Revenue for the social networking company increased to $1.46 billion for the quarter ended March 31, up 38% from $1.06 billion from the same period last year.
The company’s advertising revenue was $1.25 billion, representing 85% of Facebook’s total sales and a 43% increase from 2012′s first quarter, the company said. Mobile advertising revenue constituted 30% of the company’s total ad revenue.
Facebook posted net income of $219 million for the quarter, up 7% from the year-ago quarter. The company’s net earnings per share were 9 cents, less than the consensus expectations of 13 cents in a poll of analysts by Thomson Financial.
“We’ve made a lot of progress in the first few months of the year,” Facebook CEO Mark Zuckerberg said in an earnings announcement, also citing “strong growth and engagement across our community.”
Facebook’s daily active users were 665 million for the quarter, 26% more than last year. Monthly active users increased by 23% to 1.11 billion, the company said.
On mobile, monthly active users increased by 54% to 751 million. Facebook did not disclose numbers for mobile daily active users.
The mobile ad revenue gains Facebook reported Wednesday were on par with the gains it reported in 2012′s fourth quarter, when its mobile ad revenue as a percentage of total ad revenue jumped from 14% in the third quarter to 23% in the fourth quarter.
Monetizing its services on mobile devices as more users migrate away from the desktop and onto their smartphone and tablets is one of Facebook’s biggest challenges today.
In 2013, the number of messages sent via chat app will climb to 41 billion per day, more than double the number of text messages sent globally, according to data from Informa shared with the Financial Times . London-based Informa didn’t respond to a request for comment.
Wireless carriers have noticed the trend to using chat apps for a while, and analyst firms started reporting the tipping point in favor of chat apps at the start of 2013. Informa estimates text messages will generate more than $120 billion in revenue for wireless carriers in 2013, but didn’t provide a similar number for chat apps.
The trend toward reduced texting revenues has been felt especially in Spain, the Netherlands and South Korea, according to Informa, but the trend is somewhat harder to define in the U.S., analysts said. That’s because some operators, such as Verizon Wireless and AT&T, are giving away free texting — along with voice — as part of shared data plans. At the same time, other U.S. carriers, like Sprint and T-Mobile USA, are pushing unlimited data plans, so that relying on a data connection for a chat app won’t add any cost.
Chat apps are often called a type of “over the top” service that doesn’t benefit a wireless carrier directly, at least as much as texting might.
Chat apps are seen by analysts as growing in popularity because of their flexibility. A chat app like BlackBerry Messenger — which is especially popular in Europe — can easily be converted with a touch or two to an audio or video call with the new Z10 smartphone and the coming Q10 on BlackBerry 10.
Other popular chat apps are Apple’s iMessage or Facebook’s Chat Heads. The latter can easily be reached with an account on Facebook, which has nearly 700 million regular mobile users.
Text messages, over the Short Message Service, operate over a separate network channel from a data channel used by chat apps. A single SMS is also restricted in length to 140 characters.
Internet chat app messages also have the flexibility of running over multiple platforms so that a desktop computer user can communicate with a smartphone or tablet user.
Canonical has touted Ubuntu 13.04′s support for VMware’s ESX and Microsoft’s Hyperv hypervisors.
Canonical’s Ubuntu 13.04 is the latest version of the firm’s popular Ubuntu Linux distribution that is growing in popularity in the server and specifically cloud market. The firm said it has been working with virtualisation vendors VMware and Microsoft to ensure that virtual machines running Ubuntu 13.04 are well supported by the underlying hypervisor, with Canonical telling The INQUIRER that collaboration with Microsoft has been particularly easy.
For some time now Canonical has been touting its Ubuntu distribution as being the most popular choice on Amazon’s EC2 public cloud, and while it has clearly worked hard in that area, the firm is now working on ensuring the operating system works on private clouds that run hypervisors from VMware and Microsoft.
Mark Baker, server product manager at Canonical said the use of KVM based virtualization it is important to support VMware and Microsoft.
Baker said, “Customers ask us ‘does it work?’ and we say yes absolutely it works. Is it supported? If you are running a version of Ubuntu on [VMware] ESX and you have problems, and you have a support contract with Canonical will we help you? Absolutely. Will VMware support it? That wasn’t necessarily clear before, but it is clear now that it is a supported guest platform.”
Baker continued, “We build and test Ubuntu on ESX everyday now.” However he did say that while VMware remains the market share leader, Microsoft’s Hyperv is gaining popularity and the firm is working with Microsoft to ensure that Ubuntu 13.04 has the same level of support on Microsoft’s hypervisor.
