January 05, 2007

StudiVZ Acquisition Means FaceBook Users Worth $100 Each

posted by MR WAVETHEORY at 1/05/2007 05:38:00 AM
Private equity guys, VCs, you name it, they all love to do comps. Comp this. Comp that. Big bonus comp! Well, the comp of the day that every VC is studying the StudiVZ comp, because it's one of the largest exits this year for a Web 2.0 company. Ok. Fine, it's the first exit. In fact, the question of the hour is: What does the StudiVZ acquisition mean for the value of Facebook?

What does the StudiVz comp say about FaceBook's valuation?

We want to solve the following equation (even a third grader can do this)

Number of Users * Price Per User = Valuation of StudiVZ

StudiVZ Number of Users: 1 million users
Valuation of StudiVZ : $100 million

1 million * X = $100 million

Solve for X

Price Per User: $100

Simple enough? Now do it for FaceBook except we want to solve for Valuation of FaceBook this time around. Let's assume a FaceBook user is worth the same as a StudiVZ user (hence the comparable)

FaceBook Number of Users: 13 million users (via)
Price Per User: $100

13 million users X $100 = $1.3 billion

So, we can debate all day about whether FaceBook is worth $1.3 billion or whether the StudiVZ deal was priced off of a $1.3 billion valuation for FaceBook to figure out whether the chicken or the egg came first. I don't know.

But if I were a betting man, my bet is that the StudiVZ deal was based on an assumption that FaceBook is worth $1.3 billion, the indisputable fact that there are 13 million users, and hence, the indefensible conclusion that each user is worth $100.

That neither proves nor disproves the valuation of FaceBook, but merely shows that there are companies out there in the world that are willing to pay $100 per user for a Web 2.0 company.

So, if I were a startup entrepreneur, next time I meet a VC, I would demand to have my company valued at the "StudiVZ valuation" and the "FaceBook comp."

For all those twenty something year olds out there, if you're still in college and have started your own FaceBook clone, mention those two magical words to your VC and you'll sound like a genius. Best of all, you'll get a great valuation.

Get Your Black Donnellys from NetFlix for Free

posted by MR WAVETHEORY at 1/05/2007 04:06:00 AM
NBC is sending free DVDs for "The Black Donnellys" to Netflix subscribers before it debuts online in the spring. NBC had free DVDs to 5 million subscribers for the fall launch of two shows: "Kidnapped" which has gone off air and "Studio 60 on the Sunset Strip" which is still on air. Users get first dibs on the DVD before NBC makes it available on Jan 15 on NBC.com. (press release)

Get the Black Donnellys here.

Spockos Brain Bites the Dust - Walt Disney Takes Down Amateur Blogger

posted by MR WAVETHEORY at 1/05/2007 04:00:00 AM
Walt Disney Company (NYSE DIS) has succeeded in shutting down amateur blog Spocko's Brain , because he was too good at his job. "Spocko" took issue with on-air comments made by right-wing talk show hosts at Bay Area ABC affiliate radio station KSFO. That was ok - except he posted audio files of hosts' comments on his Web site, and also began a letter-writing campaign that, he says, resulted in advertisers fleeing the station.

On Tuesday, Spocko's Internet service provider, 1&1 Internet, pulled the plug, prompted by a Dec. 22 cease-and-desist letter from ABC Radio claiming that material on Spocko's Brain violated Disney's copyright.

Neil Simpkins, spokesperson for 1&1, says the company gave Spocko one week to remove the material, and when he did not, took down his site. He says the company is particularly leery of the audio files, adding that 1&1 would "probably be more than likely" to allow the blog back if Spocko used transcripts of the show as opposed to actual audio files of what aired.

But Spocko argues that the audio files on his site constitute a "fair use" of the copyrighted material. "The [fair use] battle for bloggers hasn't been waged yet," Simpkins says. "Right now, technology is outracing the legal system."

KSFO features hard right-wing talk show hosts who endorse torture, call for the public hangings of New York Times editor Bill Keller and other journalists, and demand that callers mock Islam. They also mock their own advertisers--calling Chevrolet, for example, "sh!tty," or recommending that Sears' Diehard battery be attached to an African-American's testicles.

Spocko not only recorded the programming and posted audio files on his site, but also sent letters to advertisers on the station, including AT&T, Bank of America, Visa, MasterCard, and others--pointing out the station's content and directing them to his blog to hear proof through his audio files.

Since Spocko began contacting advertisers, they have departed KSFO in droves. Netflix, MasterCard, Bank of America, and most recently, Visa have pulled their advertising from the station. According to Spocko, Federal Express, AT&T and Kaiser Permanente are weighing their departure as well.

January 04, 2007

PlayBoy PlayMates Kick Bill Miller's Ass - Hot Stock Picks Trump Legg Mason Value Fund

posted by MR WAVETHEORY at 1/04/2007 05:53:00 PM
2006 was the year that Bill Miller ended his streak of beating the S&P 500 for 15 consecutive years. It was also the first time that 5 PlayBoy PlayMates beat the returns of the Legg Mason Value Fund (Nasdaq LMVTX) with their stock picks. TradingMarkets and PlayBoy sponsored the 2006 Stock Picking Contest and their returns were phenomenal. Each of the Playmates picked 5 stocks at the beginning of 2005 and their picks were hot. The top Playmate was Deanna Brooks who returned 43% vs Bill Miller's measly 6% (Shameful isn't it?). She gave Bill Miller a whooping. For your future stock picking needs, next time you may want to consult a PlayMate. Without further adue, the PlayMates and their Picks!

Winner: Deanna Brooks +43%
Deanna Brooks, Miss May 1998, picked 5 stocks that returned 43%. Deanna Brooks smoked Bill Miller with her picks. Deanna's top pick was Yamana Gold Inc. (USA) (AMEX AUY). Her reason: "What girl doesn't like a little bling? I'm hot for gold this year..." She also owned Hauppage Digital, Inc. (Nasdaq HAUP), International Business Machines Corporation (NYSE IBM), Petroleo Brasileiro S.A. (ADR) (NYSE PBR) and Pfizer Inc. (NYSE PFE).

