catered to these relatively sophisticated tastes. Brown worked in the record department of a store across from Epstein's. The two became friendly, grabbing morning coffee at "elevenses," supper at night. Brown's employer had recently put him through a two-year business degree, an investment that still didn't move him to stay with the organization. He joined NEMS when Epstein offered him a 30 percent raise, plus commissions.

As legend and biographers have it, in October 1961, a customer dropped by the store to ask if they had a single, "My Bonnie," by the singer Tony Sheridan (who died in February), with a local band called the Beatles backing him. There were two more requests in the next couple of days. Epstein walked over at lunchtime on Nov. 9 to see their set at the dim, crowded Cavern Club.

"They smoked as they played and they ate and talked and pretended to hit each other," Epstein wrote in his 1964 autobiography, A Cellarful of Noise. "They turned their backs on the audience and shouted at them and laughed at private jokes." But they also gave off a "magnetism" that held sway over the crowd and himself. Instinctively, he ordered 200 copies of "My Bonnie" for his store.

Even then, Beatlemania was under way. The Beatles’ original drummer, Pete Best, put the beginning of the craze at Dec. 17, 1960, at the Casbah Coffee Club, which his mother had opened the previous year. "This was the first time the Beatles had played in Liverpool, seeing the audiences switch on to what we were doing," Best said in an email. "Rapturous applause and screaming girls. Every show becoming bigger than the last one was wonderful."

Propelled back for several visits -- "part sexual, part showman," as Brown and Gaines wrote -- Epstein decided he could manage them.

‘A Tough Contract’

Record executives didn’t share Epstein’s vision. Decca Records President Dick Rowe would become infamous for passing on the Beatles after they auditioned, on the assumption that guitar bands were on their way out. Later Beatles biographers have exonerated him, given the state of the band’s act in 1962. As a consolation prize, George Harrison later suggested Rowe look into a band in London he liked called the Rolling Stones, according to The Beatles by Bob Spitz.

George Martin of EMI’s Parlophone label saw how much work they needed. "I wasn’t particularly knocked out by what [Brian] played for me. I didn’t think a great deal of the songs or the singers. But I did think they produced an interesting sound," Martin told journalist Hunter Davies.

He was willing to sign them, but not with their current lineup -- namely with drummer Pete Best, who he felt wasn’t "regular enough" and didn’t "give the right kind of sound." Epstein fired Best and hired Ringo Starr (Richard Starkey), making them, respectively, the unluckiest and luckiest drummers in the history of humans hitting things with sticks.

Martin’s offer to Epstein was standard for the time -- and accordingly not a strong bet on the band’s future success. "It was a tough contract," Martin wrote in his 1979 book, All You Need Is Ears. In the first year, with an option to renew, it required that the band deliver two double-sided singles, for which the four musicians split three-quarters of a penny among them for every sale, while Epstein got 25 percent of a penny. Despite their tiny royalty percentages -- 18.75 percent of a penny per Beatle per sale -- they sold enough records within a year to become wealthy, about 6 million pounds (about $16.7 million) worth.

EMI’s profits shot up 80 percent. Beatlemania spread.

Taking Stock

Since Lennon and McCartney were writing their own songs, they needed a music publisher, which owns song copyrights and pays composers their royalties. Dick James Music set up a company, called Northern Songs, after the composers’ northern English origins, to publish these compositions. DJM owned 50 percent of the company, Lennon and McCartney were given 20 percent each, and Epstein’s management company, NEMS Enterprises, took 10 percent.

Brown said there was nothing wrong with it. But all things being equal, as he and Gaines wrote, "in literal terms, Brian signed over to Dick James 50 percent of Lennon-McCartney’s publishing fees for nothing. It made him wealthy beyond imagination in eighteen months."

These deals, and the others, and the lawsuits, that came after them, structured the Beatles' lifetime income -- and not necessarily happily. "We were desperate to get a deal," Paul McCartney said in the official compendium The Beatles Anthology, published in 2000. "Brian did do some lousy deals and he put us into long-term slave contracts which I am still dealing with. For 'Yesterday,' which I wrote totally on my own, without John's or anyone's help, I am on 15%."

Brown declined to discuss individual band members.

The top rate for British taxpayers in the mid-1960s reached 83 percent. The wealthiest among them paid a 15 percent super-tax on top of that, pushing taxes as high as 98 percent. The pain came out in the band's music. George Harrison opened his 1966 song "Taxman":

Let me tell you how it will be.
That’s one for you, 19 for me...
Should 5 percent appear too small,
Be thankful I don’t take it all.

As Lennon and McCartney racked up hits with their compositions in 1963 and 1964 -- "Please Please Me," "From Me to You," "I Want to Hold Your Hand," "She Loves You," to name a few -- and money started pouring in, it became clear that the songwriting profits would be siphoned away to the U.K.’s treasury if something wasn't done.

"They were the most famous people in the world, and they were making a lot of money, but they were not seeing any of it," Brown said. "So capital gains was the obvious route to go."

The London financial community wasn’t quite sure what to make of a company whose only assets were the songwriting potential of two Liverpudlian twentysomethings. Still, the profits looked good, and in February 1965 the London Stock Exchange quietly hosted the initial public offering of Northern Songs Ltd.

Five million shares were offered. Lennon and McCartney each received 15 percent, which was worth $640,000 at the time, according to The Love You Make. Dick James and his partner received almost $1.7 million worth. Harrison and Starr were awarded small percentages. Fans, many of them American, bought shares to get a piece of the Beatles.

Lennon and McCartney have never owned the Beatles song catalog outright. Today, music-publishing rights rest with Sony/ATV, a joint venture between Sony Corp. and the estate of Michael Jackson. The Beatles’ recorded music is owned by Vivendi's Universal Music Group, which purchased EMI last fall.

On the Road

The Beatles' first movie, A Hard Day’s Night, showed the band coping with the demands of Beatlemania in their native Britain. The second picture, Help!, went on location to Austria and the Bahamas, both because it was an adventure spoof and because working abroad they could avoid taxes.

Beatles tours were exercises in chaos. There was no infrastructure or services in place to support this scale of enterprise. They needed their own chartered planes. They played stadiums with tiny speakers.

When the group traveled to Munich, Essen and Hamburg, in 1966, "the German government gave us the royal train," Brown said, "the train which had been built for Queen Elizabeth’s tour of Germany, like, five years beforehand." That situation set off a spat over "who was getting the queen's bed," Brown laughed.

