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    Monday, April 30, 2012

    Reuter site - Microsoft buys Nook stake, Barnes & Noble shares soar

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    Microsoft buys Nook stake, Barnes & Noble shares soar

    Mon, Apr 30 20:49 PM EDT

    By Phil Wahba and Bill Rigby

    NEW YORK/SEATTLE (Reuters) - Microsoft Corp is jumping into the fast-growing e-books market by investing $605 million over five years in Barnes & Noble Inc's Nook e-reader and college business, as it looks to unlock and Apple Inc's grip on the exploding tablet computer market.

    The move comes just six months before the world's largest software maker is due to launch its new touch-enabled Windows 8 operating system, and the inclusion of a Nook app on Windows tablets should allow them to compete with Apple's iPad and Amazon's Kindle Fire.

    It also gives Microsoft a direct interest in electronic publishing just as the market for downloadable college textbooks starts to take off and the publishing industry undergoes a radical shift toward electronic distribution.

    "It's a good strategic deal," said Sid Parakh, an analyst at fund firm McAdams Wright Ragen. "It gets Microsoft in the game for e-readers, and gives them access to a market that has been growing nicely and they've basically sat out of. It also makes Windows 8 a more compelling platform from an e-readers perspective."

    In turn, Barnes & Noble gets a much-needed capital injection and a way to enter the digital books market outside the United States. The new unit will be run and majority owned by Barnes & Noble and will maintain a relationship with the U.S. bookstore chain's nearly 700 stores.

    Shares of Barnes & Noble soared as much as 90 percent in early trading, before sliding back and ending with a 52 percent gain at $20.75. Microsoft shares, which recently hit a four-year high, edged up 0.1 percent to close at $32.015.

    Microsoft's initial investment of $300 million, which will give it a 17.6 percent stake in the newly created Barnes & Noble subsidiary, values the new unit at $1.7 billion. Over the next five years, Microsoft has committed to invest another $305 million.

    The deal - initially worth only 0.5 percent of Microsoft's cash hoard - is financially small, but strategically important for both companies.

    Microsoft's Windows software still runs on more than 90 percent of the world's personal computers, but the company has been left behind in the mobile revolution as millions of people do more computing on smartphones and tablets running Apple or Google's Android software. Microsoft has also struggled to make its mark on internet-based commerce, which is dominated by Amazon, or rival Apple and Google's online app stores.

    "The deal brings Microsoft technology and engineers into the Nook business - that talent will be tapped to make the Nook even better," said Albert Greco, a book industry expert at the business school of Fordham University in New York. "It gives Microsoft a tablet already, and Barnes & Noble global reach for the Nook platform, through Windows 8."

    Barnes & Noble Chief Executive William Lynch told Reuters that the investment would go primarily to fund the international rollout of the Nook's digital bookstores and new reading software for the Windows platform.


    Under the deal announced early on Monday, Microsoft will get a 17.6 percent stake in a new Barnes & Noble unit combining the bookseller's college bookstore and Nook businesses. Those areas made up just over $1 billion in sales last quarter, about 40 percent of Barnes & Noble's total.

    Microsoft, which will get an unspecified share of the new unit's sales, will pay $25 million a year for the first five years to help with development costs and acquiring content, and will make an upfront payment of $60 million a year for the first three years after the launch of Windows 8, essentially guaranteeing minimum sales of that amount to Barnes & Noble.

    That means Microsoft's total outlay will be at least $605 million.

    As part of the deal, Microsoft has dropped a patent lawsuit against Barnes & Noble over the Nook, which runs on Google's Android system, and will get royalties on those patents. There is a possibility that future Nook models will be based on the Windows operating system, but executives would not comment on that in a call with analysts.

    Barnes & Noble gets a much-needed capital injection and a way to enter the digital books market outside the United States. The new unit will be run by Barnes & Noble and will maintain a relationship with the U.S. bookstore chain's nearly 700 stores.

    Barnes & Noble's Nook has found a strong following, allowing it to garner some 27 percent of the U.S. e-books market in the 2-1/2 years since the device was launched, compared with Amazon's 60 percent and Apple's 10 percent. But battling Amazon's market-leading Kindle has proved expensive.

    "It gives them a much larger partner with deeper pockets, it gives them increased reach," said Morningstar analyst Peter Wahlstrom. "In the last two years they've had their backs against the wall."

    Last year, Barnes & Noble suspended its dividend to direct more cash into developing Nook, which resulted in a well-reviewed glow in the dark Nook introduced last month.

    In January, however, it lowered its sales and profit forecasts as it faces pressure from Amazon's aggressive pricing strategy which has prompted it repeatedly to lower the prices on its own devices.


    Barnes & Noble has poured tens of millions of dollars into developing the Nook. The first version hit the market in 2009, two years after the Kindle.

    The company's e-readers, tablets and electronic book sales have helped it offset a broader decline in book sales. Same-store sales of books at its brick-and-mortar stores have edged up again largely thanks to the bankruptcy last year of Borders Group.

    But the Nook has been available only in the United States and the company said last year it wanted to take its digital business to new markets. Lynch told Reuters that deals to sell Nook through retailers abroad were "coming soon."

    Barnes & Noble said in January that it might spin off its digital business, which includes the Nook, arguing that investors were not giving the company enough credit for that growth.

    The company did not say on Monday if it would take the new venture public.

    Barnes & Noble put itself up for sale in 2010 but attracted only one firm offer - a bid for $17 per share, or $1 billion, last May, from Liberty Media, which was drawn by the Nook's growth.

    Liberty ultimately decided to invest $204 million rather than buy the company outright. It now has preferred shares it can convert into a 16.6 percent stake in Barnes & Noble at a strike price of $17.

    (Reporting by Phil Wahba, Martinne Geller and Sinead Carew in New York and Bill Rigby in Seattle; Additional reporting by Mihir Dalal in Bangalore and Alistair Barr in San Francisco.; Editing by Lisa Von Ahn, Maureen Bavdek, Dave Zimmerman and Matthew Lewis)

    Reuter site - It's not a BlackBerry World anymore

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    It's not a BlackBerry World anymore

    Mon, Apr 30 17:26 PM EDT

    By Alastair Sharp

    ORLANDO, Florida (Reuters) - When Mike Lazaridis and Jim Balsillie were running Research In Motion, BlackBerry World was a chest-thumping celebration of RIM's successes and a showcase for the innovations that would assure its continued dominance.

    Their successor Thorsten Heins will preside over a very different event.

    Three months after replacing the longstanding co-CEOs, Heins desperately needs more time to right the now-struggling company and he likely has next to nothing concrete to offer his restless audience in terms of new products and services.

    In late March, Heins embarked on a strategic review of the Canadian smartphone maker's direction in an effort to reverse the growing power of Apple Inc and Google Inc's Android, and to thwart a budding Microsoft/Nokia resurgence.

    The company is working furiously to get a next-generation lineup of smartphones on sale, while also seeking licensing deals, partnerships and cost savings of $1 billion this year.

    Unless Heins has a big surprise up his sleeve at this year's BlackBerry World, held next week in Orlando, Florida, analysts expect him to focus on products and services already in market. Most of them have so far failed to capture the imagination of investors or consumers.

    "It's too early in RIM's strategic review process to announce one particular strategy," IDC analyst Kevin Restivo said. "However, Heins would be wise to provide any kind of news to help staunch the bleeding."

    Restivo expects RIM to tout any progress it's made in attracting developers and possibly announce a PlayBook that connects to cellular networks. That would make the 7-inch tablet more portable and give carriers an incentive to promote the device.


    BlackBerry World - which brings together several thousand RIM partners and customers - was once a must for financial analysts. But this year few are making the trip, in part because RIM has broken with tradition by cancelling a specific presentation for them. Instead it delayed the briefing until the next-generation BlackBerry 10s are on sale, sometime later this year.

    In the year since RIM's last Orlando conference, the company has issued a string of disappointing financial results, suffered an embarrassing global network outage and watched its share price tumble by 75 percent.

    Lazaridis and Balsillie quit under pressure in late January, replaced by Heins, a former Siemens AG executive who ran RIM's hardware business for several years.

    "Expectations are so low I don't think it's possible to disappoint investors," said National Bank Financial analyst Kris Thompson. "The conference isn't for investors anyway; it's for customers, developers and partners."

    Thompson said RIM may use the event to introduce a marketing chief, which he said was long overdue. RIM is also seeking a chief operating officer.

    "The company needs to display confidence and staying power at the show to keep this constituency loyal until the BlackBerry 10 smartphones are launched," he said.

    Other RIM watchers privately pointed to subdued comments from a major investor and new board member last week as a hint not to expect much. Prem Watsa, who joined RIM's board in January's reshuffle, said that a turnaround could take three to five years.


    The BlackBerry 10 devices will be RIM's first smartphones to make use of a hardy operating platform from QNX Software, an Ottawa, Ontario-based company that RIM acquired in 2010.

    RIM's first test of QNX was its PlayBook tablet, which has languished on store shelves since its launch a year ago. The company is eager to get software developers to build PlayBook applications that could then populate an app store for the new phones.

    On the sidelines of BlackBerry World, the company will hand out a prototype BlackBerry 10 device for developers to test their software applications. RIM has stressed that the device's hardware bears no relation to the finished product.

    The BlackBerry was once seen as an indispensable business tool but has been eclipsed by more consumer-focused iPhones and Android devices which boast large, vivid touchscreens and hundreds of thousands more applications and games.

    RIM had an 8.8 percent slice of the global smartphone market in the fourth quarter, according to research firm Gartner, down from 14.6 percent a year ago. Apple and Android smartphones accounted for almost three-quarters of the market, up from less than half a year earlier.