About Deanna. Deanna's turn-ons are being touched on my lower back, good kissers and well planned romantic evenings. Her turnoffs: hairy backs...especially on men! And, guys who whistle or say "Hey Babe!" when I walk by. Also, last but not least: "When it comes to sex, I want it anywhere I might get caught! A golf course, the back porch, an elevator..."

Deanna sure knows how to pick stocks.

Runner Up: Courtney Culkin +32%
Courtney Culk, Miss April 2005, came in second with a very respectable 32% return. Just as Deanna likes bling, then Courtney clearly likes shopping. Her top pick was Steve Madden, Ltd. (Nasdaq SHOO) which gained a whopping 80%. Steve Madden is her favorite shoe brand. Others included Bebe Stores, Inc. (Nasdaq BEBE), Nike, Inc. (NYSE NKE), Apple Computer Inc. (Nasdaq AAPL), and Google, Inc. Class A (Nasdaq GOOG).

About Courtney. Ambition: To secure a successful career in modeling and entertainment and finish her degree. Turn-ons: Educated men with a strong sense of self. Thin and sexy with a pronounced jaw line. Turn-offs: Bad teeth; pushy, disrespectful men; show offs.

Forget modeling. Start stock picking.

2nd Runner Up: Amy Sue Cooper +28%
Amy Sue Cooper, Cyber Girl of the Year, came in third with a 28% return. She likes drilling because her big pick was Dril-Quip Inc. (NYSE DRQ). Amy thought that drilling just sounded exciting. Cool. We agree. I like drilling too. Amy's other picks were mostly pharmas and biotechs - she's a nurse. She picked: Amgen, Inc. (Nasdasq AMGN), Indevus Pharmaceuticals, Incorporated (Nasdaq IDEV), Microsoft Corporation (Nasdaq MSFT), and Pacific Ethanol (Nasdaq PEIX). Did we mention she's a hip tree hugger?

About Amy Sue. Amy Sue is a nurse and studying to be an anesthetist. When she isn't hitting the books, Amy Sue runs half marathons, play tennis or spends extra time in the gym fine tuning her fineness.

With her returns, it will be difficult to catch up! Drill on!

3rd Runner Up: Kara Monaco +16%
Kara Monaco, Miss June 2005, returned 16% with her picks. Her portfolio had a mix of steady performers mostly 16-18% winners like AppleComputer, Inc. (Nasdaq AAPL) because she likes their products, Bank of America Corporation (NYSE BAC) and CVS Corporation (NYSE CVS) because they seem to be growing, Perrigo Company (Nasdaq PRGO), and Zimmer Holdings, Incorporated (NYSE ZMH) because her friend told her to.

About Kara Monaco. Kara wants to become a successful model/actress, but I think she should be a stock picker. Turnons: intelligence, a sense of humor, someone tall, dark and handsome. Turnoffs: hairy guys! Cheaters! Jealousy and possessiveness.

4th Runner Up: Lindsey Vuolo +13%
Lindsey Vuolo, Miss November 2001, earned 13% on her portfolio. Her portfolio was very volatile. Vuolo is addicted to BlackBerry. She picked Research In Motion Ltd. (Nasdaq RIMM) which jumped 93% in 2005 - "I'm the dork of tech stuff". She also picked XM Satellite Radio Holdings CL A (Nasdaq XMSR) which tanked 47% - "XM Satellite Rocks." Rounding out the field: Bluefly Inc. (Nasdaq BFLY), Boyd Gaming Corporation (Nasdaq BYD) because "I love the Borgota", and Google, Inc. Class A. (Nasdaq GOOG) because "I Google everything."

About Lindsey. Her ambition is to get a degree in communications, to live successfully and start a family. Turn-ons are back rubs, a sense of humor, intelligence, confidence, true love, a good kisser & a nice butt! Turnoffs are self-indulgence, insecurity, jealousy, liars and cheaters.

StudiVZ - German FaceBook Gets $100 Million Exit in 14 Months

posted by MR WAVETHEORY at 1/04/2007 03:21:00 PM
StudiVZ, a German Facebook clone, has been acquired for $100 million.The network was launched in October 2005 by two students from Berlin, but in the meantime has collected an undisclosed sum of investments by, among others, the media group Holtzbrinck and the Samwer brothers, founders of the ringtone vendor Jamba!. Similar services have just been launched in France (StudiQG), Italy (StudiLN), Spain (EstudiLN), and Poland (Studentix), other countries are supposed to follow. (via). In and out in 14 months!

A few months ago, I wrote about Chinese FaceBook, Xiaonei. Xiaonei got acquired 10 months after launch in October 2005. Xiaonei took less time to get acquired, but the exit was not nearly as large as the $100 million that StudiVZ is getting. StudiVZ took longer to get acquired, but it certainly sets the record for Facebook knockoffs.

Did I mention that StudiVZ is still in beta? I must have forgotten.

Any body say bubble? Did I hear bubble? Anyone? Bueler? Anyone?

StudiVZ blog entry about the acquisition
English Translation of DeSpiegel article
Great backgrounder on StudiVZ

Watch the Premier of the Apprentice on Yahoo

posted by MR WAVETHEORY at 1/04/2007 11:31:00 AM
The Donald is back on primetime. You can watch the premier episode of the Apprentice on Yahoo! This time, the tall skyscrapers of New York City have been replaced by the palm trees of the West Coast as Mr. Trump and his associates take on Los Angeles.

NBC is premiering the first 24 minutes of Donald Trump's "The Apprentice" online on NBC.com and Yahoo days before it hits the air. Separately, NBC and Yahoo are kicking off a season-long "The Intern" contest on the heavily trafficked portal. Visitors can predict what will happen on the next episode, with the winner getting the chance for a two-week internship with the "Apprentice" winner. NBC has increasingly offered full-premiere episodes of new scripted shows such as "30 Rock" and "Friday Night Lights" on its Web site before air. But it's chosen to only offer "sneak peeks" of returning reality shows--such as "The Biggest Loser" and now "The Apprentice"--likely figuring that viewers are already familiar with the shows and an online taste will serve to boost "live" viewing.