"Who got it?" I asked.

"John."

For Epstein, chaos was opportunity. "It became clear to Brian that if he and the boys were going to grab any money at all in what might be just a few fleeting moments of great prosperity, he had better grab it in cash, and cash meant touring," Brown and Gaines wrote. Epstein felt justified collecting paper bags of cash because of the river of money the Beatles were sending into the treasury through taxes on royalties, they wrote.

Chaos also meant lost opportunities. NEMS ended up initially giving away 90 percent of merchandise-licensing income to an American middleman, resulting in a catastrophic loss of income for the Beatles. That loss would be reduced through lawsuits, but by the time the controversy settled down, Beatlemania had peaked and the drama had scared off would-be manufacturing partners.

"Brian agreed that that was the worst thing he ever did," Brown said.

Fandom was far from universal. "The attention they were getting wasn't always positive, because there was the Frank Sinatra generation saying, 'Who the ---- are these people?' " Brown said.

Beatles backlash grew serious on the 1966 tour, when the band hit a trifecta of difficulties. A perceived snub of Imelda Marcos, the Philippine president’s wife, made them personae non grata in the Philippines, requiring a hair-raising escape in which the band members needed to be protected from Philippine security who were threatening them with guns and wooden clubs at the Manila airport, Brown and Gaines wrote. A right-wing Japanese group threatened violence at a concert. In the U.S., comments made by Lennon to a British journalist that the Beatles were "more popular than Jesus now" set off record-burning protests.

"We never really said it very much" in The Love You Make, Brown said, but "there was a very great nervousness about somebody getting shot when they were onstage."

And in the End

The Beatles performed their last scheduled concert on Aug. 29, 1966, at San Francisco’s Candlestick Park. The end of touring meant less need for constant management.

Brown frequently escaped to the country, leaving Epstein behind, often in an unsettled state. Plagued by depression and drug use, Epstein had spent part of May 1967 in a hospital breaking a cycle of insomnia and stimulant use, according to The Love You Make. The previous year Epstein had attempted suicide, according to the book.

"I had persuaded Brian to buy this house in the country because I was worried about his drug intake," Brown said, surprised that Epstein went for it. Epstein loved the one that Brown picked out, an 18th-century house in Sussex, and bought it just months before his death on Aug. 27, 1967.

After Epstein’s death, Brown took on even greater duties as a top executive and helped the Beatles form and launch Apple Corps Ltd. He continued to oversee more than just the Beatles' professional matters, through the band's ultimate break-up in April 1970. He witnessed McCartney and Linda Eastman’s wedding in March 1969. Eight days later he was best man at John Lennon and Yoko Ono’s wedding, for which he is immortalized in the song "The Ballad of John and Yoko":

Peter Brown called to say
‘You can make it okay,
You can get married
In Gibraltar, near Spain...

In the half-century since the album Please Please Me was released, the Beatles have never been far from the popular culture. Their simple lyrics, original melodies and tight harmony stand as a kind of universal musical language -- hence the title of All You Need Is Ears -- and have kept music scholars busy for decades. Their songs, and antics, banged up against British tax policy, cold war politics and American religion. Beyond that, the band’s "promotion of the English language around the world is one of their most substantial, and least documented, achievements," the late music critic Ian MacDonald wrote in his 1994 book, Revolution in the Head: The Beatles and the 1960s.

On the way to the first of my two interviews with Brown, I passed a young family on the sidewalk. The smallest among them, a boy, maybe 8 years old, wore a Beatles T-shirt. I asked Brown why events in England in the early 1960s should have an impact on what American children wore in 2012. He said he asks people that himself.

"Did you show them? Did you tell them? No. They find it on their own," Brown said. "It's an amazing phenomenon that 50 years later, kids find them.

Correction: The original version of this article said Peter Brown is 74, based on information from an aide to Brown. He is 75.

Analyses and commentary are the views of the author and do not necessarily reflect the views of Bloomberg News.

Samsung Can Sell Galaxy Nexus During Appeal, Court Rules

2012-10-14T23:10:00.000+08:00

By Susan Decker and Todd Shields - Oct 12, 2012 6:47 PM GMT+0400

Samsung (005930) Electronics Co., the world’s largest mobile-phone maker, won its bid to continue selling its newest Galaxy Nexus smartphone in the U.S. while it battles patent-infringement claims filed by Apple Inc. (AAPL)

The U.S. Court of Appeals for the Federal Circuit yesterday granted Samsung’s request to lift a lower court’s ban on sales. Samsung wants to continue selling the phone while it challenges a federal judge’s June 29 ruling that Apple was likely to win its suit claiming the Galaxy Nexus infringed four patents and that sales were hurting Apple’s business in the meantime

Apple argued that it’s important to keep the Galaxy Nexus out of the U.S. market now because most Americans haven’t yet switched to smartphones, and a product that copies Apple’s features could steal customers from its iPhone. Photographer: Denis Doyle/Bloomberg

The case is part of a global battle between the two biggest makers of mobile phones that surf the Web, play video games and do most other functions of a computer. The case involves different patents than the ones at the heart of a $1 billion verdict Apple won against Samsung Aug. 24 in San Jose, California.

A feature in the Nexus phone that aids data searches was an issue in yesterday’s opinion. The appeals court said the district court had abused its discretion by deciding that Apple would suffer harm because of the feature. The patent-holder needs to show “that the infringing feature drives consumer demand for the accused product,” and Apple presented “limited” evidence of such a link, the appeals court said.

’Stifle Competition’

“Today’s decision confirms that the role of patent law is to protect innovation and not to unreasonably stifle competition,” Adam Yates, a spokesman for Suwon, South Korea- based Samsung, said in an e-mail. Kristin Huguet, an Apple spokeswoman for Cupertino, California-based Apple, declined to comment in an e-mail.

Apple and Samsung are involved in more than 30 patent- infringement lawsuits spanning four continents as they vie for a greater share of a smartphone market that Bloomberg Industries said grew 62 percent last year to $219 billion.

Apple claims the Galaxy Nexus infringes patents that cover the way the iPhone’s voice program, Siri, searches for information, its slide-to-unlock function, an automatic recognition of phone numbers or e-mail addresses and a word- suggestion feature, according to the filing. Apple was ordered to post a $95.6 million bond to cover any losses incurred by Samsung should the case end in Samsung’s favor.

