Category: News

  • Atlas Pipeline to Buy TEAK Midstream for $1 Bln

    Atlas Pipeline Partners has agreed to buy TEAK Midstream for $1 billion. The transaction is expected to close in May. TEAK, which is backed by Natural Gas Partners, is a Dallas-based midstream natural gas company. Evercore Partners acted as TEAK’s financial adviser.

    PRESS RELEASE

    TEAK Midstream, L.L.C., a Natural Gas Partners-sponsored company, announced the company has signed a definitive agreement with a wholly owned subsidiary of Atlas Pipeline Partners, L.P. whereby Atlas will acquire 100 percent of TEAK’s equity interests for $1 billion in cash. The transaction is expected to close in May 2013 subject to certain regulatory approvals and customary closing conditions.

    TEAK’s assets include an interest in 265 miles of primarily 20-to-24-inch diameter natural gas gathering and residue delivery pipelines and all of the adjoining Silver Oak 200 million cubic feet per day (MMcf/d) cryogenic gas processing plant in the heart of the liquids-rich Eagle Ford Shale oil and gas play in South Texas. In addition, Silver Oak II, a second 200 MMcf/d cryogenic gas processing plant, is expected to be delivered for installation in May 2013 and operational during the first quarter of 2014.

    “We are extremely gratified that TEAK is being acquired by such a well-respected midstream company as Atlas. Their go-forward strategy, vision for growth and business values complement what we have built in the Eagle Ford Shale since we established the company in 2009,” said A. Chris Aulds, TEAK Co-Chief Executive. “We want to assure our existing and potential customers that TEAK is partnering with Atlas to offer the same top-quality services and solutions we always have. We are working together to ensure all customers’ needs are met. I know that Atlas is as committed as we are to making customers their first priority.”

    “Our objective was to build a significant midstream company operated primarily in the prolific Eagle Ford Shale play and surrounding area. We thank our loyal and highly skilled employees for helping us accomplish this goal. The TEAK team has always done an outstanding job of assisting our customers with their growing midstream needs by providing value-added solutions, and they will continue to do so. Atlas has displayed the same entrepreneurial spirit and company culture we enjoy, so we are extremely pleased that TEAK employees will become an important addition to and integral part of the Atlas team,” said TEAK Co-Chief Executive Jim Wales.

    TEAK’s assets also include the 275-mile low-pressure Texana gathering system in South and East Texas, which the company acquired in July 2010.

    Evercore Partners acted as TEAK’s financial adviser and Thompson & Knight LLP acted as TEAK’s legal adviser for the transaction.

    About TEAK Midstream

    TEAK Midstream, L.L.C., a Dallas-based midstream natural gas company, provides gathering, transmission, treating, processing, compression and marketing services in key gas producing areas of the United States. TEAK was founded in October 2009 and currently has operations throughout South and East Texas. TEAK Midstream is a portfolio company of Natural Gas Partners. For more information on TEAK Midstream, visit www.teakmidstream.com.

    About Natural Gas Partners

    Founded in 1988, Natural Gas Partners (NGP) is a family of private equity investment funds organized to make investments in the energy and natural resources sectors. NGP is part of the investment platform of NGP Energy Capital Management, a premier investment franchise in the natural resources industry, which together with its affiliates has managed $13 billion in cumulative committed capital since inception. www.naturalgaspartners.com

    About Atlas Pipeline Partners, L.P.

    Atlas Pipeline Partners, L.P. (NYSE: APL) is active in the gathering and processing segments of the midstream natural gas industry. In Oklahoma, southern Kansas, northern and western Texas, and Tennessee, APL owns and operates 13 active gas processing plants, 18 gas treating facilities, as well as approximately 10,600 miles of active intrastate gas gathering pipeline. APL also has a 20 percent interest in West Texas LPG Pipeline Limited Partnership, which is operated by Chevron Corporation. For more information, visit the Partnership’s website at www.atlaspipeline.com or contact [email protected].

    The post Atlas Pipeline to Buy TEAK Midstream for $1 Bln appeared first on peHUB.

  • Older model iPhones are more popular than ever

    The big number everyone’s going to be watching for during Apple’s earnings announcement on Tuesday is how many iPhones it sold during its second fiscal quarter. We don’t know the total yet, but a study published by Consumer Intelligence Research Partners estimates how many of those were the latest model iPhone 5: about 53 percent of all iPhones sold worldwide.

    It also found that the rest were iPhone 4 and iPhone 4S models, which sell for free with a contract or for $99 with a contract, respectively. That breakdown is slightly improved from December, when a CIRP survey shows that just half of all iPhones sold were the newest model iPhone 5.

    CIRP January through March iPhone model purchases

    CIRP January through March iPhone model purchases

    This is a very different sales pattern than what we saw in the second quarter of the iPhone 4S’s availability. When that device was the latest model, it accounted for 73 percent of all iPhone sales in April 2012, a significantly larger share than the iPhone 5 had as of March, according to CIRP, whose data comes from a survey of 500 customers who’d recently bought an Apple device.

    The iPhone 4S sold 33% of all iPhones in the survey period, while the iPhone 4 represented 14% of all iPhones. In contrast, in the similar period following the launch of the iPhone 4S, the lower-priced iPhone 4 represented 22% of sales, and the free iPhone 3GS represented 5% of sales.

    As a share of iPhones sold, 33 percent is the highest share a legacy model iPhone has carried in at least the last two years, according to CIRP’s data. Apple wants to sell iPhones no matter what, but ideally it wants to sell more of the most expensive iPhones, not the severely discounted and free-on-contract devices; that way its average selling price stays high.