Always the ladies man: 10 women and 8 men.

The 18 candidates will endure the scrutiny of not only Mr. Trump, but Ivanka and Donald Jr. as well. To top things off, the losing team each week will have more to worry about than just the boardroom. Their lives will be turned upside down in a shocking new twist that will feature the ultimate battle of the "Haves" versus the "Have-Nots." Is this taking a page from Survivor?

Link: Watch The Apprentice: Season 6 Episode 1 (first 24 minutes)

Watch Perfume The Movie: Its Every Startup Entrepreneurs Dream

posted by MR WAVETHEORY at 1/04/2007 10:44:00 AM
A few days ago, I sneaked into a sneak preview of Perfume: The Movie after finding out from one of the cleaners that the theatre had a screening. (It's amazing what type of information you can get from the cleaning crew!) It was total serendipity. If you've ever been to a screening, you know that they like to hold it during the week when the theatres are far from full and less than empty. Even for the screening, the theatre was about 70% capacity. Since it was Tuesday, you can't blame them.

The movie is about an orphaned boy who grows up dirt poor in the ghettos of Paris and is born with the talent of a very good nose. (If he were born in the twenty first century, he probably would have been a tech startup entrepreneur.) Jean-Baptiste Grenouille is sold into indentured servitude when he is born. His job is to tan leather and he works his ass off, but he gets his lucky break one day when he meets his benefactor, a successful old parfumier (played by Dustin Hoffman) and impresses him so much that old Dustin buys him out of servitude.

Old Dustin has gotten rusty and complacent with success and old age - he is outshown by the hot parfumier in town, but with the help of the young apprentice, he regains his stature as the best parfumier in Paris. Of course, Grenouille has his own dreams - to produce the best perfume ever known to man. And that is when the movie gets interesting, because like every entrepreneur, he goes on a quest to discover the secret sauce for his perfume. In his case, his secret sauce: young women. He becomes obsessed with capturing the irresistible but elusive aroma of young womanhood and things turns deadly -twelve young girls are found murdered. His ultimate prize is the daughter of a wealthy baron.

Perfume is a scary movie. It's also a European movie. If you watch the movie in America, I'm sure you'll hear alot of giggles at the end of the movie like I did, when there is some gratuitous nudity and public displays of affection. You've got to love the French and their free spirit for squeezing that in right at the end, but that's what you get when in a French movie! (Note the shape of of the perfume bottle. I've never seen a perfume bottle shaped like that and there couldn't be a more obvious fallic symbol!)

In any case, while Perfume does get freaky, it captures the essence of what it means to be an entrepreneur - the struggle, the discovery, the recognition from creating something the world will enjoy. If you have a dream, then you'll love watching Perfume.

Watch the trailer.



Update: Just found out that it's directed by the director of Run Lola Run.

Perfume: The Movie Website
Perfume: The Movie Trailer at Yahoo

Online Help Wanted Postings Down 10% in December

posted by MR WAVETHEORY at 1/04/2007 10:35:00 AM
Is the Economy Slowing? Or is this just seasonal? Employers placed 3.34 MILLION help wanted ads online last month, marking a 17% increase from December of 2005, according to a new report by The Conference Board. Still, postings were down 10% from November's approximate 3.71 million. The Conference Board attributed the monthly decline to a slowdown in hiring during the holidays.

Miva Signs Search Distrubution Agreement with Google

posted by MR WAVETHEORY at 1/04/2007 09:57:00 AM
According to an 8-K filed with the SEC, Miva, Inc. (Nasdaq MIVA) has dropped Yahoo Search (Nasdaq YHOO) and signed up with Google (Nasdaq GOOG). Miva will begin using Google's WebSearch and AdSense services on its websites within 30 days. The agreement lasts 2 years.

Entry into a Material Definitive Agreement, Termination of a Material Definitive Agree

On December 28, 2006, MIVA, Inc. ("MIVA") and Google, Inc. entered into a Google Services Agreement (the "Google Agreement") pursuant to which MIVA, and its subsidiaries, have agreed to exclusively utilize Google's WebSearch and AdSense Services for approved websites and applications. Initial approved websites and applications are expected to be from MIVA's subsidiary MIVA Direct, Inc. and are expected to be implemented within 30 days of the date of the Agreement. Pursuant to the terms of the Google Agreement, MIVA and its subsidiaries will generate revenues when consumers click through listings to Google advertisers' websites. The Agreement has a term of two years and contains broad termination rights.

Miva had been a partner of Overture (which was acquired by Yahoo!) since 2001. When Miva signed on with Overture, Overture was still called Go To. The Go To Search agreement terminates on January 27, 2007.

On December 28, 2006, MIVA Direct, Inc., gave notice of termination of the Go To Search Services Order, dated April 26, 2001, and all amendments thereto, to Overture Services, Inc., dba Yahoo! Search Marketing and Overture Search Services (Ireland) Limited. Pursuant to this agreement, MIVA Direct had utilized advertisement listings provided by Yahoo! The termination is expected to be effective January 27, 2007.

The reason for the termination may be several fold:

Google offers better monetization. The word in the industry is that Yahoo is still at 50% of the monetization rate for keywords which means Yahoo earns about $.50 per click for every $1.00 that Google generates.

Yahoo has been competing with Miva and Miva has been hurt badly by Yahoo. A couple of years ago, Yahoo depended on a company called ESpotting to provide it with paid listings and CPC advertising on its European web properties. ESpotting was a leader in European paid search and provided paid search listings to many European portals. Miva acquired eSpotting, which depended on Yahoo for most of its business. However after Miva acquired ESpotting, Yahoo started ramping up in Europe and took the paid listings in house. ESpotting lost quite a bit of business because Yahoo accounted for so much of its revenues. It's unclear to me whether Miva knew about Yahoo!'s decision to compete with ESpotting when it acquired the company. However, I am pretty sure that ESpotting knew. In short, there is some bad blood between Miva and Yahoo and Miva needs the revenue boost.