Interestingly Baker said that working with Microsoft has been far more pleasant than many Linux fans might think and that working with Microsoft was a pragmatic solution to customers’ needs.
He said, “Go back a few years, I’m not sure you would have seen us and Microsoft collaborating in the way that we are. But we have to be pragmatic really. If customers want to run Ubuntu we don’t want our lack of integration or testing or interoperability to be a limiting factor. We’d much rather they run Ubuntu albeit on Hyperv on Windows 8 Server.
“Actually, we’ve had a fairly easy time collaborating with Microsoft, they are very cooperative.”
Canonical is right to work on ensuring Ubuntu 13.04 plays nicely with VMware and Microsoft hypervisors as KVM currently lacks market share and it would be bad for the Linux community as a whole if one of the most popular distributions provided such a bad experience on established hypervisors that firms simply ignore Linux altogether.
Last month the Opensuse project announced the release of Opensuse 12.3, which brought ARM support to the same level as x86 and AMD64. While the project is working on bringing ARMv7 and more importantly ARMv8 support to its Linux distribution, Jos Poortvliet, community manager at Opensuse, said that the project’s ARM development has been limited by the lack of build resources.
Opensuse announced a collaboration with Samsung to create the OBS, which it was hoped would speed up the development life-cycle. However Poortvliet said, “ARM development is limited by available build resources required for compiling each iteration of new software and while the OBS helps by bringing a lot of build power in one place, the use of QEMU meant that build resources were shared with native x86_64 builds, which turned out to be a performance limitation.
“With fast and dedicated ARM hardware we can reserve build power for ARM builds and make use of the more efficient KVM virtualization.”
However in better news, Poortvliet said that the project had managed to deploy KVM – the Linux kernel based virtual machine – on ARM hardware. He added that parent firm Suse has assigned more resources to building ARM software on OBS and forecast that all packages would be built in two weeks.
While Canonical and Red Hat have been vocal about their ARM developments, Suse and its Opensuse project have been quietly going about their business, though given Poortvliet’s comments regarding a lack of resources, perhaps they have been going about it too quietly.
Although ARM vendors are not expected to converge on the server market until next year, even ARM thinks that most servers using its chips will run open source software.
Unless Suse manages to get its act together, it might find that Canonical and Red Hat have already carved out a significant chunk of the market.
Richard Stallman has asked a South American free software association not to promote Ubuntu Linux at its events because it “spies on its users” by collecting its users’ desktop search activity and selling the data to Amazon.
Canonical released Ubuntu 12.10 last October with Amazon search integrated into its Dash desktop search function.
Although Ubuntu users can opt out and Canonical claims it anonymises users’ search information before sending it to Amazon, the change resulted in Ubuntu users being shown Amazon ads in response to desktop search queries.
The ‘feature’ has attracted a lot of criticism and might have led some users to defect to other Linux distributions.
When Stallman’s request was denied by the FLISOL event organiser with the excuse that it would limit user freedom of choice, Stallman fired off a response to the organisation’s entire mailing list on Sunday. Parts of his email are quoted below, as translated by Groklaw.
“The issue I raise is about what should happen at FLISOL events. Give away copies of Ubuntu or not? Promote Ubuntu or no? I asked the organisers of the event that they, as a policy, not distribute or promote Ubuntu.
“Freedom of users is something else, and there isn’t a conflict between a user’s freedom and my request. If someone decides to install Ubuntu, I would consider it a mistake, but it’s his own choice to do it. What I ask is that you don’t participate, help or suggest that he do it. I didn’t request that you block him from doing so.
“As a matter of principle, I don’t believe anyone has a right, morally, to distribute proprietary software, that is, software that deprives the users of freedom. When the user controls his own software, he can install what he wants and no one can stop him. But today’s issue isn’t about him, what he does, but rather what you do with him.”
As Stallman sent his email only yesterday, it’s not yet known whether FLISOL has reconsidered promoting Ubuntu at its free software events.
These points might seem like splitting hairs, but apparently Richard Stallman – the author of the GNU General Public Licence (GPL), as well as the founder and president of the Free Software Foundation – is serious about them.
Word on the street Microsoft is seriously considering creating a version of Office which can run on Linux. According to ExtremeTech, Microsoft is taking a “meaningful look” at releasing a full Linux port of Office in 2014.