    Something similar is taking place with iPads, CIRP found: Between January and March, the iPad 2 — which originally debuted in early 2011 — grabbed a larger share of iPad sales, up from 27 percent to 32 percent. The newest model, the iPad with Retina display, dropped from 43 percent of sales in the holiday quarter to 36 percent of sales during the January quarter. Meanwhile, the smaller and cheaper iPad mini grew slightly, from 30 percent to 32 percent of sales.

    It’s not really a mystery that cheaper Apple devices, even when the devices are not the latest model, are attractive to buyers when viewed against the competition. What is a mystery (until tomorrow anyway) is how this affects Apple’s balance sheet.

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  • Young Scientists and Innovators Amaze President Obama at the White House Science Fair

    President Obama with Evan Jackson, Alec Jackson, and Caleb Robinson at the White House Science Fair, April 22, 2013

    President Barack Obama talks with Evan Jackson, 10, Alec Jackson, 8, and Caleb Robinson, 8, from McDonough, Ga., while looking at exhibits at the White House Science Fair in the State Dining Room, April 22, 2013. The sports-loving grade-schoolers created a new product concept to keep athletes cool and helps players maintain safe body temperatures on the field.

    (Official White House Photo by Chuck Kennedy)

    President Obama today celebrated the remarkable achievements of student science fair winners and extraordinary kid innovators from across the nation in the third White House Science Fair. The Fair brought 100 students from more than 40 states to an all-day, hands-on celebration of the power and potential of science, technology, engineering, and math (STEM) education.

    As the President said in 2009, when he announced the first-ever White House Science Fair, “If you win the NCAA championship, you come to the White House. Well, if you're a young person and you've produced the best experiment or design, the best hardware or software, you ought to be recognized for that achievement, too.”

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  • Blackstone Inks buy of Strategic Partners

    Blackstone said Monday it had agreed to buy Strategic Partners, Credit Suisse’s dedicated secondary private equity business. Financial terms weren’t announced. The sale is part of Credit Suisse’s strategic divestment plans that it announced in July. Strategic Partners has $9 billion in assets under management.

    PRESS RELEASE

    Blackstone (NYSE:BX) today announced an agreement with Credit Suisse to acquire Strategic Partners, Credit Suisse’s dedicated secondary private equity business with $9 billion in assets under management. The transaction is subject to customary closing conditions and is expected to close by the end of the third quarter 2013. The terms of the deal were not disclosed.

    Tony James, President and Chief Operating Officer of Blackstone, said, “We are thrilled that the people of Strategic Partners are joining Blackstone. Many of us here at Blackstone were once colleagues of the Strategic Partners team, and this gives us high confidence that it will be a seamless cultural fit here at the firm. Strategic Partners complements Blackstone’s existing businesses, and we expect to be able to grow its franchise and help it enter new product areas.”

    Alastair Cairns, Co-Head of Credit Suisse’s Legacy Asset Management business, added, “Strategic Partners is a leader in the secondary private equity space. We are pleased to have reached this agreement and are confident that with Blackstone, Strategic Partners will continue to build on its excellent track record.”

    The sale is part of Credit Suisse’s strategic divestment plans that were announced on July 18, 2012.

    Strategic Partners seeks capital appreciation through the purchase of secondary interests in high quality private equity funds from investors seeking liquidity on a fair, timely and confidential basis. From its start in 2000, it has raised over $11 billion of capital commitments, completed over 700 transactions, and acquired over 1,400 underlying limited partnership interests. Its performance has been top quartile among its peers. Strategic Partners’ team of twenty-six dedicated secondary investment professionals is headed by Stephen Can and Verdun Perry.

    About Blackstone

    Blackstone is one of the world’s leading investment and advisory firms. We seek to create positive economic impact and long-term value for our investors, the companies we invest in, the companies we advise and the broader global economy. We do this through the commitment of our extraordinary people and flexible capital. Our alternative asset management businesses include the management of private equity funds, real estate funds, hedge fund solutions, credit-focused funds and closed-end funds. Blackstone also provides various financial advisory services, including financial and strategic advisory, restructuring and reorganization advisory and fund placement services. Further information is available at www.blackstone.com. Follow us on Twitter @Blackstone.

    Credit Suisse AG

    Credit Suisse AG is one of the world’s leading financial services providers and is part of the Credit Suisse group of companies (referred to here as ‘Credit Suisse’). As an integrated bank, Credit Suisse is able to offer clients its expertise in the areas of private banking, investment banking and asset management from a single source. Credit Suisse provides specialist advisory services, comprehensive solutions and innovative products to companies, institutional clients and high net worth private clients worldwide, and also to retail clients in Switzerland. Credit Suisse is headquartered in Zurich and operates in over 50 countries worldwide. The group employs approximately 47,400 people. The registered shares (CSGN) of Credit Suisse’s parent company, Credit Suisse Group AG, are listed in Switzerland and, in the form of American Depositary Shares (CS), in New York. Further information about Credit Suisse can be found at www.credit-suisse.com.

    The post Blackstone Inks buy of Strategic Partners appeared first on peHUB.

  • Netflix shares go up 25 percent, and the website goes down

    Earnings season can be quite the roller coaster ride. You never know what investors will do. Today, in after-market trading they rewarded Netflix by driving up shares about 25 percent. As I write, the furor is calmer, with the stock only up by 24.39 percent, or $42.53, to $216.90. Netflix closed at $174.37 today.

    The video service beat the Street and returned to profitability during first calendar quarter. Perhaps the excitement explains intermittent problems handling traffic, resulting in network errors late this afternoon at Netflix’s website.

    Excluding refinancing and tax charges, earnings reached $19 million or 31 cents a share, in line with Wall Street consensus. Including charges: $3 million and 5 cents EPS.

