Internet Audience Passes 1 Billion For The First Time

January 23, 2009

The number of people 15 and older on the Internet pass 1 billion in December, comScore said Friday.

Internet users from the Asia-Pacific region accounted for 41 percent of the total, while people logging on from Europe made up 28 percent.

North American Internet users, 185 million, added up to 18 percent and Latin American Web surfers accounted for 7 percent.

China, by itself, provides the largest national online audience, with 180 million people connected, or 18 percent of the worldwide total.

The U.S. is the second largest, with 16 percent and Japa follows with 6 percent.

“The second billion will be online before we know it, and the third billion will arrive even faster than that,” predicted comScore CEO Magid Abraham.

The most widely visited Net property was the Google sites, with 778 million visitors in December, followed by Microsoft, with 648 million visitors and Yahoo!, with 563 million visitors.

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Posted by Mark Boslet

Yahoo CEO Gets $40 Million And Freezes Employee Pay!

January 23, 2009

For the first time in its history, Yahoo suspended employee pay increases for 2009, while its newly appointed CEO will receive an $8 million “grant” next month!

Actually Yahoo CEO Carol Bratz should lead by example and at least relinquish her salary of $1 million, as did other Silicon Valley leaders like Cisco CEO John Chambers during harsh times or Steve Jobs who receives $1 in pay or the Google boys.

According to the Sunnyvale, Calif.-company filing to the SEC, Bratz will also receive an annual bonus that could exceed $4 million depending on performance; 5 million, 7-year options; annual equity grants (her 2009 grant will be worth $8 million; a $150,000 grant to cover advisory fees connected to her employment contract; and a $10 million equity grant that will cover the equity grants and medical coverage she gave up when she left Autodesk.

All in all, Bratz compensation package is valued at $40 million.

Yahoo’s compensation committee should also be fired for awarding Bratz that $8 million “grant”. That’d should be enough to pay for a small pay increase, no? :-)

Here’s an excerpt of Bratz’s compensation package as described in her employment contract:

You [Bratz] shall be granted annual equity grants, with due regard for your position, at such time as grants are generally made to other senior executives of the Company, the amount and term of such grants being in the sole discretion of the Compensation Committee.

It is currently contemplated that the 2009 grants will be made in February 2009 and the Company will recommend a grant to you at that time of a grant date value of approximately eight million dollars ($8 million) based on the methodology utilized by the Company to value grants. Such annual grants shall be subject to the same terms and conditions as the standard awards generally granted to other senior executives, except as otherwise provided herein, and made when awards are generally made to other senior executives.

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Posted by TechPulse 360

GE Profits Fall 44%; Expects 2009 To Be Extremely Difficult

January 23, 2009
General Electric is a huge company but highly exposed to the credit crisis with its GE Capital unit

General Electric is highly exposed to the credit crisis. GE Capital unit alone owes more than $500 billion!

General Electric ended 2008 on a high note despite the battered economy, its huge debt load and its faltering credit arm.

The diverse conglomerate with businesses in media (NBC, Universal), industrial (energy, technology) and finance (GE Capital) said today that it earned in 2008 $18 billion – the third highest earnings year in its history – generating $19.1 billion of cash from activities, on total revenues of $183 billion.

However, GE CEO Jeff Immelt expects an extremely difficult 2009 with total revenues to be flat or to decline 5%, while positioning the company to “return to double-digit growth in a post-recession economy.”

The main problem for GE, if it gets to that post-recession economy intact is its huge debt load – over $500 billion – in this current credit crunch.

That means divestitures, divestitures and more divestitures and cost cutting. Extremely difficult year ahead indeed.

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Digg Digs For Profitability In 2009: Cuts 10% Of Staff, Hires Salesforce

January 22, 2009

What is four months in a life of a startup? An eternity I guess!

Four month ago Digg raised $28 million in a venture capital round and announced aggressive plans to expand globally, translate the site into other languages and move to larger offices.

Now, the San Francisco, Calif. startup – that let’s people discover and share content from anywhere on the Web – will immediately cut 10 percent of its 75-person staff in order to reach profitability in 2009.

Digg CEO and founder, Jay Andelson also said in a blog post that it plans to hire a direct sales team to supplement its revenues from its advertising relationship with Microsoft.

“I’m confident that with commitment and focus on these priorities, Digg will be an even stronger company in 2009 and will continue to create innovative features for our more than 35 million community members,” Andelson wrote.

According to a recent BusinessWeek story, Digg’s revenue was just $4.8 million in 2007, and $6.4 million through the first three quarters of 2008.

I think 10% is a very conservative numbers, especially as Digg relies entirely in its community for “digging” out content and has no editors on staff!

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Netbooks Going Away, AMD CEO Says

January 22, 2009

In a call with investors today, AMD CEO Dirk Meyer said that he sees the distinction between a netbook and a notebook eventually go away.

For AMD’s chief, new cheap ultra-thin and light graphically capable notebooks are going to be the next generation of netbooks or netbooks 2.0!

So, why pay more indeed for the current expensive (over $500) bulky, widescreen, battery hungry notebook? I wonder why the PC industry didn’t think about it sooner. Greed perhaps?

Here are some excerpts of his comments about netbooks:

“There will be a continuum of price points and form factors”

“Given the way netbooks are configured today, consumers who want a notebook at those kind of price points have to compromise and as a result don’t enjoy a full PC experience, particularly around the graphics and media capability of the machine. And likewise people who wanted a thin and light machine had to pay a lot of money, typically well over a thousand dollars.”