Miva took a big bath 2 quarters ago, but insiders still appear to be selling stock at prices as low as $2.29. There has been one major purchase on December 15, 2006 by Lowell Robinson for 1.435 million shares. Lowell joined Miva on December 18, 2006 as CFO - formerly he was CFO of HotJobs. A part of his compensation depends on getting the stock up according to the Miva SEC filing:

Mr. Robinson was also granted an aggregate of 175,000 restricted stock units, (i) 140,000 of which are service-based and vest in 25% increments on each of the first four anniversaries of the date of the RSU agreement, and (ii) 35,000 of which are performance-based and vest in 25% increments on the day immediately following the tenth consecutive trading day on which the per share closing price of the Company's stock equals or exceeds $6, $8, $10 and $12, respectively, provided in each case that Mr. Robinson has been continuously employed by the Company from the award date until the vesting date.

Miva is up +14% since he joined. The new agreement should give Miva a much needed boost. As they say in Casablance, "I this is the beginning of a beautiful friendship."

INSIDER TRANSACTIONS REPORTED - LAST TWO YEARS
DateInsiderSharesTypeTransactionValue*
15-Dec-06ROBINSON LOWELL W
Officer
1,435,000DirectAcquisition (Non Open Market) at $0 per share.N/A
1-Dec-06WEBER LARRY
Director
309DirectDisposition (Non Open Market) at $3.42 per share.$1,056
1-Dec-06HEPP GERALD W
Director
309DirectDisposition (Non Open Market) at $3.42 per share.$1,056
1-Dec-06ROTHSTEIN CHARLES
Director
309DirectDisposition (Non Open Market) at $3.42 per share.$1,056
1-Dec-06SIMONSON LEE
Director
309DirectDisposition (Non Open Market) at $3.42 per share.$1,056
1-Dec-06DURRETT JOSEPH P
Director
523DirectDisposition (Non Open Market) at $3.42 per share.$1,788
1-Nov-06WEBER LARRY
Director
309DirectDisposition (Non Open Market) at $3.19 per share.$985
1-Nov-06HEPP GERALD W
Director
309DirectDisposition (Non Open Market) at $3.19 per share.$985
1-Nov-06ROTHSTEIN CHARLES
Director
309DirectDisposition (Non Open Market) at $3.19 per share.$985
1-Nov-06SIMONSON LEE
Director
309DirectDisposition (Non Open Market) at $3.19 per share.$985
1-Nov-06DURRETT JOSEPH P
Director
523DirectDisposition (Non Open Market) at $3.19 per share.$1,668
19-Oct-06PISARIS JOHN B
Officer
9,686DirectDisposition (Non Open Market) at $3.14 per share.$30,414
19-Oct-06GARCIA ANTHONY A
Officer
14,051DirectDisposition (Non Open Market) at $3.14 per share.$44,120
1-Oct-06WEBER LARRY
Director
656DirectDisposition (Non Open Market) at $3.30 per share.$2,164
1-Oct-06HEPP GERALD W
Director
656DirectDisposition (Non Open Market) at $3.30 per share.$2,164
1-Oct-06ROTHSTEIN CHARLES
Director
309DirectDisposition (Non Open Market) at $3.30 per share.$1,019
1-Oct-06SIMONSON LEE
Director
309DirectDisposition (Non Open Market) at $3.30 per share.$1,019
1-Oct-06DURRETT JOSEPH P
Director
523DirectDisposition (Non Open Market) at $3.30 per share.$1,725
1-Sep-06DURRETT JOSEPH P
Director
523DirectDisposition (Non Open Market) at $2.59 - $2.59 per share.$1,3542
1-Sep-06SIMONSON LEE
Director
309DirectDisposition (Non Open Market) at $2.59 - $2.59 per share.$8002
1-Sep-06ROTHSTEIN CHARLES
Director
309DirectDisposition (Non Open Market) at $2.59 - $2.59 per share.$8002
1-Sep-06HEPP GERALD W
Director
309DirectDisposition (Non Open Market) at $2.59 - $2.59 per share.$8002
1-Sep-06WEBER LARRY
Director
309DirectDisposition (Non Open Market) at $2.59 - $2.59 per share.$8002
16-Aug-06DURRETT JOSEPH P
Director
7,474DirectAcquisition (Non Open Market) at $0 per share.N/A
16-Aug-06GOLDBERG ADELE
Director
7,474DirectAcquisition (Non Open Market) at $0 per share.N/A
16-Aug-06OPZOOMER MARK W
Director
7,474DirectAcquisition (Non Open Market) at $0 per share.N/A
14-Aug-06HEPP GERALD W
Director
1,000DirectPurchase at $2.27 per share.$2,270
14-Aug-06CORRAO PETER A
Officer
10,000DirectPurchase at $2.28 - $2.29 per share.$23,0002
11-Aug-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $2.29 - $2.32 per share.$12,0002
10-Aug-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $2.23 - $2.6 per share.$12,0002
4-Aug-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $2.84 - $2.96 per share.$15,0002
3-Aug-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $2.91 - $2.98 per share.$15,0002
1-Aug-06SIMONSON LEE
Director
309DirectDisposition (Non Open Market) at $3.05 per share.$942
1-Aug-06GUEST FREDERICK E II
Director
309DirectDisposition (Non Open Market) at $3.05 per share.$942
1-Aug-06ROTHSTEIN CHARLES
Director
309DirectDisposition (Non Open Market) at $3.05 per share.$942
1-Aug-06HEPP GERALD W
Director
309DirectDisposition (Non Open Market) at $3.05 per share.$942
1-Aug-06WEBER LARRY
Director
309DirectDisposition (Non Open Market) at $3.05 per share.$942
28-Jul-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $2.90 - $2.96 per share.$15,0002
27-Jul-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $2.90 - $2.95 per share.$15,0002
21-Jul-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $2.70 - $2.9 per share.$14,0002
20-Jul-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $2.75 - $2.84 per share.$14,0002
14-Jul-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $2.82 - $2.89 per share.$14,0002
13-Jul-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $2.85 - $3 per share.$15,0002
7-Jul-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $3.29 - $3.59 per share.$17,0002
6-Jul-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $4.18 - $4.29 per share.$21,0002
1-Jul-06SIMONSON LEE
Director
309DirectDisposition (Non Open Market) at $4.05 per share.$1,251
1-Jul-06GUEST FREDERICK E II
Director
309DirectDisposition (Non Open Market) at $4.05 per share.$1,251
1-Jul-06ROTHSTEIN CHARLES
Director
309DirectDisposition (Non Open Market) at $4.05 per share.$1,251
1-Jul-06HEPP GERALD W
Director
656DirectDisposition (Non Open Market) at $4.05 per share.$2,656
1-Jul-06WEBER LARRY
Director
656DirectDisposition (Non Open Market) at $4.05 per share.$2,656
30-Jun-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $3.94 - $4.04 per share.$20,0002
29-Jun-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $3.90 - $4 per share.$20,0002
23-Jun-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $3.91 - $3.93 per share.$20,0002
22-Jun-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $3.93 - $3.97 per share.$20,0002
16-Jun-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $3.89 - $3.96 per share.$20,0002
15-Jun-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $3.77 - $3.88 per share.$19,0002
14-Jun-06SIMONSON LEE
Director
10,582DirectAcquisition (Non Open Market) at $0 per share.N/A
14-Jun-06SIMONSON LEE
Director
1,543DirectDisposition (Non Open Market) at $3.78 per share.$5,832
14-Jun-06GUEST FREDERICK E II
Director
10,582DirectAcquisition (Non Open Market) at $0 per share.N/A
14-Jun-06GUEST FREDERICK E II
Director
1,543DirectDisposition (Non Open Market) at $3.78 per share.$5,832
14-Jun-06ROTHSTEIN CHARLES
Director
10,582DirectAcquisition (Non Open Market) at $0 per share.N/A
14-Jun-06ROTHSTEIN CHARLES
Director
1,543DirectDisposition (Non Open Market) at $3.78 per share.$5,832
14-Jun-06HEPP GERALD W
Director
13,558DirectAcquisition (Non Open Market) at $0 per share.N/A
14-Jun-06HEPP GERALD W
Director
1,543DirectDisposition (Non Open Market) at $3.78 per share.$5,832
14-Jun-06WEBER LARRY
Director
13,558DirectAcquisition (Non Open Market) at $0 per share.N/A
14-Jun-06WEBER LARRY
Director
1,543DirectDisposition (Non Open Market) at $3.78 per share.$5,832
14-Jun-06WEBER LARRY
Director
13,558DirectAcquisition (Non Open Market) at $0 per share.N/A
14-Jun-06WEBER LARRY
Director
1,543DirectDisposition (Non Open Market) at $3.78 per share.$5,832
9-Jun-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $3.87 - $3.97 per share.$20,0002
8-Jun-06THUNE PHILLIP R
Director
5,000DirectAutomatic Sale at $3.81 - $3.87 per share.$19,0002
2-Jun-06THUNE PHILLIP R
Director
5,000DirectSale at $4.11 per share.$20,550
1-Jun-06THUNE PHILLIP R
Director
5,000DirectSale at $4.09 per share.$20,450
17-May-06SEIPPEL WILLIAM
Officer
6,200DirectPurchase at $4 per share.$24,800
15-May-06HEPP GERALD W
Director
1,000DirectPurchase at $3.76 per share.$3,760
15-May-06CORRAO PETER A
Officer
25,000DirectPurchase at $3.76 - $3.98 per share.$97,0002
9-May-06THUNE PHILLIP R
Director
101,053DirectDisposition (Non Open Market) at $4.37 per share.$441,601
9-May-06THUNE PHILLIP R
Director
360,000DirectOption Exercise at $1 - $1.91 per share.N/A
4-May-06PISARIS HENDERSON CRAIG A
Director
73,518DirectDisposition (Non Open Market) at $4.23 per share.$310,981
4-May-06THUNE PHILLIP R
Director
57,050DirectDisposition (Non Open Market) at $4.23 per share.$241,321
15-Mar-06GUEST FREDERICK E II
Director
4,113DirectDisposition (Non Open Market) at $3.72 per share.$15,300
15-Mar-06GUEST FREDERICK E II
Director
20,081IndirectDisposition (Non Open Market) at $3.72 per share.$74,701
15-Mar-06GUEST FREDERICK E II
Director
15,000DirectOption Exercise at $1 per share.$15,000
15-Mar-06GUEST FREDERICK E II
Director
75,000IndirectOption Exercise at $1 per share.$75,000