    Meanwhile, a partnership between Microsoft Corp and Nokia Oyj threatens both RIM's corporate heartland and its recent growth markets internationally.

    By the time RIM launches its first BlackBerry 10s, its global share could slip to 6 percent, analysts at Canaccord Genuity said in February. They said the small base would make it difficult for RIM to create an ecosystem of applications and content for its new platform.

    Recognizing it is powerless to stop iPhones and Android devices from invading its once-impenetrable corporate and government business, RIM launched its Mobile Fusion software to enable IT managers to control those devices through RIM's servers. But it has so far failed to go further.

    Sources told Reuters last month that former co-chief executive Balsillie had worked for months on a radical shift in RIM's strategy that would have offered use of its proprietary network, including its popular BlackBerry Messenger chat program, for rival devices such as the iPhone.

    Heins has since said he believes in RIM's integrated model - in which it runs its own software on its own devices connected exclusively to its global peer-to-peer network - but that he would consider offering that via partnership.

    (This version of the story has been corrected in the third paragraph to change period to three months from five months)

    (Editing by Frank McGurty)

    Sunday, April 29, 2012

    Reuter site - UPDATE 1-RIM turnaround could take up to 5 years, Watsa says

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    UPDATE 1-RIM turnaround could take up to 5 years, Watsa says

    Thu, Apr 26 16:24 PM EDT

    * Smartphone maker has fallen behind rivals

    * Hurdles in the road, but a good buy at current

    * Fairfax CEO says stocks better than bonds over next decade

    * Shares rise 3.6 pct

    By Cameron French

    TORONTO, April 26 (Reuters) - Research in Motion Ltd
    may take up to five years to regain its stride after
    its recent stumbles, but the BlackBerry maker's stock is a good
    value at current levels, investor Prem Watsa said on Thursday.

    Speaking at the annual shareholder meeting of Fairfax
    Financial Holdings Ltd, the Canadian insurer he heads,
    Watsa said he believed RIM's recent troubles were mere hurdles
    for a company he called a "Canadian success story."

    "Is it going to turn around in three months, six months,
    nine months? No," Watsa told reporters after the meeting in
    Toronto. "But if you're looking four, five years ... We make
    investments over four or five years."

    RIM's once high-flying shares have dropped 70 percent during
    the past 12 months as it has bled market share to smartphone
    rivals such as Apple Inc while demand for its Playbook
    tablet device has floundered.

    RIM's Toronto-listed shares rose nearly 4 percent Thursday
    afternoon to C$13.90, likely helped by reports on a
    Blackbery-focused blog that RIM plans to announce its first
    BlackBerry 10 device in August for an October launch.

    RIM declined to comment on the report, citing its standard
    policy not to talk about rumors and speculation. The company
    said in late March the first BlackBerry 10 device remained on
    track for a launch in the latter part of the year.


    Watsa, a value investor whose approach and acumen is
    sometimes compared to Warren Buffett's, joined RIM's board in
    January as part of a front-office shuffle in which Thorsten
    Heins replaced longtime co-CEOs Jim Balsillie and Mike

    Watsa also boosted Fairfax's stake in RIM to 5.1 percent at
    the time, making it one of the company's largest shareholders.

    Asked what he saw in the struggling company, Watsa pointed
    to his close friendship and admiration for Lazaridis, who
    remains on the company's board, and suggested shareholders have
    been to quick to give up on the company.

    "Mike Lazaridis is a technical genius. Some of you might
    forget that this is a company in Canada that invented the
    (mobile) email service that we all use. It's not like Apple
    wasn't there, and Google wasn't there," he said,
    stressing that he was speaking as an investor, rather than as a
    board member.

    Once the dominant player in the smartphone sector, RIM's
    Blackberry has withered from competition from Apple's iPhone and
    Google's Android system, prompting Lazaridis and Balsillie, the
    men who had engineered RIM"s rise, to step down in favor of
    former Siemens executive Heins.

    More recently, RIM has hired lawyers to work out a
    restructuring plan that could include selling assets, seeking
    joint ventures or licensing patents, according to people briefed
    on the matter.

    Watsa would not comment on how RIM should move forward,
    stressing that his investment was based primarily on his belief
    the stock was undervalued.

    "The stock price is down 90 percent (from its all-time high
    in 2008). That overrides everything else," he said.

    "People think that ... when things are going down it's over,
    and when things are going up, it will never stop. The reality is
    it's different," he said, noting the company's strong cash
    position and lack of long-term debt.

    "But there's no guarantees," he said.


    Watsa has built a reputation as a shrewd investor by
    correctly calling major market disruptions like the 2008 and
    1987 stock market crashes, and making billions for Fairfax as a

    Speaking at the meeting, he said he would maintain the
    company's hedges on its equity holdings, as he believed the
    equity market would retrench over the next few years.\

    Further out, however, he said the days of bonds
    outperforming stocks were likely over.

    "If you take a 10-year view, stocks are going to be a
    terrific place," he said. "For us, caution is the best way

    Reuter site - App aims to make "Hey Sexy" a sound of old New York

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    App aims to make "Hey Sexy" a sound of old New York

    Tue, Apr 24 18:19 PM EDT

    NEW YORK (Reuters) - Exasperated by the wolf whistles and cat calls that seem to be the universal welcome for women passing construction sites? New York City is creating an app for that.

    City Council Speaker Christine Quinn, who is expected to run for mayor in 2013, said on Tuesday that $20,000 in city funding has been approved for development of a mobile-phone application to fight sexual harassment on the streets and subways.

    It will be developed by the creators of, a website that asks people to use camera phones to take a photo or video of their harasser and post it online. The new app is expected to work in a similar fashion but could also alert authorities to particularly egregious offenders.

    "Harassers out there take note - We're going to know who you are, where you are, what you said and how many times you said it," Quinn told reporters.

    "The days of thinking you can make life uncomfortable for women and girls are going to be over through old-fashioned girl power and 21st Century technology."

    Research to develop the app is still underway but it will likely feed information into a collection center, Quinn said.

    Review of the data may lead to sensitivity training for workers in particularly offending professions or for residents of badly behaved neighborhoods, she said. The most offensive data may be funneled to the New York City Police Department.

    "Sometimes catcalling can be harassment or aggravated harassment," Quinn said. "It's a complete violation of someone's right to exist freely and safely in this city and it is also a terrible message to young boys that this is the way grown men conduct themselves."

    (Reporting by Barbara Goldberg; Editing by Cynthia Johnston and David Brunnstrom)

    Reuter site - Trimble Navigation to buy Google's SketchUp

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    Trimble Navigation to buy Google's SketchUp

    Thu, Apr 26 10:29 AM EDT

    (Reuters) - Trimble Navigation Ltd has agreed to buy SketchUp 3D modeling platform from Google Inc for an undisclosed price, the companies said.

    As part of the SketchUp platform, Trimble will partner Google in developing SketchUp's 3D Warehouse — an online repository where users can find, share, store and collaborate on 3D models, the companies said in a joint statement.

    Trimble, which makes surveying, mapping, and marine navigation equipment, said SketchUp will enhance the integration of its field presence with the wider enterprise.

    SketchUp is a free 3D modeling platform that helps in designing 3D models within Google Earth — a virtual map of most of the planet's surface.

    The platform enables users to create collections of models, including 3D buildings, and share them with fellow modelers around the world.

    SketchUp, which was a tiny startup when it was bought by Google in 2006, now boasts of millions of active users.

    "With over 30 million SketchUp activations in just the last year, we're awfully proud of our accomplishments," John Bacus, SketchUp product manager wrote in a blog post.

    The deal is expected to close in the second quarter of 2012, and it would not be material to Trimble's 2012 earnings.

    Trimble's stock was trading flat at $53.98 in morning trade on the Nasdaq on Thursday.

    (Reporting by Supantha Mukherjee in Bangalore; Editing by Joyjeet Das)

    Good times with the POTUS

    Sent via BlackBerry by AT&T

    Thursday, April 26, 2012

    Sunday mornings

    Sunday mornings

    Part one

    The one thing I remember most about Sunday mornings were my mothers outfits. Her hats were so ornate. The colors screamed at you in golds and purples and reds and auburn. And her suits were amazing as well. I remember this one gold suit she had. Loved it so much. And she had the golden shoes to match. With the gold and purple hat, and the suit had these bright golden buttons.

    In the Jamaican sunlight, everything looked heavenly. Your skin glowed with the awesomeness of love. A country with so much culture and vibes and music with such conservative traditions. Blame it on the English monarchy or the religious indoctrination, but if you weren't in reggae, dancehall, or calypso, you were in church. And Sunday morning was quite a parade.

    My fathers outfits were nothing to scoff at either. He had this brown suit that shined like it was polished with light and dark stripes pinned to each other. In the caribbean sun it looked like he had just stepped out of the morning news and into your life, live and direct.

    We were a family of beauty. I spit polished my shoes. My sister had curly blonde bangs in her hair. The had called her Goldie locks because of her fair complexion and sunlight kissed mane. My brother came along later on and did not stay long enough in the island to participate in the unofficial pageant that was Sunday morning service. But his baby clothes and carriage were nothing to scoff at either.

    We were the Nation family. My father was Keith Nation, the youth president for the biggest Pentecostal church in Jamaica and and held the National position of youth president as well. He bought and sold auto parts for a living and also rented cars to Jamaican ex patriates who visited the island for vacations and to anyone that wanted to look fashionable on wheels. He had style, swag, and was a serious man.

    My mother was a lab technician that often times put her career on pause to help my dad with his businesses, returning on and off when finances were needed. Eventually for health reasons, she couldn't continue with the chemical company she worked for, and worked with my dad full time. At least that how I remember it as a child. It is what I was told.