‘Menacing’ Letters

Samsung, which makes other phone models that aren’t affected by the order, said in filings that Apple has been sending “menacing” letters to Samsung customers and “engaged in a campaign of litigation around the world against the largest sellers of Android devices.”

Android, owned by Google Inc. and distributed for free to bolster Google’s advertising business, is the most popular platform for mobile phones. The Galaxy Nexus is the first to run on the 4.0 version of Android, called Ice Cream Sandwich.

The case is Apple Inc. v. Samsung Electronics Co., 12-1507, U.S. Court of Appeals for the Federal Circuit (Washington). The lower court case is Apple Inc. v. Samsung Electronics Co., 12-630, U.S. District Court for the District of California (San Jose).

To contact the reporters on this story: Susan Decker in Washington atsdecker1@bloomberg.net; Todd Shields in Washington at tshields3@bloomberg.net

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net

Meningitis Outbreak Linked to Steroid Kills Five People

2012-10-06T16:12:00.002+08:00

By Anna Edney - Oct 6, 2012 2:12 AM GMT+0400

AP Photo/Mark Humphrey

Dr. Robert Latham, chief of medicine at Saint Thomas Hospital in Nashville, Tenn., is interviewed on Thursday, Oct. 4, 2012. Latham said a fifth person has died in a growing outbreak of a rare form of meningitis that has sickened more than two dozen people in five U.S. states.

A meningitis outbreak traced to a contaminated steroid used for back pain killed five people and threatens thousands more, U.S. health officials said.

The New England Compounding Center, a Framingham, Massachusetts-based pharmacy, supplied the steroid found to be tainted with a fungus, Ilisa Bernstein of the Food and Drug Administration’s Center for Drug Evaluation and Research said yesterday. The steroid, methylprednisolone acetate, was shipped to 75 facilities in 23 states from July to September, according to the Centers for Disease Control and Prevention.

Meningitis is an inflammation of the lining of the brain and spinal cord usually caused by an infection from a virus or bacteria. Forty-seven people in seven states -- Florida, Indiana,Maryland, Michigan, North Carolina, Tennessee and Virginia -- have contracted fungal meningitis and five have died after receiving steroid injections in their backs, the CDC said today in a statement. The fungal illness is not contagious and can be treated with medication, the Atlanta-based agency said.

“All patients who may have received these medications need to be tracked down immediately,” Benjamin Park, medical officer of the CDC’s Mycotic Diseases Branch, said in the statement. Lives may be saved if they are put on antifungal therapy, he said.

The agency and state health departments today released a list of the 75 health-care centers that received the contaminated product.

Expanded Warning

“Out of an abundance of caution, we advise all health-care practitioners not to use any product” manufactured by the Massachusetts pharmacy, Bernstein said yesterday.

The pharmacy recalled 17,676 single-dose vials, Omar Cabrera, community health education manager with the Massachusetts Department of Public Health, said in an e-mail. The company is a compounding pharmacy, which means it custom mixes versions of medications in ways that generally aren’t otherwise available for sale.

“As previously announced, we have voluntarily suspended operations while we assist authorities in this investigation,” the company said in a statement. “The fatalities and illnesses confirmed today by the CDC and FDA are tragic. The thoughts and prayers of everyone employed by NECC are with those who have been affected.”

To contact the reporter on this story: Anna Edney in Washington at aedney@bloomberg.net

To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net

Facebook Flirts With Local Geeks in Battle for Russia

2012-10-06T16:02:00.003+08:00

By Marie Mawad and Ilya Khrennikov - Oct 5, 2012 12:14 PM GMT+0400

Why It Matters That Facebook Has a Billion Users
Related Video: http://bloom.bg/VzNc0W

Looking for a public bathroom in Moscow? Facebook Inc. (FB) has you covered.

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The Facebook website. Photographer: David Paul Morris/Bloomberg

3:50

Oct. 4 (Bloomberg) -- Bloomberg Businessweek's Ashlee Vance talks about his interview with Facebook's Mark Zuckerberg. Vance speaks on Bloomberg Television's "Market Makers." (Source: Bloomberg)

1:17

Oct. 4 (Bloomberg) -- On today's "Off The Charts," Scarlet Fu looks at the rate of growth for Facebook's revenue. She speaks on Bloomberg Television's "Market Makers." (Source: Bloomberg)

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Russia's Prime Minister Dmitry Medvedev, left, receives a T-shirt as a present from Facebook CEO Mark Zuckerberg during their meeting at the Gorki residence outside Moscow. Photographer: Alexander Zemlianichenko/AFP via Getty Images

Still a dwarf in Russia, the world’s largest social network is courting local geeks to build apps tailor-made for their home market. Its goal is to win over users in Europe’s most populous country and catch up with local rivals VKontakte and Odnoklassniki, which combined attract 10 times more traffic.

Founder Mark Zuckerberg hosted about 200 developers in Moscow this week in a six-hour competition to create apps meant to get people to sign up and log in daily. An app mapping Moscow’s toilets was on the list, while a Russian-made tool to boost your friendships through Facebook got top spot.

“The reason people love Facebook is because they can play games on it or because they can get their music there,” said Julien Codorniou, Facebook’s head of game partnerships in Europe. “To get ahead in Russia, we need Russian developers who can develop great content in Russian.”

In Russia, Facebook is behind -- its 3.5 million daily users compare with VKontakte’s 22 million and Odnoklassniki’s 16 million, data by research firm TNS Global shows. Menlo Park, California-based Facebook is betting that new apps will attract more traffic, and that its global scale of 1 billion users will convince Russian developers to jump ship.

Growing Market

Facebook needs to win over those trying social networking for the first time, while also persuading VKontakte and Odnoklassniki users to sign up on a second platform. About 63 percent of Russia’s teens and adults use the Internet, up from 39 percent five years ago, according to TNS Global, leaving growth potential. Russia’s population is 143 million.

“There are few places in the world that have such a large number of potential users,” said Brian Blau, an analyst at researcher Gartner in San Francisco. “Internet penetration is still not that high, so there’s room to grow and Facebook has to be there when more Russians sign up to social networks.”

Facebook is looking to replicate the success it had in Brazil, where it came from behind to surpass a strong incumbent. Orkut, which had a head start and dominated the country’s social-networking market for years, ceded its No. 1 position to Facebook in December, according to ComScore Inc.

Zuckerberg, who is 28 and ranks 82nd on the Bloomberg Billionaires Index with a personal fortune topping $11 billion, told Russian developers that reach was Facebook’s main advantage over local competitors.