Miva Search Agreement with Google: Miva 8-K

Ask.com Wants to Be a Traffic Cop for IAC/InteractiveCorp

posted by MR WAVETHEORY at 1/04/2007 07:57:00 AM
Internet investors will find an interesting interview by Tony Perkins with Jim Lanzone, boss of Ask.com. Ask.com was acquired by IAC/InteractiveCorp (Nasdaq IACI) for about $1.85 billion. IAC/InteractiveCorp owns a slew of properties like Shoebuy, CitySearch, and Match.com and they all have one common problem: How to get traffic?

That's where Ask.com is coming in.

Among all the runner up search engines, Ask.com is in the pole position.

Ask can be the fourth or fifth ranked search engine but the sixth largest web property in the United States, ahead of Amazon and MySpace. So while we’re not Google, Microsoft or Yahoo in size, we’re bigger than nearly everybody else. And even just specifically within search, when it comes to query volume, we’re closer in order of magnitude of 6 percent share to Google at 42 or to Yahoo at 28 than anybody below us is to Ask. And we’re just at an interesting point in the marketplace.

Ask.com dreams of being the traffic cop for IAC properties, but I have to wondering that use of the word synergy.

So when you look at Ask, the other IC companies are licking their chops because they would look at us as a strong central hub for the rest of the IC network over time, especially as you build share for Ask and we get larger. And on the other hand for Ask, we look at those other companies as great sources of data that will help us build differentiated products in the different areas of search that we address. So, Ask does represent a new opportunity for IC to go in the direction of synergy and any kind of help that we can all lend each other, and I think that’s a first for the company.

