October 14, 2006

Catching Up on Shows - Watch The Office Season 3 Episode 4 Free

posted by MR WAVETHEORY at 10/14/2006 12:56:00 PM
It's the weekend and it's time to catchup on that missed episode of The Office and what better place to do it than YouTube. So what if big media going after YouTube. I will have it my way. I have embedded them so that the less technical savvy (octogenarians) don't have to navigate to far off - I wouldn't want you to get Lost or check out the cool promo by American Express secret episode of Lost.








The Office - Season 3 Episode 4 "Grief Counseling" (1/3)
The Office - Season 3 Episode 4 "Grief Counseling" (2/3)
The Office - Season 3 Episode 4 "Grief Counseling" (3/3)

By the way, thanks to ProtocolShow for posting it. For his valiant efforts, he even earned the comment "You Are a Great Person" from an adoring fan. To NBC, he was even kind enough to provide a disclaimer:

I am not affiliated with NBC in any way; I have merely been a fan of the show since the beginning. I am providing those who share the love of The Office an opportunity to catch the show if they were unable to watch the episodes as they aired. If you like what you see, please support the show by buying Seasons 1 & 2 on DVD.

You have to admit that he was gentleman enough to come clean! Now for the million dollar question for you aspiring young lawyers: does linking or embedding copyrighted video on your site from YouTube constitute infringement? Brownie points for whoever gets that question right. FYI, as far as I know, NBC is partnering with YouTube to promote The Office, so ProtocolShow may be merely a minion of YouTube or NBC doing covert marketing

Zecco - Not Entirely Free Lots of "Hidden" Fees

posted by MR WAVETHEORY at 10/14/2006 12:23:00 PM
Following up on my post Zecco: Is Free A Business Model, Zecco has proven that it is not entirely free. In fact, just about everything but trading costs money at Zecco - even getting a statement. Of course, the page is hidden deep inside the site. I thought you should know before you switch. I expect Bank of America (NYSE BAC) to also charge for many services. You can see the charges for yourself.

The Other Charges really add up. Some of things that cost money but really shouldn't including maintaining an IRA account (annual fee) and also closing/transferring your account. If you have a $2500 account at Zecco and you have to pay an IRA maintaince fee of $50, that translates into 2% of your account! And that's just for starters, a copy of your statement is $15 and automated account transfer is $50.

Other Charges

144 Sales $35.00 plus regular commission
Accommodation Transfers $25.00 plus certificate fees per issue
Automated Customer Account Transfer (ACAT) $50.00 per account
Physical Stock Deposit $50.00
Prepays on Customer Trades $10.00 plus interest to settlement date
Reg. “T” Extension $10.00 per request plus interest from settlement date until paid
Reorg Items and Tenders $15.00 per request plus interest from settlement date until paid
Research & Statement Copies $15.00 per hour (1 hour minimum)
Returned Checks $20.00 plus interest from the earlier of the settlement date or date of deposit
Securities purchased against Non-Cleared Funds Interest on balance (see margin interest rates)
Taxpayer ID Penalties At Cost
Transfer Fees At Cost
Wire Funds $15.00
Foreign Wire Fee $55.00
Saturday Delivery Checks $25.00
Overnight Check Delivery (U.S.) $15.00
Overnight Check Delivery (Int’l) $25.00
Stop Payment $25.00 per check (only if check is 10 or less days old)
Overdrawn NSF Fee $35.00
Restricted Stock processing fee $35.00 + transfer agent fee to re-register and FedEx
FedEx Overnight Fee $15.00
FedEx Saturday Fee $25.00
Transfer and Ship (Certificates) $50.00 per request
IRA Annual Fee $50.00
IRA Closing Fee $50.00
By the way, the margin rates are userous:

Dollar Range Above/Below Base Rate* Margin Rate
Above $999,999 Base Rate 8
$250,000 - $999,999 + 0.75% 8.75%
$100,000 - $249,999 + 01.25% 9.25%
$ 50,000 - $ 99,999 + 1.50% 9.50%
$ 25,000 - $ 49,999 + 2.00% 10.00%
$ 0 - $ 24,999 + 2.50% 10.50%

BofA analyst downgrades AmeriTrade ahead of free stock trading

posted by MR WAVETHEORY at 10/14/2006 02:00:00 AM
This is one of the most hilarious downgrades by Bank of America (NYSE BAC). What a cheap shot. In case you didn't know, Bank of America is going to start offering free stock trading.

Showdown: Windows Search vs Google Desktop

posted by MR WAVETHEORY at 10/14/2006 01:36:00 AM
I was searching for notepad.exe on my computer because like most people I couldn't find its path, so I typed it into Windows search. Guess how long it took to find it using Windows Search (All Programs => Search) vs Google Desktop (Nasdaq GOOG)?

Here are the results:

Windows Search : 10 seconds

Google Desktop : .83 seconds

I was surprised it took ten times longer using Windows to find an application on Windows. Why does it take a tenth of the time to search using Google Desktop than Windows Search - a native app. Where are you Bill Gates? Where are the usability engineers at Microsoft (Nasdaq MSFT)?