Dueling Billionaires

“The biggest opportunity for building on Facebook for you guys -- instead of the local networks -- is the opportunity to reach almost a billion people,” Zuckerberg said during what was his first visit to Russia, addressing the crowd at the event near Kremlin, in Moscow’s former chocolate-factory district characterized by red brick walls and bay windows.

In his Russia push, Zuckerberg is up against a fellow billionaire, Alisher Usmanov, whose Mail.ru Group Ltd. (MAIL) controls Odnoklassniki and owns 40 percent of VKontakte. Ksenia Chabanenko, a spokeswoman for Mail.ru, declined to comment.

The gap between VKontakte and Facebook “has been widening” in recent years, Pavel Durov, the founder of the social network also known as VK, said by e-mail. “We feel no need to protect our home markets. The question is rather —- can Facebook hold on to its hegemony in the world?”

Pushing app development is also a way for Facebook to add new revenue sources, as it faces investor pressure to boost sales. Facebook gets about 85 percent of its revenue from advertising, and the rest comes from the 30 percent cut it gets on sales that developers generate through its platform.

“Attracting developers in different parts of the world is critical,” Gartner’s Blau said. “They create the content which will drive more people on the site and keep them coming back.”

Russian Zynga

As of yesterday, Facebook’s stock has lost 43 percent since the company’s initial public offering in May. St. Petersburg- based VKontakte shelved its planned IPO after Facebook shares plunged. Facebook fell 1 percent to the equivalent of $21.64 at 9:52 a.m. in Frankfurt trading. Mail.ru declined 0.6 percent to $32.30 in London.

One Moscow-based developer, Game Insight, was among the first in Russia this year to add Facebook to its list of supported platforms, which so far included VKontakte as well as Apple Inc. (AAPL)’s and Google Inc. (GOOG)’s mobile operating systems.

“Russia has become one of Facebook’s priorities and management is paying attention to it,” said Alisa Chumachenko, Game Insight founder and chief executive officer. “Developers are excited that Zuckerberg is here. Facebook is set to show fast growth in Russia now.”

Sometimes referred to as the Russian equivalent of Zynga Inc. (ZNGA), Game Insight was founded in 2010 and employs more than 400 people. Its “Airport City,” a city-building game, and “Mystery Manor,” a clue-finding adventure, have both passed the one-million user mark on Facebook.

Flipping Apps

About a third of the 34 apps built during the Facebook contest this week were games, made by developers hoping to replicate Game Insight’s success. Some chose to port existing apps from VKontakte to Facebook to save time. In one demonstration, programmer Jacob Ilin flipped his “Cut a Sheep,” a puzzle game revolving around a herd of sheep, in less than six hours.

“BoostMate,” an app for managing one’s friendships using Facebook, won the first prize in the event. Its maker, Ashot Golovenko, said he plans to hire more programmers to turn the beta version into the final product.

‘Go Big’

“You only need one local success story to get people on board and even reshuffle the cards in a market,” Facebook’s Codorniou said. The executive got promoted last month from Facebook’s Paris office to head gaming partnerships across Europe, Middle East and Africa and is now based in London.

Codorniou, who plays number-crunching game “Numbers Together” daily with his Facebook friends on his PC and iPhone, said Russia is on top of his priority list, along with partnering with developers in Israel and with builders of mobile applications.

“There’s already a dozen success stories in Russia,” Codorniou said. “We want to put them forward and get others on board, with the argument that if you want to go big on the Web and on mobile, you’ve got to go Facebook.”

To contact the reporters on this story: Marie Mawad in Paris at mmawad1@bloomberg.net;

Ilya Khrennikov in Moscow at ikhrennikov@bloomberg.net

To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net

Apple CEO ‘Extremely Sorry’ for IPhone Maps Frustration

2012-09-29T05:29:00.001+08:00

By Adam Satariano - Sep 28, 2012 10:42 PM GMT+0400
Related Video: iPhone 5 Map Criticism Testing Tim Cook, Apple
http://bloom.bg/NVx74j

Apple Inc. (AAPL) Chief Executive Officer Tim Cook apologized for the iPhone mapping software released last week that has been criticized for flaws such as misrouted directions and inaccurately located landmarks.

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The new Apple Inc. Maps app icon is seen on an Apple Inc. iPhone 5 in this arranged photograph in London. Photographer: Simon Dawson/Bloomberg

1:03

Sept. 28 (Bloomberg) -- Bloomberg's Rich Jaroslovsky talks about Apple Inc.'s mapping application, released last week on the new version of iOS, the software that runs Apple Inc.'s iPhones and iPads. Apple Chief Executive Officer Tim Cook apologized for the mapping software that has been criticized for flaws such as misrouted directions and inaccurately located landmarks. (Rich Jaroslovsky is a Bloomberg News columnist. The opinions expressed are his own. Source: Bloomberg)

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Tim Cook, chief executive officer of Apple Inc. Photographer: David Paul Morris/Bloomberg

“We are extremely sorry for the frustration this has caused our customers and we are doing everything we can to make Maps better,” Cook said in a letter to customers posted today on the Cupertino, California-based company’s website.

Apple’s decision to build its navigation application reflects a widening rift with Google Inc. (GOOG), which had provided its Google Maps program since the iPhone debuted in 2007. While the new software adds features such as turn-by-turn navigation, it is widely faulted for unreliable landmark searches, routes that get users lost and a lack of public transit directions.

“An apology is never bad,” Carl Howe, an analyst at Yankee Group in Boston, said in an interview. “But notice they didn’t say that they are going to reinstate Google Maps. There is no impact, there is no change in philosophy or direction.”

Apple’s mapping application was released as part of the new iOS 6 software, which runs the iPhone, iPad and iPod Touch. Cook said that the feature will improve as the company collects more data. In the meantime, he said people who are frustrated with the experience could download mapping applications such as Microsoft Corp.’s Bing, Waze and MapQuest from the company’s App Store. He said customers also could use the iPhone’s Internet browser to use Google’s mapping application.

‘Their Call’

Google Chairman Eric Schmidt said on Sept. 25 that Apple should have stuck with Google Maps. “It would have been better if they had kept ours,” Schmidt said at a press event in Tokyo. “What were we going to do, force them not to change their mind? It’s their call.”

Nate Tyler, a spokesman for Google, declined to comment beyond an online post explaining how to access its maps through the iPhone Web browser. The company hasn’t submitted a mapping app to Apple for the approval needed for it to appear in the App Store, a person familiar with the matter said on Sept. 25.

