Amazon.com Inc has acquired live-streaming gamingnetwork Twitch Interactive for about $970 million in cash, reflecting Chief Executive Officer Jeff Bezos’ vision to transform Amazon into an Internet destination beyond its roots in retail operations.
The deal, jointly announced by the two companies, is the largest deal in Amazon’s 20-year history and will help the U.S. e-commerce company vie with Apple Inc and Google Inc in the fast-growing world of online gaming, which accounts for more than 75 percent of all mobile app sales.
The acquisition involves some retention agreements that push the deal over $1 billion, a source close to the deal told Reuters.
“Twitch will further push Amazon into the gaming community while also helping it with video and advertising,” Macquarie Research analyst Ben Schachter said in a note.
Twitch’s format, which lets viewers message players and each other during live play, is garnering interest as one of the fastest-growing segments of digital video streaming, which in turn is attracting more and more advertising dollars.
The deal, expected to close in the second half of the year, is an unusual step for Amazon, which tends to build from within or make smaller acquisitions. Tech rival Google was earlier in talks to buy Twitch, which launched slightly more than three years ago, one person briefed on the deal said.
Neither Amazon nor Twitch would discuss how the deal came together or comment on Google’s interest.
In an interview, Twitch Chief Executive Officer Emmett Shear said the startup contacted Amazon because its deep pockets and ad sales expertise would allow the startup to pursue its strategic objectives more quickly.
“The reason why we reached out to Amazon, the reason I thought working for Amazon, having Twitch being a part of Amazon, would be a great idea for us (because) they would give us the resources to pursue these things that we honestly already want to pursue and they’d let us do it faster,” Shear said.
While the in-house platform is initially planned to replace ads supplied by Google Inc on Amazon’s own website, the new system could challenge Google and Microsoft Corp’s advertising business in the future, the newspaper cited the people as saying.
Amazon’s system would resemble Google’s AdWords, and is planned to make it easier for marketers to reach the company’s users, the newspaper reported the people as saying.
The retailer is also building a tool that would help advertising agencies buy in bulk for thousands of advertisers, the Journal said, citing the people.
Amazon is known as a sleeping giant in the ad industry because it has rich consumer data but has been tentative about using it for a lot of advertising.
The company already has an advertising service it employs chiefly on its own website.
Amazon did not immediately respond to requests for comment.
Tablets with low-resolution screens are already selling for $45 on Amazon, many of which have single- or dual-core processors from a Chinese chip company called Allwinner.
But the prices could fall under $35 when Allwinner ships its “fully formed” quad-core A33 chip for only $4, said analyst firm Linley Group in a newsletter this week.
The chip’s quad-core processors will deliver better performance than older chips, and be capable of supporting 1280 x 800 displays, the analyst group said. The chip is based on ARM’s Cortex-A7 design and has a Mali-400MP2 GPU, which is capable of rendering high-definition video.
The cheap tablets will likely come from no-name vendors in China, and won’t offer the bells and whistles of Samsung or Apple tablets, but they could increase price pressure on brand names like HP and Acer, which have entry-level tablets priced around $100.
They’ll be most suited to first-time buyers or users who aren’t picky about hardware or software but certainly not power users, said Jim McGregor, principal analyst at Tirias Research. That’s because they’ll likely have limited memory, storage and fewer ports than more expensive devices.
“Users eventually will move up in performance,” McGregor said.
The tablets would almost be disposable items, said Nathan Brookwood, principal analyst at Insight 64.
And they could be here soon.
Mass production of the chip has already begun and prototype tablets have already been built.
A lot would come from Shenzhen, China, where a bulk of the device development is taking place, said Brookwood.
“This Shenzhen ecosystem, it’s absolutely scary what they are doing,” he said. “They operate on very thin margins. The kind of margins that no U.S. vendor can think about running on.”
The no-name tablets usually don’t come with customer support, and some may not have the Google Play store.
YouTube appears to be readying a paid premium music service that would cost US$9.99 a month, called YouTube Music Key. Roughly a dozen purported screenshots of the service were recently published online on the blog Android Police, possibly showing how it would work. The images showed exclusive content such as remixes or cover songs, offline access to entire albums or concerts, and personalized playlists.
