Category: Business

iPhone sales continue to slide as press spins

disappointment-valleyThe Tame Apple Press is in full spin mode this morning after Apple admitted that sales of its iPhone continued to slide.

Some desperate press even suggested that the fall of the iPhone was not “real” because sales of the iPhone 6 were so high it just made the slide look worse.  Others quoted CEO Tim Cook saying that Apple was going to come up with some super, cool, technology to replace the iPhone as Apple’s cash cow.

However at the end of the day Apple’s iPhone business has hit a wall and there is no opening in sight.  March-quarter units’ sales this year came in at 51.2 million iPhones, which was down from 61.2 million units in the same quarter last year.

It will get worse too because this year’s new iPhones will hardly be an upgrade and some of us are predicting further iPhone sales declines that reach well into 2017.  If that happens Apple is going to have a devil of a job clawing back sales.

The Tame Apple Press did its best to spin the figures too.  Jobs’ Mob earned $7.8 billion in net income, on sales totalling $42.4 billion. That is a slide from $49.6 billion.  The press tells us that figure was a record and should not be used to gauge Jobs’ Mob’s current performance.  It was better than analysts had predicted, it claimed.  Given that analysts were expect it to be $42.1 billion we are not talking a big difference. It was also in the middle of what Apple itself had expected (although at the time the Tame Apple Press assured us that Apple guidance’s were always on the conservative side) .

All this promotion did help Apple avoid any slide in share price, but Cook’s attempts to calm long term investors were less successful.

Cook stressed that Apple is high on augmented reality for the long-run” and investing heavily. Augmented reality, in which computer-generated content is overlaid on the real world, is one of the latest fixations in the technology business, with Pokemon GO among the first applications to catch on.

Cook also highlighted Apple’s investment in artificial intelligence, which the company now uses to recommend content to users and even spot usage patterns to improve a device’s battery life.

However, the comments were weird. Apple has no AI or AR products in the works yet and if they were they are a long way away. In fact, Augmented reality and artificial intelligence don’t really work for Apple. It really is not an innovative company, it needs other people to create it before it appears on the market and claims to have invented it.

Analyst Bob O’Donnell of TECHnalysis Research said that Apple was wanting the world to know that they are working on it, but they have nothing to show for it.  Which is basically what in the real press we call “spin”.

 

Two factor ID is insecure

back-door-to-hellA US government standards body has released a draft version of the Digital Authentication Guideline that contains language hinting at a future ban of SMS-based Two-Factor Authentication on the grounds of poor security.

For those who came in late, two-factor security is rather popular with the likes of Google who seem to use it to ask for you to provide them with your mobile phone number as part of a way of identifying you.

But the  US National Institute for Standards and Technology (NIST) which sets the rules used by software makers to build secure services, and by government and private agencies to assess the security of their services and software is not happy with the method.

It says that while SMS-based 2FA still acceptable, it will not be for long.

NIST officials are discouraging companies from using SMS-based authentication, even saying that SMS-based 2FA might be considered insecure in future versions of the guideline. Basically,  SMS-based two-factor authentication is an insecure process because the phone may not always be in possession of the phone.

While the guideline recommends that apps use tokens and software cryptographic authenticators, these may also take the form of phone apps or devices that can be stolen or “temporarily borrowed” as well, just like phones.

The NIST guideline says this risk as acceptable, but unlike tokens and cryptographic authenticators, SMS is considered insecure, especially on VoIP connections. Some VoIP services allow the hijacking of SMS messages.

Instead it suggests that biometrics might be a more secure way of dealing with all this. In the meantime it is probably better not to give Google your mobile number.

 

Salesforce would have paid more for Linkedin

SalesforceThere is a bit of head scratching going on over why Linkedin chose Microsoft’s lower offer for its company over a bigger one offered by Salesforce.

Microsoft wrote a cheque for  $26.2 billion for the social notworking site, which was lower than what was offered by Salesforce.  However Salesforce CEO Marc Benioff said that he was willing to go much higher and would have changed other terms of the bid if he had been given the chance.