Ask.com can grow much faster.

"If they [Google, Microsoft, Yahoo] add a point of share, that’ll help them make a quarter. Whereas, if you add a point of share to Ask, it’s 15, 16 percent growth, and that’s growth in revenue. So, for us, our growth opportunity is actually as a percentage of growth just huge compared to the rest of them.

We'll see what happens.

January 03, 2007

Who's Inside the PS3? PlayStation 3 Bill of Materials

posted by MR WAVETHEORY at 1/03/2007 07:25:00 PM
If you take apart a Sony Playstation 3 (aka PS3) (NYSE SNE), you will find the following components in it. The big winners are Nvidia Corporation (Nasdaq NVDA), IBM (Nasdaq IBM), and Marvell Technology Group Ltd. (Nasdaq MRVL). The PlayStation bill of materials includes:

  • Nvidia Reality Engine
  • IBM Cell Broadband Engine
  • Optional 802.11 b/g Module Marvell Chipset

Description Manufacturer 20 GB 60 GB
Reality Synthesizer Nvidia (Sony) $129.00 $129.00
IBM Cell Broadband Engine IBM (Sony) $89.00 $89.00
I/O Bridge Controller Toshiba (Sony) $59.00 $59.00
Emotion Engine and Graphics Sythnesizer Toshiba (Sony) $27.00 $27.00
Noteworthy Memory - XDR DRAM (4 x 512Mbit) Samsung $48.00 $48.00
Other Components and Manufacturing N/A $148.00 $148.00
Bluetooth Module Sony, Featuring CSR BlueCore 4 Chip $4.10 $4.10
Optional 802.11 b/g Module Marvell Chipset N/A $15.50
Other Components and Manufacturing N/A $2.50 $2.50
Memory Card Board N/A N/A $5.00
Blu-Ray Optical Drive Sony $125.00 $125.00
SATA Hard Drive Seagate $43.00 $54.00
Power Supply Sony (Private-Label) $37.50 $37.50
Cooling / Mounting Cage for Motherboard N/A $22.00 $22.00
Enclosure / Hardware N/A $31.00 $33.00
Miscellaneous Other Assemblies N/A $1.75 $1.75
Manufacturing Costs N/A $39.00 $40.00
Preliminary Total Console Cost Estimate $805.85 $840.35
Suggested Retail Pricing (US) $499.00 $599.00




Difference Between Cost and Retail Price $306.85 $241.35
Source - iSuppli Corporation November 2006
The total cost of the bill of materials is $840.35. Sony's suggested retail price (MSRP) for PS3 is $599.

The difference between the cost and retail price of a PS3 is $241.35 which means that Sony is selling the units at a loss of $241.35.

The average cost of a PS3 game is $59.99. That means Sony is assuming an attach rate of at least 4-5 PS3 games for each Playstation 3 that is sold over the life of the unit.


0.32m Japan
5.26m Americas
2.55m Others
8.13m
1.11m Japan
1.79m Americas
0.93m Others
3.83m

0.49m Japan
0.82m Americas
0.00m Others
1.31m



NEW!! Handheld Wars:

14.37m Japan
10.74m Americas
10.83m Others
35.94m
4.88m Japan
7.46m Americas
6.97m Others
19.31m

Sony has sold 1.31 million PS3s which means it has lost $316 million on PS3 hardware in just 1 month. Keep up the good work! It looks like Sony is betting that the gamers will buy more than just a few games and maybe a BluRay DVD or two.

PlayStation 3 Scalpers Fail to Make Big Bucks on eBay. No Irrational Exuberane for PS3

posted by MR WAVETHEORY at 1/03/2007 01:25:00 PM
When the Sony PlayStation 3 (NYSE SNE) launched, scalpers on eBay (Nasdaq EBAY) tried to sell PS3 systems for $800 to $2,000. Most were listed for around $1,000. The lucky eBayers made a profit. Not so for the unlucky ones. Thousands of unopened PS3s are being returned to shops across the US as scalpers on eBay failed to sell their consoles online for a huge profit. This is largely thanks to Sony managing to push out a fresh batch of PS3s before the Christmas break, lowering interest in the auctions.

Canadian newspaper The Hamilton Spectator recently interviewed a number of disappointed eBay sellers who plan to return their unwanted consoles. One person adds that it'll be "the 'scalpers' who really lose out." Poor things.

There're currently over 1,000 PS3 auctions running on eBay.com

Many auctions don't have a single bid. One system is even selling for less than the retail price at just $475, with no bids.

Paid Leave: Bob Nardelli Gets Fired and $210 Million

posted by MR WAVETHEORY at 1/03/2007 05:55:00 AM
Bob Nardelli started the New Year with a bang: a $210 million bang. The board of The Home Depot, Inc. (NYSE HD) had to pay him $210 million to usher him out. He was criticized for having an exorbitant pay package during his tenure and his exit package is even more egregrious considering the performance of HD vs Lowe's Companies, Inc. (NYSE LOW) since he joined HD as CEO in December 2000. Lowe's is up 218% since December. Home Depot is up a measly 7%. (press release)


You have to love the game! Ironic that Forbes wrote in the January 8, 2006 issue on newstands, "The housing bust is worse than people expected. But Bob Nardelli has a plan for survival." Not so. If you read the article, you should have read the last two sentences, "Will the housing sector survive this recession? Parts of it will." Meanwhile, Nardelli has bailed. Timed like a pro.

Update: Bob Nardelli leaving seems to support the idea that the housing slump is continuing. It serves as a conflicting data point to the conclusion drawn by Halstead and Brown Harris Stevens that real estate prices continue to firm up in New York. The strength of New York real estate could be regional - and partially explained by the private equity and the hedge fund boom.

Average Price of a Manhattan Apartment Condo $1.1 Million

posted by MR WAVETHEORY at 1/03/2007 03:55:00 AM
Ask the average Manhattanite: "Is there a housing bubble?" and the answer is going to be a resounding "no." The average price of a Manhattan apartment rose to more than $1.14 million in the fourth quarter of 2006, up 5 percent compared with the same period a year earlier, according to Halstead and Brown Harris Stevens. The median price for the apartments was $760,000, a new record, beating the figure from 2005 by 9 percent (via).