    Mom had worked for Sherlhome Chemicals. The were a nationally recognized cleaning products company. They had commercials on prime time Jamaican TV, billboards all across the island, and print adds and the national publications, The Daily Gleaner, The Weekly Star, The Daily Star, The Sunday Herald, The Jamaican Observer, and the like. I was proud to have known my own mother had a hand in making the chemicals the kept the country clean. Every time I saw a billboard for Sherlhome Chemicals, I would say to myself with pride ,"my Mommy makes that".

    I remember going to the parties her company used to have. Awesome beauty. Jamaican professionals, light skinned, dark skinned, white, asian, all colors, and the national motto goes, "Out of many, One People".

    And it was on on Sunday morning. You dare not leave the house without primping and priming every aspect of your body. Your hair must be well oiled with Dixie Peach hair oil. A clear petroleum jelly that was very popular in the island back them. It was on my the family dresser which was really my Mom and Dad's dresser that me and my sister adopted for ourselves on Sundays. Teeth scrubbed to the max and flossed, mother always said, "take the pains to keep your teeth clean". Mom had taught me from when I could walk tie my shoes how to press my shirts and my pants. I had my own iron and ironing board and I always spent minutes or hours getting my shirts and pants pressed tight with the long crease down the front and back of each leg, we wore 'Chaplin' pants back then, baggy dress pant like the ones Charlie Chaplin wore in his movies with pleats in them. Three on each side normally, or if you were fancy, you would have variations in yours. If you were daring, you would try to get away with what the youth of my time called 'bell bottoms'. The style of today, a flat pants front with no pleats, tight and low at the waist with some room in the ankle were the stuff of jokes and ridicule back then, and only older folks, being forty and older, would even dare step out in public with such designs.

    I spent time getting my pleats straight. Spraying them with the water in the iron or pouring water from a cup, dragging the iron across the wet garments and watching the steam hiss and rise like snakes from a snake charmers whistle.

    With shiny hair, shiny shoes, pressed and straight pants, and sharp shirt collar, and stunning neck tie, I was proud to be Brother Nation's big son. "young Nation" is what they called me. And I liked it.

    After we were all ready, we would go into the gaily vehicles, and travel to Sunday morning service.

    The funny thing about the family vehicle, is we never really had one for a long time. We had like five. My father's auto business gave him access to many of the latest model of motor vehicles. Nissan Sunnys and Nissan Sentras, Toyota Camrys and Ladas, but the one I remember the most is the stone white Mazda RX7. That was the first family I remember, the last one was a Ford Escort. In between were company cars of various designs like the Burgundy Honda Civic that one of my Dad's employees wrecked on Flat Bridge. That burgundy was amazing with a powdered finish, the man who wrecked it was lucky to survive and from what I can remember and I will never forget this, he was skidding, and tried to get out of the skid, and the car flipped over. Now if you know Jamaica, and you know Flat Bridge, you know that Flat Bridge is the most terrifying bridge to cross in the world, it is between two banks over a river with no railings and looks like driving your vehicle across a tight rope with ninety degree turns on each side. That burgundy Honda Civic, flipped over on that Bridge, and if it ended up in the river or the banks, I do not know, but the top of the vehicle when it was brought back to my Dad's shop was caved in. A part of my Dad's business along with buying and selling parts, and renting fancy wheels, was auto body repair. His guys put the bits and pieces back together of that vehicle, but like humpty dumpty, it was never quite the same. They worked weeks if not months on that vehicle, and I watched them every day after school when I would spend evenings at my Dad's place of business. They hammered it and welded it and sanded it and putty and what not all over it and painted it till it was good as used.

    The Mazda RX7 had a special demise. We were all packed in the sports sedan. I was six years old. My sister was two. My mother was still in her twenties, and my father just into his thirties. We were an amazing family. I was all polished and shined up, my Mom had on her Gold and Purple Sunday suit, my father was wearing his Brown Bomber, my sister with her red complexion and sunny kinky hair, we were going to Sunday Morning Service and Sunday School. My father, the Sunday School teacher, my mother, a Sunday school teacher, young professionals late for the Sunday parade, my dad, speeding in the sports car with his two young children in the back slams on the breaks. I lurch out of my seat, flying against his and falling to the floor of the car, my sister was strapped in her car seat, my Mom has screamed out in her beautiful and elegant Jamaican accent, "Jesus!" and my father was quiet as a mouse, eyes wide open, teeth clenched tight. I looked up from where I was, on the floor of the rear of the car, if I was not six years old and all of three feet long or so, I would have still been in the back seat, but I managed to fly around the rear and end up on the floor, I saw blood all over the cracked windshield. The boy my father had hit was on the sidewalk, wincing in pain,his back a pattern of cuts and bruises, like a hundred shards of glass were crudely spread in a plaid pattern across his backside. He was in pain. He and his friends were playing cricket, and he ran out into the street to get the ball, and my fathers car with his his family in it, and that boy and his backside both collided.

    After the vehicle was repaired, my father tinted the windshield. Yup. Tint it a midnight black. He sold the vehicle not long after that and rotation of family vehicles began not long after.

    Sent from my iPad

    Wednesday, April 25, 2012

    Reuter site - Still in the frame, the camera defies smartphone onslaught

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    Still in the frame, the camera defies smartphone onslaught

    Wed, Apr 25 01:55 AM EDT

    By Jeremy Wagstaff, Asia chief technology correspondent

    SINGAPORE (Reuters) - While most attention in the gadget world is on the breakneck pace of innovation in mobile phones, tablets and computers, another device has resolutely refused to die: the camera.

    Despite the onslaught of camera phones — the iPhone 4 has this year become the most popular device for posting snaps to the photo-sharing website Flickr — cameras are still being sold. Japan, the world's largest manufacturer, shipped nearly three times as many cameras in January as it did in the same month of 2003, when the camera phone was still in its infancy.

    "For several years, it has been predicted that smartphone adoption would cut into digital camera sales," said Prashant Malaviya, Associate Professor of Marketing at Georgetown University's McDonough School of Business. "In fact, the exact opposite has happened."

    Driving this is a number of factors, analysts and enthusiasts say. And, while most point to a continuing role for cameras for both professional and personal users, the device's future is far from assured.

    Firstly, photography is personal. We may be happy taking snaps with our cellphone or simple point-and-shoot camera, but it turns out that most of us won't entrust key memories to such basic devices. Surveys by NPD In-Stat last November show that while more than a quarter of all American photos were taken by a smartphone, more people were buying cameras with detachable lenses or cameras with optical zooms of 10x or more.

    This, says NPD In-Stat senior digital imaging analyst Liz Cutting, is because those people taking important family photos don't want to trust them to a device that isn't up to the task. "Camera photography is certainly not dead," said Cutting. "We're just seeing a skewing towards what the smartphone can't deliver. People are recognizing that and are going for a higher end camera."

    This in turn benefits the established players, because users are reluctant to entrust their photos to an untested brand. We may be ready to try out a new brand of cellphone, laptop or TV, but when it comes to family snaps we're more conservative. "It's part of who you are, showing the kind of brand of camera you have," Cutting said. "But it's also trusting the quality of that memory because that's how you remember your life."

    This has helped entrench several key players, some of whom have dominated the scene for a generation or more — Canon Inc <7751.T>, Nikon Corp <7731.T>, Sony Corp <6758.T>, Olympus Corp <7733.T>, Pentax <7752.T>, Fuji <4901.T> and Panasonic Corp <6752.T>.


    Canon has been one of the main beneficiaries of this, maintaining a strong brand from the professional high end to the point-and-shoot bottom, says Christopher Chute, global imaging chief at International Data Corp. Canon has seen its camera business grow as the proportion of its overall sales to more than 25 percent in 2008 from below 11 percent in 1999. In a survey of more than a quarter of a million users of Ontario-based gadget website, Canon was the most popular brand, with a third of the vote.

    Not that its rivals are standing idle.

    Panasonic, Olympus, Pentax and Nikon have in the past few years launched a new kind of camera that matches the quality of lenses of a professional model with the sleek, light body of a pocket, point-and-shoot device. Although these mirrorless cameras aren't a lot cheaper than the professional digital single lens reflex (DSLR) model, they are lighter and more compact.

    This has won them fans among both those trading up and those looking to replace or supplement their professional gear. Ong Hock Chuan, a hobbyist who runs a Jakarta public relations company, recently sold his heavier Canon EOS 50D for a mirrorless Sony NEX-7. Price wasn't a factor. "I was tired of lugging around an SLR and getting a hernia for it," he said. Canon has yet to announce a mirrorless model.

    Not only are camera manufacturers seeking an edge over each other: They're battling the encroachment of camera phones on to their territory.

    At the bottom, Nokia and other mobile manufacturers have long partnered with lens makers like Carl Zeiss to improve the quality of photographs and phones, a trend which has meant many mobile phones now do a better job of a point-and-shoot camera. The appeal of the camera phone has also grown as social media services like Facebook <FB.O> make it possible to share a photo with friends and family as soon as it's taken.

    This leaves the compact point-and-shoot camera segment of the market vulnerable.

    In markets such as the United States and Japan, says Japan-based IHS analyst Kun Soo Lee, there's not many more people who want to buy one. On the one hand, this is eating into sales that Canon and others traditionally dominated. On the other, the ease with which photos can be taken on a phone is feeding an interest in taking better photos, expanding the middle of the market into a "pro-sumer" segment of devices which cost a bit more but offer the user options so far unavailable on the mobile phone: An optical, rather than digital, zoom, for example, better flash, and image stabilization.