A YouTube spokesman declined to comment, but rumors of a paid music service from the Google-owned video site have been circulating for some time now. An earlier report in the Financial Times claimed YouTube was blocking or penalizing independent labels that were not signing up for the yet-to-launch paid service. Earlier this month, YouTube head Susan Wojcicki confirmed the company was working on some kind of subscription music service, in aRe/code interview.
So it looks likely that a premium version of YouTube just for music is on the way. The free version of YouTube works well for many right now, but a premium version might let Google monetize some new content and lead users to the company’s other digital media services.
The amount and diversity of content already available free on YouTube is massive, and the advertisements don’t interrupt the listening experience like those on Spotify or Pandora do. Plus, Google already offers Google Play All Access, a paid music service that syncs across devices and lets people listen offline, for $9.99 a month.
“Premium” might be the draw for a paid music service. The special content might include exclusive recordings of professional artists’ cover songs, or unreleased tracks similar to iTunes exclusives.
To do that, Google would probably have to strike new licensing deals with music labels. But if YouTube could convert just a tiny fraction of its billion-plus monthly users into paying customers, that might be a win for Google, argues Mark Mulligan, co-founder of the music and technology research firm Midia Consulting.
YouTube claims viewers watch more than 6 billion hours of video each month on its site — almost an hour for every person on Earth — and that 100 hours of video are uploaded every minute. That catalogue is peerless, Mulligan said, but Google probably wants to do more with it in order to take on streaming services like Spotify, Rdio or Beats Music.
“YouTube has the ability to offer so much more than anyone else, with video the killer component,” he said.
Amazon.com Inc rolled out a $10 credit-card reader and mobile app for brick-and-mortar businesses on Wednesday, marking the latest step by the U.S. online retailer to expand its presence in the physical world.
The move pits Amazon against a slew of rivals, including startup Square, which popularized a payments dongle that allowed small- and mid-sized businesses like food trucks, coffee shops and personal trainers to quickly accept credit and debit cards.
The new point-of-sale system, called Amazon Local Register, would give Amazon crucial data on how U.S. consumers shop offline. More than 90 percent of U.S. retail sales still take place in physical stores, according to U.S. government data.
Amazon hopes to court small businesses in part by charging lower fees than Square and eBay Inc’s PayPal unit. Those who sign up for Amazon’s program before Oct. 31 will be charged 1.75 percent for each card swiped until January 2016.
For those who sign up after October, Amazon will take a 2.5 percent cut of each card swipe, still less than Square’s 2.75 percent flat transaction rate and PayPal’s 2.7 percent.
“Final production of the current Reader model, PRS-T3, was made at the end of May,” a spokeswoman for Sony in Tokyo wrote in an email Wednesday. “The product will continue to be available until inventory supplies last, which differs by country.”
There are no plans for a successor to the device, she added.
The PRS-T3 was launched last year in 20 countries including Japan, Canada and European states, but was not released in the U.S.
Weighing 200 grams, it has a 6-inch E-ink touchscreen display, an optional night light, Wi-Fi and a battery life of six to eight weeks.
While it’s still available on Sony’s UK site for 99 pounds (US$166), it’s out of stock at Sony’s sites for France and Canada. The PRS-T3 will continue to be sold for the time being in Japan, where Sony maintains its Reader Store.
The company said earlier this year it is closing down its e-book business in North America, Europe and Australia and that users would be transferred to Kobo, owned by Japanese online shopping giant Rakuten.
Sony helped pioneer e-readers with a product it launched in Japan 10 years ago, the Librie. Developed with Philips, it was billed as the first commercial device of its kind to use E-ink’s electronic paper display technology.
Beginning with the PRS-500 Portable Reader System in 2006, Sony marketed a series of e-readers that were well received, though some reviewscomplained about its price compared to the features of cheaper rivals.
Sony Reader shipments had exceeded 800,000 units for 2010, according to IDC. But the product was never as popular as competitors from Amazon, Barnes & Noble or Kobo. By late 2012, Amazon’s Kindle reader was used by over 50 percent of e-book buyers, according to Publishers Weekly.
The market for e-readers peaked in 2011 at 26.4 million units, IDC noted last year, adding it expects only modest growth in 2014 after a period of decline. The category was expected to begin a gradual, permanent decline in 2015.
Sony also shed its Vaio PC business this year as it continues to struggle with restructuring efforts.