    In the United States, during Q1, Netflix gained 2.03 million streaming subscribers, up from 1.74 million new adds a year earlier but down slightly from the 2.05 million gains in fourth quarter. “Our international membership grew by 1 million during the quarter to a total of 7.1 million, generating 14 percent of global revenue”, the company states in its quarterly letter to investors. “During Q4 2012, we added 1.8 million net international members and 1.2 million during Q1 2012”. Overall, Netflix added 3 million streaming subscribers, bringing the global total to 36 million.

    Looking ahead to second quarter, Netflix expects earnings to be between $14 million and $29 million, or between 23 cents and 48 cents a share. Additionally, the company expects total streaming subscribers to range from 36.7 million to 38.4 million.

    Service tier addition is coming. “A few members with large families run into our 2-simultaneous-stream limit”, Netflix says. “To best serve these members, we’re shortly adding a 4-stream plan, at $11.99 in the U.S., and we expect fewer than 1 percent of members to take it”. By my math, that’s conservatively another $1.4 million in revenue.

    The video service provider dismissed concerns about original programming:

    Our decision to launch all episodes at once created enormous media and social buzz, reinforcing our brand attribute of giving consumers complete control over how and when they enjoy their entertainment. Some investors worried that the ‘House of Cards’ fans would take advantage of our free trial, watch the show, and then cancel. However, there was very little free-trial gaming — less than 8,000 people did this — out of millions of free trials in the quarter.

    The original series debuted February 1, with all 13 episodes at once. My response after watching “House of Cards” two days later: “I predict that Netflix has here what HBO did with ‘The Sopranos’ in 1999, an industry-changing series”.

    On Friday (April 19), Netflix debuted another original series, “Hemlock Grove,” with 13 episodes. Re-imaging of “Arrested Development” arrives May 26, officially the fourth season with 15 episodes.

    Original programming puts Netflix at the vanguard of the future, which perhaps more than anything else drives investor excitement tonight. The question isn’t so much if but when and by how many original programs Netflix earns classification as television network.

    The service isn’t alone seeking such distinction. On Friday, Amazon debuted 14 original pilots, some of which will become full-fledged series. Which and how many depends on viewer response. The pilots accounted for eight out of the 10 most streamed Amazon Instant Videos over the weekend.

  • Buzzkill for Glass fans: Google headset won’t launch until 2014 at the earliest

    Buzzkill for Glass fans: Google headset won't launch until 2014 at the earliest
    Although gadget fans may be itching to buy a Google Glass headset, it seems that they’ll have to wait a bit longer before they get their chance. The Telegraph reports that Google chairman Eric Schmidt has told the BBC’s Radio 4 that the company expects to offer Glass to the general public in roughly one year’s time, which would give it a release date of early to mid 2014. Glass, which Google has been teasing for the past year as a headset capable of projecting images and data onto users’ eyes, features a 640 x 360 pixel display, 16GB of internal storage, a microUSB port and a 5-megapixel camera capable of shooting 720p video. While Google was originally aiming to release Glass sometime in 2013, it seems that the company has pushed back its launch timeline into at least next year.

  • Help Kiwi get to Vegas in Fly Kiwi Fly US TOUR for BlackBerry 10

    Rock n’ Roll Game Studio has released a sequel to their game Fly Kiwi Fly. The latest episode has Kiwi make his way to Las Vegas for reasons all of his own.

    Having crossed the Pacific in the last adventure, Kiwi will be taking the scenic route through 12 different states on his way to Las Vegas. Tilt your phone to build up speed, avoid obstacles and grab power ups to glide longer and faster. Earn bonuses, execute stunts and get upgrades to finally get to the desert oasis that is Las Vegas Nevada.

    The original Fly Kiwi Fly is now free to play, download it at BlackBerry World today.

    Click here to buy Fly Kiwi Fly for 99 cents for BlackBerry 10.

  • Microsoft busts some myths with new Outlook ad

    Microsoft is in the process of pushing users to Outlook.com for web email services. The company purchased Hotmail back in 1997, largely ignored it, and then suddenly began updating the app right before deciding to unceremoniously replace it with Outlook.com back in July of 2012.

    Now the company is in full push-mode to get users moved over and also try to woo new customers for the service. With that in mind, Microsoft has teamed up with the folks from the popular Mythbusters TV show to advertise Outlook.com and also push the brand new season of the show.

    No myths about the email service are touched on in the ad, but the team, or at least part of it, is shown using the web-based email to take a trip down memory lane in anticipation of the big anniversary. Microsoft, in posting the 30-second spot, describes it as “to celebrate the MythBusters’ 10th season premiering May 1, check out the build team — Kari, Tory and Grant — reminiscing about their experiences on the show through photos and videos shared with Outlook.com”.

    No word on when the ad will debut on TV, but the show, one of the longest-running in Discovery channel history, will hit the airwaves on May 1st to begin its tenth season with Adam Savage, Jamie Hyeman and the rest of the crew.

  • Two deals that make it obvious where Twitter’s heart lies: inside your television

    There were a number of reports last week that Twitter was looking to do TV-related content deals with broadcast networks such as Viacom and NBC so that it could add video clips to its real-time stream, and now we have seen two deals announced that show the kind of thing Twitter has in mind: one with BBC America that was revealed (naturally) via a tweet, and an interesting arrangement with Comedy Central, both of which emerged over the weekend.

    These deals reinforce something I tried to make clear in an earlier post about the company’s plans: namely, if you don’t like television then you’re probably not going to be very happy with the future of Twitter. The deal with BBC America — a joint venture between the British public broadcaster and the Discovery Channel, which carries such popular shows as Doctor Who and Top Gear in the U.S. — will presumably see Twitter run clips from those shows inside its users’ streams, in much the same way it did with ESPN during March Madness.

    TV shows inside your Twitter stream

    There have been other such one-off deals — as well as arrangements like the one with the Weather Channel, which will bring weather clips into Twitter’s expanded tweets — but the BBC America partnership seems to be the first one that involves an entire channel and potentially all of their shows, and it could easily be the prototype for further such deals. But will users react positively or negatively to all of this real-time video showing up in their Twitter streams?