October 13, 2006

The Partnership Lottery at Goldman Sachs

posted by MR WAVETHEORY at 10/13/2006 01:44:00 AM
Great article about the partnership lottery at Goldman Sachs (NYSE GS). Every year 300 people compete for a shot to take home a $7 million bonus/salary. Below are the juicy bits.

"The $7 million lottery. 25% Chance to win."
Goldman will announce on Oct. 25 its new class of partners, who will join the 287 who currently hold that title. Last year, that group shared more than $2 billion, or about 20% of the total compensation Goldman paid to its more than 25,000 employees world-wide, according to people familiar with the matter. That averages out to about $7 million per partner.

"Getting Graded - A, B, Cs"
Candidates were divided by letter grade into three categories -- A's, B's and C's. The C's were the long shots. "I can tell you that for anyone who is a B or a C in this process, it's the first time in their lives they've ever been ranked that," says Gary Cohn, Goldman's co-president, who oversees the process.


"We are still mostly male."
The firm won't discuss this year's candidates or comment on partner compensation. In 2004, 237 people were nominated, 174 were vetted by partners, and just 99 were selected, including only 14 women.

"We have alot of time on our hands."
Successful partner candidates are expected to be "culture carriers," he says. The firm encourages public service by partners, he says, and many partners have pursued that path, including former Chief Executive Officer Henry Paulson Jr., who is now Treasury Secretary. "Sure, Goldman partners make a lot," Mr. Blankfein says. "But I can pay people a lot of money without going through this process."

"The consolation price is MD Light."
At other Wall Street firms, executives typically aspire to become managing directors, a title that often comes with perks ranging from the right to buy firm stock at a discount to membership at the corporate gym. Goldman has 950 managing directors, who are referred to internally as "MD light," because that position is viewed as a stepping stone to becoming a partner, or PMD. Goldman Co-President Jon Winkelried, who oversees the selection process with Mr. Cohn, says making partner is viewed as the real beginning of a career at the firm.

"The game is like survivor."
In the mid-1990s, then senior partners Stephen Friedman and Robert Rubin, who have since joined other companies, developed a system to vet candidates. They dubbed the process "cross-ruffing," a reference to a complex bridge maneuver. At Goldman, it is the process by which partners review candidates from other departments. Investment-banking partners, for example, will review candidates from asset management.

Hedge Fund Bubble - Avenue Capital Selling to Morgan Stanley for $2 Billion

posted by MR WAVETHEORY at 10/13/2006 01:18:00 AM



Morgan Stanley (NYSE
MS) is reportedly buying 20% of Avenue Capital for $2 billion. That is a rich price to pay for a hedge fund. Avenue Capital has $12 billion in assets.

Put that into perspective, MWD is paying $1 for every $6 of assets. The price translates into 16% of the assets under management. I don't understand the logic. Someone, please explain to me what I am missing. Don't get me wrong, they are a great fund. But a typical fund earns 2% of assets plus 20% of the return.

To get to 16% return on equity, here's how the math has to look.

Target Return = 16%
Target Return = Fees + Performance

Assume,

Fee = 2% (Industry Standard)
Performance = 14% (20% of the Total Return)

Avenue has to earn 14% from performance. Since the typical fund gets 20% of the total return of assets, that implies Avenue has to generate 70% annualized returns on its $12 billion in assets to generate 16% return on equity. 70% returns are nearly impossible to achieve on an asset base of $12 billion.


Here's another way to look at it. Avenue has 210 employees, so Avenue Capital is being valued at $50 million per employee. Add to that, many of those employees are working in the backoffice, so the value of an investment professional is more than $50 million.

With the reputation of Morgan Stanley, is it that hard to raise $12 billion in assets? Is this a hedge fund bubble?

China Demand for Oil

posted by MR WAVETHEORY at 10/13/2006 01:13:00 AM
This picture courtesy of the IEA shows that China's demand for oil is going up - in fact, there is no slowdown.

Meanwhile, the Journal says,
Despite Beijing's efforts to conserve energy and curb runaway economic growth, crude imports in September jumped to 13.46 million metric tons, or an average of about 3.3 million barrels a day -- 24% more than in September 2005 and 2.4% more than the previous record in January, according to China's General Administration of Customs.


Did Google Buy SueTube?

posted by MR WAVETHEORY at 10/13/2006 01:01:00 AM
Jane Martinson from The Guardian, a UK broad sheet, is writing that Google Faces CopyRight Suit over YouTube.
Dick Parsons, the chairman and chief executive of Time Warner (Nasdaq TWX), fired a shot across the bows of Google, saying his group would pursue its copyright complaints against the video sharing site YouTube.com.
From the looks of it, there is a very big battle going on - the likes of which were mentioned by Mark Cuban. Parsons may have been posturing. In the same interview, he said,
"We'd like to have our content displayed on these platforms, but on a basis that it respects our rights as the owner of that content."
So, will they or won't they?