    This is driving manufacturers to push more and better technology from their upper end models into cheaper devices. Prices have fallen dramatically in the past decade, says Mark Walters of U.S.-based website Ten years ago a 3-megapixel DSLR camera would cost $3,000; now a better quality 18-megapixel DSLR can be found for less than $500. "The technology that has trickled down into the more consumer-targeted DSLRs is incredible," he said.

    Lowering prices and raiding the technologies of formerly professional models is not without danger. "This pricing strategy has certainly caused some cannibalization of sales at the higher end for the likes of Canon and Nikon," said Walters, "but they make up for it with volume at the low end by selling more critical accessories like lenses and flashes."

    Manufacturers are also competing through innovation.

    Apart from mirrorless cameras, there have been improvements in sensors and a technology called high dynamic range (HDR) imaging, which layers images at different exposures. "There's an amazing amount of innovation in digital photography equipment at the moment," said Melbourne-based Sydney Low, a former Internet entrepreneur who now takes sports photos for a living. "More so in many ways than Apple <AAPL.O>, HP <HPQ.N> and other computer manufacturers."

    While enthusiasts like Low believe that still cameras will eventually be replaced by video cameras — from which scenes can be grabbed — others believe that eventually mobile phone and camera will start to look and feel more like each other.

    A range of cameras launched in the past few months, said NPD In-Stat's Cutting, have for the first time included WiFi chips, making it possible for users to share their photos much as a smartphone user might. "It has to be easy, and we haven't hit that yet," she said.

    Just as the camera gets smaller and more sociable, so will the mobile phone evolve to incorporate features presently only available on a camera. IHS's Kun said the introduction of 12 megapixel cameras into smartphones, for example, is a "kicker to change the market."

    Then, said J. Gerry Purdy of cellphone analysts MobileTrax, there's Polaroid's SC1630, announced in January and due to be launched this year: an Android device with an optical zoom. These and other innovations, Purdy said, may usher in a future where a smartphone camera "will perform as well as today's digital cameras with large optical zoom and larger lenses." California-based Pelican Imaging Corp, for example, promises a camera that will improve image and video quality while allowing for thinner smartphones.

    How traditional players react to these challenges is unclear. Canon, for example, has no obvious strategy to combat the rise of the smartphone, said IHS's Kun, and so will have to keep on peddling digital cameras. In the meantime other technologies may arise either inside or outside the industry.

    Says IDC's Chute: "Everything is up in the air."

    (Editing by Ian Geoghegan)

    Saturday, April 21, 2012

    Reuter site - Splunk shares double in value on debut

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    Splunk shares double in value on debut

    Thu, Apr 19 13:33 PM EDT

    (Reuters) - Data analytics software maker Splunk Inc's shares doubled in value on their market debut, as it tapped investor demand for enterprise-focused companies in an otherwise weak IPO market.

    Technology companies such as Splunk, Demandware Inc and Guidewire Software Inc have been doing well at the markets, even as investors shun other deals.

    The IPO market has seen poor pricings, pulled deals and delayed filings in the past few weeks.

    Splunk's stock was trading up almost 89 percent at $32.05 on the Nasdaq. Nearly 11 million shares exchanged hands by 1.30 pm Eastern Time.

    The company's debut experienced a minor hitch and trading was temporarily halted.

    "There was a 'fat finger' trade," Splunk Chief Executive Godfrey Sullivan told Reuters.

    "Somebody hit the wrong button and entered a trade for Splunk at $18 and the stock was halted for about 5 minutes till we could sort out what was really going on."

    Some trades were also cancelled by the NYSE Arca stock exchange and the stock's high-point was revised to $34.72 from $40, according to Thomson Reuters data.

    Splunk was set up in 2004 to troubleshoot problems in IT departments. It indexes and manages machine data from computers, servers and mobile devices.

    Last June Splunk Chief Executive Godfrey Sullivan had told Reuters that the company was gearing up to go public in 2012.

    Network-control company Infoblox Inc and business security products maker Proofpoint Inc are also expected to see strong demand when they price their shares later on Thursday.

    Splunk, which had raised its expected price range to between $11 and $13 per share earlier this week, priced 13.5 million shares at $17 apiece on Wednesday night.

    At the IPO price, the company had a market valuation of about $1.58 billion.

    Luxury bag maker Tumi Holdings Inc, which also made its market debut on Thursday after pricing above its expected range, saw a surge in the price of its shares.

    The company opened 44 percent above its IPO price, and was trading up 54 percent at $27.70 on the New York Stock Exchange.

    (Reporting by Aman Shah in Bangalore; Editing by Joyjeet Das)

    Wednesday, April 18, 2012

    Reuter site - Analysis: In Asia, BlackBerry's RIM sees a glimmer of hope

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    Analysis: In Asia, BlackBerry's RIM sees a glimmer of hope

    Wed, Apr 18 14:36 PM EDT

    By Jeremy Wagstaff, Asia technology correspondent

    JAKARTA (Reuters) - The launch in India of a new BlackBerry by Research In Motion Ltd is not just a nod to its lower-end users who love it less for its security, push email and seamless roaming than for its simplicity and its Messaging. It's a strategy the Canadian company hopes will help fill both a hole in its balance sheet and a half-year wait for its next big thing — the BlackBerry 10 platform.

    But will it work?

    The handset itself won't impress devotees: its main selling point is a dedicated side button that lets users chat over its BlackBerry Messenger (BBM) and a built-in FM radio, which lower-end Nokia phones have had for a decade. It works only on the slower 2G networks, and the camera isn't that great. But, RIM says, that's the point.

    RIM calls it a parallel approach: building the high-end next generation platform and devices, while coming up with cheaper phones that can prod some of the vast majority of its users to trade up. "We're really trying to build on and help those people who are moving from feature phone to smartphone. We believe we can be successful in that," Patrick Spence, RIM's global sales chief, said in a telephone interview.

    It's a smart move, some analysts believe, given RIM's position. Adam Leach, principal analyst at research company Ovum, said there is a misperception that RIM's bruising experience in North America will be repeated elsewhere. RIM's strength, he said, is being able to offer lower-end users a better experience on a slow connection than the equivalent Android handset.

    RIM launched its new handset, the Curve 9220, in India on Wednesday, with other markets to follow. A RIM spokesman said the company would launch in Indonesia, one of its most lucrative markets, in the coming weeks.

    "Their success in Indonesia shows they have other attributes and capabilities in the BlackBerry platform globally that appeal to different markets rather than just the high-end, mature markets (like North America and Western Europe)," said Ovum's Leach.

    RIM doesn't break down its sales by region, but has reported that sales outside the U.S., Britain and Canada accounted for 68 percent of total revenue in its fourth quarter, up from 61 percent in the previous three months. Those markets include India, South Africa, Nigeria and Saudi Arabia, which RIM says are all targets for this year's sales blitz.

    But understanding why a market like Indonesia works — and then applying those lessons elsewhere — is not straightforward.

    Slamet Riyadi, a 30-year-old office boy in Jakarta with a wife and two young children, shifted to BlackBerry from Nokia two years ago. He owns a Gemini 8520 which he bought new for about $200 — about two months' salary. He keeps his old Nokia to communicate with his family by voice and SMS, but loves his BlackBerry for staying in touch with friends and colleagues. He dreams of owning an Onyx 2, which would cost upwards of $350, but the reality is that he must soon sell his BlackBerry to pay for his daughter's schooling.

    Therein lies the rub for RIM.


    On the surface, Indonesia looks like an extraordinary success story in a gloomy narrative of failures elsewhere. While RIM slashed more than $750 million from the value of its inventory in each of its last two quarters, BlackBerry sales to Indonesia have boomed, with industry experts saying BlackBerrys account for around half of smartphone sales. Joy Wahjudi, director of marketing of operator XL Axiata, said there could be as many as 7 million BlackBerry users in Indonesia, the world's fourth-most-populous country.

    According to Harry Sasongko, CEO of cellular operator Indosat, Indonesia is RIM's largest market outside the United States and Britain. And, with smartphones accounting for less than 25 percent of phone users, it's not hard to see why RIM believes in Indonesia. When RIM offered half-price handsets at a Jakarta mall in November, 5,000 people surged through barriers, knocking several unconscious and prompting a police investigation.

    Still, the reality is more nuanced. Interest in smartphones is growing — nearly 10 times as many smartphones were sold in Indonesia last year compared to 2009, according to IDC. And in a country starved of land-lines and fixed-line computer connections, the phone has long been a key communications tool.

    RIM's success in Indonesia is down to a number of things, not all of them replicable outside Indonesia.

    Indonesian operators started early, among the first in the world to adopt RIM's experimental stripped-down pricing plans which offered basic services at a fraction of the usual enterprise prices. Now plans start at as low as $5 per month.

    This nurtured a vast ecosystem before RIM had even set up office in Indonesia in 2010. Take for example Hendrik, a 20-year-old who has worked as a phone repair man for the past three years, mostly fixing BlackBerrys. From a small stall in a down-market mall in Jakarta, Hendrik installs apps, upgrades software or replaces parts. One recent customer had dropped his device in the toilet. Despite burying the device in a pile of rice to try and dry it out, it still wouldn't work. Hendrik replaced the power supply and some chips from another machine. Total cost: $50.

    As demand has risen, so have opportunities for smuggling in handsets from countries where they are subsidized — pushing down prices. Retailer Devandi Nugroho, for example, offers two versions of the same device: an official one for 1.8 million rupiah ($200) and another for 200,000 rupiah less. Second-hand BlackBerrys can be found for as little as $75.

    All this has fuelled a perception that RIM has done little to make Indonesia a success and so doesn't understand how best to leverage it. "Part of RIM's issue is that they have had successes in areas they haven't exactly planned," said Ovum's Leach.