In a filing with regulators on Friday, LinkedIn said a board committee met on 7 July  to discuss an email from Salesforce CEO Marc Benioff.

“The email indicated that Party A would have bid much higher and made changes to the stock/cash components of its offers, but it was acting without communications from LinkedIn,” LinkedIn said in the updated filing with the Securities and Exchange Commission.

LinkedIn has said its board was concerned about other problems with a Salesforce bid, including the fact that a deal would have required approval from its shareholders. LinkedIn could still go with another bid if one comes in, but its deal with Microsoft contains a $725 million breakup fee provision.

Salesforce was the only serious rival to Microsoft.

British banking system ends up with the US

mastercardMasterCard has said “that will do nicely” to itself and is going to spend up to $1.14 billion on buying a majority stake of  a crucial part of the UK’s payments infrastructure.

Up for grabs is VocaLink runs Link, the network that provides interoperability between British ATMs, as well as BACS, the clearing house for payments between bank accounts, and Faster Payments, the inter-bank transfer system for Internet and telephone-based payments.

According to MasterCard  the deal would create “the first true combination of the traditional person-to-merchant cards business with a clearing business”. That is, of course, presuming it clears regulatory scrutiny.

It is responsible for processing more than 90 percent of British salaries and over 70 percent  of British household bills. It also handles almost all state-issued benefits.

VocaLink developed the Zapp payments tool for British mobile banking apps, and the Paym mobile payments system, which identifies recipients of payments by their mobile phone numbers. Both have a lot of buy-in across U.K. banks, and it also licenses its technology to countries including the US, Sweden, Singapore, and Thailand.

VocaLink is currently owned by a consortium comprised of big banks and building societies, such as Barclays, HSBC, and Royal Bank of Scotland the current shareholders would hang onto 7.6 percent of the company for at least three years.

MasterCard would pay out around $920 million at the start.

MasterCard chief Ajay Banga said that VocaLink was unique with outstanding technology, assets and people.

The UK payment systems regulator said in February that the common ownership of VocaLink by “a relatively small number of banks” was harmful to innovation and competition. It recommended that the banks sell their stakes.

 

Verizon buys Yahoo

marissa_new4Verizon has announced it is buying most of what people think is Yahoo for $5 billion.

The deal will end months of uncertainty about Yahoo’s future after the company announced plans to review strategic alternatives in February. Bloomberg first reported the deal would be announced on Monday for $4.8 billion which was pretty close.

The transaction would boost Verizon’s AOL internet business, which the company acquired last year for $4.4 billion, by giving it access to Yahoo’s advertising technology tools, as well as other assets such as search, mail, messenger and real estate.

It would also mark the end of Yahoo as an operating company, leaving it only as the owner of a 35.5 percent stake in Yahoo Japan, as well as its 15 percent interest in Chinese e-commerce company Alibaba.

Started in 1994 by Stanford graduate students Jerry Yang and David Filo, Yahoo in its early years was the destination of choice for many making their first forays onto the World Wide Web.

By 2008, Yahoo was fending off a contentious takeover bid from Microsoft and struggling to define its mission.

In December, Yahoo scrapped plans to spin off its Alibaba stake after investors fretted over whether that transaction could have been carried out on a tax-free basis. It instead decided to explore a sale of its core assets, spurred on by activist hedge fund Starboard Value LP.

More details are expected to be announced today.

Microsoft calls “injuste” on French privacy “accuse”

Degradation_alfred_dreyfusSoftware giant Microsoft has claimed that the French are being rather nasty when it comes to the privacy levels on its Windows 10 operating system.

Yesterday France’s National Data Protection Commission (CNIL) slapped a formal order on Microsoft to comply with data protection laws after it found Windows 10 was collecting “excessive data” about users and ate roast beef. The company has been given three months to meet the demands, and improve its cooking, or it will face fines.

Vole has officially responded and said that it is  happy to work with the CNIL to work towards an acceptable solution. It has not actually denied the allegations set against it, the company does nothing to defend the amount of data collected by Windows 10, and also fails to address the privacy concerns it raises.