October 12, 2006

Google to News Corp: We Won't Eat Your Lunch ... For Now

posted by MR WAVETHEORY at 10/12/2006 07:27:00 PM
Google CEO Eric Schmidt (Nasdaq GOOG) talked to the FT about what buying YouTube means for big media companies like News Corporation (NYSE NWS) and Time Warner Inc. (NYSE TWX). The answer is: We won't eat your lunch ... for now. But we're going to take a hell of big bite of it!
We don't want it to be Google foe. We see ourselves as a technology provider and a distribution network. We're not in the content business.
Somebody remind me, didn't Google say it wasn't going to be a portal just a few years ago. And what is Google today? Oh, and Google wasn't going into the Office suite business. Kudos to Eric for being a true disciple of Sun Tzu: The Art of War. If he weren't a rockstar dot-com CEO, he would probably be running America. George Dubya is no match for Eric Schmidt.
All of the media companies are dealing with dramatic changes in their business. All of them are looking for a partner. All of them are looking for a way to make money. One of the great news, from our perspective, is people are using this content on the internet. The bad news is it doesn't make as much money for the businesses. And ultimately the businesses need to make money in order to produce the new content. So what we're trying to do with all of these partners is to say, 'if you work with us we can combine our advertising platform and your content with a much larger audience.' So far people like that message, they are now trying to figure out what to do about it – should they, should they not, under what terms, and those sort of things.
Read the Google interview here.

UTUBE Site Swamped by YouTube Users

posted by MR WAVETHEORY at 10/12/2006 07:03:00 PM
It's good to be UTUBE. The company's site traffic has more than tripled in the past week due to publicity about the acquisition of YouTube by Google (Nasdaq GOOG). UTUBE is short for "Universal Tube & Rollform Equipment Corporation." The company offers "wide selection of used, rebuilt, and new equipment for the tube, pipe, and coil processing industries. Includes tube mills, rollformers, benders, shears, and brakes. Site includes current inventory details." UTUBE has been rolling pipes since 1985.
Due to the spillover effect, the site UTUBE.com is getting over a quarter million unique users. UTUBE's headquarters are nothing like YouTube's. However, while YouTube may the starlet of the online video craze, UTUBE gets top honors for being the more experienced online e-commerce company. UTUBE has been online since 1996, while YouTube has only been online since 2005.

The owner of UTUBE turned down a $1 million for the domain. The CEO is holding out for offers of $2.5 to $3.0 million. It is the sixth most popular US manufacturing site, ahead of Whirlpool.

Rags to Riches Story of SunTech Power

posted by MR WAVETHEORY at 10/12/2006 09:25:00 AM
The Journal writes about the Rags to Riches story of the founder of SunTech Power Holdings Co. Ltd. (NYSE STP). Below is a brief excerpt.

When he arrived in Australia 18 years ago as a physics student, Shi Zhengrong scraped by on a meager stipend from the Chinese government that he supplemented by working at a restaurant.

A doctorate, several patents, two solar-power companies and a $455 million initial public offering later, Dr. Shi is now one of the richest people in China.

Suntech Power Holdings Co., the company he founded in 2001 in the flat, green lands of the Yangtze River Delta, has quickly become one of the world's largest producers of photovoltaic equipment, which converts sunlight into electricity. The company's combination of first-world technology and developing-world prices has helped it gain market share from more-established, and expensive, producers.

Dr. Shi's wealth, made up almost entirely of his holdings of Suntech stock, has fluctuated in value along with company's volatile share price, from a low of about $1.3 billion to a peak of just over $3 billion; his stake currently is valued at around $1.7 billion. It is, by some estimates, the largest private fortune of anyone living in mainland China.

The story of his journey from China to Australia and back shows how important China's growing openness has become to its people. Nearly three decades after market reforms began, the network of personal, educational and financial ties between China and the rest of the world is reaching a new level. And the Chinese government's willingness to underwrite both advanced education abroad and technology startups at home is starting to pay dividends.

Amazon.com Upgrades Astores Beta

posted by MR WAVETHEORY at 10/12/2006 08:51:00 AM
I wrote about how to launch your own ecommerce store using Amazon.com Inc. (Nasdaq AMZN) when it launched Astores. They seem to have delivered on a few of them. Below is the letter to all Associates:

Dear Amazon Associate:

As an aStore Beta participant we thought you'd like to know that the Associates team has released some updates to aStore that provide improved control over the layout and navigation of your store.

Features in this release include:

  • For those of you linking from your website to your aStore rather than embedding it, we have added the capability to put a link back to your website in the store navigation.
  • Advanced users can now remove both the header and category navigation when embedding the aStore within existing websites.
  • The custom product description length has been extended, allowing you to say more about the products you recommend to your customers.
  • Product detail pages now display a "crossed-out" list price followed by the Amazon.com price.
  • The page title in the browser now displays the name of the aStore combined with the category name or product name, making aStore more search-engine friendly.
  • Our development team is still hard at work building the capabilities to allow you to build multiple aStores, use the same category multiple times, and specify products to feature on category pages. We are excited about the way the next version is coming together and look forward to sharing it with you in time for the holidays!

These changes are additional features that will not affect your current aStores. However, we encourage you to visit Associates Central to take advantage of the new aStore features. Thanks for all the great work you have put into your aStores so far!