    RIM acknowledges it could have done things differently in Indonesia. "Every company has to figure out how to deal with globalization and that's what we've really been trying to do," said Spence.

    Despite a raft of local initiatives, there's no guarantee BlackBerry users will remain loyal. There is already a feeling that Indonesians are beginning to tire of the device. While smartphones have grown as a share of the overall phone market in the past year, RIM's share has slipped while Samsung Electronics' has tripled, industry data show.

    Indonesians with long memories worry they've seen it before. Indonesia was the world capital of the bulky Nokia Communicator until it suddenly fell from grace. Prasetyo Andy Wicaksono, community leader for Indonesia's largest BlackBerry developer group, said doubts over RIM's future were denting interest among developers. "If RIM isn't careful, they can lose their loyal customers here. This phenomenon must be understood by RIM to prevent the same thing as happened to previous gadgets."

    More importantly, are poorer Indonesians going to bite? RIM believes it can persuade some of those millions of users of the more basic feature phones to upgrade. But Slamet, the office boy, illustrates how thin the line is between those who can afford one and those who can't afford to keep one. "The biggest challenge for RIM is price," said Sarwoto Atmosutarno, CEO of one of the largest cellular operators, Telkomsel. "Indonesia, like India, is a volume game industry."

    RIM said the Curve would sell in India for 10,990 rupees ($210), and about the same in Indonesia.

    Also, the key attraction of the BlackBerry for many - its Messenger function — is less of the unassailable citadel it once was. The growing popularity of messaging services such as WhatsApp that use a cellphone's data connection offer a cheap alternative to SMS — as well as a way to build BBM-like groups without having to own a BlackBerry.

    WhatsApp has recently released versions of its software that work on even the lower-end Nokia phones running the Symbian operating system — which still account for up to two-thirds of Indonesian cellphone users, according to StatCounter, a traffic monitoring service. Graham Hills, Indonesian general manager for travel start-up Wego, said that when he arrived in Jakarta last year everyone would ask for his BBM PIN number. "Now people ask whether you have WhatsApp on your phone," he said.

    Nor are all Indonesian operators big RIM fans. While nearly all offer BlackBerry packages, some do so only because it is popular — not because it is a great money spinner for them. One industry insider, who declined to be named, said at least one operator was not paying for any promotion because BlackBerrys weren't a profitable line and it didn't believe the device would remain popular. "The numbers are good, but I doubt it will continue," he said. "It's a fashion thing and it's going to die."

    RIM says it is confident it can overcome all these issues, both in Indonesia and beyond. "The reality is that only 15 percent of people have a smartphone," said RIM's Spence. "It's still quite early."

    ($1 = 9180 Indonesian rupiah)

    ($1 = 51.5650 Indian rupees)

    (Additional reporting by Andjarsari Paramaditha in JAKARTA and Devidutta Tripathy in DELHI; Editing by Ian Geoghegan)

    Monday, April 16, 2012

    Reuter site - Google fined $25,000 for impeding FCC investigation

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    Google fined $25,000 for impeding FCC investigation

    Mon, Apr 16 11:05 AM EDT

    WASHINGTON (Reuters) - Google Inc has been fined $25,000 for impeding a U.S. investigation into the Web search leader's data collection for its Street View project, which allows users to see street level images when they map a location.

    The Federal Communications Commission imposed the fine late on Friday, saying Google had collected personal information without permission and had then deliberately not cooperated with the FCC's investigation.

    "Google refused to identify any employees or produce any e-mails. The company could not supply compliant declarations without identifying employees it preferred not to identify," according to an FCC order dated April 13.

    "Misconduct of this nature threatens to compromise the commission's ability to effectively investigate possible violations of the Communications Act and the commission's rules."

    Google said in a statement said it turned over information to the agency and challenged the finding that it was uncooperative.

    "As the FCC notes in their report, we provided all the materials the regulators felt they needed to conclude their investigation and we were not found to have violated any laws," the company said in a statement. "We disagree with the FCC's characterization of our cooperation in their investigation and will be filing a response."

    Between May 2007 and May 2010, Google collected data from wi-fi networks throughout the United States and across the world as part of its Street View project, which gives users of Google Map and Google Earth the ability to view street-level images of structures and land adjacent to roads and highways.

    But Google also collected passwords, Internet usage history and other sensitive personal data that was not needed for its location database project, the FCC said.

    Google publicly acknowledged in May 2010 that it had collected the so-called payload data, leading to an FCC investigation on whether it had violated the Communications Act.

    (Reporting By Lucia Mutikani; Editing by Richard Chang and Eric Meijer)

    Reuter site - Can an app help you craft the perfect dream?

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    Can an app help you craft the perfect dream?

    Mon, Apr 16 11:43 AM EDT

    By Natasha Baker

    TORONTO (Reuters) - Whether it is a stroll on the beach, sitting in a tranquil garden or a trip in the space shuttle researchers are testing a new iPhone app in a mass experiment to see if it is possible to craft the perfect dream.

    Developed by British psychologist Richard Wiseman, a professor at the University of Hertfordshire in England, the Dream:ON app plays a soundscape to evoke the sensation of being in a particular environment during the stage of sleep when dreams occur.

    "If it's birds tweeting, then the idea is that you'll hear birds tweeting in your dream," said Wiseman.

    There are 20 soundscapes with themes such as Wild West, Space Shuttle and A Trip to Tokyo. After choosing a wake up time and soundscape, the user places the iPhone face down on the mattress and the app monitors body movements throughout the night.

    During the last 20 minutes of sleep, the app plays the soundscape if the dreamer is in REM sleep, a state when body movements are suppressed and dreams most likely occur.

    The app activates the alarm when the user is coming out of REM sleep because there is only a ten-second window when a dream will be remembered, according to Wiseman.

    "Ten seconds later and it's gone," he said, adding that dreams are likely to occur in the last 20 minutes before waking.

    Users are then prompted to submit their dream to the database which will be analyzed by Wiseman and his team.

    The researchers are also studying whether they can help to induce lucid dreams, which is a state when you are conscious that you are dreaming and try to control the dreams.

    "Some of our soundscapes have a voice-over which tells you that you're dreaming and that it's okay for you to take over that dream. And one of the questions we're asking is 'Do those induce lucid dreams?'" Wiseman said.

    According to Allan Hobson, a dream researcher and professor of psychiatry emeritus at Harvard University, lucid dreaming is a rare occurrence.

    "There's no question that you can influence the plot of your dreams. But lucid dreaming is rare because it's a design error; it shouldn't happen," Hobson said.

    "The body doesn't want to be awake and asleep at the same time -- the brain wants to be in one state or the other," he added.

    Wiseman came up with the idea for Dream:ON while researching the link between external stimuli and sleep.

    "I had the idea of giving people a proper night's dream with the idea really being twofold. The mood you're in the next morning is related to the last dream you have before you wake up. You put people in a better mood and they're more productive and happier," he explained.

    He hopes that the app could be used to help people suffering from depression.

    "The research into depression and dreaming is quite well established in that (depressed people) dream more, and their dreams are more negative," said Wiseman.

    Since its launch at the Edinburgh International Science Festival last week the app has had 300,000 downloads, and has collected data from over 200,000 dreams.

    Reuter site - RIM considering hiring bankers: report

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    RIM considering hiring bankers: report

    Mon, Apr 16 17:37 PM EDT

    TORONTO (Reuters) - Research In Motion is considering hiring a financial adviser to weigh its strategic options, Bloomberg News said on Monday, citing three sources with knowledge of the matter.

    RIM said while reporting its latest quarterly results in late March that it was considering options including partnerships, licensing deals, joint ventures or even a sale.

    RIM spokeswoman Tenille Kennedy declined to comment, citing company policy.

    (Reporting by Alastair Sharp in Toronto; Editing by Gary Hill)

    Sunday, April 15, 2012

    Reuter site - In Silicon Valley, designers emerge as rock stars

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    In Silicon Valley, designers emerge as rock stars

    Fri, Apr 13 16:36 PM EDT

    By Gerry Shih

    SAN FRANCISCO (Reuters) - Five years ago, Justin Edmund arrived at Carnegie Mellon University, a floppy-haired freshman, with artistic talent and dreams of joining a venerable design firm like IDEO or Frog. But during his sophomore year, a recruiting pitch from a Facebook employee turned his head, and prompted a detour of his ambitions.

    "It didn't even occur to me that working at a tech company was something I could do," Edmund said. "I switched my trajectory completely."

    So, in 2010, Edmund interned on Facebook's burgeoning design team, and, after graduation, landed a job at Pinterest. There, at just 21, he has played a central role in building the virtual scrap-booking site into one of the hottest startups on the Internet.

    Edmund isn't alone. Inspired by the legacy of Steve Jobs and lured by the promise of the current tech boom, young designers are flocking to Silicon Valley, where they're shaking up a scene long dominated by engineers and programmers.

    The new breed of "user experience" designers - part sketch artist, part programmer, with a dash of behavioral scientist thrown in - are some of the most sought-after employees in technology. Entry-level interactive designers at startups are commanding salaries easily topping $80,000, almost twice the median pay for primarily print designers of about $45,000, according to a recent survey by the American Institute of Graphic Arts.


    Top venture capital firms, from Google Ventures to Andreessen Horowitz, are hiring in-house designers to help the young startups in their portfolios. One angel investor has even established a Designer Fund to identify startups driven by design talent.

    To feed demand, new digital design programs have sprouted over the past two years, at both elite engineering universities such as Stanford, and art schools like the California College of the Arts. The School of Visual Arts in New York has seen applications for its digital design program soar by 43 percent since its inception in 2009.

