At the intersection of technology, finance and the Pacific Rim.

Saturday, October 31, 2009


Robert Cringely, who I find to be among the astute technology analysts, had this to say about e-Ink in his blog:

This e-ink/PVI deal is especially interesting because it was announced back in June as an all-cash deal for $215 million then revised earlier this month throwing-in 120 million preferred PVI shares for the former e-ink investors. This is a huge about-face that instantly doubles the price of the purchase while also giving the former e-ink owners a share in any upside for the business — an upside they obviously expect to enjoy or they wouldn’t have held out for it.

E-ink had, over the years, raised $150 million, so while the investors were being made whole by the original $215 million sale price, their upside wasn’t much. But then the electronic ink business, for all its apparent potential, hasn’t really been that good despite e-ink’s use in both the Sony and Amazon Kindle readers. Four months ago the e-ink investors were thrilled to just get their money back. Then something changed. They just demanded (and got) twice as much money in the form of preferred shares giving them a significant piece of any upside explosion — an explosion they clearly didn’t expect when the original cash deal was negotiated.

The something that happened I believe was Apple’s entry into this market segment. That alone may have been enough. I’m guessing Apple, like it did with Samsung and Flash RAM, made a huge commitment for most — maybe all — of e-ink’s color display production for years to come. Or maybe PVI is simply flipping e-ink to Apple. Only time will tell, but I know in my bones that there is something going on here.

Tuesday, October 27, 2009

The Impending Smart Phone Wars

New York Times writes:

Two campers see a bear, and one immediately puts on his running shoes.
“You can’t outrun the bear,” the other says.
“I don’t have to outrun the bear. I just have to outrun you,” responds the other.

This succinctly describes the relationship when it comes to smartphones between Google (the camper with the running shoes), Microsoft (the other camper) and Apple (the bear).

Monday, October 26, 2009

How did Facebook get started?

Mark Zuckerberg, Founder and CEO of Facebook, was interviewed recently at "Start-up School", a training ground for people who want to start technology companies. Some key points made:

Difference between Google and Facebook:

"As we’ve grown it’s become more apparent to us how we’re different from other companies. Google is a technology I admire. It’s become apparent the way we’re different. They have a really strong academic culture. They do a lot of research and a lot of Ph.D’s. What we pride ourselves on is having a lot of impact, having a strong hacker culture, giving people a chance to grow — those are things that we work on. We have more than 300 million users and less than 300 engineers. The ratio of users to engineers is far more than any other company. One of the things we’re committed to is having a smaller team. We have frequent pushes for code. We encourage people to build a lot of their own stuff. We have a technology company that’s really a hacker company"

On People Management:

"Our goal isn’t necessarily to keep people forever. There are companies that train people really well. A lot of Harvard people went on to McKinsey. A lot of people went to IBM because that was the best place to learn sales. A lot of people go to USC to learn how to play football. One of the things at Facebook is have a place where it’s one of the best places to learn how to build stuff. If you want to learn how to build really good products and practices and have a large impact, I would argue there’s no better place to do that than at Facebook.....We’re not pretending we’re building a company that hackers are going to want to work at forever. I want to be a part of building some institutions to be a great hacker institution in the long-term."

On What He has learned about Running a Big Company:

Not clear that I’ve learned much. A lot of it is — I don’t know — you want to have the values and culture that you think are going to be unique and are going to be the best for what you’re going to be doing. You can move so much faster when you’re small. You get bigger and you get slower. We need to institutionally push moving really fast, or else it will just be inertia. I actually think a lot of the best stuff we’ve done is try not to take all the advice from other people. What I said the last time at startup school and I got yelled at — is it’s a group of entrepreneurs who are mostly technical. All of these people would tell me you have no experience. You’re just this engineer. You can’t do this. My message the last time was No. People interpret this as you don’t value experience. But you need to value what you bring to the table

On Risk-taking:

The biggest risk you can take it is to take no risk. In a world that’s moving quickly, you know that if you don’t change you’ll lose. Not taking risk is the riskiest thing you can do. You have to do things that are kind of bold even if they’re not obvious....Values are worthless unless they’re controversial. We want to move quickly. We’re willing to give up a huge amount of stuff in order to move quickly

Wednesday, October 21, 2009

China and 1 Billion LInes

Light Reading reports:

"China Mobile Ltd. (NYSE: CHL) had more than 508 million mobile customers, China Telecom Corp. Ltd. (NYSE: CHA) boasted over 241 million (including fixed and mobile), and China Unicom Ltd.(NYSE: CHU) had nearly 250 million. OK, so the actual total is 999.5 million, but we're rounding that baby up to 1 billion."

Tuesday, October 20, 2009

The State of the IT Industry

One area that we do not talk about as much in class is the huge market for IT in the business world. It is certainly as large as the consumer side, where we have been spending most of our time. There are three distinct patterns in the IT Industry, according to FT, as quoted below:

First, increased M&A activity:

the recent pick-up in mergers and acquisitions in the sector suggests, neither buyers nor sellers of companies any longer feel the paralysing uncertainty that freezes dealmaking in a downturn.

In its pursuit of new markets to conquer, for instance, networking equipment-maker Cisco has pulled off two $3bn acquisitions this month, taking it further into the video-conferencing and mobile-networking markets.

"Tech companies have clean balance sheets and they're chasing growth," says Christopher Varelas, a former top technology investment banker and founder of Riverwood Capital, a Silicon Valley private equity firm. "The only way to stay out in front of these trends is global consolidation."

Second, an accent on services:

Services represent a more constant source of income, thanks partly to the longer-term nature of services contracts. They also typically come out of a company's operating budget, not the capital budget set aside for large technology purchases, making them less vulnerable to swings in capital spending.

That has helped to trigger a long-predicted realignment of IT, with hardware-makers diversifying into services. Xerox last month agreed to pay $6bn for ACS, a services company, while Dell agreed to buy Perot Systems for $3.9bn. Those deals come in the wake of Hewlett-Packard's $13.9bn purchase last year of EDS. The diversification into services and increasing vertical integration in IT are trends that are set to continue, says Mr Gopalakrishnan.

Third, Emerging Markets:

The hunt for growth, meanwhile, has led to a focus on customers based in the emerging world. Thanks to continued high rates of economic growth and the need for infrastructure - from new telecommunications networks to banking systems and "smart" power grids capable of distributing electricity more efficiently - these countries are set to assume a much larger significance in the market.

Though they currently represent only 21 per cent of global spending on IT, more than half of all new technology spending over the next four years will come from the emerging world, according to IDC, a technology research company.

That suggests that in the technology cycle that is just beginning, emerging countries will for the first time exert a powerful influence as leading sources of new demand as well as main sources of supply. world. Thanks to continued high rates of economic growth and the need for infrastructure - from new telecommunications networks to banking systems and "smart" power grids capable of distributing electricity more efficiently - these countries are set to assume a much larger significance in the market.

For the full article, go here.

Apple’s Profit Rises 47% as Sales Gain

This quote from Tim Cook, COO of Apple in the NY Times:

“We feel very good suiting up and competing against anyone,” Mr. Cook said. “People are really just trying to catch up with the first iPhone that was announced two years ago, and we have long since moved beyond that.”

Nothing like winning to bring out the cockiness.

Monday, October 19, 2009


For the past several weeks, we have been kind of making fun of Microsoft--the big whale that was being harpooned by lots of little harpoons being thrown at it by Google. The NY Times produces a Microsoft view of the world--they have not given up. Notice the profits that they are making--somewhere around USD 15BN. And yet they seem so past tense. Anyway, here's a brief preview of the article and for more click on the link.

