One of the regulatory hurdles a Yahoo (YHOO)-Microsoft (MSFT) deal
will face is in the combined company's dominance of communications
(email, instant messaging, etc.). According to Kara Swisher:
Yahoo has 256 million email users, while Microsoft has 255 million.
Google's (GOOG) Gmail is a distant third with about 92 million users
and AOL (TWX)-which kind of started off the whole email craze among
consumers-has about half that at 49 million.
The same is true in the instant messaging market, with Microsoft and Yahoo holding an 80% to 90% percent market share together.
Based on personal experience, these figures are surprising (we don't
know anyone who uses Microsoft or Yahoo instant messaging, for example,
and given the number of folks we know who use AOL's AIM, it seems
inconceivable that it only has 10%-20% share, but whatever.)
But if these market-share figures are to be believed, Microsoft and Yahoo
might indeed have to mollify regulators by spinning off a mail property. If so, this will eliminate one of the big
reasons for the merger. (Kara says this issue is holding up the negotatiations, which is easy to believe). The combined company's only hope of not
gradually losing the whole Internet game to Google is to own dominant
positions in various portions of it, such as communications. Also, a
dominant web-based email platform would help Microsoft make the
transition from desktop Outlook software to web-based corporate
services.
According to Kara, however, Microsoft is already considering two options that could neutralize some of the value of the combination:
One solution is to spin off all the communications assets, said
sources, into a separate company. In that case, the two brands would
remain, so as not to inconvenience consumers, although all the back-end
technologies to run the services would be merged.
The more drastic step is for Microsoft sell Hotmail to a third
party, especially given that Yahoo! Mail is considered a stronger
brand. Hotmail has already been in the midst of a transition, including
a recent name change to Windows Live Hotmail.
Of these options, the first is preferable: Microsoft and Yahoo shareholders would still own the dominant communications provider, and a focused, stand-alone business like this might have a good chance of continuing to keep Google an also-ran. But this would also take the business in which the Yahoo-Microsoft combination will be strongest and spin it out of the company. And if you're willing to entertain that possibility, why not just spin the whole Microsoft web business into a stand-alone Yahoo, which would be a better way to structure this combination?
The second solution, spinning off Hotmail, would still leave the more valuable mail assets--Outlook and Yahoo Mail--in the same entity. But losing the Hotmail subscriber base would weaken the company's market position and would also leave a reasonably strong player as a competitor. Google or AOL would likely quickly merge with Hotmail (or all three would merge), which would reduce Microsoft-Yahoo's mail position further. So spinning off Hotmail would seem to eliminate would major reason for the combination.
The best answer here, in our opinion, is still to spin Microsoft's web businesses and $10-$15 billion of cash into Yahoo, with Microsoft owning a majority of the combined company. This still doesn't appear to be under consideration.
See Also:Get Ready for Windows Live Hot Yahoo MailWhy the Microsoft-Yahoo Deal Will Be a DisasterHere's a Better Way to Structure a Microsoft-Yahoo Combination
The big story is that Microsoft's Bing continues to gain share, jumping another half-point to 11.3%. We think Bing is buying these share gains, which means that they won't be building a profitable search business anytime soon (on the contrary).
One very big problem with Google Buzz -- Google's new social network built on top of Gmail -- is that while our Gmail contact lists are, like Facebook, full of people we actually know, it's not full of people we necessarily want to socialize with.
At least, that's the case for me and the rest of the SAI staff.
When I lost my job in June of 2009, I wasn’t very concerned. I knew the labor market was poor, and that it might take me awhile to find another position.
Still, I had a solid network of contacts within my industry (and those contacts had numerous contacts as well), and a great track record at the company I’d worked for during most of the previous nine years. (That company, Lehman Brothers, was acquired by Barclays Capital. I was laid off six months after the acquisition, soon after the majority of work my groups preformed was outsourced.)