    Indeed, the flourishing of digital design reflects the Valley's evolution, entrepreneurs and investors say.

    In the latest generation of innovation, heavily concentrated in applications for mobile devices and social networks, and relying on ever-cheaper cloud-computing services, success depends not on whiz-bang technology, but rather, on a subtle sense of how to make features useful and engaging.

    The most recent example is Instagram, the slick photo-sharing app that was snapped up by Facebook earlier this week for $1 billion. The 12-person company's founding duo includes Kevin Systrom, who majored in Management Science and Engineering at Stanford, and Mike Krieger, who describes his background as "Human-Computer Interaction and User Experience."

    "There's a growing recognition that it's critical for a company's first employees to be people with great design sense," said Eric Feng, founder of Hulu and Erly, an evite- and photo-sharing company, and a former partner at venture capital firm, Kleiner Perkins Caulfield and Byers. "That's true even if you look at larger companies like Google and Facebook, who have moved in that direction."

    To be sure, engineers still occupy a rarefied perch at the top of the Silicon Valley hierarchy, and are the target of the fiercest recruiting battles.


    But even Facebook, famous for a culture that glorifies the "hacker way," now talks of integrating "design thinking" into its products and has steadily beefed up its design studio.

    From her team's brightly-colored studio in Facebook's Menlo Park offices, design chief Kate Aronowitz dispatches designers who are paired with an engineer, a product manager and sometimes a researcher to conceive new products or improve features such as user profiles or messages.

    The embrace of design starts at the top with CEO Mark Zuckerberg, who has stressed the importance of building a crack design team, Aronowitz said.

    In a highly competitive recruiting climate, it's not uncommon for even Facebook to encounter top design talent playing hard to get. For the toughest cases, Aronowitz plays her trump card: She asks Zuckerberg to place a personal phone call.

    "When they're not returning my email, that tends to work," said Aronowitz, who herself was poached by Zuckerberg from LinkedIn in 2009. "I'm lucky to have that in my back pocket."

    The spotlight fell squarely on the design team last November, when Facebook credited Nicholas Felton, one of its data-visualization experts, with conceiving the Timeline interface which has become one of Facebook's most significant overhauls in recent years.

    For fledgling startups, it's even more critical to understand how design affects user behavior, said Dave McClure, an angel investor who cited the example of Mint, an online tool for managing personal finances acquired by Intuit in 2009.

    Jason Putorti, the startup's designer founder, lent the Mint interface "much more warmth," which was crucial for a startup that dealt with sensitive information, McClure said. Design, he added, "made the app feel trustworthy, comforting, functional."

    Last year, McClure put down money to create the Designer Fund, a program that identifies entrepreneurs with strong design backgrounds and offers seed money and mentoring from experienced founders like Putorti and Chad Hurley, of Youtube. The fund, headed by Enrique Allen, a 25-year old graduate of Stanford's design school, has partnered with more established venture investment firms like Khosla Ventures, Andreessen Horowitz and Kleiner Perkins.

    "We're reshaping a lot of how you build a company," McClure said. But, he added, "there's still a resource and talent shortage" for interaction designers.


    Finding exceptional design talent, though, is not a simple matter. Last year, Kalvin Wang, the co-founder of Ridejoy, a service that arranges carpools, said he spent several "incredibly hard" months recruiting an interaction designer.

    Dirk Cleveland of Riviera Partners, a Silicon Valley headhunting firm, said startups have trouble finding a design "unicorn" - the rare designer with the interactive digital skills that many app startups require.

    "It's literally the toughest position to fill right now," Cleveland said. "That equation of supply and demand is out of balance. Engineering education has progressed, and startups have learned to do more with limited resources, but I don't think that's the case for design."

    Even though he sifted through 150 resumes, Wang said, "There are so many startups and so many tech companies that are snapping them up. It's slightly ridiculous."

    Ridejoy interviewed candidates from Toronto, New York and the Midwest, and ultimately hired a Parsons School of Design graduate living in Omaha.

    "You do really have to look outside Silicon Valley," Wang said. "For Bay Area designers, they have literally hundreds of options and they're going to work at a place where they know people, or a big name like Google."

    The sizzling job market hasn't escaped the notice of design schools across the country.

    Liz Danzico, founding director of the School of Visual Arts' masters program in Interaction Design, said the original goal was simply to understand where the new innovation economy field was going. "Experience is now the material, not ceramic or plastic," she said.

    Still, Danzico expected most graduates to stay in New York — the traditional hotbed of design. She was "really surprised" to find, in a survey of her first graduating class, that almost half ended up on the West Coast at companies including Apple, Facebook, Twitter and Yelp.

    Meanwhile, at Carnegie Mellon, Kelly Lau-Kee, a junior industrial design major, said "there's huge buzz generated by the students, the employers, even the professors" about the prospect of work in Silicon Valley.

    On any given day, Lau-Kee said, she'll spot pictures on Facebook and Instagram shared by friends currently employed by startups. They paint a heady picture of life in California, of snazzy workspaces, hip coworkers and sunshine spilling into every frame.

    "A lot of people like the mentality of work and play, which the startups advertise really well," she said. "It's a culture we really want to check out."

    Wayne C. Chung, the chair of Carnegie Mellon's industrial design program who taught Edmund, the young star at Pinterest, said the new economics of the profession was evident on college grounds. Traditional design firms, buffeted by the last recession, have noticeably cut back on recruiting, while tech companies have maintained a visible presence on campus, he said.

    After this semester, Chung expects another sizeable contingent of his graduates to make their way West to Silicon Valley.

    "In their hearts and eyes," Chung said, "they don't see anything else as nearly as exciting.

    (Editing by Jonathan Weber and Bernadette Baum)

    Reuter site - Exclusive: Former RIM boss sought strategy shift before he quit

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    Exclusive: Former RIM boss sought strategy shift before he quit

    Fri, Apr 13 06:51 AM EDT

    By Alastair Sharp

    TORONTO (Reuters) - Former Research In Motion co-chief executive Jim Balsillie sought to reinvent the BlackBerry smartphone maker with a radical shift in strategy before he stepped down, two sources with knowledge of his plans said.

    Balsillie hoped to allow major wireless companies in North America and Europe to provide service for non-BlackBerry devices routed through RIM's proprietary network, a major break with the BlackBerry-only strategy pursued by RIM since its inception.

    The plan would have let the carriers use the RIM network to offer inexpensive data plans, limited to social media and instant messaging, to entice low-tier customers to upgrade from no-frills phones to smartphones.

    But the talks with carriers led to discord at the highest levels of the troubled Canadian company, and Balsillie resigned as a director soon after he stepped down as co-CEO. His former partner at the helm, Mike Lazaridis, still has an active role.

    The veto leaves RIM's focus squarely on a new generation of BlackBerry gadgets it promises will wow consumers. The devices will have to do just that, analysts say, to arrest the precipitous decline in market share suffered by RIM, the company that virtually invented mobile email more than a decade ago.

    Balsillie's plan may have heralded a broader strategic move by RIM to define its high-margin network services - which bring in around $1 billion a quarter - as a business that's distinct from building and marketing the BlackBerry. That hardware business may have lost money last year.

    Carriers may have seen value in the plan, which would have encouraged lower-value talk-and-text customers to upgrade to entry-level smartphone plans, with access limited to Twitter, Facebook, messaging and other social media platforms.

    The package would have included RIM's BlackBerry Messenger application, a powerful tool that has kept many BlackBerry users faithful even as flashier gadgets from Apple Inc and running Google Inc's Android software beckon.

    That said, the arrangement would have relied on RIM's private network, which crashed painfully last year, adding a layer of risk that some carriers might have shied away from.

    The RIM network is integrated with cellular networks across the world. Managed from a string of data centers, RIM encrypts and compresses massive amounts of data it then pushes out to BlackBerry devices. It charges carriers a monthly subscription fee per user for the service.

    The system allows the BlackBerry - and in theory other devices - to gobble up much less bandwidth. So routing non-BlackBerry traffic through RIM's servers would help carriers by easing strain on their networks.

    RIM took a first step toward establishing the network as a standalone operation late last year with its Mobile Fusion software that gives corporate and government customers the option of linking iPhones and Android devices to their existing BlackBerry management systems.

    But that does not offer outsiders the unique technology that encrypts data and pushes it out to the BlackBerry.


    Balsillie developed close business relationships with hundreds of telecoms executives as RIM's chief salesman and dealmaker in the years of BlackBerry's most prodigious growth.

    He was talking to AT&T Inc and Verizon Communications Inc in the United States, and Vodafone Group Plc, Deutsche Telekom AG, Telefonica SA and France Telecom SA in Europe, as well as at least one major Canadian carrier, the sources said.

    RIM, which declined comment, already offers basic messaging and social media plans to BlackBerry users in many countries, something that has helped it drive growth, particularly in emerging markets.

    The plans restrict Internet access to a few popular sites and are typically cheaper than the smallest per-gigabyte plan available for other gadgets.

    RIM was well along the path, having developed software to deliver the service to users of the latest versions of Apple and Android operating systems. It had also studied the global potential of selling the service, one source said.

    But before that could happen, RIM's new CEO Thorsten Heins, backed by Lazaridis and the board, rejected Balsillie's initiative in favor of a focus on next-generation BlackBerry 10 phones due later in the year, two sources said.


    Balsillie's plan might have resonated with investors and analysts who have urged RIM to sell its hardware business as a way of salvaging some value from the company, whose shares have shed 80 percent since February last year.

    RIM's BlackBerry devices have struggled to compete with Apple's iPhone and iPad and a slew of Android devices. RIM slashed more than $750 million from the value of its smartphone and tablet inventory in each of its last two quarters.