Average Condo Prices in Manhattan

New condominiums = $1.3 million (unchanged)
Cooperative apartments = $953,120 (+3)
Four-bedroom and up (Upper West Side) = $5.7 million (+48%)
Three-bedroom and up (Upper East Side) = $3.8 million (+22%)
Average price per square foot = $1,050 (+7%)
Sample Size = 2,364 reported sales

What housing bubble?

Nielsen SoundScan - Online Music Downloads Grow 67% in 2006

posted by MR WAVETHEORY at 1/03/2007 02:40:00 AM
Nielsen SoundScan reports that through the first 49 weeks of 2006, sales of individually downloaded digital tracks are up more than 67% over the same period in 2005, accounting for more than 525 million digital downloads; already 173 million more than 2005's annual total.

* In 2005, digital track sales reached 353 million; 150% higher than total track sales for all of 2004.
* In 2004, digital download track sales broke the 100 million mark with more than 140 million digital tracks sold.
* In 2006 to date, 54 tracks have sold more than 500,000 units as opposed to only 22 tracks in all of 2005. None reached that sales mark in 2004.

Digitally downloaded albums have increased more than 100% with 29.7 million YTD in 2006 versus 14.5 million in the same time period in 2005. In 2006 to date, 11 albums have sold more than 100,000 units digitally comparing to only 3 for the entire year in 2005 and none in 2004.

Nielsen SoundScan data coverage represents more than 95% of the digital music sales market, and Rob Sisco, President Nielsen Music, concludes that "It is clear that digitally downloaded music is continuing to enjoy tremendous and growing consumer acceptance."

$102 Apple? So Says Goldman Sachs

posted by MR WAVETHEORY at 1/03/2007 02:34:00 AM
Goldman Sachs Group Inc. (NYSE GS) is putting a $102 target on Apple Computer, Inc. (Nasdaq AAPL).

Apple Computer (AAPL: Nasdaq)
By Goldman Sachs ($80.87, Dec. 28, 2006)

WHILE ALL OF THE POTENTIAL implications of Apple's options backdating cannot be neatly resolved with a single filing, Apple's long-awaited 10-K puts to rest the relatively minor financial impact of its backdating issues and provides further detail about the findings of the company's internal investigation, the most important of which is that current management was not involved.

This should allow the stock to be driven more by fundamentals in the near term where we see several positive catalysts which should take the stock higher, including likely product announcements at MacWorld on Jan. 9, December-quarter earnings upside to be announced on Jan. 18, and anticipation of additional product announcements including Apple's entry into the cellphone market.

During its independent internal investigation of over 42,000 stock options grants between 1996 and 2003, Apple found 6,428 grants that were backdated. While the number of backdated grants seems high, the financial impact is small, only $105 million pre-tax ($84 million after-tax) with the vast majority of that occurring before 2004.

Most importantly, Apple investigated two grants to Steve Jobs. The first grant showed no evidence of backdating. In the second case, which has attracted a great deal of media coverage, the options were backdated but without any evidence that Steve Jobs was involved in the backdating. The grants were approved by the board before the grant date but not finalized until after the recorded date of the grant.

Even from here, the Apple product story is kicking into high gear. The evidence is pointing to a MacWorld introduction and a calendar first-quarter release for the full-screen video iPod which, according to our checks, is noticeably more innovative than the current generation and should not be considered as a simple refresh.

Apple should formally launch its iTV digital hub at MacWorld which not only creates a new revenue stream for Apple and places the company in a lead horse position in this emerging market but should also increase sales of video iPods as the ability to watch movies and TV shows downloaded from iTunes on televisions as well as video iPods raises the incentive for consumers to purchase the new video iPod.

The Apple cellphone should be released to manufacturing in April 2007 for an on-schedule second-quarter launch and will almost certainly break new ground. Indeed, Apple is already in early discussion with multiple suppliers regarding next-generation models of cell phones with no decisions made yet as to which direction they're going in.

Reflecting strong demand and expected MacWorld announcements, we raised our already-above-the-Street fiscal 2007 estimates on Dec. 11. Our earnings-per-share estimate for fiscal 2007 is now $2.85 versus Street consensus of $2.76.

We could expect Apple to see at least a few pennies of upside versus the Street for the December quarter, with our forecast calling for 79 cents a share versus the Street's 78 cents driven by better margins and slight revenue upside (we're at $6.36 billion compared to Street consensus of $6.38 billion).

Across the Mac line, Apple seems to have had an exceptional Thanksgiving weekend. Fourth-quarter demand for MacBook and MacBook Pro [notebooks] are running better than Apple's already aggressive targets. We expect 1.1 million notebooks and 1.8 million total Macs in the December quarter.

Our retail checks point to strong Apple store results both on the Mac and the iPod side. Combined with a higher mix of Macs, higher retail sales should drive upside to our 28.6% gross margin forecast and Apple's 28.25% target. Based on strong demand, at least one key supplier is allocating even more capacity to Apple and taking it away from other areas.

Despite what has been described as a very "healthy" video iPod forecast entering fourth quarter, video iPod shipments seem very much on track, and should be up more than 40% sequentially. IPod shuffle demand looks strong.

With the bias to estimates still upward and Apple about to start a new product cycle, Apple shares could move strongly toward our $102 target price, based on target price-to-earning multiples, growth-adjusted earnings multiples, cash flow metrics, and discounted cash flow -- well before our 12-month timeframe.

-- David C. Bailey
-- Laura Conigliaro
-- Min Park

January 02, 2007

How to Fire A Portfolio Company CEO Via Email Like Daniel Loeb - Hedge Fund Manager Extraordinaire

posted by MR WAVETHEORY at 1/02/2007 09:03:00 AM
You have to love Daniel Loeb. As manager of Third Point LLC, a New York-based hedge fund that earned an average annual return of 28.9 percent since its 1995 start, Loeb has gained stardom by sending out scathing memos and unleashing his wrath on various movers and shakers whose companies he has invested in. Not only has Daniel perfected the art of running a hedge fund, but also Danny has mastered the craft of grinding the axe with company CEOs.