Within two months after being laid off, it became clear that my contacts, and their contacts, were not hiring. “We’re going to be flat or reducing headcount until 1Q10. Great resume … check back with me then,” became a consistent refrain. ‘Fine,’ I thought, ‘I have a solid operations and management background, so it’s time to explore another industry I’m passionate about. If I can just land interviews, explaining the value of my skill set and experience shouldn’t be too difficult.’ And perhaps that would be the case. But with the advent of web-based resume and cover letter submissions, getting in front of a hiring manager, or even an HR screen, has proven difficult.
From MediaMemo: Real Networks (RNWK) and Viacom (VIA) are reorganizing Rhapsody, their joint venture music service, and will be spinning it off into an independent company, the companies told the SEC today.
The Walt Disney Company earnings were flat in its first fiscal quarter, compared with last year.
$0.44 per share compared to $0.45 in the prior-year quarter.
EPS for Q1 increased 15% to $0.47 compared to $0.41 in the prior-year quarter.
DIS was expected to post an EPS of $0.39 on revenues of $9.63 billion. For Q109, DIS reported an EPS of $0.41, and revs of $9.6 billion.
Cable Networks revenue was $2.65 billion.
Broadcasting revenue was $1.52 bilion.
Interactive Media revenue was $221 million.
Operating income at Cable Networks increased $27 million to $544 million.
The increase at the worldwide Disney Channels was driven by higher affiliate revenue due to subscriber growth internationally and higher contractual rates domestically.
The increase at ESPN was due to higher affiliate and advertising revenue, partially offset by higher programming and production costs.
Decreased equity income was driven by increased programming and restructuring costs, partially offset by higher advertising and affiliate revenue at A&E Television Networks (AETN) which now includes the Lifetime networks. Restructuring charges at AETN were primarily for severance costs as a result of the combination of AETN and Lifetime in the fourth quarter of fiscal 2009.
Operating income at Broadcasting increased $42 million to $180 million for the quarter primarily due to the absence of a bad debt charge in connection with the bankruptcy of a syndication customer in the prior-year quarter and higher revenues from ABC Studios productions driven by increased third party network license fees and international sales of Criminal Minds.
At the ABC Television Network, results reflected lower primetime ratings and advertising rates, partially offset by a shift from political news coverage in primetime in the prior-year quarter to entertainment programming in the current quarter. At the owned television stations, results reflected lower advertising revenue due to higher political advertising sales in the prior-year quarter.
“We are pleased with our first quarter results and are excited about our creative pipeline, from upcoming movies like Alice in Wonderland and Toy Story 3 to new attractions at our Parks and Resorts,” said Robert A. Iger, President and CEO, The Walt Disney Company in the earnings release. “Our unique ability to deliver outstanding experiences to consumers across platforms, markets and businesses gives us a strong competitive advantage and positions us well for long-term growth.”
According to survey results from Retrovo, 9% of respondents had heard of the iPad and "would like to buy one." That's up from 3% from Retrovo's last survey before Apple unveiled the iPad. But it still represents a tiny minority.
Apple probably isn't freaking out. If those 9% actually follow through with their purchases, that would probably blow past Apple's early sales expectations.
Disney is getting involved in the White House's new "Let's Move" campaign. Their goal: Cure the childhood obesity epidemic within a generation.
For their part, Disney is creating a series of public service announcements which will feature Disney characters encouraging kids to get active and eat healthy.
Mark Peter Davis is a New York City VC and member of the DFJ Gotham Ventures team. This post originally appeared on his blog, and it is republished here with permission.
Tech-lite companies often rely on data to create value and barriers as they scale. Being able to structurally think about what data your company is and is not leveraging may enable you to
deliver more value and create additional barriers from the data that you are currently mining or
identify other types of data that you can and should be capturing. While no framework is without exception, I have attempted to create a structure that should help you take inventory of your data.
The diagram below illustrates how I segment the world of data into key types: identity, descriptive, subjective, activity, relationship.
Yahoo (YHOO) didn't wait for Google's (GOOG) press conference announc Google Buzz to end before sending us an email on Yahoo Updates -- the Yahoo product that does almost exactly the same things, and has been around for over a year.