“Upcoming inexpensive ultra-thin notebooks will meet the need for a small, thin, lightweight laptop that is more powerful than a netbook”

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AMD Accuses Intel Of Fueling Legal Uncertainty Over X86 Rights

January 22, 2009

In addition to disclosing its fourth quarter and annual 2008 financial results today, AMD reported that it received a letter from Intel related to their 1976 and 2001 patent cross-license agreements, allowing AMD to make x86 chips.

In the letter, Intel requests a meeting with AMD to discuss whether the newly formed Foundry Company qualifies as a licensed “subsidiary” under the cross-licenses, or whether the creation of the Foundry Company is a breach of the provisions of one of the x86 cross-licenses.

In summary, Intel is questioning if either the transaction establishing the Foundry Company or AMD’s 2006 acquisition of ATI constituted a change of control of AMD under the x86 cross- licenses.

“We believe that the letter is another attempt by our competitor to cause uncertainty as we approach our Asset Smart deal closing next month,” said AMD spokesperson Drew Prairie. “I would like to draw your attention to remarks made by Intel spokesperson, Chuck Mulloy, to The Times Union newspaper last October, where he is quoted as saying that “We [Intel] may need to ask AMD some questions, too. But we’re not in a position to block [the creation of the Foundry]…”

The close of the Abu Dhabi transation is crucial to AMD’s survival. However, an eventual AMD bankruptcy might put Intel in the “monopolist” seat again, facing the wrath of the Obama administration anti-trust commission or worse, the European Union’s!

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AMD Posts $740 Million Operating Loss And Dismal Outlook; Is Bankruptcy Looming?

January 22, 2009

The bad news in the tech sector in general – and the semiconductor in particular – keeps on coming.

AMD today posts a record $1.4 billion loss – including a non-cash charge of $684 million associated with its 2006 acquisition of graphics maker ATI – on revenues of $1.16 billion, much lower than the company’s self-imposed breakeven point of $1.5 billion.

AMD also said it will try to breakeven next quarter. But how?

The worst is still to come

Looking ahead, AMD expects sales to continue to drop citing computer makers “severe” downward inventory correction in reaction to the economic crisis.

At this point, AMD might have to look at a $1 billion or less breakeven point, meaning unfortunately much more cuts or divestitures to come.  But with only $320 million in the bank, time is running out.

The company hopes to close its deal with Abu Dhabi investors next month, bringing over $1 billion in cash into AMD itself. Just enough to survive one or two more quarters at this rate of losses.

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Google Plans Massive Options Bailout

January 22, 2009

The global downturn has done more than slow online advertising growth at search giant Google.

It has driven the value of employee stock options underwater and made them worth less than what workers would have to pay to redeem them.

85% of Googlers have options that are underwater, says Eric Schmidt

85% of Googlers have options that are underwater, says Eric Schmidt

Google is searching for a solution. The company announced on Thursday a massive plan to buy back worthless options and exchange them for shares that could be worth something in the years to come.

Google said the plan is good for employee retention. It also could be good for the bank accounts of staffers, whose worthless options add up to about 3 percent of Google outstanding shares.

About 85 percent of Googlers have options that are underwater, said CEO Eric Schmidt. The reason for this is clear: the shares ended Thursday at $306.50, down from a 12-month high of $602.45.

Under the voluntary plan, employees will be able to exchange their worthless options for lower priced ones, as long as they add a year to vesting date and under no circumstances cash out an option within the next six months.  The program will begin on Jan. 29.

Google plans to take $460 million of charges to cover the exchange.

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Posted by Mark Boslet

Large Online Advertisers Are Examining Their Marketing Budgets

January 22, 2009

With a worldwide recession slowing consumer and business spending, online advertisers are re-examining their marketing budgets, Google said Thursday.

Google is working in the field, says Omid Kordestani

Google is working in the field, says Omid Kordestani

Large companies in particular are taking a second look at online spending, lowering their bids for search keywords and seeking solid returns on their campaigns, the company said on a fourth-quarter conference call.

In some cases, they are looking at changing the sizes of online campaigns.

Smaller and medium sized companies tend to cut their online budgets less, Google executives told Wall Street analysts. Most presently do not spend their maximum daily budgets.

In this environment, “we’re hard at work in the field,” said Google Senior Vice President Omid Kordestani.

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Posted by Mark Boslet

Google Promises New Search Products And A YouTube Breakthrough

January 22, 2009

Google showed its business dodged the worst of the economic slowdown. Revenue rose 18 percent in the fourth quarter and impressed investors, who had lowered their expectations in recent weeks.

Were in a worldwide recession, says Eric Schmidt

We're in a worldwide recession, says Eric Schmidt

“It’s clear we’re in a worldwide recession,” CEO Eric Schmidt said Thursday  on a conference call. But the company cut costs and saw growth in most of its markets.

While it appeared that cost-per-click, a measure of ad profitability, fell in the quarter, business for Google was solid in the U.S. and in the emerging markets of China and Brazil.

The company also said it anticipated key innovations in the months ahead. There is a huge untapped potential in online search, said Schmidt.

What if Google could understand the meaning of words people type into search queries? The company has new products to roll out in this area, Schmidt said.

There also are “breakthroughs” coming this year in the use display advertising on YouTube, Schmidt promised. Nevertheless,  despite experimentation with advertising on the video site, “we’ve not found a single solution that drives revenue,” he said. “We’re working on that.”

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Posted by Mark Boslet

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