    Meanwhile, Twitter is also launching a somewhat different project with the Comedy Central channel that illustrates just how much the company wants to bring video as an experience inside the stream: the network is launching what it calls a five-day “comedy festival,” but all of the content will appear within Twitter, and most of it will be either created or distributed via Twitter’s recent video acquisition, Vine — which is designed for video clips of six seconds or less.

    According to a report in the New York Times about the arrangement, a number of comedians — including legends like Mel Brooks and Carl Reiner — will be posting video snippets of comedy routines as well as jokes using the hashtag #ComedyFest. On Tuesday, comedian Steve Agee will reportedly host a “Vine Dining” party as part of the festival, in which he and others will tell stories in six-second video clips that will be hosted and distributed by the Twitter network.

    Video plus brands equals ad dollars

    twitter-money-bag

    As my colleague Eliza Kern noted in her post last week about the rumors of deals with Viacom and NBC, these moves are just part of Twitter’s ongoing plans to not only host TV and video content on the network, but to monetize it (or help its creators monetize it) as well. In addition to Vine, one of the recent acquisitions that could help Twitter do that is Bluefin Labs, which specializes in tracking the real-time data about who is watching what show.

    That kind of information — along with the data from Twitter’s partnership with Nielsen, announced last year — would in turn help Twitter appeal to advertisers who are looking for as much targeting information as they can get. And that appeal could be paying off already: according to a report from the Financial Times on Monday, Twitter has signed a major multi-year deal worth “hundreds of millions of dollars” with Starcom MediaVest Group, a large ad-buying firm that represents clients like Walmart and Coca-Cola.

    Moves like these — and the launch of Twitter Music last week — reinforce just how much the company has evolved away from its original nature as a short-messaging service that gave you only 140 characters or less, and could be consumed quickly. Now, it is becoming a lot more like a broadcast network, or at least a willing handmaiden for broadcast networks, as CEO Dick Costolo predicted in a speech last year. But is that what users really want from Twitter?

    Post and thumbnail photos courtesy of Shutterstock / Dmitris K and Eva Blue

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  • Should Your Startup Use Open Source Software?

    Open source software is awesome, and it’s free. What more do you need to know? In all actuality, there’s a lot to consider when thinking about what software to use in your startup. Do you go with open source or proprietary? Maybe Google can help.

    Chris DiBona, Director of Open Source at Google, is interviewed by Don Dodge about how your startup should use open source software. It’s a given that you should use open source and perhaps contribute as well, but there are tricks to doing it correctly, so that you can scale, so you don’t run into legal trouble and so that you can be acquired.

  • Apple needs a COO, not new CEO

    A rather fanciful and irresponsible commentary at Forbes today asserts Apple is looking for a new chief executive. “Some Wall Street sources close to some Apple executives say such a move is afoot”, contributor Gene Marcial writes, without offering any more meaningful identification in that. What? Were the boys talking between toilet stalls again?

    At the very best, his sources are second-hand. Hearsay. Regardless, replacing Tim Cook is the wrong solution because his management isn’t the problem, nor should he be ousted simply because the stock is in freefall. The fruit-logo company is a money machine, enormous in his hands compared to predecessor Steve Jobs. What Cook lacks is what Jobs had: a chief operating officer. Apple needs to find one — now — and public COO search might even boost investor confidence, which lacking perplexes me, given how much money this company mints.

    Monster Money

    Starting in 2010, Apple saw tremendous — simply astounding — revenue and profit gains, nearly doubling in one year from $13.5 billion to $24.7 billion and $3.1 billion to $6 billion, respectively. During fiscal 2010, Apple generated $65.23 billion in revenue. 2011: $108.25 billion. For fiscal 2012, which closed end of September: $156.51 billion. Apple revenue is up 140 percent from fiscal 2010. During the same time period, Apple’s net income rose from $14.01 billion to $25.92 billion to $41.733 billion.

    Looked at differently, for all calendar 2012, Apple generated $164.68 billion in revenue. That’s more than twice Microsoft ($73.2 billion). Two years ago, the software giant’s revenue exceed the fruit-logo company quarter for quarter. By calendar Q4 2011, iPhone revenue alone exceeded all of Microsoft.

    During fiscal first quarter 2013, Apple generated $54.5 billion revenue and $13.81 earnings per share. Analyst consensus for fiscal Q2 is $42.49 billion, up 8.4 percent year over year, and EPS of $10.07, which compares to $12.30 a year earlier. Apple reveals second quarter results tomorrow.

    Two Men, One Mind

    Cook largely deserves credit for Apple’s amazing success for more than three years. As COO for most of the time, and CEO since August 2011, he managed day-to-day operations. Jobs’ role changed starting with his first medical leave in January 2009. Critics, and even many Apple supporters, don’t give Cook the credit he deserves.

    Jobs and Cook worked as a team. My favorite analogy for the pair is Captain Kirk and Mr. Spock. Kirk, like Jobs, is more emotional, intuitive, risk-taking. Cook is more like Spock, making logical, logistical decisions that maximize margins. Under Jobs, Apple released category-creating, or redefining products, that left people breathless — and wanting to buy. Cook brought Appleware to market and wrung every cent the supply chain would give.

    Jobs may have had the vision with iPhone, which launched in June 2007, but Cook executed on it, particularly in 2010 and 2011, with launches of iPad and iPad 2 and iPhone 4 and 4S, and further in 2012 with iPad mini and iPhone 5. At the end of calendar 2011, Apple had 315 million cumulative iOS device sales. 2012: 500 million, all from zero four-and-a-half years earlier.