Join us Wednesday, 2/10, at 2pm ET for a free webinar by Henry Blodget, CEO & Editor-in-Chief of Business Insider. Henry will share the secrets to “How to Write a GREAT Business Plan.”
There can be no productivity without a plan in place. This is especially true when creating a new business. In this webinar you'll learn why you need a business plan and where to start creating one. You will also discover must-include elements such as the problem your product solves, how to size up your competition, and what you should include for financials.
The webinar is one in a series from Verizon's Small Business Center. Next up? John Jantsch on how to attract new customers to your brand. See a scheduled and archived webinars.
You'll find more useful advice on Verizon's Small Business Blog, including tips on social networking, marketing, and relevant products and services from Verizon.
Google's lame Twitter/Facebook rival, Google Buzz, also includes a feature aimed at disrupting mobile "check-in" apps like Foursquare, Gowalla, Loopt, and others.
The irony: Google bought, owned, neglected, and shut down the predecessor to Foursquare, called Dodgeball. Now that "checking in" is en vogue, Google is bringing the feature back.
This is a report from our premium subscription research service The Internet Analyst. To sign up for a free trial, please submit your name and email address here.
The CEO of one of the larger gaming companies on Facebook says that Facebook's recently-released payment platform is increasing sales of virtual goods in games by 20% to 25%.
This sales lift is enough to make up for the higher commissions paid to Facebook for the service (Facebook takes 30% of a sale, versus less than 10% for most of the competing payment services).
Stories about the sex lives of politicians are just about the hottest copy in the business. So hot, that the hottest story at the New York Times is the rumor of a story about the sex life of David Paterson, New York’s governor.
We are all waiting for the great bombshell.
Although it may be that we don’t even need an actual story, that having had so many stories about politicians' sex lives, we can all fill in the blanks.
There are already reports that the governor will resign, and already denials from the governor about the imminence of his resignation, and about the details—he hasn’t had extra-marital sex, he says, since the last time he admitted to having extra-marital sex. Even though the story does not exist, the Times is being censured for it. The story is “psychological warfare,” according to Rick Lazio, a potential Paterson opponent (i.e., he gets to call attention to the story by distancing himself from it). This drubbing is not dissimilar to what happened after the Times published its investigation of John McCain’s sex life.
Barclays analyst Vijay Jayant says in a note for clients that the iPhone probably won't be on Verizon this year:
Via John Paczkowski: “Launch of Apple’s iPad on AT&T’s network is a vote of confidence in AT&T’s network by the equipment maker,” Jayant writes. “While iPad sales are unlikely to materially impact wireless revenues in the short term, selecting AT&T to launch its second major communications product reflects Apple’s bias for the global GSM platform and the prospects of AT&T’s network capability. Moreover, it could suggest the iPhone exclusivity may continue, at least through the end of 2010.”
Google will announce new "social" features and products at 1 P.M. EST today. Everyone's characterizing them as new competitors to Facebook and Twitter.
Be sure to check back with us to find out! We'll be covering the announcement live.
This is a report from our premium subscription research service The Internet Analyst. To sign up for a free trial, please submit your name and email address here.
Amazon is currently in talks with book publishers Macmillan and Hachette about selling e-books via an "agency" model, in which the publisher sets the price and Amazon takes a 30% commission.
Analysts are worried that if the whole publishing industry goes this way, Amazon's ebook dominance (and revenue) will suffer, because publishers will keep ebook prices high to protect physical book sales.
When I lost my job in June of 2009, I wasn’t very concerned. I knew the labor market was poor, and that it might take me awhile to find another position.
From MediaMemo: Real Networks (RNWK) and Viacom (VIA) are reorganizing Rhapsody, their joint venture music service, and will be spinning it off into an independent company, the companies told the SEC today.
The CEO of one of the larger gaming companies on Facebook says that Facebook's recently-released payment platform is increasing sales of virtual goods in games by 20% to 25%. 
Amazon is currently in talks with book publishers Macmillan and Hachette about selling e-books via an "agency" model, in which the publisher sets the price and Amazon takes a 30% commission.
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