    The company likely lost money on hardware sales in the fiscal year just ended, an analyst said on Tuesday.

    Yet with the global smartphone boom showing no signs of abating, RIM could target a market six times larger than its existing BlackBerry base, former RBC Capital Market analyst Mike Abramsky wrote in a note last year advocating RIM split in two.

    Some 1.55 billion mobile phones were shipped worldwide in 2011, of which less than one third were smartphones, according to research firm IDC. Only about 51 million were BlackBerries.

    But smartphones will likely account for more than half of the 2.17 billion phones shipped in 2016, IDC said.

    Assuming that RIM could sell its services for even a tiny portion of the new smartphones, while retaining its existing subscribers, its services business would expand meaningfully.

    Verizon, Vodafone, France Telecom and Telefonica declined to comment. A Deutsche Telekom spokesman said the company was not aware of such a proposal.

    Verizon Wireless is a joint venture of Verizon and Vodafone, while Deutsche Telekom also owns T-Mobile USA. France Telecom, Telefonica and Vodafone all have operations in emerging economies where RIM has notched most of its recent growth.


    Balsillie and Lazaridis stepped down from their shared CEO roles in late January, and gave up roles as co-chairman of the board.

    Lazaridis stayed on as vice-chair and head of a newly created innovation committee.

    The pair, who together built Lazaridis' 1985 start-up into a global business with $20 billion in sales last year, handed the CEO job to Heins, a German-born former Siemens AG executive.

    Heins initially said it would be wrong of RIM to focus on licensing its software or abandoning its integrated stance - where RIM ran its own software on its own phones, supported by its own network - and he certainly wasn't considering a sale.

    But in late March, while reporting RIM's first quarterly loss since 2005, Heins abruptly said he was reviewing options such as partnerships, joint ventures, licensing and other ways to leverage RIM's assets. He did not rule out a sale.

    "I did my own reality check on where the entire company really is," he said. "It is now very clear to me that substantial change is what RIM needs."

    Those comments don't rule out talks with carriers about a plan like the one Balsillie proposed.

    "There hasn't been any inconsistent 'back-and-forth' between Thorsten and carriers," a separate source familiar with the situation said, without confirming or denying that any talks had taken place.

    Balsillie cut his last professional tie to the company on the day Heins opened the door to all those options, stepping down as a board director. He remains one of RIM's largest shareholders, with a 5 percent stake.

    (Editing by Frank McGurty and Janet Guttsman)

    Thursday, April 12, 2012

    Reuter site - RIM to launch updates of popular BlackBerry apps

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    RIM to launch updates of popular BlackBerry apps

    Wed, Apr 11 09:22 AM EDT

    (Reuters) - Research In Motion said it will shortly release a slew of updates for its BlackBerry apps, making it easier for users to stay connected with their messenger community.

    Apps such as Facebook, Twitter, BBM Music and BlackBerry App World will now include BlackBerry Messenger (BBM) connectivity, the Canadian company said in a statement on Wednesday.

    Users will now be able to automatically share their Facebook status or Twitter update with their BBM friends from the apps, it added.

    Alec Saunders, vice president of developer relations at RIM, said about one in every five apps being downloaded on BlackBerry App World is BBM-connected.

    Waterloo, Ontario-based RIM has more than 70,000 apps in its App World store for either BlackBerry phones or the PlayBook tablet, compared with 200,000 iPad apps, and half a million for the iPhone.

    (Reporting by Krishna N. Das in Bangalore; Editing by Joyjeet Das)

    Reuter site - Barnes & Noble unveils glow-in-the-dark Nook

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    Barnes & Noble unveils glow-in-the-dark Nook

    Thu, Apr 12 16:32 PM EDT

    By Liana B. Baker

    NEW YORK (Reuters) - Book retailer Barnes & Noble Inc debuted an e-reader on Thursday with a screen that can glow in the dark, a move aimed at improving its position against

    The 6-inch (15-cm) touch-screen device, which will hit stores in early May for $139, lands in a market where Apple Inc and Amazon are battling with Barnes & Noble for customers who want to read books and magazines on small portable devices. Weighing just under 7 ounces (200 grams), it is Barnes & Noble's lightest Nook yet and is aimed at people who want to read in the dark without a light.

    To read in the dark with other e-readers that use electronic ink, consumers had to buy an external light that attached to the device. While Apple's iPads have backlit screens, Barnes & Noble said its technology creates a better nighttime reading experience than an LCD screen because it throws off less light and will not disturb a reader's partner who is trying to sleep.

    While Barnes & Noble is first to market with a glowing e-reader, Amazon may be hot on its heels. The Internet retailer is working on releasing its own e-reader with a glowing screen, according to a report on April 6 from the blog TechCrunch. Amazon did not respond for comment on the report.

    "If Amazon isn't already working on one, they will immediately start working on one now after today's announcement," Forrester analyst James McQuivey said.

    Fighting deep-pocketed Amazon has proved to be an expensive proposition for Barnes & Noble, as it has poured hundreds of millions into developing the Nook. In January, the retailer forecast a steeper net loss than expected for the fiscal year, as it continues to spend on the technology.

    "We are investing a lot but we feel good that those investments will pay off," Barnes & Noble Chief Executive William Lynch said in an interview on Thursday.

    He added that the chain, the No. 2 seller of e-books behind Amazon, is increasing its market share faster than any other company. In February, he estimated the company captures 27 percent to 30 percent of the U.S. digital books market.

    Barnes & Noble introduced its first version of the Nook in 2009, two years after Amazon's Kindle.

    Lynch declined to comment on whether Barnes & Noble would change the prices of its e-books after the Department of Justice reached a settlement with three major book publishers that it says colluded with Apple to push up e-book prices.

    Amazon had said it plans to lower its e-book prices. Apple did not comment on Wednesday on a lawsuit filed against it and five booksellers alleging collusion.

    "We'll come out with some points of view on that in the coming weeks," Lynch told Reuters.

    Users can turn off the glowing feature on the screen to read outdoors as well, while the battery can last one month with the glow on without Wi-Fi. The $139 price on the new Nook is the same as that of Kindle Touch without ads.

    McQuivey, the Forrester analyst, said the device would appeal to Barnes & Noble customers, as well as consumers who have never bought an e-reader before. Attracting Kindle users will be a tougher proposition.

    "To its core base, it says, 'we are still committed to this,' but if you owned a Kindle for years, there's no way you're going to move to Barnes & Noble at this point," McQuivey said.

    Barnes & Noble shares fell 72 cents or 6.13 percent on Thursday to $11.05. Amazon shares rose $2.73 or 1.4 percent to $190.69 per share.

    (Additional reporting by Phil Wahba; Editing by Dale Hudson)

    Tuesday, April 10, 2012

    Reuter site - After game-changing run, Santorum quits White House race

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    After game-changing run, Santorum quits White House race

    Tue, Apr 10 19:50 PM EDT

    By Patricia Zengerle

    GETTYSBURG, Pennsylvania (Reuters) - Rick Santorum ended his improbable run for the White House on Tuesday after leading a Republican tilt to the right that could dog the more moderate front-runner, Mitt Romney, in November's election.

    Trailing in polls and fundraising, the conservative former Pennsylvania senator suspended his campaign and cleared the way for Romney to clinch the nomination to face President Barack Obama in the November 6 general election.

    A staunch social conservative with a penchant for sleeveless sweaters, Santorum was the underdog who clawed his way to near the top of the Republican race and won the first 2012 nominating contest in Iowa by a thread.

    His rise forced the issues of birth control and the role of Christianity in public life to the forefront of the campaign, frustrating Romney, a former private equity executive who sought to keep the focus on the economy.

    During his exit speech on Tuesday, Santorum again reached out to the working class and the Republican Party's right wing, which he had courted throughout the campaign with his focus on manufacturing, religion and conservative family values.

    "Over and over again we were told, 'Forget it, you can't win.' We were winning, but in a different way, we were touching hearts, we were raising issues that frankly a lot of people didn't want to have raised," Santorum said at a news conference in a hotel near the Civil War battlefield site of Gettysburg.

    Santorum's exit leaves the stage free for a two-man fight between Romney and Democrat Obama for the presidency.

    That contest intensified on Tuesday when Obama's campaign accused the multimillionaire Romney of not paying his "fair share" of taxes, and tried to paint the Republican as an elitist.

    Santorum proved to be a more formidable opponent to Romney than many expected, especially in light of a historic 18-percentage point defeat during his Senate re-election bid in Pennsylvania in 2006.

    His vocal opposition to gay marriage and abortion offered Republican voters a stark contrast with former Massachusetts governor Romney's more moderate record.

    Romney moved to the right on social issues to try to outflank Santorum. Now Romney, and Republican congressional candidates, could have some difficulty in November, when the overall electorate will be more moderate.

    "When voters are interested in the economy, Rick Santorum was talking about socially conservative issues ... and that would take us off message. That would take the whole party off message," said Republican strategist Ron Bonjean.

    Santorum lagged Romney in opinion polls and in the fight for the 1,144 party delegates needed to win the Republican nomination. He was facing the possibility of an embarrassing defeat in his home state of Pennsylvania on April 24. Romney has 659 delegates to 275 for Santorum, according to a CNN estimate.

    A devout Catholic, Santorum failed to stretch his appeal far enough beyond conservatives and some blue-collar Republicans to overtake Romney.

    Santorum spoke to his main rival on Tuesday but did not endorse the front-runner or either of the two other Republican candidates, Texas Congressman Ron Paul and former U.S. House speaker Newt Gingrich, both of whom are way behind Romney in polls.

    "Mr. Santorum brought excitement to the race, and helped the GOP mobilize voters earlier in the season," Hunter College Political Science Professor Jamie Chandler said.