Sincerely,

The Amazon Associates Team

Is FaceBook Unrealistic with Yahoo? Is Microsoft Going to Buy?

posted by MR WAVETHEORY at 10/12/2006 08:26:00 AM
WSJ did an article on Yahoo/FaceBook again. Yahoo, Inc. (Nasdaq YHOO) I love the quote at the end with Mark Zuckerberg: "Mr. Zuckerberg said there was no sense in saying, "let's make a lot of money now....I can be doing this for a long time, hopefully." Zuckerberg is an incredibly lucky entrepreneur. He doesn't seem to understand that there are fewer than 10 companies in the world that have the capacity or desire to purchase his company. First time entrepreneurs always make the same mistake. Or that $1 billion is alot of money. Scobleizer speculates that FaceBook will get picked up soon - still having a hard time convincing Microsoft (Nasdaq MSFT) execs to pull the trigger. He does make a good point that it is hard to duplicate the community. However, I do agree with Ballmer that the users in FaceBook churn every 4 years and that's not very sticky. Still, Scoble insists:
I, and others, told Microsoft’s execs to start buying everything that moved in the social software space cause we knew that valuations were gonna be much more expensive later on. The executive leadership at Microsoft didn’t believe us. Still doesn’t.

Nintendo Wii Pre-Orders Begin on Friday

posted by MR WAVETHEORY at 10/12/2006 04:18:00 AM
Nintendo Co. Ltd (Tokyo 7974) is going to start taking orders for the Nintendo Wii on Friday at EB Game and GameStop Corp (NYSE GME). The Wii is an incredible machine. Below is a video of a girl playing tennis on the Wii. The Wii will be launched on November 19, 2006 in the US. More details at the Nintendo Wii official site.


Comment on this video at Str8Up.com


October 11, 2006

The Richest Person in China Is A Woman: Zhang Yin, $3.4 Billion Fortune from Recycling Paper

posted by MR WAVETHEORY at 10/11/2006 08:40:00 PM
Hurun.net writes a great story about the richest people in China (via SCMP). The richest: Zhang Yin, who made her fortune in recycling paper.
  • 49-YEAR OLD ZHANG YIN CHINA NUMBER ONE WITH US$3.4 BILLION
  • RICHEST SELF-MADE WOMAN IN WORLD
  • FIRST WOMAN TO TOP CHINA RICH LIST
  • 15 USD BILLIONAIRES UP FROM 7 LAST YEAR
  • US$100 MILLION CUT-OFF TO MAKE LIST
  • LIST EXPANDED TO 500 INDIVIDUALS UP FROM 400 LAST YEAR

PAPER-recycling entrepreneur Zhang Yin became the first woman to top a ranking of China's richest people, amassing a fortune of $US3.4 billion ($4.6 billion) after her company's shares were listed in Hong Kong and almost tripled in value.

Ms Zhang, 49, whose Nine Dragons Paper Holdings (HKG:2689) buys scrap paper from the US for use in China, vaulted from 36th to replace retail tycoon Huang Guangyu, according to Shanghai-based Hurun Report, which compiles the annual China Rich List.

Ms Zhang's wealth ranks her as the world's richest self-made woman, ahead of global celebrities such as US chat show host Oprah Winfrey and eBay chief executive officer Meg Whitman. The number of women on the list rose by more than half to 35, reflecting their increasing role in an economy that's growing at more than 10 per cent annually.

The top 35 people on the list were all entrepreneurs. She's even wealthier than Oprah Winfrey and Meg Whitman from eBay (Nasdaq EBAY) who come in at $1.4 and $1.5 billion respectively.
Ms Zhang, who owns 72 per cent of Nine Dragons, started the business with her Taiwan-born husband Liu Mingzhong. Her fortune is more than double that of Ms Winfrey, 52, who is estimated to be worth $US1.4 billion by US-based Forbes magazine. Ms Whitman, 49, of eBay is worth $US1.5 billion, according to Forbes.
You don't need to be a dot commer or technopreneur to make a fortune in China. In fact, the report points out:

One of the biggest losers was Chen Tianqiao, 35, chairman of Shanda Interactive Entertainment Ltd., who dropped to No. 24 from No. 3. Chen's assets declined almost by half to US$750 million from US$1.45 billion as Nasdaq-listed Shanda shares slumped after the company said it would offer some online games free.

The report is published by Hurun.net and the full list of the richest people in China is here. Try this for the English version of Hurun.net and the richest people in China.

Bank of America Offers Free Stock Trading - But Is It Really Free?

posted by MR WAVETHEORY at 10/11/2006 07:39:00 AM

Bank of America is offering 30 free stock trades per month for customers with $25,000 or more in deposits. Zecco is offering 40 free stock trades per month to customers with at least $2,500. Additional trades are $3.50. Free online stock trading may be here to stay, but consumers should be aware that there are hidden costs.