Google has been building out its online mapping software since 2005, using cars and satellites to accumulate data that helps improve its accuracy and reliability. To catch up, Apple can use location data collected from customers using its maps to improve the service. Apple’s map software includes a feedback feature for users to report inaccurate directions and other bugs.

‘Fell Short’

“At Apple, we strive to make world-class products that deliver the best experience possible to our customers,” Cook said. “With the launch of our new Maps last week, we fell short on this commitment.”

In the past few years, Apple has acquired small mapping companies including C3 Technologies, Poly9 and Placebase. The location information that Apple licenses from TomTom NV (TOM2)and OpenStreetMap isn’t as good as Google, said Noam Bardin, the CEO of Waze Inc., which makes an iPhone mapping app.

“The big problem is they’re 100 percent hostage to the quality of their data -- Apple is stuck,” Bardin said. While the quality will improve, it will be very expensive to match the billions Google has already spent on maps, he said. “The tactical challenge is they bit off what Google does really well and tried to do it themselves.”

Record Sales

Apple had to have known the application had problems during the testing period and decided to move ahead nonetheless, Bardin said.

The mapping fiasco is a product of Apple’s growing rivalry with Google, the maker of the world’s most popular smartphone software. Google’s Android operating system runs on devices from manufacturers including Samsung Electronics Co. and HTC Corp. (2498) that compete with the iPhone.

Apple built the replacement app because it wanted to scale back its relationship with Google, not because of any glaring product flaws, two people familiar with Apple’s development of the mapping features said last week.

The feud also extends beyond maps. For the first time since 2007, Google’s YouTube video service isn’t preinstalled on the new iPhone. Schmidt exited Apple’s board of directors in 2009 as tensions escalated between the competitors.

Apple took a strategic risk releasing its own maps app before it was ready, said Barbara Kahn, a marketing professor at the Wharton School at the University of Pennsylvania.

‘Competitor’s Brand’

“Maps is a very critical Google brand,” Kahn said in an interview. “Apple doesn’t want their competitor’s brand all over their phone.”

That said, defects with the maps isn’t likely to crimp sales of the iPhone 5, said Gene Munster, an analyst at Piper Jaffray Cos. Apple sold a record 5 million iPhone 5s during the handset’s debut weekend. The device, which has a bigger screen and is lighter than previous models, went on sale in another 22 countries today and will be in 100 by the end of the year.

“Consumer sentiment on the iPhone remains high,” Munster wrote in a research note today. “The maps product is not causing a user backlash.”

The maps software joins a list of other faulty services Apple has introduced in recent years. It recently discontinued the Ping music social network after it failed to attract users. MobileMe, a product for e-mail, calender and other online services, was also plagued by defects and recently transitioned into Apple’s iCloud service.

Prior Apologies

This is also the third time Apple has had to apologize or reverse course during the introduction of a new iPhone.

Following the first iPhone release in 2007, Apple co- founder Steve Jobs offered users rebates and an apology because early customers complained about a price cut two months after it went on sale.

In 2010, Jobs apologized and gave out free cases to customers because of antenna defects for the iPhone 4. After Consumer Reports and other publications showed the device would lose its signal if held a certain way, Jobs called a rare press conference to explain the issue.

The mapping application has made the company a target of ridicule. A website was created to chronicle various snafus, including one where a huge swath of Portland, Oregon, is shown as a park and others where bridges are labeled as being on land. In one New York example, Lexington Ave. is listed as being in Brooklyn, not Manhattan.

“Maps is an appalling first release,” David Pogue, the technology critic for the New York Times, said in a review this week. “It may be the most embarrassing, least usable piece of software Apple has ever unleashed.”

Apple fell 2.1 percent to $667.11 at the close in New York, paring the gain for the year to 65 percent.

To contact the reporter on this story: Adam Satariano in San Francisco at asatariano1@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

RIM Defies Critics by Finding BlackBerry Sales Overseas

2012-09-29T05:19:00.001+08:00

By Hugo Miller and Sean B. Pasternak - Sep 28, 2012 5:22 PM GMT+0400
Related Video: RIM's Uphill Battle Gets Overseas Sales Boost
http://bloom.bg/NV59Wh

Research In Motion Ltd. (RIMM)’s sales of the BlackBerry smartphone trounced estimates last quarter as it gained ground in emerging markets, signaling that the company may still have a future in the age of the iPhone.

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The results show that RIM can gain customers in lower-income markets such as Asia and Africa, even as it struggles to compete in the U.S. with Apple Inc.’s iPhone and devices running Google Inc.’s Android software. Photographer: Adeel Halim/Bloomberg

RIM shares rose the most in almost a year in intraday trading after the company sold 7.4 million smartphones, about 500,000 more than analysts had projected. RIM also posted a narrower loss for the period than estimated and increased its cash holdings. That impressed some of RIM’s biggest critics -- including shareholder Vic Alboini, who has previously demanded a shakeup in management and strategy.

“Those numbers are very, very positive,” Alboini, chairman of Toronto-based investment firm Jaguar Financial Corp. (JFC), said in an interview yesterday. “RIM has taken a step up the ladder, and they can see where they’re going.”

The results show that RIM can gain customers in lower- income markets such as Asia and Africa, even as it struggles to compete in the U.S. with Apple Inc. (AAPL)’s iPhone and devices running Google Inc. (GOOG)’s Android software. The challenge now is a successful release of the BlackBerry 10 phone, the linchpin of the Waterloo, Ontario-based company’s comeback strategy.

“If they can have another quarter of not burning cash and can get the device out in a few months, then investors are thinking, ‘Perhaps they have a chance to come back,’” said Neeraj Monga, an analyst at Veritas Investment Research in Toronto who rates RIM a sell.

Shares Gain

The stock jumped 5 percent to $7.50 at the close in New York after climbing as much as 15 percent earlier in the day. That pared the shares’ decline this year to 48 percent.

RIM’s free BlackBerry Messenger program, known as BBM, has emerged as a selling point indeveloping countries, where data plans often cost more.

“It’s amazing when you go into those countries and you see how BBM is just kicking it,” Chief Executive Officer Thorsten Heins said on a conference call, fresh from a tour through Asia, theMiddle East and Africa. “I mean, it’s everywhere.”

RIM also did a better job conserving cash than some analysts predicted, curtailing operating expenses 7.9 percent. Cash and investments grew to $2.3 billion by the end of last quarter, up from $2.2 billion three months earlier.

