Internet

Twitter’s $1bn valuation is for twits

24 Sep 2009

The revenuefree microblogging site is said to have raised $100m at an implied $1bn price tag. There have been many opportunistic capital markets issues recently. But Twitter's valuation at twice Facebook's per user could be the best example of market exuberance.

Facebook digs infrastructure moat deeper

16 Sep 2009

The firm said in the past its operations throw off more cash than they consume. So the news that operating profits cover capital expenditures may not surprise until you realise it added 50m users over 3 months. This selffinanced infrastructure buildout is significant.

Ebay’s Skype sale eliminates vexing distraction

1 Sep 2009

Its purchase of the internet telecom firm was a strategic mistake from the start. Selling 65% of it at a betterthanexpected $2.75bn valuation frees the online auction company to focus on more important matters such as what to do with Paypal and its cashrich balance sheet.

Silly season dash for stock trash turns absurd

26 Aug 2009

The biggest winners in the recent US stock rally have been shares of shaky companies. The rationale is that firms like Fannie Mae and Citi offer geared bets on economic recovery. This dubious idea has now become farce.

Will MySpace try to steal Facebook’s groove?

18 Aug 2009

Rupert Murdoch s website is reportedly poised to buy iLike, the most popular music application on Facebook. It s a small deal financially but could give a glimpse into whether the two dominant social networks will cooperate or go for the jugular.

Woodstock 40th a grim anniversary for music business

13 Aug 2009

The industry s fiscal circumstances look nothing like they did during the celebrated 1969 festival. The threeday concert was a financial disaster, but a subsequent live album and documentary made it profitable. Rob Cox looks at the economic reversal in today's rock and roll.

Twitter goes down, world goes on

12 Aug 2009

The popular microblogging service s network failed again, yet the sun still rose. Now Google and Facebook are introducing rival services. Humanity can live without vapid hourly updates from Blist stars, but continued outages may yet kill Twitter.

Co-opetition runs course for Apple and Google

3 Aug 2009

Mutual backscratching among Silicon Valley s leading lights was already in the Obama administration s sights. Another federal government hot button, mobile telephony, is now in the frame, and Google s Schmidt is leaving Apple s board. A less clubby future looks likely.

Yahoo’s retreat in search makes it look like AOL

29 Jul 2009

The internet company has agreed to let Microsoft handle its users web search queries in exchange for a big cut of revenue. Handing over the keys to its rival will boost margins. But Yahoo s new business strategy is unsettlingly like that of internet alsoran AOL.

Google’s Q2 killer app: cost-cutting

16 Jul 2009

Revenue at the search giant has stagnated amid the downturn. Yet the company has found a way to deal with this dilemma. It is cutting costs and reducing its focus on wacky ideas. It s not rocket science, but it s a sign Google is accepting its increasing maturity.

Facebook goes for 65 cents on the dollar

13 Jul 2009

Russia s DST is tendering for $100m of the social networker s common stock at a price suggesting a $6.5bn valuation less than the $10bn implied by its purchase of preferred shares in May. But don t cry for Facebook given its embryonic business model that s still robust.

Google goads Microsoft with operating system

8 Jul 2009

The search firm will take the software giant headon with a cheap alternative to Windows. Yet the operating system will only arrive in limited form by mid2010. Google s plan will be more effective at freaking out its rival than changing the software market.

Liquidity drought could save venture capital

6 Jul 2009

New data show VCbacked liquidity fell 80% over the past two years. That s starving all save the bestconnected, like Netscape founder Marc Andreessen, who just raised $300m. Ironically, this thinning of the ranks is just what the VC industry needs.

Online skirmishes pave way for US sales tax war

1 Jul 2009

Virtual retailers Amazon.com and Overstock.com are scaling back in states that demand they collect sales tax on some purchases. While this won t dent their revenues much, it foreshadows a larger clash over taxing internet commerce. Cashstrapped states are firing the first shots.

Twitter’s Iran boost is no guarantee of success

17 Jun 2009

Media around the world are using tweets from Tehran to supplement their coverage of the postelection upheaval. This has given the revenuefree website a credibility boost. But Twitter still hasn t proven it can leverage its popularity to make money.

Web 2.0 bubble deflates as MySpace slashes staff

16 Jun 2009

Rupert Murdoch s social network was one of the few winners, earning some $200m last year. Now it s cutting 30% of its staff and looks set to lose money when Google renegotiates its partnership. The first internet bubble ended with a bang; this one could be ending with a whimper.

Tackling tech monopolies takes perfect timing

10 Jun 2009

Google s digitisation of outofprint books benefits readers, authors, publishers and itself. Now the Feds are sniffing around. This project may give Google monopoly power longterm, but it benefits the public today. It isn't a good first round choice for antitrust.

Citadel’s ties with E-Trade deepen

10 Jun 2009

But not in a good way. Ken Griffin s fund bought into the online broker 18 months ago and took dodgy assets off its hands for pennies on the dollar. But ETrade s remaining homeloan book has proved a dead weight. To salvage its investment, Citadel has little choice but to help.

AOL needs more than just independence

28 May 2009

The former web highflier is finally being spun off by parent Time Warner. That can t hurt its chances of a renaissance. But it has a long way to go to compete with other internet heavyweights. Its independence may prove the preamble to gradual extinction.

Don’t be fooled: Facebook’s not worth $10bn now

26 May 2009

That s the headline number for Digital Sky s $200m investment. But the Russian internet group is getting preference shares with undisclosed rights. While $10bn could be a target, DST's planned offer for common stock held by employees will say more about Facebook's value today.