Tag: retail

Amazon’s cloud and retail booming

Amazon retail and cloud computing sales rose in the first quarter, better than what the cocaine nose jobs of Wall Street predicted.

The online bookseller said sales rose 23 percent to $35.7 billion, just beating analysts’ average estimate of $35.3 billion.

More fees from Amazon’s Prime shopping club and media streaming services, along with growing advertising revenue, also boosted results.

Profit, which has traditionally been fleeting at a company that focused on growth, was also ahead of expectations. Net income rose 41 percent to $724 million, or $1.48 per share, marking the eighth straight quarter that the company posted a net profit. Analysts on average were expecting $1.12 per share.

Amazon’s revenue has soared in recent years as shopping has moved online and businesses have moved their computing operations to the cloud, where Amazon Web Services (AWS) is the biggest player. AWS accounts for much of Amazon’s operating profit.

Amazon Prime, which offers fast shipping and video streaming to members, helped raise the company’s subscription sales 49 percent from a year earlier to $1.9 billion. Sign-ups have been key to Amazon’s strategy because Prime encourages shoppers to buy more goods, more often.

Sales from AWS, the company’s fast-growing business to host companies’ data and handle their computing in the cloud, rose 42.7 percent to $3.66 billion, matching the average analyst estimate.

Amazon posted an operating loss of $481 million in its international segment, which is four times its loss a year earlier for the segment. The company has said it is investing more than $5 billion in India to gain market share, and this month it announced plans for a retail marketplace in Australia.

Amazon Chief Financial Officer Brian Olsavsky said that a lot of the same playbook seen working in the US is being rolled out internationally.

Seattle-based Amazon forecast that operating income in the second quarter would be between $425 million and $1.075 billion, below the average estimate of $1.46 billion, according to FactSet StreetAccount.

The company forecast sales for the second quarter of between $35.25 billion and $37.75 billion, which includes an unfavourable impact of about $720 million from foreign exchange rates.

 

Enterprises consider internet of things strategic

internet of thingsA report from IDC said that a survey it conducted showed that 73 percent of organisations surveyed have either already inplemented internet of things strategies or will do so in the next year.

Different sectors are moving at different speeds, however. IDC said that the healthcare industry is ahead of the game, followed by transportation and manufacturing.

But government lags behind, the report said.

IDC surveyed 2,500 respondents from 15 countries and claims that has shown that the internet of things “is not just a concept but a real global accelerator of the third platform”.

But organisation are still chary about implementation, with security a major worry as well as putting up money and ongoing costs.

And in 2015, hardware vendors fell behind software vendors in implenting products and plans.

The retail industry, said IDC, is currently the underdog but that is set to change on the next 24 months.

The enterprises surveyed by IDC included organisations with over 500 employees and 50 percent of those who responded had at least heard of the phrase internet of things.

Internet of things continues to buzz

Bee swarm - Wikimedia CommonsAlthough there is still a lack of standardisation for the Internet of Things (IoT), a bullish report suggests the market worldwide will grow by 19 percent this year.

The forecast, from IDC, is even more bullish about the future. For example, it estimates that the IoT market in manufacturing will be worth $98.8 billion by 2018.

Digital signage will be worth $27.5 billion in 2018, that’s up from revenues of $6 billion in 2013.

But IDC predicts strong growth in “connected vehicles”, with the market growing by 34.8 percent this year.

IDC is concentrating on 11 vertical industries including home, retail, healthcare, government, manufacturing and transportation.

Aussies pay 68 percent more for Microsoft

The Australian government has been looking into unfair electronics pricing in the country for a year now, and the results are in – Aussies really are getting a raw deal.

Corporate giants like Apple, Microsoft, and Adobe were not very keen on the inquiry. This could be because, as it turns out, Australians pay on average 66 percent more for Microsoft products and 42 percent more for Adobe products than the rest of the world.

Games cost a staggering 84 percent more, while music is up 52 percent and hardware costs 46 percent more than in the USA.

The traditional line has been that inflated prices were just part of an added cost of business to trade in the region. But that doesn’t really hold up to scrutiny when you consider digital downloads.

In the report, the investigating committee also notes it has not received any evidence at all about why it is “almost invariably cheaper” for Aussie games to buy and ship physical media from the UK to Australia than getting a digital copy of the same game.

“Given the evidence presented to the Committee of very large price differentials, it is difficult to avoid the conclusion that these practices amount to international price discrimination to the clear disadvantage of Australian consumers and businesses,” the report reads.