“The fact cash is not going to burn out in a quarter or two gives us an opportunity to see what BB10 is going to do,” Alboini said.

BlackBerry Sales

Revenue fell 31 percent to $2.87 billion in the period, which ended Sept. 1, topping a projection of $2.47 billion.

While sales of the BlackBerry’s phone beat the 6.9 million predicted by analysts, they remain a fraction of Apple’s volume. The latest iPhone, released earlier this month, sold 5 million units in a single weekend.

RIM’s subscriber base climbed to 80 million at the end of last quarter, up from 78 million. Still, the new BlackBerry 10 lineup has been delayed at least a year, making it harder for the company to compete with the latest Apple and Android devices. At RIM’s software developer conference this week in San Jose, California, Heins said the debut of BB10 is “a few short months away,” without being more specific.

The delays mean the BlackBerry 10 will miss the holiday season, when new Android devices and phones built on Microsoft Corp. (MSFT)’s Windows 8 software will hit the market.

RIM’s share of the global smartphone market dropped to 4.8 percent in the second calendar quarter, from 12 percent a year earlier, according to research firm IDC. Still, Heins said this week that BB10 will have a “clear shot” at being the world’s third-largest mobile operating system. That would put it behind Android and Apple’s iOS, and ahead of Microsoft.

‘Continued Pressure’

RIM posted a second-quarter net loss of $235 million, or 45 cents a share, compared with net income of $329 million, or 63 cents, a year earlier. The company expects to have an operating loss this quarter and face “continued pressure” on its operating results for the remainder of the fiscal year, Chief Financial Officer Brian Bidulka told analysts on the call. He said RIM is using “aggressive pricing initiatives” to sustain the growth of its subscriber base.

“While we applaud the cost and balance sheet improvements, we’d note that selling devices below cost to boost its subscriber base is likely not a viable business solution long term,” saidWilliam Power, an analyst at Robert W. Baird & Co. He left his rating unchanged at the equivalent of a sell.

Scotia Capital Inc.’s Gus Papageorgiou raised his rating to sector perform, and Kris Thompson, an analyst at National Bank Financial, boosted his rating to outperform. Cormark Securities Inc.’s Richard Tse lifted his rating to buy.

Cost Cutting

Heins, who became CEO in January, has embarked on a cost- cutting plan to stem losses at the company. He’s eliminating almost a third of its workforce and shutting down manufacturing sites to boost efficiency.

RIM also has hired JPMorgan Chase & Co. (JPM) and RBC Capital Markets to help explore its strategic options. Heins told analysts yesterday that he’s met with CEOs at various organizations over the past several months to discuss BB10 licensing and partnerships. He plans to continue meeting potential partners and hasn’t set a specific timeframe for the end of the review. Heins has said in the past that he hasn’t ruled out a sale of the company, though that’s not his focus.

RIM needs to keep talking to potential partners because there’s no guarantee that BB10 will be the company’s savior, said Jaguar Financial’s Alboini.

“RIM is still losing money,” he said. “You have to have a push-the-button, ready-to-go backup plan.”

To contact the reporters on this story: Hugo Miller in Toronto at hugomiller@bloomberg.net;

Sean B. Pasternak in Toronto at spasternak@bloomberg.net

To contact the editor responsible for this story: Nick Turner at nturner7@bloomberg.net

Intel-Based Motorola Smartphone to Debut in Europe in October

2012-09-18T19:35:00.001+08:00

By Ian King - Sep 18, 2012 1:30 PM GMT+0400

Intel (INTC) Corp.’s effort to land chips in smartphones is getting a boost from Google Inc. (GOOG)’s Motorola Mobility, which plans to start selling devices featuring Intel processors in Europe and Latin America next month.

Motorola Mobility plans to sell the Razr i in the U.K., France, Germany, Argentina, Brazil and Mexico, the companies said today. The handset is the first to boast a 2-gigahertz version of Intel’s Atom processor, which is designed to speed up such tasks as taking pictures and toggling between applications.

Motorola Mobility becomes the second top-ten smartphone maker to introduce an Intel-based mobile phone, after China’s ZTE Corp. (000063) released one in Europe this month. While Intel is establishing a beachhead in mobile chips after a decade of failed attempts to persuade phone makers to use its products, it doesn’t expect material sales from the effort until 2013.

Intel has less than 1 percent of the market for mobile- phone processors, said Will Strauss, an analyst at Forward Concepts Co., a Mesa, Arizona-based research firm.

Intel lags in mobile chips behind Qualcomm Inc., Samsung Electronics Co. and Apple Inc. Its new device will square off against Apple’s iPhone 5, which goes on sale in parts of Europe on Sept. 21, as well as other, more established brands.

Not all of Intel’s announced partners end up bringing Intel-based phones to market. That was the case with Nokia Oyj (NOK1V) and LG Electronics Inc. (066570)

Fast Camera

The Motorola Mobility phone will be capable of loading the camera function and taking multiple pictures instantaneously, said Jim Wicks, a vice president of mobile devices at Motorola Mobility.

“It will build on the Razr brand,” Wicks said in an interview.

Intel shares fell less than one percent to $23.31 in New York trading yesterday, leaving them down 3.9 percent this year.

India’s Lava International Ltd. became the first company to offer an Intel-based phone, rolling out a model called the XOLO X900 that runs Google’s Android software in April.

Intel has also said that France Telecom SA (FTE)’s Orange and Lenovo Group Ltd. (992) are phone-chip customers.

-- Editors: Tom Giles, Reed Stevenson

To contact the reporters on this story: Ian King in San Francisco at ianking@bloomberg.net;

To contact the editors responsible for this story: Tom Giles at tgiles5@bloomberg.net;

Facebook Posts Record Gain as IPhone Aids Mobile Effort

2012-09-14T16:36:00.002+08:00

By Brian Womack and Douglas MacMillan - Sep 13, 2012 1:09 AM GMT+0400

Related Video: http://bloom.bg/NYo2IY

Facebook Inc. (FB) posted a record gain after Apple Inc. debuted the iPhone 5 with tighter integration for the social network, enabling voice-activated posts and photo sharing.