I pointed out that free is not a business model for Zecco, but a great marketing strategy. It seems like that is true. Both Bank of American and Zecco cap the number of free trades you can make. Additionally, companies like Zecco and Bank of America may make a market in your trade. That means, they will buy from you or sell to you when you trade - earning their money in the form of a spread. This could be very costly to the average investor. For instance, let's say you wanted to buy 100 shares of Apple for your retirement account. If you paid just $.10 extra on a 100 share order of Apple stock by going through Zecco or Bank of America, that translates in $10 out of your pocket and into Zecco or BofA's. Imagine doing that for 1000 shares, multiply by 40 times. That would be $4000 in hidden costs to you the customer. There may be free hot dogs at Zecco but there is no free lunch.

In any case, today's announcement by Bank of America is bad news for online brokers: Charles Schwab , E*Trade Financial, TD Ameritrade Holding. Bank of America has 50 million customers. Charles Schwab has 6.8 million.


Online Trading Stocks

SymbolTimeTradeChange% ChgVolumeIntradayRelated Info
BAC10:17AM ET53.92Down 0.71Down 1.30%2,662,900Chart, Messages, Key Stats, More
SCHW10:22AM ET17.13Down 0.93Down 5.15%9,503,870Chart, Messages, Key Stats, More
ET10:17AM ET22.35Down 2.11Down 8.63%6,329,600Chart, Messages, Key Stats, More
AMTD10:22AM ET17.08Down 2.02Down 10.58%12,398,085Chart, Messages, Key Stats, More


Warren Buffett Memo to All Stars

posted by MR WAVETHEORY at 10/11/2006 07:23:00 AM
The FT published a recent memo written by Warren Buffett to the top 44 Berkshire Hathaway managers "The All-Stars." Buffett is the chairman of Berkshire Hathaway Inc. (NYSE BRKA) discusses the stock options backdating scandal and the temptations of misgovernance.

BERKSHIRE HATHAWAY INC.

To: Berkshire Hathaway Managers (“The All-Stars”)

From: Warren E. Buffett

Date: September 27, 2006

The five most dangerous words in business may be “Everybody else is doing it.” A lot of banks and insurance companies have suffered earnings disasters after relying on that rationale.

Even worse have been the consequences from using that phrase to justify the morality of proposed actions. More than 100 companies so far have been drawn into the stock option backdating scandal and the number is sure to go higher. My guess is that a great many of the people involved would not have behaved in the manner they did except for the fact that they felt others were doing so as well. The same goes for all of the accounting gimmicks to manipulate earnings – and deceive investors – that has taken place in recent years.

You would have been happy to have as an executor of your will or your son-in-law most of the people who engaged in these ill-conceived activities. But somewhere along the line they picked up the notion – perhaps suggested to them by their auditor or consultant – that a number of well-respected managers were engaging in such practices and therefore it must be OK to do so. It’s a seductive argument.

But it couldn’t be more wrong. In fact, every time you hear the phrase “Everybody else is doing it” it should raise a huge red flag. Why would somebody offer such a rationale for an act if there were a good reason available? Clearly the advocate harbors at least a small doubt about the act if he utilizes this verbal crutch.

So, at Berkshire, let’s start with what is legal, but always go on to what we would feel comfortable about being printed on the front page of our local paper, and never proceed forward simply on the basis of the fact that other people are doing it.

A final note: Somebody is doing something today at Berkshire that you and I would be unhappy about if we knew of it. That’s inevitable: We now employ well over 200,000 people and the chances of that number getting through the day without any bad behavior occurring is nil. But we can have a huge effect in minimizing such activities by jumping on anything immediately when there is the slightest odor of impropriety. Your attitude on such matters, expressed by behavior as well as words, will be the most important factor in how the culture of your business develops. And culture, more than rule books, determines how an organization behaves.

Thanks for your help on this. Berkshire’s reputation is in your hands.

Microsoft CEO Ballmer: Is YouTube really some permanent, long-term thing?

posted by MR WAVETHEORY at 10/11/2006 06:01:00 AM
Great interview between Microsoft CEO Steve Ballmer and Businessweek. They talk about the YouTube deal and FaceBook. Ballmer seems to question whether the YouTube and FaceBook are fads.
[You've got to ask] could Google do whatever it is they're hoping to buy without paying $1.6 billion? Is YouTube really some permanent, long-term thing, or is it a fashion? I'm not saying it is a fashion. But every time we do valuations, I wonder if we can afford to keep this hot for 10 years. I'm sure somebody at Google has got to do the same analysis, because even $1.6 billion is more than 1% of their market cap.
He brings up a great point which is there are very few companies that can afford to pay over $1 billion for Web 2.0 companies.
Look, there are only [a few] buyers who can buy anything over a billion dollars in this space. There's us. There's eBay (EBAY). There's Yahoo. And there's Google. I don't think there's anybody else. Even Amazon (AMZN) has a market cap of only $13 billion. I don't think they're going to do too many $1 billion deals. So you've got maybe four guys who will buy in that range. And there's the public market.