Amazon.com Inc will offer 3D printing services that allow customers to customize and build earrings, bobble head toys and other items from third-party vendors using a new personalization option on its website.
Most of the more than 200 items available on the company’s new 3D printed products store, which was rolled out on Monday, can be customized using a new feature that allows users to rotate and change the item they are viewing.
Before it is printed by one of Amazon’s sellers, users can customize a product like as a bobble head figure by changing its skin and eye color, hair style and outfit, Amazon said.
“The customization is something we’re keenly interested in,” said Petra Schindler-Carter, director for Amazon marketplace sales, speaking in an interview. “We’ll always look for new applications for that.”
Amazon, which has more than 240 million users, has expanded its marketplaces division to include new areas such as fine art and wine. It is part of Amazon’s larger investment into new areas like mobile services and original content that led to its larger-than-expected second-quarter loss last week.
The new printing option taps into a broader “Maker movement” among tech entrepreneurs in northern California, and to some extent Europe, that is focused on customizing 3D objects rather than development software or mobile applications.
3D printers have gained in popularity on Amazon Supply, a wholesale site for businesses. That interest led Amazon to offer customers an 3D print option, Schindler-Carter said.
Consumer and business shoppers can pay for products directly via bitcoins or through Coinbase, a third-party payment processing company, Dell said.
Buyers can pay for products through Bitcoin wallets or by scanning a QR code with a smartphone.
The volatile Bitcoin has had its share of controversies and exchange shutdowns as the currency matures. Companies like Overstock.com, Newegg, Expedia and some Amazon storefronts accept Bitcoin as a form of payment. But major retailers like Walmart and eBay have not warmed up to the idea. The value of one bitcoin was around $630 as of Friday, according to multiple cryptocurrency website.
There are some advantages to paying via Bitcoin. The form of currency is accepted around the world, and for Dell, the payment-processing cost is less than with credit cards.
But the form of payment has its quirks.
“Due to the nature of the Bitcoin network, once you initiate a Bitcoin transaction you cannot change or cancel it,” Dell said on a terms and conditions page.
Customers could seek refunds in the case of canceled transactions or product returns.
“For a qualifying return of product paid for in Bitcoin, any refund due will be remitted to the purchaser via check in U.S. Dollars for the full amount of the purchase price paid at the time of the original transaction, less any applicable restocking fees,” Dell said.
Amazon.com Inc is asking U.S. regulators for permission to test its delivery drones near Seattle, as part of a rapid expansion of a program that has sparked widespread debate over the safety and privacy implications of drone technology.
Chief Executive Jeff Bezos wants to use drones – small unmanned aircraft – to deliver packages in 30 minutes or less as part of the program dubbed “Prime Air.” The company is developing drones that can fly at speeds of 50 miles per hour.
Now Amazon is seeking permission to test drones in outdoor areas near Seattle, where one of its research and development labs is working on the technology, according to a letter posted on the Federal Aviation Administration’s website.
Currently Amazon can test drones indoors and in other countries. But it cannot conduct R&D flight tests in open outdoor space in the state of Washington, where Amazon has its headquarters.
“Of course, Amazon would prefer to keep the focus, jobs and investment of this important research and development initiative in the United States,” the company said in the letter, dated July 9 and signed by Paul Misener, head of global public policy for Amazon.
In 2012, Congress required the FAA to establish a road map for the broader use of drones. The FAA has allowed limited use of drones in the U.S. for surveillance, law enforcement, atmospheric research and other applications.
Last year, the U.S. government created six sites for companies, universities and others to test drones for broader commercial use in Alaska, Nevada, New York, North Dakota, Texas, and Virginia.
But the area near Seattle, where Amazon wants to conduct its tests, is not among those sites. Amazon plans to use one or more of the six FAA sites, but said in the letter that it would be “impractical” to limit its testing to those areas.
CEO Bezos, who founded Amazon 20 years ago, disclosed the “Prime Air” drone program on the CBS television program “60 Minutes” late last year. His plan was derided by some as a mere publicity stunt, while others raised privacy concerns and said the technology needed more refinement.
Despite the controversy, Amazon has rapidly grown the drones team in the last five months. It has hired roboticists, aeronautical engineers and a former NASA astronaut, and recently advertised for a full-time communications manager for the program.