Enlarge image

Mark Zuckerberg, chief executive officer and founder of Facebook Inc. Photographer: David Paul Morris/Bloomberg

1:50

Sept. 11 (Bloomberg) -- In today's top headlines, Facebook CEO Mark Zuckerberg breaks his silence on stock performance. Kelly Bit reports on Bloomberg Television's "Bloomberg Rewind." (Source: Bloomberg)

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Facebook increased 7.7 percent to $20.93 at the close in New York. Its prominence on the iPhone 5 debuted today bolstered efforts by Chief Executive Officer Mark Zuckerberg to allay concerns over its ability to generate sales from users who increasingly socialize over handheld devices. The stock has plunged 45 percent since an initial public offering on May 17.

“Now we are a mobile company,” Zuckerberg said in an on- stage interview at the TechCrunch Disrupt conference in San Francisco yesterday, his first since Facebook’s IPO. “Over the next three to five years I think the biggest question that is on everyone’s minds, that will determine our performance over that period, is really how well we do with mobile.”

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Integration with the iPhone, the world’s best-selling handset, offers some evidence that Facebook’s mobile push can work, said Mark Harding, an analyst at JMP Securities LLC in San Francisco. “Investors feel more confident that Zuckerberg is now focused on mobile and focused on monetizing mobile.”

Zuckerberg “struck an upbeat tone,” said Colin Sebastian, an analyst at Robert W. Baird & Co. in San Francisco. “Clearly, from his words, they are making progress in mobile.”

Zuckerberg, who appeared at ease while trading laughs with his interviewer, for the first time elaborated on technical struggles that have impeded Menlo Park, California-based Facebook from creating a user- and advertiser-friendly mobile application. The company spent too long trying to build mobile products using a programming language known as HTML5, Zuckerberg said.

‘Biggest Mistake’

“The biggest mistake we’ve made as a company is betting too much on HTML5,” he said.

Facebook is lessening its reliance on the tools, and it has built an application better tailored forApple Inc. (AAPL)’s mobile software, Zuckerberg said. It’s also working on an application forGoogle Inc. (GOOG)’s Android system. New features will be available to the mobile service in the coming weeks and months, he said.

Based on the amount of time users spend on mobile, the company should make “a lot more money” via wireless devices than through desktops, Zuckerberg said. Mobile users also tend to be more interactive than desktop users, he said.

“It makes perfect sense to us that more people have mobile phones so there is a far larger universe of potential Facebook users and it is much easier to check Facebook mobile regularly,” said Richard Greenfield, an analyst at BTIG LLC in New York, in a research report.

‘Communications Tool’

At the same time, mobile ads may alienate users if the promotions disrupt use of the social-networking service, he said.

‘Facebook is not a media consumption service, it is first and foremost a communications tool,’’ said Greenfield. “If your phone call, IM or iChat were disrupted by ads you would never tolerate it. Facebook users did not mind advertising on desktop because it could be ignored.”

Zuckerberg said Facebook is taking steps to strengthen search capabilities. The company is fielding about a billion search queries a day.

“We have a team working on search,” said Zuckerberg, who was interviewed by Michael Arrington, a venture capitalist and the founder of the TechCrunch technology blog. “Search engines are really evolving towards giving you a set of answers.”

Zuckerberg also said Instagram, the mobile photo-sharing service recently acquired by Facebook, has more than 100 million registered users. Facebook wants to help Instagram, which cost the company about $740 million in cash and stock, to grow to hundreds of millions of users, he said.

Slower Growth

Facebook, which hasn’t closed above the $38 IPO price since its first trading day, reported in July that second-quarter sales increased 32 percent, down from 45 percent in the previous three months.

The share-price performance has been “disappointing” and it “doesn’t help” in terms of employee morale, Zuckerberg said.

Still, Zuckerberg would rather Facebook be underestimated rather than lavished with praise, he said. That gives the company flexibility to make big bets on the future.

“Sure, maybe some people will leave,” he said. “But I think it’s a great time for people to join and a great time for people to stay and double down.”

Zuckerberg’s comments helped boost shares of Millennial Media Inc., operator of a mobile-advertising network. The stock gained 12 percent to $13.68 at the close in New York.

Millennial stands to gain from Facebook’s transition to custom-built apps because it may help increase demand for mobile-ad networks, according to Jason Helfstein, an analyst at Oppenheimer & Co. in New York.

To contact the reporters on this story: Brian Womack in San Francisco at bwomack1@bloomberg.net;

Douglas MacMillan in San Francisco at dmacmillan3@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

Aging Baby Boomers Face Losing Care as Filipinos Go Home

2012-09-14T15:38:00.004+08:00

By Kanoko Matsuyama - Sep 13, 2012 7:01 PM GMT+0400

Stephanie Chan spent four years at Manila Doctors College qualifying to work as a nurse overseas. She never left the country. Instead, she switched careers and now earns almost as much monitoring people’s finances.

Chan is one of thousands of Filipinos each year who study to become health workers to boost their chance of a higher income overseas. She’s also now part of a growing trend of workers who are opting not to go. Chan now works at a call center in Manila, where she reminds Macquarie Bank Ltd. credit-card holders to make payments.

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Angelica de Guzman Tabora, a nurse from the Philippines, right, speaks to a charge nurse at the nurses' station of Kameda General Hospital, part of Kameda Medical Center, in Kamogawa City, Chiba Prefecture, Japan. Now, the supply of health workers faces a squeeze as faster economic growth in source countries brings more opportunities at home, and as aging populations in wealthier nations such as Japan, Germany and Italy, boost demand for nurses and caregivers. Photographer: Kiyoshi Ota/Bloomberg

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Angelica de Guzman Tabora, a nurse from the Philippines, uses a computer to fill out the patients' electronic health records at the nurses' station of Kameda General Hospital, part of Kameda Medical Center, in Kamogawa City, Chiba Prefecture, Japan. Photographer: Kiyoshi Ota/Bloomberg

Enlarge image

Angelica de Guzman Tabora, a nurse from the Philippines, right, uses a computer to fill out the patients' electronic health records at the nurses' station of Kameda General Hospital, part of Kameda Medical Center, in Kamogawa City, Chiba Prefecture, Japan. Photographer: Kiyoshi Ota/Bloomberg

“I’m thankful this career opportunity opened up for me,” said Chan, 23, who works the night shift at a business-process outsourcing company and lives at home with her parents. “If I can maintain a relatively high standard of living as a customer- service representative, why go overseas to work as a nurse?”