Rumors of the Linux version of Office surfaced last weekend at FOSDEM, the open source conference held annually in Brussels. It is all being prompted by Microsoft’s late realization that Linux may be a viable commercial opportunity after all. Redmond has been developping a version of Office for Android to work on mobile devices. Since Android is Linux-based a lot of the porting work will have already been done. This means that it should not take too much effort to take the next step and bring Office to Linux.
There is no proof of this of course; it is just rumor and speculation. In the past, Microsoft has been worried about letting its crown jewels work on other operating systems. However if it is going to port to Android it might as well go the whole hog.
Canonical has released Ubuntu Linux 12.10 including Amazon search results in Dash and support for the latest version of Openstack.
Canonical has received some flak in the past two years for its decision to use Unity as the default window manager in its popular Ubuntu Linux distribution and more recently its decision to display “related” search results from Amazon in the user’s Dash search function in Ubuntu 12.10. The outfit has now released Ubuntu Linux 12.10 for desktop and servers claiming it lays out the foundations for what will be the next Long Term Support (LTS) release in 18 months.
Steve George, VP of communications and products at Canonical said, “This is the start of the next [two year] cycle which [we] will bring to its final conclusion in [Ubuntu] 14.04. Really what we are doing here is setting out the future direction for Ubuntu with a platform, setting out the core themes that we are thinking about and then we develop those technologies and deploy those technologies over successive releases.”
George highlighted support for Openstack’s most recent Folsom release as being a major driver for Ubuntu 12.10, however he did admit that many of the firm’s larger customers will continue to use Ubuntu 12.04 LTS, which also supports Openstack Folsom, rather than migrate to the newer version of the operating system using the firm’s cloud archive to obtain the software. George also claimed that Ubuntu is the reference operating system for Openstack, which should help it gain some customers as Openstack grows in popularity.
While Canonical is placing a lot of faith in Openstack to push lucrative enterprise deployments, George said that technologies such as its Juju configuration tool, Quantum virtual networking and Cinder Block storage are key for Ubuntu 12.10′s deployment in servers.
George also confirmed that Ubuntu 12.10 desktop users can disable Amazon’s search capabilities within Dash through the control panel or remove the lens from the command line should they so wish. He followed Mark Shuttleworth by reiterating that the firm anonymises all search data sent to Amazon, but added that users can, if they so wish, remove the Amazon search capability from Ubuntu 12.10.
Canonical’s Ubuntu 12.10 desktop and server distributions are available for download and users can use its System Update tool to update existing Ubuntu Linux systems.
Red Hat, which last year became the first Linux vendor to hit $1bn in revenues in a fiscal year, has revealed revenue figures that once again show it can repeat that performance in 2013. The firm announced that its second fiscal quarter revenues were up by 15 percent from the same quarter a year previously to $322.6m, however its profits fell by 12.5 percent from last year to $35m.
Charlie Peters, EVP and CEO of Red Hat said the firm’s earnings per share would have been higher if the firm had not made two large purchases. Peters said, “This quarter marked a significant ramp-up in investments in our nascent storage business, with the launch in late June of Red Hat Storage Server 2.0. Furthermore, we announced two small technology acquisitions in the middleware space to further round out our offerings, which decreased the quarter’s EPS by approximately $0.01 per share due to one-time closing costs.”
Red Hat’s $1bn fiscal year was seen as a watershed moment for the commercial viability of Linux, as it showed that the open source company could compete with large, established competitors such as Microsoft and Oracle and still make a considerable amount of cash.
The firm is facing increased competition in the commercial Linux market from Canonical, however its Red Hat Enterprise Linux and free distributions based on it such as CentOS and Scientific Linux are extremely popular with businesses and are seen as the benchmarks for enterprise Linux.
Canonical wants to establish itself as a force in the Linux server and cloud computing markets.
The company, which has long been known as a champion for the expansion of Linux into the consumer and developer markets, said that Ubuntu will also play a part in the next generation of cloud computing platforms.
Speaking in a keynote address at the 2012 Linuxcon North America convention in San Diego, Canonical VP of cloud Kyle MacDonald told attendees that the company sees itself performing particularly well in the scale-out server market.
He noted that social networking firms such as Instagram have favoured Ubuntu builds for their services. Canonical has also developed a number of developer tools aimed at helping to enable cloud computing platforms.
“We are actually spread across a number of different parts of the cloud,” MacDonald said.
“We have learned a lot of lessons about how you build things at a cloud scale.”
The company is also touting a series of partnerships with vendors aimed at furthering Ubuntu and Openstack’s place in the server market. While MacDonald said that Canonical will not be looking to compete with established vendors in markets such as high-availability servers, the company is looking to offer bundled systems for the scale-out market.