Did Google Buy YouTube to Negotiate with MySpace?

posted by MR WAVETHEORY at 10/11/2006 05:50:00 AM
MySpace is one of the largest online audiences and with the recent ad deal between Google and MySpace, part of me says that Google bought YouTube so it could be in a stronger negotiating position with MySpace. The $900 million ad deal between MySpace and Google is no chump change even for Google, and in order to deliver on that number, it looks like the number crunchers at Google may have thought that adding YouTube to the fold would strengthen their bargaing position. The WSJ seems to agree. News Corp execs were upset over they got passed over.

Circumstances of the deal upset executives at News Corp. The media conglomerate had sniffed around YouTube several times in recent months, but never made a firm offer because the start-up's executives said it wasn't for sale, say people familiar with the matter.

Understandably, this is one the biggest deals in recent years. The deal really forces MySpace to work with Google.

Google Chief Executive Eric Schmidt and Advertising Sales Vice President Tim Armstrong are expected to meet this week in Los Angeles with News Corp. executives, including Chairman Rupert Murdoch, to discuss new ways of working together. One possibility is to expand Google's recently signed ad deal with social-networking site MySpace to include video advertising on the Web. "If we can figure out the ways to work with them or integrate with them, that could be really good for us," said Ross Levinsohn, head of News Corp.'s Fox Interactive Media division, which oversees MySpace. He declined to comment on specifics.

Sprint Tests MediaFlo From Qualcomm

posted by MR WAVETHEORY at 10/11/2006 02:06:00 AM
Sprint Nextel Corporation (NYSE S) is testing mobile TV service MediaFlo from Qualcomm.

Qualcomm Inc.'s (Nasdaq QCOM) highly anticipated MediaFLO mobile TV service is gaining momentum as Sprint Nextel Corp. confirmed it is conducting trials using the network technology and could soon join initial launch carrier Verizon Wireless in offering the service to consumers. The additional support could be crucial as competing mobile TV services come online.

Qualcomm MediaFlo Demo

That's great news. Now I can catch live sportscasts and CNN on my phone.

Verizon is already working with Qualcomm on MediaFlo.

That's bad news for MobiTV which is currently providing TV service on Sprint, Cingular, and Verizon Communications (NYSE VZ). That's probably why they raised a whole bunch, a couple million in fact, of change a few months ago - MobiTV raised $70 million from Oak Investment. It'll be going from hot to not.

Renee Blodgett, Courtsey Scott Beale (Laughing Squid)
Phil Alveda, CEO of MobiTV, crowed.
"We have taken tremendous strides to develop this rapidly emerging market across three continents over the last few years," said Phillip Alvelda, CEO, chairman and co-founder, MobiTV. "These rather substantial funds will help us capitalize on MobiTV's head start and position as the premiere brand in mobile television. We plan to use these funds to provide even more television content on more devices, across more networks, and in more countries around the world."
Nice job managing the downside Phil. Oak must have known about this that some of MobiTV's largest customers are testing Qualcomm's TV product. If not, this could be a real big issue for the board members. Believe me. Getting blindsided by the CEO is not good. I've been there. It's not a good feeling.

All is Not Well at Yahoo!

posted by MR WAVETHEORY at 10/11/2006 01:53:00 AM
NYTimes writes an article admonishing Yahoo! for not doing more. It's not easy being Yahoo! Inc. former leader of the Internet, especially when everyone thinks you lost out on YouTube. Nothing to worry though. It's just a few operational issues.

Summary of what I think are the highlights.


Execution Retention Bonuses
Yahoo has responded by giving substantial raises to favored executives it wants to keep, according to one current executive who spoke on the condition of anonymity because he did not want to jeopardize the raise he received.

Hiring
Yahoo’s faltering image and plunging stock price may also be hurting its ability to recruit talented people. “A lot of entrepreneurs I talk to would rather work for a hypergrowth technology company than what they consider — and this is funny — a stodgy old Internet company,” Mr. Squali said.

Political Fights and Turf Wars (Read my speculation FaceBook Turf War at Yahoo!)
Current and former Yahoo employees say the company has been bogged down by bureaucracy and internal squabbling. For example, the media group, which handles video programming, and the search group, which has a system to find videos on the Web, both wanted to offer a service for users to upload their own video clips. The search group won, but the delay allowed YouTube, a start-up, to dominate the market.


Losing Ad Monies to MySpace and Viacom

“Yahoo has lost the favor it enjoyed a year or two ago,” said David Cohen, a senior vice president of Universal McCann, a media buying agency of the Interpublic Group. He said his clients were reducing the share of their budgets they allocate to Yahoo in favor of newer sites, like MySpace, and sites developed by big media companies like Viacom.

Goodbye Microsoft Office. Hello Google Docs.

posted by MR WAVETHEORY at 10/11/2006 12:21:00 AM
Google (Nasdaq GOOG) has announced Google Docs which is a word processing and spreadsheet package. It competes with Microsoft Live Writer Beta.

Google Watch says "According to sources, Google Docs isn't so much a new online software app as it is a combination of the two existing products. However, Google Docs focuses on collaboration among multiple users." Right. More posturing. It will be integrated with QuickBooks in 2007.