“Our goal is to provide even greater protection for data across all the great Microsoft services you use and depend on every day. This effort also helps us reinforce that governments use appropriate legal processes, not technical brute force, if they want access to that data,” Matt Thomlinson, vice president, Trustworthy Computing Security, at Microsoft wrote in a blog post.
The move follows similar ones from other cloud computing providers. For example, Google announced end-to-end encryption for Gmail in April, including protection for email messages while they travel among Google data centers. It recently announced similar encryption for its Google Drive cloud storage service.
It’s not clear from Microsoft’s announcement whether the encryption protection it announced covers Outlook.com messages and OneDrive files as they travel within Microsoft data centers. It’s also not clear what, if any, encryption OneDrive and Outlook.com have had until now. Microsoft didn’t immediately respond to a request for comment.
Cloud computing providers like Microsoft, Google, Amazon and many others have been rattled by disclosures from former National Security Agency contractor Edward Snowden regarding government snooping into online communications, due to the effect on their consumer and business customers.
As a result, these companies have been busy boosting encryption on their systems, while also lobbying the U.S. government to stop the stealthy and widespread monitoring of Internet services.
IBM announced the general release for its cloud development platform as a service (PaaS) offering Bluemix.
The Cloud Foundry suite, which has been in open beta since February, now boasts more than 50 services and has been adopted at a rate which, the company claims, makes it one of “the largest Cloud Foundry deployments in the world”.
IBM launched Bluemix as part of a $1bn investment in cloud computing, and it’s a framework that allows users to create cloud based applications, slotting in open source services from the IBM Cloud Marketplace.
New services added to the list include Gameification, to add incentives to apps, MQ Light, a messaging service, Redis Cloud, allowing Redis users to run datasets easily and Sonian Email Archive which allows mining of big data from emails and their attachments.
“Organizations are rapidly moving new, innovative apps to Cloud Foundry’s scalable, user-friendly model,” said James Watters, vice president of Cloud Foundry Product and Ecosystem at Pivotal.
“IBM Bluemix furthers the Cloud Foundry vision for rapid app development, as well as the ability for developers to work easily between platforms and tools from multiple providers.”
The investment in Bluemix stretches far beyond the technology infrastructure with over 80,000 consultants trained to advise developers on how to use it, and the first of a series of so-called Bluemix Garages opening in San Francisco as a place where developers from different companies can get advice both from IBM itself and through cross-pollenation of ideas from other companies.
The news coincides with the announcement of a new IBM data centre in London.
The expansion of the free tier, and other changes to OneDrive, will go into effect in July.
Microsoft’s moves come as all the major players are scrambling to offer customers more for less. Earlier this month, Apple said it would cut prices by up to 70% for paid iCloud plans. And last week Amazon said that users of its Fire phone would have an unlimited amount of storage for photos taken with the device’s camera.
Along with the doubling of the free allotment, Microsoft also said that it would hand subscribers of Office 365 Home and Office 365 Personal — the two consumer-grade rent-not-own plans — 1TB (terabyte) per user, up from a comparatively paltry amount of just 27GB. Students who have subscribed to Office 365 University, an $80 four-year program, also will receive 1TB free of charge.
The bump to 1TB per user on the consumer side matched the move Microsoft made in April on Office 365 commercial accounts.
Microsoft will also slash prices for additional storage for those consumers and students who need more than the standard 15GB or 1TB. An extra 100GB will cost $1.99 per month — or $23.88 per year — 52% less than the current $50 annually; the price of 200GB will also drop by 52%, from $100 per year to $3.99 per month ($47.88).
The cuts appear deeper when compared to the monthly payment plan Microsoft offers as an option: Then, the new prices will be 65% to 73% less than the current ones.
On a per-megabyte-per-year basis, the new OneDrive paid-plan prices of about 24 cents will be competitive with Google Drive’s 100GB bump-up (also 24 cents) and Apple’s 200GB offer (24 cents), but will remain twice that of Google’s 1TB deal (12 cents).
Apple has said it will offer a 1TB iCloud plan, but has not revealed what it will charge for that amount.
German monthly Magazine Manager cited people familiar with the matter as saying the talks were far advanced but no deal had been clinched and that Netflix was also in touch with other German telecoms groups.
Netflix in May unveiled plans to launch in both Germany and France this year, in the biggest test so far of its global expansion strategy.
