Internet

Facebook puts Web 2.0 rivals in appropriate light

7 Sep 2011

Tech companies like Demand Media and Pandora have shown how investors can take a shine to profitless growth. But Groupon’s troubles partly show how fickle such approval can be. Facebook’s fast-growing bottom line is a stark reminder of exactly what’s missing from Silicon Valley.

New Yahoo CEO challenge: to dismantle the beast

7 Sep 2011

Fixing the $16 bln Internet firm is proving tough thanks to its many dysfunctions. Firing Carol Bartz looks a step forward, even if the hapless board did so in characteristically shambolic fashion. A breakup is probably needed, but may be hard with the founders calling the shots.

Groupon’s gaffes give fair warning to investors

30 Aug 2011

The run-up to the web coupon company’s IPO has been a string of embarrassments. Promised profits disappeared in filings, the chairman put his foot in his mouth and now the CEO has made comments that appear to skirt SEC rules. Forget valuations, this company should be avoided.

Demand Media takes cake with galling stock buyback

26 Aug 2011

The content farm’s shares have halved since Goldman and Morgan Stanley took it public in January. Now it’s spending a third of the cash it raised to repurchase stock. That contravenes the promised use of proceeds in its prospectus - and does nothing to fix its damaged business.

HTML5 buzz weakens the power of mobile apps

12 Aug 2011

Apple and Google-powered smartphones have hundreds of thousands of specialized Web programs, allowing them to lock up the market - and users. A new Web standard is gaining traction, potentially allowing an end-run around walled gardens. But Apple and Google have little to fear.

Apple, Google and Microsoft revalue smartphone DNA

29 Jul 2011

A battle among tech giants has lit up the market for thousands of patents that could dictate the future of mobile devices. Auctions, activists and further purchases certify the hype. Once appraised for their royalty streams, such invention rights now bring strategic premiums.

Microsoft ought to kick off search for Bing buyer

22 Jul 2011

The distant number two in online search is a distraction for the software giant and one that cost shareholders more than $2 bln in the latest fiscal year. Facebook or even Apple would make a better home for Bing. Moreover, a sale would be a boon for Microsoft's owners.

Facebook’s primary engine nears burnout

14 Jul 2011

The social network's growth in users is slowing. Happily, Facebook has a secondary booster available for its top line increasing the intensity at which the network is used. But claims that the sharing of information will double each year, indefinitely, look exaggerated.

Google shrugs off economy and sets bar for rivals

14 Jul 2011

What weak economy? The Web search giant's secondquarter net revenue and earnings both jumped more than a third yearonyear. Android, Google's surging mobile platform, is picking up 550,000 users daily. And a suddenly thriving social network is a warning shot for competitors.

Netflix growth may slow as it reaps what it sowed

13 Jul 2011

The video rental and download service has seen blistering growth. Yet content owners and shortsellers have questioned how the company can charge so little. Now Netflix is substantially raising prices potentially throwing it off the virtuous circle powering its U.S. expansion.

Europe’s web investment costs should be shared

12 Jul 2011

Telecom networks need big upgrades to cope with surging demand for capacityguzzling internet applications. Demanding payment from content providers would help fund the bill. But charges should be based on the capacity required and not used to squeeze out potential rivals.

Three’s a crowd in Zynga’s ownership structure

6 Jul 2011

It's bad enough for shareholders when companies have two sets of shares, as they invite bad governance habits and valuation discounts. Now Zynga is going for a trio of voting rights, with founder Mark Pincus in a class of his own. The innovation shouldn't be copied.

Microsoft gets message late on China market

5 Jul 2011

A tieup with rival Baidu shows that the U.S. software giant has realised it's better to partner up than go it alone. That's a start. With cash to spare, Microsoft should now consider a bolder move such as buying a stake in a local player like Sina or Shanda.

Zynga brings much-needed cash crop to IPOville

5 Jul 2011

Tech firms have gone to market by the bushel with little earnings in tow. Zynga arrives with income aplenty from online games like FarmVille. Most of it was harvested from Facebook, but that risk is manageable. And Zynga's profitability is even more bountiful than first appears.

Pricey Nortel IP shows fear of Google’s Android

1 Jul 2011

Apple, Microsoft, RIM and others are paying an eyewatering $4.5 bln for Nortel's wireless patents, blowing Google's early $900 mln bid out of the water. It's partly an effort to hold back the search giant's phone platform, but Android looks strong enough to shrug it off.

Google probe may resemble Microsoft’s in end alone

30 Jun 2011

The antitrust investigations of the two tech giants invite easy comparison but are actually quite different. The U.S. case against Microsoft was simpler and still took over a decade to resolve with the company promising to restrain itself. Google's outcome could be similar.

Rid of MySpace, Murdoch should focus on his space

29 Jun 2011

Mercifully for shareholders, the octogenarian media mogul's failed experiment in social media has ended. The costly episode is a reminder of his many poor uses of capital of late, including buying Dow Jones. Big TV is what News Corp does best and where most resources belong.

History suggests Big Tech discount could linger

24 Jun 2011

Growth at Apple, Microsoft and Google isn't reflected in their market values. The phenomenon isn't a new one. In the last 40 years, investors have twice shunned the sector for long stretches, worrying obsolescence would preempt expansion. The cycle could be repeating itself.

Setting Hulu free will give it best chance to fly

22 Jun 2011

Media titans NBC, Disney and News Corp have given the online TV service a running start. But their ownership creates conflicts that will retard Hulu's growth. An analogy can be found in banking, where Visa and MasterCard have flourished since being granted independence.

China’s next accounting worry could be the VIE

22 Jun 2011

Companies from Baidu to Renren rely on a legally untested ruse to get around restrictions on foreign investment. But these variable interest entities (VIEs) can go wrong. They may be behind Yahoo's spat with partner Alibaba. As so often in China, investors seem too trusting.