TechCrunch says there are security concerns with saving your files online "A drawback of online office applications is the fact that potentially sensitive documents are stored on Google’s servers. The fact that an internal Google document about their Project “Platypus” was discovered on Writely earlier this year only perpetuates these concerns (Google says this was not a security breach, however). Google notes that individuals and small & medium sized businesses aren’t too concerned - Google’s security precautions are probably far beyond what they are doing anyway."

The one company that is rarely mentioned is Zoho which has a nice Office suite that is embeddable into webpages. Zoho is a really great set of apps. Check it out.

October 10, 2006

Sell Your Company on Ebay

posted by MR WAVETHEORY at 10/10/2006 10:52:00 PM
Got a company, sell it on eBay (Nasdaq EBAY). TechCrunch put together a list of companies that were recently sold on eBay.There are many more for sale. If you earch for site for sale on eBay, you get a whole list of sites ranging from MySpace sites to auctions sites to dog training sites. Sites range from $10 to $500,000. eBay charges just 1% fee based on the closing value of the auction with a maximum of $250. What a steal compared to bankers.
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Google Sony BMG and Warner Music Deals

posted by MR WAVETHEORY at 10/10/2006 08:38:00 AM
Here are the Google (Nasdaq GOOG) press releases for the Warner Music Deal and the Sony BMG deal. They main difference is that Warner will be selling songs off Google immediately for $1.99 a download while Sony will distribute for free and monetize through advertiser sponsorships.

Sony BMG Deal Facts

Monetizing through Ad-Supported Content
SONY BMG MUSIC ENTERTAINMENT will be able to monetize its music video content online by leveraging Google's extensive advertiser network of hundreds of thousands of advertisers. SONY BMG MUSIC ENTERTAINMENT's expansive music video catalog will be sponsored by Google advertisers making it free to all users. The advertising revenue generated will be shared by SONY BMG MUSIC ENTERTAINMENT and Google.

Unmatched Distribution through AdSense Partner Sites
In the coming months, SONY BMG MUSIC ENTERTAINMENT will also work with Google to distribute select videos from its vast archives to websites around the world via Google's extensive AdSense publisher network, making it even easier for music fans to access streaming premium content while surfing the Web, all at no cost to the user. Web publishers will be able to easily display videos that match the tone of their sites adding value to their online content and creating a new way to earn revenue from their sites. For example, a fan site devoted to a particular artist can run ad-supported music videos from that artist. Each time a user is interested in the accompanying ad and clicks on the video, the web publisher, SONY BMG MUSIC ENTERTAINMENT, and Google accrue revenue.

Facilitating User-Generated Content
SONY BMG MUSIC ENTERTAINMENT and Google will also work together to create a groundbreaking new service that will allow music fans to access user-created music video content featuring certain material from SONY BMG MUSIC ENTERTAINMENT's library of recorded music, while at the same time respecting the rights of artists and copyright holders.

Warner Deal Facts

Monetizing through Ad-Supported Content
WMG will be able to monetize its music video content online by leveraging Google's extensive advertiser network of hundreds of thousands of advertisers. WMG's music video catalog will be sponsored by Google advertisers, making it free to all users. The resulting generated advertising revenue will be shared by WMG and Google. Besides providing ad-supported content on Google Video, select WMG's music videos will immediately be available for purchase as downloads on Google Video for $1.99.

Unmatched Distribution through AdSense Partner Sites
In the coming months, WMG will also work with Google to distribute its substantial video collection to websites around the world via Google's extensive AdSense publisher network, making it even easier for users to access free premium content while surfing the Web. Web publishers will be able to easily display videos that match the tone of their sites adding value to their online content and creating a new way to earn revenue from their sites. For example, a fan site devoted to a particular WMG artist can run ad-supported music videos from that artist. Each time a user is interested in the accompanying ad and clicks on the link, the Web publisher, WMG and Google will share in the resulting revenue.

Facilitating User-Generated Content
WMG and Google are working together to allow users access to music from WMG's recorded music library for use in their creative user-generated productions. Once Google's technology is implemented, content companies such as Warner Music Group will have the opportunity to monetize the use of music in user-generated content, or if they choose, have the content removed from the platform.

Video of YouTube Founders

posted by MR WAVETHEORY at 10/10/2006 05:35:00 AM
Watch the YouTube founders Chad Hurley and Steve Chen talk about the Google deal.


Google / YouTube - Wall Street Analyst Comments on Deal

posted by MR WAVETHEORY at 10/10/2006 04:52:00 AM
Below are the Google (Nasdasq GOOG)/ Youtube comments from Wall Street Analysts. All of the firms below make markets in Google stock and/or options, so take their advice with a grain - make that 2 grains - of salt. I will kick things off with the comments from the one and only, the master of the Internet universe, Henry Blodget, the $500 target Amazon.com man - who is the only one who doesn't make a market in Google stock or options. Actually, I think Henry makes a good point about Google stock. Read on.