Hiring and firing are the two toughest decisions any venture investor eventually has to make. It's all ying and yang to me. When the sh*t hits the fan at a startup, you have to fire the CEO. When a company is going gangbusters, you have to interview new candidates and new hires, and reject the bums. You used to have to do these things in person - actually face to face - or over the phone. You actually had to look at the guy in the face. But today, you can do it all via e-mail. Thank the Internet! On the e-mail etiquette of hiring and firing and gloating at your competition, venture capitalists and private equity investors alike can learn alot from the ways of Danny Loeb.

Daniel Loeb on How to Publicize, Vilify, and Fire a Portfolio Company CEO

To Leonhard Dreimann, CEO of Salton Inc. (NYSE SFP), he ranted: "It was only over time that we came to recognize the magnitude of your incompetence and apparent disregard for shareholders." Salton is the maker of the George Foreman Lean Mean Grilling Machine which has sold over 55 million units worldwide. At the height of its success, Foreman received $4.5 million a month in payouts, says Salton CEO Leonhard Dreimann. But in the past few years, consumers have put off replacing their old Foreman grills, and Salton has struggled: It reported a loss of $3.2 million on sales of $274 million in its most recent quarter.

To Kenneth Griffin, CEO of Citadel Investment Group, he once taunted: "There is little I enjoy as much as watching you from afar as your reputation and 'organization' declines as the same rate as your falling returns." Ken Griffing started Citadel in his Harvard dorm room. He is accused of poaching employees from Greenlight Capital and Third Point. Sued by his friend and mentor, Rush Simonson, of fraud, breaching a partnership agreement, and misappropriating trade secrets when he launched his fund. (Bloomberg profile on Kenneth Griffin.)

And to Wilbur Ross, chairman of W.L. Ross & Co.: "The many years you spent generating fees as a financial advisor make it irresistible for you to try to extract fees in your relatively new capacity as principal."

Loeb also vowed to boot the CEO and board of directors of Nabi Pharmaceuticals, telling them: "We will work assiduously . . . to ensure that you will have ample time to pursue your golf games and to enjoy the Florida sun thereafter."

But that was then. When confronted by a Men's Vogue reporter at a fund-raiser, Loeb snapped, "I can't talk to you. I'm not allowed to talk to you," and then backed away. (via)

Daniel Loeb *EXCLUSIVE* Email - How to Say No to a Potential Hire Reject

-----Original Message-----
From: Alan Lewis
Sent: Tuesday, March 22, 2005 11:34 AM
To: Daniel Loeb
Subject: CV

Daniel,

Thanks for calling earlier today. Enclosed is my cv for your review. I look forward to following up with you when you have more time.

Best regards,

Alan

Alan D. Lewis
Managing Director
Sthenos Capital Ltd.

-----Original Message-----
From: Daniel Loeb
Sent: 27 March 2005 23:08
To: Alan Lewis
Subject: RE: CV

what are your 3 best current european ideas?

Daniel Loeb
Managing Member
Third Point LLC

-----Original Message-----
From: Alan Lewis
Sent: Monday, March 28, 2005 1:03 AM
To: Daniel Loeb
Subject: RE: CV

Daniel,

I am sorry but it does not interest me to move forward in this way. If you wish to have a proper discussion about what you are looking to accomplish in Europe, and see how I might fit in, fine.

Lesson one of dealing in Europe, business is not conducted in the same informal manner as in the U.S.

Best regards,

Alan

-----Original Message-----
From: Daniel Loeb
Sent: 28 March 2005 09:50
To: Alan Lewis
Subject: RE: CV

One idea would suffice.

We are an aggressive performance oriented fund looking for blood thirsty competitive individuals who show initiative and drive to make outstanding investments. This is why I have built third point into a $3.0 billion fund with average net returns of 30% net over 10 years.

We find most brits are bit set in their ways and prefer to knock back a pint at the pub and go shooting on weekend rather than work hard. Lifestyle choices and important and knowing one's limitations with respect to dealing in a competitive environment is too. That is Lesson 1 at my shop.

It is good that we learned about this incompatibility early in the process and I wish you all the best in your career in traditional fund management.

Daniel

-----Original Message-----
From: Alan Lewis
Sent: Monday, March 28, 2005 4:08 AM
To: Daniel Loeb
Subject: RE: CV

Daniel,

I guess your reputation is proven correct. I have not been in traditional fund management for more than eleven years. I did not achieve the success I have by knocking back a pint, as you say. I am aggressive, and I do love this business. I am Half American and half French, and having spent more than half my life on this side of the pond I think I know a little something about how one conducts business in the UK and Europe.

There are many opportunities in the UK and Europe, shareholder regard is only beginning to be accepted and understood. However, if you come here and handle it in the same brash way you have in the U.S. I guarantee you will fail. Things are done differently here, yes place in
society still matters, where one went to school etc. It will take tact, and patience (traits you obviously do not have) to succeed in this arena.

Good luck!

Alan

-----Original Message-----
From: Daniel Loeb
Sent: 28 March 2005 10:23
To: Alan Lewis
Subject: RE: CV

Well, you will have plenty of time to discuss your "place in society" with the other fellows at the club.

I love the idea of a French/english unemployed guy whose fund just blew up telling me that I am going to fail.

At Third Point, like the financial markets in general,"one's place in society" does not matter at all. We are a bunch of scrappy guys from diverse backgrounds (Jewish Muslim, Hindu etc) who enjoy outwitting pompous asses like yourself in financial markets globally.

Your "inexplicable insouciance" and disrespect is fascinating; It must be a French/English aristocratic thing. I will be following your "career" with great interest.

I have copied Patrick so that he can introduce you to people who might be a better fit-there must be an insurance company or mutual fund out there for you.

Dan Loeb (via)

Links: Bloomberg Profile on Daniel Loeb