    "Now much of the electorate will tune out until the fall. His delegates will now be open at the convention, but will likely support Mitt Romney."

    Disappointed Santorum supporter Felicia Collie, 29, of Gettysburg, was not ready to throw her vote to Romney.

    "I don't really want to because Romney is the same as Obama," she said. "Santorum is the only one (of the Republican candidates) who is a clear contrast."

    Santorum has been the only serious Republican challenger to Romney in the last six weeks, and he won victories in nominating contests in Alabama, Mississippi, Missouri, Kansas, Louisiana and Colorado.

    But he failed to take big Rust-Belt states such as Michigan and Ohio, despite portraying himself as a blue-collar guy and playing up his roots as the grandson of an Italian immigrant coal miner.

    Santorum also could not compete in campaign funding.

    Romney's allies in the Restore Our Future "Super PAC" have spent nearly $41 million on advertising that consisted mostly of attacks on Gingrich and Santorum, portraying the latter as a supporter of big spending during his 12 years in the Senate.

    "It's no surprise that Mitt Romney finally was able to grind down his opponents under an avalanche of negative ads," said Obama's campaign manager Jim Messina.

    "But neither he nor his special-interest allies will be able to buy the presidency with their negative attacks. The more the American people see of Mitt Romney, the less they like him and the less they trust him," said Messina, who heads a campaign that has a stronger fundraising operation than Romney's.

    Santorum leaves a legacy of harsh statements on social issues that alienated many voters, including Republicans.

    He upset fellow Catholics in February when he said that late President John F. Kennedy's 1960 speech praising the separation of church and state made him want to "throw up." Santorum later said he regretted the comment.

    When Santorum criticized gay rights and birth control, the media highlighted a 2008 speech in which he declared that "Satan" was attacking great U.S. institutions by means of "pride, vanity, and sensuality."

    The father of seven children, Santorum's decision to quit was partly influence by a serious illness suffered by his three-year-old daughter, Bella. She was hospitalized over the long holiday weekend with Trisomy 18, a rare genetic condition that hinders a child's development.

    (Additional reporting by Alina Selyukh, Andy Sullivan and Jeff Mason; Writing by Alistair Bell; Editing by Mary Milliken and David Brunnstrom)

    Sunday, April 8, 2012

    Reuter site - Factbox: Lure of Facebook "social commerce" for VCs

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    Factbox: Lure of Facebook "social commerce" for VCs

    Thu, Apr 05 07:09 AM EDT

    SAN FRANCISCO (Reuters) - The potential of e-commerce on and around Facebook Inc's giant social network has inspired a rash of investments from Silicon Valley venture capitalists and even Wall Street outfits. Here are 10 recent examples.

    - BeachMint, which sells apparel, jewelry, shoes and other accessories through Facebook, has raised about $70 million from investors including Accel Partners, Goldman Sachs, New World Ventures and Millennium Technology Value Partners.

    - Buddy Media, which helps brands manage their Facebook presence, raised $54 million in August from GGV Capital, Institutional Venture Partners, Bay Partners and Insight Venture Partners.

    -, a seller of designer goods that is built around Facebook and other social networks, has raised more than $50 million from venture capital firms including Andreessen Horowitz, Menlo Ventures and First Round Capital.

    - OpenSky, a shopping website that lets consumers get recommendations from celebrities through social networks including Facebook, raised $30 million in October from Providence Equity Partners, Highland Capital Partners, Canaan Partners and The Raine Group.

    - Oodle, which runs a classifieds marketplace on Facebook with more than 3 million unique monthly users, has raised more than $20 million from venture capital firms including Greylock Partners and Redpoint Ventures.

    - Yardsellr, which links buyers and sellers through Facebook, raised $5 million in late 2010 from Accel Partners and Harrison Metal Capital, which had previously seeded the business with $750,000.

    - Lockerz, a social shopping network, has raised more than $50 million from investors including venture capital giant Kleiner Perkins Caufield & Byers.

    - Payvment, which runs thousands of Facebook stores for small merchants, has raised $8 million from investors including Sierra Ventures and BlueRun Ventures.

    - Wrapp, a social gifting service, has raised more than $10 million from investors including Greylock Partners and Atomico, a venture capital firm run by Skype co-founder Niklas Zennström.

    - Minted, a social commerce startup focused on stationery, invitations and greeting cards, raised $5.5 million in November from Benchmark Capital, IDG Ventures and Menlo Ventures. Marissa Mayer of Google and Jeremy Stoppelman of Yelp also invested.

    (Reporting By Alistair Barr; Editing by Gary Hill)

    Reuter site - Analysis: Facebook e-commerce: the next big thing?

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    Analysis: Facebook e-commerce: the next big thing?

    Thu, Apr 05 07:05 AM EDT

    By Alistair Barr

    SAN FRANCISCO (Reuters) - A group of e-commerce start-ups, backed by some of the tech world's most pedigreed financiers, are betting that Facebook Inc can become an e-commerce powerhouse to rival Inc and eBay Inc.

    As the world's largest social network hurtles toward a $5 billion initial public offering, it will come under more pressure from Wall Street to find new sources of profit growth and reduce its reliance on advertising, which accounted for 85 percent of its 2011 revenue.

    Some entrepreneurs and investors increasingly think "f-commerce" - meaning e-commerce on Facebook - is the answer. Start-ups such as BeachMint, Yardsellr, Oodle and are coming up with novel ways to persuade Facebook users to not just connect with friends on the social network, but to shop as well.

    Backed by tens of millions of dollars from venture capital firms like Accel Partners and Andreessen Horowitz, and other big investors like Goldman Sachs, these start-ups are pushing out shopping apps, hosting online garage sales and testing out new business models on Facebook.

    "E-commerce is a huge category with very strong tailwinds and it's a natural move for Facebook," said Sam Schwerin of Millennium Technology Value Partners, which owns Facebook shares and has a stake in BeachMint.

    Amazon revolutionized online shopping by crunching lots of customer and purchase data to come up with relevant, personalized recommendations. In the same vein, Facebook's combination of data, analytics and payment technology could fuel the next generation of e-commerce, Schwerin said.

    Facebook declined to comment, but investors said the company understands the importance of having an e-commerce strategy.

    "It's a big imperative for them," said Theresia Gouw Ranzetta of Accel Partners, an early backer of Facebook. "They understand it's an important strategic benefit for them to make e-commerce players successful on the platform."

    FACTBOX-Social commerce on Facebook



    Facebook had 845 million monthly active users at the end of 2011, far higher than Amazon's 164 million active accounts or the eBay online marketplace's 100 million active users.

    But despite that huge base, Facebook is primarily a way to connect with friends, and not an online shopper's first destination. Big retailers including J.C. Penney, Gap and Nordstrom had previously set up stores on Facebook but shut them after generating few sales.

    That has not stopped venture capital firms from pouring money into rookie companies they think have cracked the code.

    There is a lot of buzz about, a one-year-old company that has amassed 2 million users who broadcast their purchases via a "bought" button that advertises their shopping habits to friends. Fab built its user base in part by offering $5 a month to those who sign up - Chief Executive Jason Goldberg said "tens of thousands" opted in.

    BeachMint co-founder Diego Berdakin said his company had set up a live video event called last holiday season featuring a brief appearance by Facebook CEO Mark Zuckerberg's sister, Randi Zuckerberg. For about two hours, they showcased BeachMint products that people could buy with one click.

    More than 50,000 Facebook users watched the show and a "huge percentage" bought something, Berdakin said, adding, "At the time, it was the biggest day in our history in terms of sales."

    Yardsellr, started in 2010 by former eBay manager Danny Leffel, organizes people into 3,000 communities, or "blocks," based on common interests. When someone posts a product for sale, it is sent to the news feeds of people in that block and purchases can be made with a few clicks.

    Gross merchandise sales, a measure of the value of products, has been growing about 30 percent a month, according to Leffel. "Social commerce could be bigger than eBay," he argued.

    Then there's Oodle, a start-up headed by Craig Donato, who runs Facebook's official marketplace, which boasts more than 3 million unique monthly users. When buyers and sellers post items, their Facebook identities are attached, giving users more confidence in the transactions, Donato said.


    For now, Facebook is making money mostly by selling ads to merchants trying to target potential customers. But many experts say it is a matter of time before the eight-year-old social network will ask for a cut of shopping transactions, or seek other ways to profit.

    They point to Facebook's relationship with online games developer Zynga Inc as an example. Facebook takes a 30 percent cut of revenue generated from the sale of virtual goods used to play Zynga games.

    Gamers pay for those virtual goods using Facebook Credits, a virtual currency that could eventually be used to buy physical goods, according to some Internet entrepreneurs.

    "Facebook has a huge opportunity to monetize e-commerce," said Christian Taylor, chief executive of Payvment, a startup that operates thousands of Facebook stores. "They have the infrastructure and team to pursue that."

    Others downplay the potential for Facebook Credits, saying physical goods offer much thinner profit margins than virtual products.

    "The 30 percent model is great for products with near-zero cost of goods sold," said Kevin Hartz, head of ticketing start-up Eventbrite, which works closely with Facebook. "But selling a TV with thin margins, that model will just not apply."

    Nevertheless, if e-commerce on Facebook takes off, many expect the social network to find a way to make money off it.

    "When you build on top of a platform like Facebook, there is always the risk that the platform provider decides to change the rules later on," said Laura Valverde of Beetailer, which runs more than 3,000 stores on Facebook.

    "We have seen this with Facebook Credits and games. So, once social commerce fully takes off, it will only be natural that Facebook tries to benefit one way or another from it."

    (Editing by Edwin Chan, Tiffany Wu and Bob Burgdorfer)

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