It's also worth noting that Sequoia and YouTube could easily have taken some cash off the table, but instead chose to go long Google stock at more than $400 a share. Yes, there are tax considerations, but if you think Google's stock has top-ticked (or even if you just wanted to reduce risk), you would take some cash. Both Sequoia and YouTube obviously have insight into Google's performance in Q3 and the current quarter, and neither party, presumably, would want to celebrate the closing of the deal by loading up on a tanking stock. The exchange rate has yet to be set, so Sequoia and YouTube could be gambling that a bad third-quarter report will temporarily hobble the stock, but this seems a bit too clever. So, on balance, amid the Yahoo-problem-or-industry-problem worries, probably a positive stamp of approval on Google's current business trends.
--Henry Blodget of Amazon.com fame and Internet Outsider, who is the only unbiased analyst on Google stock
* * *

While it is counter to Google's general preference to build rather than buy, and the company already has a similar offering in Google Video, we believe Google recognizes the value of YouTube's leadership position and its strong brand name in the fast-growing video space. … By owning YouTube, Google may be able to bring content holders to the negotiating table earlier and in a more strategic way than otherwise might be possible.
--Douglas Anmuth at Lehman Brothers, who has an "overweight" rating and $530 price target
* * *

Google [acquiring] YouTube … would catapult Google to the number one position in online video and greatly enhance its ability to leverage social networks to improve search monetization. … In addition to a greater share of online video advertising, Google could potentially generate fees from YouTube video purchases. The deal would also enhance Google's prowess in monetizing social-networking sites, an area it aims to begin to develop in the fourth quarter with MySpace….
--Marianne Wolk at Susquehanna, who has a "positive" rating
* * *

It would be a radical departure from its mergers-and-acquisition strategy, which has been almost exclusively based on tuck-in technology deals; 2) … the $1.6 billion would also be almost equal to Google's entire M&A spending to date; and 3) It would acknowledge that Google Video has failed to gain sufficient traction. The clear positive for Google -- synergies between the world's third largest user-generated content site and arguably one of the world's largest and most scalable advertising/computer networks could be enormous.
--Citigroup Inc.'s Mark Mahaney, who has a "buy" and $550 price target
* * *

We think a … Google/YouTube deal makes a lot of sense from a long-term business perspective, but the legal issues will likely remain clouded for some time. … The price tag of about $1.6 billion is difficult to justify on a spreadsheet and may be somewhat of a throwback to the days of paying for eyeballs and pageviews, but this is a strategic bet that Google would be placing for a long-term objective: to be THE technology and distribution partner for content owners and publishers. With YouTube's traffic and buzz, Google could quickly try to build its position as the video advertising clearinghouse online…. As we have said many times in the past, Google is a company building its capabilities for the long term, and thus far, we think it has made many strategically positive steps. Yes, a potential YouTube acquisition is a bet, but it's just the kind of bet we'd expect from Google.
--UBS analyst Benjamin Schachter, who has a "neutral" rating and $450 target
* * *

Google would likely capture additional search revenue in addition to video advertising revenue from YouTube. Google recently signed a deal to be the exclusive search and keyword sales provider for [News Corp.'s] MySpace.com, guaranteeing a minimum $900 million over the next three years. A YouTube acquisition would enable Google to retain all of the economics on search advertising on the site. … Much of the content on YouTube is free, and many video clips are copyrighted material from traditional media companies. Google could be responsible for filtering out copyrighted material or negotiating revenue-sharing partnerships with the owners before aggressively monetizing YouTube. On a positive note, the large YouTube user base could help Google sign new content partnerships.
--Justin Post at Merrill Lynch & Co., who has a "buy" rating and $500 price target
* * *

The combination of Google and YouTube may make it easier to secure distribution agreements for copyrighted video content. In fact, both companies today announced agreements with Sony BMG Music Entertainment and Warner Music Group for their music video libraries, giving users access to free (ad supported) music videos. In addition, Google will be able to offer its paid video content to the vast YouTube audience. Not only would Google's relationship with content owners give YouTube access to premium video content, it would also bring it a little closer to solving the copyright problems on the site. Having said that, the fact that YouTube was able to secure two agreements on its own today (with Universal and Sony, adding to its existing agreement with Warner) implies potentially less risk as the company is moving more towards the mainstream.
--Jefferies analyst Youssef Squali, who has a "buy" rating and $500 price target
* * *

Google shares should benefit from these announcements [involving Warner Music and Sony BMG] as they reinforce its commitment to further developing verticals that will enable it to better engage its users. Additional video inventory, combined with the deal with MySpace, enable Google to offer advertisers a more expansive user base and the opportunity to create branded campaigns to run on Google and its affiliate sites. These deals, similar to those which YouTube also has in place, could simplify a potential integration between the two companies.
--Anthony Noto at Goldman Sachs Group Inc., who has an "outperform" rating and $525 price target

Booth Babes and Robots Steal the Japan Tech Show

posted by MR WAVETHEORY at 10/10/2006 01:14:00 AM
Robots and Babes were the main attractions at the CEATEC Japan Tech Show. Attending the show is as much about taking look at gadgets as it is about checking out the short miniskirts. Lots of pictures of cool robots.

Murata Boy Cycling Robot

Mitsubishi Wakamaru
Toshiba Insects
ATR Robovie

au Babe
Cell phone babe
Another cell phone babe
One more cell phone babe

Babe in eBook
Lumix Babe