    Cook’s problem: He is now half of a whole, a man responsible for two jobs: Vision and management, and he does neither as well as he could just one. A COO, and the right one — a compliment to Cook’s weaknesses — could make a crucial difference as Apple prepares for the next big thing.

    Stock Crash

    The market clamors for Apple’s next big thing, and wanting perceptions about its absence feeds negative perceptions that have little to do with revenue and performance reality. Just look at the numbers above.

    Jobs’ legacy is part of Cook’s problem. For years, Apple was a perception stock, largely buoyed by smart marketing and Jobs’ ability to cast the so-called “Reality Distortion Field“, while generating cult-leader like adoration. For most of his time running Apple during the so-called second coming, shares rose more because of positive perceptions, and overly-given attention from the Apple Fan Club of analysts, bloggers, reporters and other writers. Funny thing: Apple is no longer a perception stock but performance one. Recent punditry about falling shares feeds an anti-reality distortion field.

    Seemingly anyone who is no one speculates about the great Apple disaster. If bumper crop is definition of crisis, gimme some of that, please. The stock’s declines should be viewed independently from the company’s real performance, or Cook’s. At market close today, Apple shares were down 43.5 percent from their all-time high, in September, of $705.07.

    Shares, already in freefall, plunged further following January’s fiscal first quarter announcement. How will they be after tomorrow’s announcement? Worse, likely, given the Street’s response to Apple. All based on negative perceptions that ignore market realities.

    Cook’s first problem is no COO. Second: no compliment, like Jobs. Third: the next big thing and his failure to deliver it. But the last is urban legend. Cook actually is doing right by Apple and shareholders by staying the course, at least for a time.

    One Less Thing

    Under Jobs, Apple launched new categories and saw them to maturity. You can see this process everywhere. First is the category definer, the new thing for the company. Then there is a process of iteration, where Apple improves features while keeping prices the same and sometimes lowering them near the end of the product cycle before something new in that category comes along. Pick any Apple product. The first several generations of iPod look similar (2001-2003), then Apple changed up with iPod mini (2004), nano (2005) and touch (2007) and completely refreshed the lineup (2012). The music player is an end-of-life category that will receive nominal reinvestment of time.

    iPhone and iPad track similarly, and not nearly as far along. Right now, Cook’s charge is managing two relatively new product lines, which make up the bulk of profits. During fiscal Q1, iOS devices represented close to three-quarters of all revenue. His first responsibility is to manage these maturing businesses before committing Apple to some new or redefining category. But investors want the feel-good thing that creates allusions, or perhaps
    illusions, about Apple as sitting-at-the-right-hand-of-God innovator.

    Apple shouldn’t replace Cook, whose managerial performance is exemplary, but instead give him a helping hand, by appointing a chief operating officer. Ousting Cook would be fool’s play. Jobs brought positive perceptions to Apple, but Cook manages a performer — a burden his predecessor never really carried.

    Some Context

    Here are a few of my recent stories related to this analysis:

    They’re a meme about a company in perception crisis, which is far different from Apple in decline or collapse.

    Photo Credit: nui7711/Shutterstock

  • What We’ve Learned About Communicating with Employees in an Emergency

    On Friday, with the Boston metro area on lockdown, many folks stuck at home were running an experiment in how much information can be consumed at once. I maxed out with a laptop streaming video coverage, iPhone full of tweets, TV blaring footage, and radio providing analysis — all simultaneously. (I’d have been using the iPad too, but was limited by having only two hands, dangit.) While we do live in an era of great access to information, this proliferation of devices only made it that much more obvious that the river of information had slowed to a frustrating drip.

    But the inability to communicate clearly and quickly didn’t just affect how much the public or the media knew. Employers, too, ran into this challenge as they tried to notify employees that they don’t need to come in to the office — and in fact, that they should stay home, as offices were closed. At 5:45 Friday morning, Harvard Business Publishing sent a mass email telling employees to stay home. Staples sent a message to their staff at 7 am. One PR firm emailed its employees at 6 am, while an environmental nonprofit emailed at 8.

    But not all the messages got through. A simple technical miscue can mean that not all employee email addresses make it on to the “everyone” email list. For others, the timing can be wrong. For instance, our early morning security guard found herself in the office before the message had gone out. Because our offices were at the heart of the locked-down zone (you probably saw them on television) she was then stuck here all day, while law enforcement used our parking lot as a staging area. Similarly, at Staples, Mark Cautela, a PR manager, mentioned that a couple of employees who had left home before receiving their 7 am message had ended up at their Harvard Square store, and ultimately decided it was safer to stay there than try to get back home. While the store remained closed, the employees hunkered down inside.

    And as with the rest of the week, miscommunications and tempers both flared. In the absence of the information we want, we’re overreacting to what little information we have. Cautela mentioned that they’ve been actively quashing online reports that Staples told employees to report for work despite the lockdown, saying those resulted from misunderstandings. A person who works in health care tweeted angrily that her employer was going to charge her vacation time for staying home on Friday. As it turned out, a supervisor later called her to assure her that that was not the case — while that would have been their usual policy, given the severity of the situation they’d decided to make an exception.

    Of course, not every employer did tell employees to stay home. On Friday, I heard reports through social media that some employees were either explicitly told to report for work, or felt pressured to do so. Then there was the too-perfect the story that police had allowed Dunkin Donuts to remain open to serve first responders.

    But some companies did get it right, safely shutting down their businesses for the day, communicating that shutdown effectively to their staff, and pre-emptively answering any concerns about lost wages or benefits.