The committee, News.com.AU points out, recommended the Australian Buraeu of Statistics work on a program that will monitor the price of IT products, hardware and software in Australia and worldwide.

Universities were encouraged to look into the needs and costs for education, and the committee also suggested putting a federally mandated IT procurement policy in place.

Interestingly, Australians could get a “right of resale” law that would – for digital content – allow them to sell on old music and ebooks, which in some cases are locked to individual user accounts not just in Oz, but everywhere. 

Nook sinking Barnes and Noble

Despite the fact that it has set up an ebook business based around its Nook reader, book seller Barnes & Noble is seeing the writing on the wall.

The outfit’s latest quarterly sales results show a lack of foot traffic in the stores and that could mean the end of the company’s 675 stores.

Barnes & Noble reported a 7.4 percent drop in revenues and a $122 million loss for the fourth-quarter of its fiscal year. The company only earned $10 million compared to the more bookish $177 million in 2012.

Ironically, it looks like Barnes & Noble’s focus on making Nook e-readers is killing the business. Nook has become a black hole for the company in these results.

Not only was there a 17 percent drop in Nook revenues, Barnes & Noble’s device division made a $475 million loss. This made the traditional business float like a Chicago businessman with cement boots.

Analysts have been telling Breakout that the odds are stacked against Barnes & Noble.

Brian Sozzi, CEO and chief equities analyst at Belus Capital Advisors said he had no confidence in the company surviving.

He said that the company has been cannibalising itself with branded tablets and e-reader applications. The more it pumped the Nook app across platforms, the more the stores become increasingly irrelevant.

 

Retail banks “will be dead in 15 years”

An analyst at the White Bull conference here in Barcelona said that in his view, retail banks will disappear over the next 15 years.

The reason for that is that quite a few of the top 100 multinationals have financial services arms where they can make value add on transactions.

Ralph Silva, of SRN, gave an example where he was going to buy a BMW car and before he knew where he was, BMW was selling him home insurance, car insurance and even pet insurance too.

BMW’s financial services arm knew the name of his dog, Jazz because he had visited the car showroom earlier with the mutt, and a salesman asked the name of his pet. That eliminated the need for him to go anywhere near a bank. Dozens of other companies are also plotting similar plans.

Silva also predicted that an IBM funded research programme was making headway with a CPU based not on CMOS, but on elements of DNA.  There are working chips already in the IBM labs, he said.

He also said that in future, every child will be fitted with two embedded chips which will contain healthcare information and other ID. The identity of the individual will be verified by a person putting her or his hand – with one chip in it, to his or her arm, with another chip fitted there.

Other future innovations include a single cable sending multiple signals, eliminating the need for miles and miles of cables in aircraft.

HMV on highway to heck

British retailer HMV looks set to become the latest in a string of casualties on the high street.

Though it survived the initial purge which turned Virgin into Zavvi into a black hole, HMV has just posted a loss of £36.4 million and is considering selling off London music venues like the Hammersmith Apollo and Kentish Town Forum. 

Sales in the 26 weeks up to the end of October dropped a staggering 17.6 percent. Shares fell 90 percent over the last year, according to the Guardian, while the company has debts of £163.7 million.

In an earnings call, HMV insisted that it will be able to keep chugging on. However, the Directors are talking to the Group’s banks and the economic downturn, twinned with the looming threat of a double-dip, “may cast significant doubt on the Group’s ability to continue as a going concern in the future.”

According to Sky, turning its attention towards selling technology products at the majority of its 252 stores, is helping. HMV claimed headphones, speaker docks and tablet computer sales were all on the up at 147 percent. 

HMV’s precarious position poses yet more questions about how the traditional high street retailer can face up to stiff competition in the online sector, as companies like Amazon continue to dominate sales and more and more Brits flock to the web to shop. 

eBay pushes policymakers on mobile broadband

Online retailer eBay is telling the British government and regulators to stop dragging their heels on plans for next generation data connectivity in the UK. 

eBay has it figured out that, actually, in five to ten year’s time lots of us are going to be spending money on our mobile devices. But a stickler to getting to that point is the UK’s comparitively poor data connectivity. 

In an eBay paper with the catchy title “Seizing the Mobile Retail Opportunity,” UK Retail Director Angus McCarey says the speed of change we’re going to see over the next five will completely trounce the last ten years. 

eBay has packed its public affair execs off to Ofcom’s doorstep, where the Silicon Valley company is recommending it proceeds with the 4G auction as fast as possible. It believes Ofcom needs to prioritise broadband coverage rollouts in rural areas and on transport routes like railway and roads.