Microsoft does address concerns about the transfer of data between Europe and the US, saying that while the Safe Harbor agreement is no longer valid, the company still complied with it up until the adoption of Privacy Shield.

David Heiner, vice president and deputy general counsel at Microsoft said:

“We built strong privacy protections into Windows 10, and we welcome feedback as we continually work to enhance those protections. We will work closely with the CNIL over the next few months to understand the agency’s concerns fully and to work toward solutions that it will find acceptable.”

He added that Vole had continued to live up to all of its commitments under the Safe Harbor Framework, even as the European and U.S. representatives worked toward the new Privacy Shield. As we state in our privacy statement, in addition to the Safe Harbor Framework we rely on a variety of legal mechanisms as the basis for transferring data from Europe, including standard contractual clauses, a data transfer mechanism established by the European Commission and approved by European data protection authorities, to cover data flows from the European Union to the United States.

“Microsoft will release an updated privacy statement next month, and that will say Microsoft intends to adopt the Privacy Shield. We are working now toward meeting the requirements of the Privacy Shield,” he said

Samsung counter-sues Huawei

fef78e0cc21705723179c3a85d917f2bSamsung has sued Huawei for patent infringements across China as the handbags at dawn row escalates between the pair.

Samsung sued Huawei in a Beijing court about two weeks ago for allegedly infringing six of its patents, a spokeswoman said. She did not elaborate on the types of patents or the other Chinese courts involved.

“Despite our best efforts to resolve this matter amicably, it has regrettably become necessary to take legal action in order to defend our intellectual property,” Samsung sang

Huawei  said in a statement it had not received a “formal complaint” but would defend itself as necessary.

“In the absence of a negotiated settlement, litigation is often an efficient way to resolve” intellectual property rights disputes, it said.

Huawei sued Samsung in the United States and China in May, accusing its rival of infringement on patents for fourth-generation (4G) cellular communications technology, operating systems and user interface software.

Analysts say that neither side will end up winning on the basis of money. Huawei could be angling to boost its reputation by taking on the top smartphone player, he said, while Samsung’s suit might be a maneuver to force Huawei to settle its claims as soon as possible.

Some have suggested that Huawei might also be trying to create some noise marketing for itself and the two firms will eventually reach a deal such as a cross-licensing agreement.

 

Equinix puts hand up for huge BT outage

equinix-se3The outfit behind the Telecity data centre has admitted that it was its fault that 10 per cent of BT internet subscribers were without a service yesterday.

Equinix confirmed that the outage started at its LD8 site in London’s Docklands where it has nine server warehouses which look after more than 600 businesses.

The company said it experienced a power problem “with one of its UPS system at 8/9 Harbour Exchange (LD8)”. It said it was carrying out a full investigation into the incident to identify the root cause of the fault.

This is not the first time that Telecity has experienced power problems. It had a major problem at its Sovereign House data centre last year which took two days to fix.

A spokesman from the company said: “Equinix can confirm that we experienced a brief outage at the former Telecity LD8 site in London earlier this morning. This impacted a limited number of customers, however service was restored within minutes. Equinix engineers are on site and actively working with customers to minimise the impact.”

A BT spokeswoman said the power problem affected around 10 percent of internet usage. But the  problem has now been fixed and services have been restored.

Kickass torrent “mastermind” arrested

arrestUS coppers claim to have arrested the “mastermind” of KickassTorrents (KAT) which is one of the largest BitTorrent distribution sites.

When we looked this morning the site was still up so we are not sure if  Artem Vaulin, 30, of Ukraine’s alleged mastermind status was incorrect or if the site is being run by his minions.

Vaulin has been charged   with one count of conspiracy to commit criminal copyright infringement, one count of conspiracy to commit money laundering, and two counts of criminal copyright infringement.

Vaulin was arrested in Poland and the DOJ will shortly seek his extradition to the United States.

Assistant Attorney General Caldwell said that Vaulin was charged with running today’s most visited illegal file-sharing website, responsible for unlawfully distributing well over $1 billion of copyrighted materials.