    Making sure employees know what to do in a fast-breaking emergency isn’t as easy as just sending a text or an email. It takes preparation as well as rapid execution. One Cambridge-based company, HubSpot, talked to me about how they coordinated their response, with people in IT, security, and HR all working together to first identify employees in the Watertown area who might be in harm’s way, and then reaching out to those people “to make sure they had heard the news and didn’t plan to go outside,” said Katie Burke, from the company. They phoned, texted, and as a last resort, emailed them individually. Then, says Burke, “Our Chief Security Officer notified all employees early [Friday] morning that the office would be closed so people wouldn’t drive or try to train into work and get stranded.” Finally, they made sure everyone knew there’d be no penalty for staying home, and encouraged them to reach out if they needed help.

    Another company for whom this situation struck very close to home was athenahealth, which offers cloud-based services to health care providers. Carolyn Reckman is VP of athenaEnvironment, the function that covers everything to do with the firm’s physical environment, from facilities to security. “As a HIPAA-regulated organization, we have a heightened sense of responsibility for business continuity and crisis management,” she told me. Their crisis plan was enviable.

    Every employee, when they first join the company, is handed a wallet card with Reckman’s phone number and other emergency contact numbers. At 4:30 in the morning on Friday, Reckman was awoken by a Watertown-based employee who’d called the number on that card to tell her that he had heard gunshots outside his home, and was now following the unfolding events on the news and listening to a police scanner. It sounded, he said, like this might go on for a while. Reckman jumped out of bed and activated their emergency notification system. The first alert went out to the firm’s crisis-management team, a group of about 15 or 20 people from around the company. Closing for the day “was a no-brainer,” Reckman said. So within another few minutes, they’d activated the automated emergency contact system that goes out to all employees — reaching their home phones, cell phones, work phones, work email accounts, and personal email accounts. They got the message out by 5:30 am.

    “I was asleep until 6 a.m.,” said Amanda Guisbond, who works in the communications department. “I woke up and had a voicemail on my cell phone telling me the offices were closed, and I also had an email in my gmail account, which was good because I wouldn’t have been checking work email right away.”

    Looking at the successes and the mistakes here, some simple best practices emerge:

    First, email isn’t the best way to get in touch with people in an emergency. This seemed especially true in companies whose employees were hourly workers who generally don’t have employer-provided smartphones. It was also especially true for anyone in the immediately affected areas of Cambridge or Watertown, where bullets and home-made bombs were flying and time was essential. SMS text messages were a quicker way to push information out to people, although this approach was less common among private employers and more common at universities. For instance, both MIT and Emerson College used text messages to push alerts out to members of their communities. Emerson’s alert went out at 5:10 Friday morning. And MIT’s first alert went out at 11:01 pm Thursday night, shortly after a member of their campus police was found shot. As Reckman told me, “Really, I think the only way to do it is to hit people’s personal cell phones.”

    Second, make sure it’s a system multiple people can activate, from any location. At athenahealth, any employee can call a senior manager and alert them to an emergency, because of the wallet card they’ve been asked to carry. Moreover, there are 15 or 20 people on the crisis management team, any one of whom can activate the alert system. It shouldn’t be a system that relies on people being able to access their work email, or that you can only log into from inside the office.

    Third, when the crisis is over, ask what you could have done better. For instance, when Reckman first initiated the emergency system — the one that went to the 15 people on the crisis team — it said “this is a test.” Obviously, it wasn’t a test, and that’s something she said they plan to figure out when they debrief on the incident this week.

    But finally, the companies that got this right realized it wasn’t only a technological challenge, but a management challenge. Not only did they communicate in human, empathetic terms, but they also addressed practical concerns up-front, such as assuring their employees that they wouldn’t lose time off or pay. Unfortunately, the number of companies that did this seems small. Those who didn’t not only created publicity problems for themselves when employees began venting on social media, but also generated anxiety in employees who wondered if they were going to take a financial hit for the time spent obeying the lockdown. Companies who have refused to pay their hourly workers or have forced salaried workers to take a vacation day are no doubt creating sour memories in their staff, perhaps saving a few dollars in the short-term, but fostering bitter feelings in the long-term. The policy at athenahealth is again admirable: in the event of an emergency office closing, everyone still gets paid. And Nordstrom confirmed over Twitter, after the fact, that all employees who had been scheduled for Friday shifts at the Boston store will still be getting paid.

    The companies that got this right anticipated the questions and concerns that all of their workers would have — no matter what mode of communication they’re most likely to use and no matter where they sit on the salary scale. It’s understandable, perhaps, that an executive who does the daily email “prayer” — check it first thing when you wake up, and last thing before you go to sleep — might assume that was the best way to reach all workers. It’s understandable that in the heat of the moment, giving reassurance on pay and benefits might just not have occurred to those executives, either. They may be worried about their own safety, or just, as highly paid professionals, unlikely to worry about a day’s pay or a day’s vacation here or there. But that’s why it’s so essential to have a plan for these sorts of emergencies ahead of time: to cover the fact that, in the moment, you probably won’t be thinking clearly.

    If you wait until the bomber is on the loose, or the hurricane is barreling down the coast, or the need to evacuate your building has become only too clear, you have waited too long.

  • Check Out Splinter Cell: Blacklist In Action On The Wii U

    Ubisoft recently revealed that it’s bringing this year’s Splinter Cell: Blacklist to the Wii U. The console is definitely hurting for content, and a new Splinter Cell is just the kind of AAA content that the console needs.

    Of course, the question now is how Splinter Cell: Blacklist will play on the Wii U. Ubisoft has released a trailer that answers that very question:

    There were definitely some lazy ports at the Wii U’s launch so it’s nice to see that Ubisoft seems to be giving the Wii U version of Splinter Cell: Blacklist plenty of love. Of course, it will all be for naught if the game doesn’t run as well as the other versions. That was a problem at the console’s launch, but we can only hope that developers have gotten used to the unique architecture of the Wii U by now.

    Splinter Cell: Blacklist will be available on Wii U on August 23.