With the arrival this week of Windows 7 and a host of complementary, slick computers, Microsoft intends to undermine those Apple ads that mock PCs and their users as stumbling bores. Mr. Ozzie, who plays the role of visionary and strategist at Microsoft, says Windows 7 will let PCs keep pace with other computing devices and, in short, finally make them sexy.

In a play for its piece of the cloud, Microsoft plans to release a software platform, Windows Azure, next month that represents its bid to lure businesses with online services. While late to cloud computing in spots and a lackluster participant in the mobile market, Microsoft, Mr. Ozzie says, has a shot at reinventing itself and moving beyond the desktop.

“This gives us an opportunity as a software vendor to refresh our value proposition,” he says. “I just think it’s an exciting time for Microsoft.”

Sunday, October 18, 2009

Google Tel

According to Wired magazine:

Saturday, October 17, 2009

Was on the plane yesterday, and read through Business Week--been some time since I have picked up a hard copy magazine--except the Economist. Anyway, these articles give a good sense of what is happening in the tech world:

For technology disruption, see this article.

To get a sense of the power of Google these days, take a look at this one.

Friday, October 16, 2009

another trend in mobile--apple

This from Read/Write

The cranky elves that run the iPhone App Store may be warming up after all to the emerging field of Augmented Reality (AR). AR app makers, who are building sci-fi-like interfaces for viewing data about the physical world on top of the mobile phone's camera, were beginning to feel spurned.

Today Apple both approved the most eagerly anticipated Augmented Reality app yet, Amsterdam's AR browserLayar (iTunes link), and made its primary challenger, Wikitude (iTunes link), a featured app in the iTunes App Store.

Mobile and Search

Tech Crunch reports,

During Google’s third quarter earnings conference call today, one message came out loud and clear: Google’s mobile strategy is starting to pay off. “Android adoption is about to explode,” declared CEO Eric Schmidt, explaining that all the “necessary conditions” are set for growth: There are now 12 Android phones out there (most recently the Motorola Cliq) across 32 carriers in 26 countries."

Tuesday, October 06, 2009

Below excerpts are from the NY Times on using the Web for health care. I just signed up for the service to give it a test drive.

The Web is still mainly a vast trove of generalized health information. The ideal, health experts say, would be to combine personal data with health information to deliver tailored health plans for individuals. That is what Mr. Bosworth and his San Francisco-based company, Keas(pronounced KEE-ahs) Inc., mean to do.

Using the Keas system, for example, a person with Type 2 diabetes might receive reminders, advice on diet and exercise, questions and prompts presented on the Web site or delivered by e-mail or text messages — all personalized for the person’s age, gender, weight and other health conditions.

So how does it work?

“The goal is not just health care information, but knowledge about what that means and what action to take,” said Dr. John D. Halamka, chief information officer at the Harvard Medical School, and a member of a federal advisory group on electronic health records. “And that is what Keas, and others in different ways, are really starting to think through.”

Other initial partners of Keas are impressed with its technology. Healthwise, a nonprofit supplier of online health information, has created 15 care plans for Keas so far, including ones on high blood pressure, cholesterol, diabetes, weight management and stress management.

Dr. Alan R. Greene, a clinical professor of pediatrics at the Stanford University School of Medicine, has two children’s care plans on Keas, for ear infections and asthma, and is working on others. Dr. Greene has done projects with WebMD and Yahoo in the past. “But this little start-up has an extremely powerful tool, both personalized and interactive,” he said.

And how will they make money?

Initially, the care plans will be free, but eventually Keas will include subscriptions for plans, probably at a few dollars a month. Keas will take a slice, and pass the rest on to the plan creator — the model used by the Apple’s iPhone applications store.

“We’re still learning, so we’re in no rush to charge,” Mr. Bosworth said. “But the idea is that people will get paid for doing things that are really engaging and useful.”

In the long term, Mr. Bosworth hopes Keas will evolve into a marketplace, where health experts are the sellers, and consumers who want the best personalized advice are the buyers. “I think that’s a pretty big idea,” he said. “If it works, it helps drive consumerism into health care.”