Friday, while the market was digesting more bad financial news, and tech watchers were processing the market’s overwhelming lack of confidence in RIM’s near term “land grab” spending plan , three news kernels hit the Applevine. Two, both positive, concerned the removal of minor legal obstacles from the Apple’s path. The third piece, while only rumor, concerned iPhone production volume and the prospect of a new model.
Research in Motion (RIM) is expected to launch three new phones in the coming months: the Blackberry Bold (new to the US, already available internationally), a clamshell phone called the Pearl Flip, and a touch screen device expected to be called “The Storm (pics).” Unfortunately, new product launches – between component parts, subsidized pricing and promotional costs – can be expensive. As a result, the company warned late Thursday that gross margins and profit will suffer in the third quarter.
Co-CEO Jim Balsillie characterized the situation as a “land grab” and justified the increase in near term expense as, essentially, an opportunity. It’s similar to the story pitched in June when the company showed sales and marketing expense up heavily. But the market didn’t treat that first glimpse as foreshadowing, and they weren’t convinced with the re-itteration. The market also wasn’t completely satisfied with the rest of RIM’s earnings news.
By midday Friday, the stock was trading near $70 a share, well below its fifty week low of $80.20. From Thursday’s market close of $97.53, it was down more than 25%.
MySpace controls 67.5% of the social networking marketplace in the U.S. (Hitwise). Thursday, the News Corp owned company moved to strengthen its position with the launch of a sweeping new music service.
First announced in April, the service is a joint venture built with the participation of all four of the major music labels (Sony BMG, Universal, Warner Music and late entry to the partnership, EMI). It offers free, on-demand, ad-supported streamed songs from a massive musical catalog. Listeners are able to pick and choose what they want to hear, when they want to hear it. To encourage sharing and interaction, they can also create and share an unlimited number of playlists, each compiled with up to one hundred songs. The service is live now.
Digital Rights Management (“DRM”), and the assorted encryption techniques that fall under its moniker, has become industries’ primary preventative weapon for thwarting rampant content piracy. It’s been their canon, their go-to machine. Unfortunately, like any weapon if improperly used it has the ability to blow up in its user’s face. Sony learned that lesson the hard way in 2005. Now, the use of a different Sony developed technology called SecuROM, along with a questionable disclosure policy, has put video game publisher Electronic Arts (EA) in the crosshairs. A lawsuit’s already been filed.
The rumors circulated, the news was deemed imminent, and now it’s official. This morning, Google, together with T-Mobile and HTC, officially revealed the hyped “Dream” phone, the first mobile phone to be built around Google’s Open Handset Alliance Android operating system.
Bloggers, press and even Google’s founding team of Sergey and Larry were on hand for the Manhattan launch event.
Rebranded from the Dream to the G1, an obvious nod to Google, the phone will be available on October 22nd at T- Mobile stores in twenty one cities. It will sell for $179 (with a two year contract), plus a $25 or $35 a month data plan subscription.
From the start, the phone will provide Google with gateway access to consumer’s mobile experience. Click to Read More
In the movies, “if you build it they will come.” In reality, customer acquisition isn’t so easy. You’ve got to build your theater (or stadium) before you can fill the seats with customers. Then you have to let your customers know there’s a show to see. Once they’re aware, you need to make sure you give them something good enough to get them to come and keep coming back. Slowly but surely, Netflix is working through this process with digital delivery.
Be it a bubble or a breakthrough, investors are sure loving games. Not two weeks ago, Seattle based Big Fish Games, a maker of downloadable games, drew down an $83m round; a number likely big enough to put them on the podium for the largest gaming venture financing of all time. Today, Redwood City, CA based Trion World Network, a “server based” game developer and publishing platform company, turned in a medal worthy performance of their own.
In a series C round, Trion raised $70m.