  • Homeworld Franchise Bought by Gearbox

    The bankruptcy and break-up of THQ is still having wide-ranging implications for the gaming industry. While many of the publishers who bought nearly-finished games in the auction are polishing up the titles for release, the future of some of the less popular game franchises that sold in January are a bit up in the air.

    One of the biggest acquisitions of the auction was Sega’s purchase of Relic Entertainment. Relic is a well-known developer of real-time strategy games such as the Warhammer 40,000: Dawn of War series and Company of Heroes.

    Now, one of Relic’s first RTS games has been sold off by what’s left of THQ. Homeworld, considered a classic by RTS gaming fans has, been sold to Gearbox. The series uses three-dimensional battlegrounds where ships face off in outer space.

    Gearbox has stated that it intends to port Homeworld and Homeworld 2 for “today’s leading digital platforms,” which implies that the classic games could soon be coming to Steam (or possibly iOS and Android devices).

    The Gearbox announcement, in full:

    Gearbox Software has prevailed as the highest bidder in the acquisition of the Homeworld franchise from THQ. Brian Martel, Gearbox Software’s Chief Creative Officer, has great love and respect for Relic’s brilliant, fun and innovative game and personally spearheaded the acquisition.

    Brian intends as first priority to direct Gearbox’s interest to preserve and assemble the purest form of the original acclaimed and beloved games, Homeworld and Homeworld 2, with the intent of making them accessible on today’s leading digital platforms.

    Please visit the Gearbox Software Forums to share with us and Brian what you think should be done with Homeworld moving forward. And, please try to get our attention if you have capability and interest to join the effort in developing or enabling Homeworld’s future.

    Gearbox is the developer that found success last year with Borderlands 2. It is also the developer that found failure this year with Aliens: Colonial Marines. Hopefully Gearbox will treat the Homeworld IP with the care and attention it deserves.

  • HTC can’t catch a break, now faces European injunction for HTC One

    HTC can't catch a break: Now faces European injunction for HTC One
    HTC may have made the world’s best Android phone with the HTC One, but the company has had trouble getting the device to potential customers in a timely manner. In addition to the HTC One’s delayed release date, the device is now facing an injunction granted by a Dutch court to rival manufacturer Nokia, which is alleging that key microphone components used for the HTC One violate an exclusivity deal between Nokia and ST Microelectronics. An unnamed source tells Engadget that “the issue is likely to be a breach of an NDA between Nokia and ST Electronics as the phone maker asserts that the ‘microphone components [were] invented by and manufactured exclusively for Nokia.’” While this sort of case may be irritating for European consumers who are hoping to get their hands on the HTC One, Engadget helpfully notes that at least it isn’t yet another patent dispute.

  • Netflix: Very Few Gamed Free Trials to Watch House of Cards

    Netflix just posted their Q1 2013 earnings – $1.02 billion total revenue, slightly beating expectations. They also added 3 million streaming customers, bringing the total to 36 million.

    Inside the letter to investors, CEO Reed Hastings and CFO David Wells talk Netflix’s push toward original content – spearheaded by the Kevin Spacey-helmed David Fincher-produced political thriller House of Cards. And they drop a pretty interesting bit of data into that discussion:

    People who signed up for Netflix this quarter stayed with Netflix. In other words, Netflix saw very little “free-trial gaming” in order to, let’s say, binge on House of Cards and then cancel the subscription shortly after.

    Some investors worried that the House of Cards fans would take advantage of our free trial, watch the show, and then cancel. However, there was very little free-trial gaming – less than 8,000 people did this – out of millions of free trials in the quarter.

    Netflix has stated in the past that they will not release viewing data on their original series. So, while we don’t really know exactly how successful House of Cards was for Netflix (in terms of the viewership stats), we know that it was a pretty big success by many other metrics.

    A recent survey suggested that around 10% of Netflix’s total subscriber base had watched at least one episode of House of Cards in its first couple of weeks of availability. That survey also found that 86% of subscribers said that they were less likely to cancel their subscription after watching House of Cards. That last figure echoes what Netflix is revealing today – that House of Cards drew people in, and once they were hooked, they decided to stay around.

    And really, that’s the goal. Netflix has put a lot of money into the new slate of original series, which includes the just released Hemlock Grove, and the upcoming 4th season of Arrested Development.

    “As we’ve said before, our first slate of Originals will represent a small percentage of both our content budget (i.e. P&L expense) and total viewing hours this year, though cash use is front loaded relative to the P&L expense. Long term, we believe the value of our Original series in driving acquisition and retention improvements will be borne out as we add more seasons of already popular shows like House of Cards and further series. Harry Potter was not a phenomenon in book one, compared to later books in the series.”

  • MURPHY: Ethanol Proponents Mislead on Gas Prices

    In their recent op-ed on the ethanol mandate and gas prices, Tom Buis and Bob Dinneen greatly misled Politico’s readers with both contradictory claims and withholding crucial facts. Both the government’s own analysis and common sense tell us ethanol mandates …

  • Gorilla Glass 3 Ensures That The Galaxy S4 Is Nigh Scratch Proof

    The Samsung Galaxy S4 comes out in just a few days, or a few weeks, depending on your carrier. While you wait to get your hands on the Samsung’s latest smartphone, you might be curious as to how the screen holds up to being attacked by knives, keys and coins.

    Well, indulge your curiosity as the first scratch test has emerged on YouTube. Romanian YouTube user Szabolcs Ignacz got his hand on the Galaxy S4 and put it through seemingly every kind of abuse that could possibly scratch or damage the display. Check it out:

    If you’re too lazy to watch the video, just know that the screen holds up like a champ. That’s because the Galaxy S4 uses Corning’s Gorilla Glass 3 in its display. Gorilla Glass 2 was already pretty much scratch proof, and the third iteration of Corning’s super tough glass only proves once again that it’s the gold standard in mobile device displays.