It also warns against monopoly, urging Ofcom to make it easier for smaller companies to access spectrum, as well as pushing white space technology.

The argument to us seems to be: people are still buying despite the recession. Enabling mobile devices to make shopping simple, easy, fun and perhaps addictive, consumers could provide a substantial boost to the economy.

Many companies at the forefront of mobile technology agree that the world is moving towards an always-connected environment and with that comes convergence. “Phrases like e-commerce or m-commerce will become increasingly meaningless,” eBay’s McCarey said, “there will just be commerce.”

If you’re always on with a decent connection the window of opportunity for consuming isn’t just a lunch break or on your laptop at home – it’s all the time. Not only that, but the relatively high cost of data really does put off shoppers, according to a survey eBay commissioned for the report.

Speaking to TechEye, Clare Moore-Bridger at eBay told us that there’s a paradox in the UK economy: “We’re leading the way in so many aspects of mobile adoption, but lagging behind in our infrastructure,” she said. “Current problems with slow download speeds are only likely to get worse as smartphone usage peaks and data demand heats up.”

Moore-Bridger said that, while signs of O2 committing to trialling 4G mobile internet in London are very encouraging, “we need more wide-ranging action, spurred on and supported by policymakers.”

The first and most important step, according to Moore-Bridger, must be taken by Ofcom: “The number one priority for Ofcom should be to proceed with the auction of the 4G spectrum as quickly as possible to enable the rollout of next generation broadband in 2013.”

Pre-infected hardware and software ships to the US

The US Department of Homeland Security has warned that hardware is being shipped from foreign parts with malware and spyware pre-installed.

While many think that this would have the advantage of cutting out the middle man, Greg Schaffer, the Department of Homeland Security’s acting deputy undersecretary for national protection and programs, said that the problem is getting worse.

Schaffer was talking to the House Oversight and Government Reform Committee. It’s thinking about an Obama-backed proposal to tighten monitoring on computer equipment imported for critical government and communications infrastructure.

Schaffer didn’t mention if he was talking about end-user consumer tech like retail laptops, DVDs and media players, or the serious business computers leant on by government departments.

However, it is the first time that the United States has publicly confirmed that foreign consumer technology is arriving in the country already loaded with nasty bugs like key-logging software, botnet components and even software designed to defeat security programs installed on the same machine.

He was asked by Jason Chaffetz, who was worried that using software and hardware built overseas ran the risk that items could be embedded in them already.

Schaffer tried to get a bit woolly and said  the issue was important to Barack Obama. Chaffetz cut him off and restated the question, to ask him if he was aware of “any component software or hardware coming to the United States of America that already have security risks embedded into those components”.

Schaffer paused before saying he was aware that there have been instances where that has happened.

To be fair to Schaffer, there have been cases were software was infected by malware at the plant before it shipped. However this had little to do with an attempt to spy on the computers. More often it is just that the disk image gets infected by mistake.

If hardware is being tinkered with, that would be another matter. So far there have been no public cases of this happening.

The exchange is on YouTube.

High Street fights back against Internet sales

Aussie High Street retailers are involved in a secret plan to tax goods and services bought over the world wide wibble.

BusinessDay has found evidence that a government plan to tax internet transactions was as a result of secret lobbying by High Street retailers.

An internal email sent by FD, the public relations agency that is pulling the strings behind the campaign, and is paying for full-page ads in newspapers and recommends when to run the ads to achieve the best outcome and impact with readers.

FD has for a client Solomon Lew who owns Premier Investments, which owns retail retail brands in the country such as Just Jeans, dotti, Portmans, JayJays and Smiggle. It also looks after Redgroup Retail, a private company that owns Borders and Angus & Robertson.

The adverts talk about nasty foreign internet sites stealing food from the mouths of retailers who are forced to pay local taxes.

However as the Sydney Morning Herald  points out, after three days of advertising the campaign has misfired. Thousands of disgruntled shoppers fill talkback stations, websites and newspaper letters pages to complain about perceived price gouging by local retailers.

The shoppers hate whinging by billionaires such as Lew and Harvey Norman founder Gerry Harvey about competition, apparently.

Consumers in Australia are fed up with paying prices that are 40 to 60 percent higher in Australia. The 10 percent GST is so low that it hardly makes an impact.