Manager Magazine said Deutsche Telekom was open to accommodate Netflix’s expansion even though the service would compete with the German company’s own web-based TV offering called “Entertain”.
Deutsche Telekom declined to comment.
Netflix, whose internet-based delivery of movies and TV series such as “House of Cards” has disrupted pay-TV markets in the United States and elsewhere, wants to grow its international business to reach new customers and increase its buying clout with content providers.
It is already in more than 40 countries, mostly in Latin America, and has entered Britain, Ireland, the Nordics and the Netherlands in the past two years.
In Germany, it would compete with Amazon’s Prime Instant Video, ProSiebenSat.1′s Maxdome, Sky Deutschland’s Snap and Vivendi’s Watchever.
Germany has the highest number of broadband households in Europe, with 29.1 million in 2013, according to estimates from SNL Kagan.
BlackBerry Ltd has agreed to a licensing deal with Amazon.com Inc that will let the Canadian smartphone maker offer some 240,000 Android applications from Amazon’s app store on its lineup of BlackBerry 10 devices this fall.
The move allows the Waterloo, Ontario-based company to add a vast array of consumer-focused apps to its devices, while at the same time directing its own efforts toward developing enterprise and productivity applications.
Customers who own smartphones powered by its BlackBerry 10 operating system will now be able to access popular Android apps such as Groupon, Netflix, Pinterest, Minecraft and Candy Crush Saga on their BlackBerry devices this fall. Google Inc makes Android, the mobile operating system used in more than a billion phones and tablets.
The apps will become available after the Canadian smartphone maker rolls out the upgraded BlackBerry 10.3 operating system, the company said.
The move is the latest by the smartphone pioneer to streamline its focus as it attempts to reinvent itself under new Chief Executive Officer John Chen as BlackBerry phones have lost ground to Apple Inc’s iPhone and Samsung Electronics Co Ltd’s Galaxy devices.
Analysts saw the move as a step in the right direction, but are not sure whether it will help turn the tide for BlackBerry.
“While this will widen the BB10 app ecosystem, the consumer
smartphone environment still remains challenging,” Wells Fargo analyst Maynard Um said in a note to clients.
Um views the announcement as a positive for BlackBerry, but said “whether it stems consumer churn remains to be seen.”
Chen wants to remain a competitor in the smartphone segment, but is focused on making BlackBerry a dominant force in machine-to-machine communications. The company’s QNX software already is a mainstay in the automotive industry, powering electronic and other systems in a wide range of cars.
BlackBerry already works with hundreds of large enterprise clients, including corporations and government agencies, to manage and secure mobile devices on their internal networks.
Chen intends to build on those ties and BlackBerry’s security credentials to let these enterprise clients build and customize in-house corporate and productivity applications for their employees.
When the Mayday button was announced with the Fire HDX eight months ago, Amazon said its response time goal was 15 seconds or less.
Amazon Customer Service Director Scott Brown said in a statement that the Mayday concept is working well and has helped revolutionize tech support.
About 75% of customer contacts regarding the Fire HDX come via the Mayday button to get a tech response. A tech then appears in a live video stream on a portion of the display (although the tech cannot see the customer). The tech can then make notations on a user’s display or help a user navigate through a process.
Amazon touted the lighter side of instant tech support using Mayday in a statement. Customers have asked tech advisors to draw on their screens, including everything from happy faces to rainbows, unicorns, fire-breathing dragons and aliens. One customer asked a tech adviser to sing happy birthday to someone receiving the Fire HDX as a gift as the person was receiving it.
Some tech advisors have even received date requests and marriage proposals, Amazon said.
There’s also a more serious side to the concept, analysts said: The Mayday button’s popularity should be a wake-up call to product manufacturers, many of whom suffer low customer-service ratings and should consider more personal contact with users.
“Companies could learn a lot from the way Amazon does customer service,” said Jack Gold, an analyst at J. Gold Associates. “The focus Amazon has on customers, and has had for years, is often what makes users so sticky to them. It’s true of their general Amazon Web site, too. Consumers love good customer service.”
Gold said that what Amazon’s done with Mayday is not completely new, as enterprises have provided remote screen control, without video streaming, to IT help desk personnel serve users for years. “Remote control is not as slick as the Mayday button, and Amazon has made it work fast and easy,” he said.