    [h/t: Droid Life]

  • Nest unleashes the power of its smart thermostat with data-driven services

    Learning thermostat startup Nest plans to announce a variety of energy services Monday that, in partnership with utilities, can help consumers reduce their home energy consumption and save money on their energy bills. While Nest has been focused on selling its thermostats directly to consumers, these new energy efficiency services show the undercover power that Nest’s hardware can deliver while working with a utility partner.

    Nest is initially launching three different types of energy efficiency services working with a couple of utilities in Texas, including Reliant Energy and Austin Energy, California utility Southern California Edison, and east coast utility National Grid. Nest has been working with Reliant Energy, the utility arm of NRG Energy, since the summer of 2012 to offer Reliant’s customers’ its thermostat.

    Nest

    Nest’s most important new service is its answer to a demand response program, which it’s calling Rush Hour Rewards. Demand response programs are widely used by utilities to better manage the grid, and utilities use them to collectively get some of their customers to curb their energy consumption during peak grid events, like late afternoon on a hot summer’s day. For Rush Hour Rewards, the Nest thermostat uses a variety of techniques to shave off energy consumption during a peak grid event, but while maintaining comfort levels within the home.

    Customers opt into the Rush Hour Rewards program and agree to have their thermostat automatically managed during that time period; in return, they save money on their energy bill. They can override the programs whenever they want. Customers who participate can save between $20 to $60 per season, according to Nest.

    The startup went out of its way to not use the words “demand response” in its service’s name and marketing, and it seems to have put substantial thought into how to market this to consumers to make it attractive. Nest has also been piloting Rush Hour Rewards for over two years, it said.

    Screen Shot 2013-04-21 at 9.22.11 AM

    Nest’s two other programs include an instant online rebate program, where customers can get one of the learning thermostats when they sign up for an energy plan, and a service called Seasonal Savings, which is a reoccurring energy efficiency tuneup. Seasonal Savings nudges the temperature or cooling slightly to see if the tiny changes affect your daily behavior. If you override those changes, the software will remember that and adjust, but Nest says that 80 percent of the time people acclimated to the small adjustments.

    Behind these new services is the cloud-based big data algorithms that are the secret sauce of Nest, and which Nest has now named Auto-Tune. Now that Nest has gotten hundreds of thousands of thermostats out there in the market, and has done two years of field trials, it has been able to collect a large amount of data about how customers use and react to temperature and cooling changes. Nest uses this data about behavioral changes to inform its services and how its algorithms work.

    Nest 2G_3-4_Dramatic_autoaway

    Nest combines this behavioral data with utility data, weather data, personal use data, demographics data and more to collectively manage the thermostats and deliver energy savings. Nest said its services sit between the consumer and the utility, and they approve eligible customers, monitor how the services are performing and how the customers are reacting.

    Nest’s offering could be powerful because the company first worked to begin to build a brand and a consumer-focused buzz. Other startups are offering next-generation demand response services with utilities, including EcoFactor, Opower, EnergyHub and others. But the biggest difference between these startups and Nest is that Nest has developed and sells its own learning thermostat.

    Nest was founded by a team from Apple, and is led by designer Tony Fadell, who developed versions of the iPod and iPhone. The company is backed by Google Ventures, Venrock, and Kleiner Perkins.

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  • Nest Labs Teams Up With Regional Power Providers For New Energy-Saving Services And Rebates

    nest

    The Nest thermostat has already gone through a hardware revision or two and found its way onto plenty of physical and virtual store shelves, but parent company Nest Labs is eager to get it into even more households in short order.

    The Palo Alto company has just announced that it has teamed up with energy providers from across the country that will see new climate-control services (not to mention some rebates) go live for customers in a handful of markets.

    So far, the list of partners includes National Grid, NRG Energy, NRG subsidiaries Reliant and Green Mountain Energy, Austin Energy and Southern California Edison. You can probably guess what markets those last two serve. These newly forged partnerships could see adoption of the household gadget surge — customers who ink deals with National Grid, for instance, can claim a $100 rebate to help defray the costs of a Nest thermostat.

    While the others don’t offer much in the way of actual cash back, Nest’s tie-ups emphasize the long-term value of having a Nest over a run-of-the-mill thermostat. The way the folks at Nest look at it, their gadget is only going to become more useful as the days get longer and warmer, and those new services I mentioned earlier should only help matters when it comes to the cost-conscious.

    First up is Nest’s so-called Rush Hour Rewards, which are meant to reduce the load on already-strained power stations once it starts getting really hot outside. Rather than cranking the temperature down low and leaving it there as a hapless human might, the Nest instead gets a feel for the sorts of climates its users prefer and will sporadically turn down the temperature to keep things within that preferred range. By occasionally introducing blasts of cold air instead of just leaving things to run at full blast, the Nest can keep your house at about the same temperature as before without much of a corresponding bump on the bill.

    Also part of the package is what Nest calls “seasonal savings,” which will see the smart thermostat measure user temperature preferences over the course of the year and make minor modifications over the course of a few weeks. The idea is to reduce a user’s heating bill by carefully acclimating them to a new, more cost-efficient temperature scheme without the residents even noticing.

    For now, only customers who select certain plans with those power companies can use these new services, but I very much doubt that team Nest is content to leave things as they are. These sorts of deals will only serve to raise the company’s profile, and buy-in from power partners is a big deal for Nest especially as the company’s rivals have moved to make their own wares smarter. Consider Honeywell: it already filed a lawsuit against Nest last year for supposed acts of copyright infringement, an allegation that Nest Labs vigorously disagrees with. Meanwhile, the conglomerate is gearing up to release a rather handsome smart thermostat of its own, so deals like these could help Nest stay a step ahead of the pack.