Developed countries that rely on Philippine nurses and Indian doctors to hold down costs in the $6.5 trillion global health-care industry face greater competition for talent just as baby boomers in the U.S., Europe and Japan reach the prime age for medical care. Economic growth in emerging economies, despite some signs of recent slowing, is stoking investment in hospitals and creating job opportunities in other industries that mean a growing number of health workers choose to stay at home.

Worker Imbalance

The growth and investments should help reduce an imbalance that has caused a severe shortage of health-care workers in developing nations. Japan had 2.2 doctors and 9.5 nurses per 1,000 people in 2009, while the U.S. had 2.4 doctors and 10.8 nurses, according to the OECD. In Indonesia, the proportion was 0.2 doctors and 1.4 nurses, while in India it was 0.7 and 0.9.

Philippine President Benigno Aquino, for instance, plans to build and rehabilitate more than 2,700 hospitals, clinics and community health centers next year as part of $9.7 billion investment in infrastructure. The nation’s $225 billion economy expanded 6.1 percent in the first half, and the peso is the best performer against the dollar among Asia’s 11 most-traded currencies this year, advancing about 5.5 percent.

“If you are taking more, somebody is losing, unless you put in place a policy that increases the overall supply,” said Kamalini Lokuge, a researcher at the Australian National University in Canberra, who has advised the World Health Organization on improving health care in developing countries. “There’s a shortage everywhere because of that.”

The world is short more than 3 million health workers, including at least 1 million community nurses and doctors, Westport, Connecticut-based Save the Children said in May.

Philippines, India

In New Zealand, 34 percent of doctors and 21 percent of nurses are from abroad, the highest among developed countries, while in the U.S. 27 percent of doctors and 5 percent of nurses are foreign, the WHO said in its 2006 World Health Report. More than half of the health workers in the Persian Gulf states are foreign-trained, according to the Geneva-based agency.

Philippine and Indian nationals lead the supply, each making up 15 percent of all immigrant nurses and doctors respectively in the 34-member Organization for Co-operation and Development. About 3 percent, or 89,000, of the 2.9 million registered nurses in the U.S. are Asian, Native Hawaiian or Pacific Islander, according to MinorityNurse.com, Westford, Massachusetts-based resource portal.

The health-worker deficit has reached a crisis level in 57 countries, according to the Global Health Workforce Alliance, a partnership created in 2006 by the WHO. Thirty-six of those countries are in sub-Saharan Africa, which has a quarter of the global burden of disease and only 3 percent of the world’s health workers, it said.

$78,000 a Year

For countries that can afford to pay, the cost of health- care workers is likely to rise. That means migrant workers stand to more than double their pay from landing a job in an advanced economy. Full-time registered nurses in the U.S. make about $57,000 a year, according to MinorityNurse, while in Australia they earn as much as A$75,000 ($78,000). In the Philippines, an entry-level nurse at a public hospital earns about 8,000 to 13,500 pesos ($195 to $325) a month, according to the Bureau of Local Employment website.

Indonesian Wahyudin lifted his pay 2,900 percent by moving to Japan from a clinic in East Java.

To get the job as a caregiver in one of the world’s fastest aging nations, the 30-year-old nurse, who uses one name, had to study Japanese language and script day and night for three years to pass the country’s challenging examination.

Coffee Plantation

Wahyudin sends most of his salary home to his parents, who sold rice paddies to pay for his education. With the money, they have bought a coffee plantation and built a two-story house in the mountain village in Lampung, Sumatra. Wahyudin’s earnings pay for his younger sister’s schooling.

“I cried when I first got my salary,” said Wahyudin, who earns 185,000 yen ($2,390) a month -- the equivalent of more than two and a half years’ pay as a nurse back home. He is one of 80 Indonesian and Filipino nurses at Kenshokai Group, which operates 114 nursing homes and daycares in Tokushima, southwest of Tokyo.

The shortage of caregivers in Japanese hospitals and nursing homes is worsening as the population ages. About one in three Japanese will be over 65 by 2025, from one in 4.4 in 2009, according to government data.

“We need to do whatever it takes to find workers,” said heart surgeon Takaaki Kameda, chairman of Kameda Medical Center in Chiba, east of Tokyo. “Demand for medical care will be much higher when baby boomers in urban areas get older. We definitely need to fill the shortages with immigrants.”

Teaching Japanese

The hospital opened a university for nurses in Japan and is considering setting up Japanese classes at colleges in China to help people there pass the test to work in Japan.

More than 40 percent of the population will be at least 60 years old in Japan and South Korea by 2050 and almost 35 percent of the population in Europe is projected to be 60 or older by 2050, from 22 percent in 2009, according to the United Nations.

The prospect of more, better-paid jobs back home appeals to migrant worker Angel Claudio, who went to Singapore in January to work as a staff nurse at Khoo Teck Puat public hospital.

“If the economy gets better and the salary gets better, I think fewer Filipinos will work abroad,” said Claudio, 25, during her break in the hospital cafeteria. “Who wants to be far away from their family?”

The biggest losers in the talent battle may be the poorest and most disease-prone countries. A billion people worldwide lack reliable access to basic health services, the Global Health Workforce Alliance said.

Global Code

Three quarters of doctors trained in Mozambique are working aboard, mostly in Portugal, South Africa, the U.S. and the U.K., the Alliance said. HIV treatments that require administration by physicians are being carried out by environment officers with six weeks’ medical training in Zambia, said Lukuge at the Australian National University.

To address the challenge, the WHO adopted a Global Code of Practice in May 2010 -- the first such use of the organization’s constitutional authority in 30 years -- to provide a framework to regulate aggressive recruitment. It recommends countries aim for self-sufficiency of workers and developed nations provide poorer economies with technical and financial assistance.

Meantime, nurses like Chan, who said she earns about 25,000 pesos a month at her call center, increasingly find opportunities elsewhere, often in related industries.

Vackie Jonn Licudan, who qualified to work as a nurse in the U.S., said he had wanted to move to America since he was a boy. While he was waiting for an immigration pass to work inVermont, he took a job at an outsourcing company in Manila. Now he earns more than 80,000 pesos a month running a team of other nurses who review medical insurance claims.

“I belong to an industry that is growing and given the career path and opportunities I have and will have, I no longer want to move,” said Licudan, 31, who bought a 3.9 million-peso apartment, goes clubbing twice a week and eats out almost every day. “I can build my future here.”

To contact the reporters responsible for this story: Kanoko Matsuyama in Tokyo at kmatsuyama2@bloomberg.net;

To contact the editor responsible for this story: Jason Gale at j.gale@bloomberg.net