“In an effort to evade law enforcement, Vaulin allegedly relied on servers located in countries around the world and moved his domains due to repeated seizures and civil lawsuits. His arrest in Poland, however, demonstrates again that cybercriminals can run, but they cannot hide from justice.”

What appears to have miffed Hollywood was that Vaulin did actually have method of dealing with DMCA violations. Hollywood studios would send their complaint and demand that the content be removed from the site and they would get a note back which said the following:

Greetings,
Your request has been reviewed, but cannot be processed due to one (or
more) of the following reasons:
1) The Claim wasn’t written in English language;
2) You provided no evidence showing that you are the copyright holder
or that you are acting on behalf of the copyright holder;
3) You provided no evidence showing that the content is legally
copyrighted;
4) There were more then [sic] 30 torrents mentioned in the Claim email;
5) Your content is hosted on a different website.
Please, make sure to fulfill all the conditions mentioned above before
sending a claim.
You can find more detailed information regarding the DMCA email
layout via the following article – https://kat.cr/dmca/
Respectfully,
KAT team
Keeping mum

It has been estimated that the sites annual advertising revenue as being more than $16 million per year as of 2016 although those figures are nearly always presented to the media hyped beyond belief. In this case they are based on the fact that an  undercover IRS agent purchased an ad on KAT in March 2016 at the rate of $300 per day.

The KAT representative provided details for a Latvian bank but warned the American buyer to “make sure that you don’t mention KAT anywhere.”

HSI and IRS looked into the historical hosting records of KAT and found that for about 3.5 years, ending in January 2016, the operation was hosted out of Chicago, Illinois, which explains why the case is now being prosecuted out of the Northern District of Illinois. The site also used a Canadian hosting service—the two American agencies also used MLAT to get an image of the Canadian server.

More interesting was that the fruity cargo cult Apple, which normally does not turn over data on terrorists  provided a copy of Vaulin’s e-mail account (tirm@me.com), which included other incriminating information that establishes probable cause of a criminal conspiracy. So it looks like Apple’s privacy morals stop when it comes to crimes against its chums in Hollywood.

Intel’s data centre business slows

snail-8296a552f7bd1064368205306ff8a3c7c7bdc7c4-s900-c85 Chipzilla produced a better than expected quarterly profit, however analysts are a bit worried about a slower than normal revenue growth for its data centre business.

If the outfit’s cunning plan to be less dependent on PCs succeeds then data centres should be front and centre but it seems that Chipzilla’s data centre business is shrinking.

It seems that there was generally weak demand from enterprises, causing revenue at the highly-profitable unit to rise five percent to $4 billion. Part of the problem was that Chipzilla did so well inthe  last quarter and increased business in this area by nine percent and this makes its growth this quarter look a bit sad.

Intel’s finance chief Stacy Smith said that as Intel enters the second half, he expect the enterprise segment of the business to stabilise and the cloud segment growth rate to accelerate.

Intel has been focusing on the unit and its operation that makes chips for internet-connected devices, as it seeks to lower dependence on the slowing PC market that it once helped create.

Sales from the Santa Clara, California-based chipmaker’s traditional PC business, which also includes chips for mobile phones and tablets, fell three percent to $7.3 billion in the second quarter ended July 2.

Global PC shipments fell less than expected in the quarter, helped by strength in the United States.

Over all Intel reported a better-than-expected profit as its cost-cutting begin to pay off. In April it announced plans to slash 12,000 jobs, or 11 percent of its global workforce, of which it said about half was already complete.

Intel’s forecast for $14.9 billion in current-quarter revenue topped the average analyst expectation of $14.63 billion.

Net income fell to $1.33 billion, or 27 cents per share, in the second quarter, from $2.71 billion a year earlier.

Profit for the quarter was hit by a one-time charge of $1.41 billion related to its cost-cutting drive.

Net revenue rose 2.6 percent to $13.53 billion, narrowly missing the average analyst estimate of $13.54 billion.