The Canonical cloud boss said that the hardware partners include HP and Rackspace, while Dell has worked with the company to develop a preconfigured system designed for Openstack.
“The message I want you to get is that lots of people are turning to Ubuntu,” MacDonald told convention-goers.
“I want you to hear about the people that are putting serious bets behind Openstack.”
Canonical has shown off Ubuntu Web Apps that allow users to interact with web-based applications from the desktop.
Canonical’s Ubuntu Linux distribution has been working on its user interface for a few years now and yesterday Canonical founder Mark Shuttleworth showed off Ubuntu Web Apps, which will allow users to access web applications such as Facebook, Twitter and Gmail from the desktop.
Canonical’s Steve George said Ubuntu Web Apps will give web applications the “full range of desktop capabilities”. He said, “We give applications the full run of our desktops, where they have their own icons and windows, but we trap the whole Internet inside one overworked application, the browser.”
Canonical said Ubuntu Web Apps initially will support Facebook, Twitter, Last FM, Ebay and Gmail web applications among others, for a total of 40. The outfit went to great lengths to show that an Ubuntu Web App is treated in the same way as a standard desktop application.
George continued, “This new feature is part of our drive to make the web a first class part of Ubuntu. We’ve already turned 40 popular web sites into Ubuntu Web Apps and there are plenty more on the way. It’s easy to integrate your favourite website or interface natively into the desktop, and share the result with all Ubuntu users.”
Canonical said it will ship Ubuntu Web Apps as part of its Ubuntu 12.10 release.
Canonical will drop Grub 2 in favor of Intel’s efilinux as its bootloader in order to comply with Microsoft’s UEFI Secure Boot.
Following Red Hat’s Fedora project announcing its plans to ensure that its Linux distribution will not fall afoul of Microsoft’s UEFI Secure Boot mechanism, Canonical has detailed how it plans on working with Microsoft’s ‘security feature’. The company will dispense with Grub 2, a Linux bootloader that it put significant work into, and modify Intel’s efilinux bootloader to add a menu interface.
In an email to the ubuntu-devel mailing list, co-authors Steve Langasek, Colin Watson and Jeremy Kerr said Canonical has generated an Ubuntu signing key to use with UEFI, with the private key being stored on the firm’s Launchpad servers. The authors said that this key will be used to sign bootloader images and distribute them in the Ubuntu archive.
For machines that come preloaded with Ubuntu, Canonical will store the Ubuntu key in firmware. The company will require machines that have “Ubuntu certified” labels to have the Ubuntu key stored in the UEFI signature database.
Canonical will not get into the business of signing third-party images according to the email. “We are not planning to provide an alternative to Microsoft’s signing infrastructure, only an additional key; so we have no current plans to implement a signing service using the Ubuntu key,” said the email authors.
Canonical said it will require the Microsoft key to be present on machines that are Ubuntu certified so users can install Microsoft’s Windows operating system if they wish.
Although Canonical and Red Hat, two of the three largest commercial Linux vendors, have announced their plans to support Microsoft’s UEFI ‘secure boot’ initiative, there’s still no word on what Suse and the myriad other Linux distributions will do.
While analysts scoff at the idea of a Facebook smartphone, one Paris-based marketing expert predicts that a “FacePhone” will crop up in 18 months — and that the social networking giant will grab Nokia for $10 billion to make it happen.
The existing hardware-operating system partnership between Nokia and Microsoft will also play into Facebook’s plans for a smartphone, which means the device would use the Windows Phone operating system, said Paul Amsellem, managing director of Mobile Network Group, a mobile marketing company.
“Facebook will launch the FacePhone. And whether it has a blue color and a logo with a big F on it, it will definitely be disruptive,” Amsellem said in a telephone interview. “Even at this moment, Facebook doesn’t know what it will look like, but they need to do it.”
With Nokia’s stock price declining in recent weeks, Amsellem said that Facebook, flush with cash from its recent IPO, could purchase Nokia for $10 billion, even though the Finland-based device maker is currently valued at around $15 billion. Nokia is already producing Windows Phone models, although they aren’t selling well.
If Facebook doesn’t buy Nokia, it could buy BlackBerry maker Research In Motion for less than $6 billion, to get access to BlackBerry Messenger compression software, Amsellem said. A primary reason to buy either Nokia or RIM would be access to their radio technology expertise and their connections to hundreds of wireless carriers globally — areas where Facebook is notably weak.
Facebook admitted in its IPO filing with the Securities and Exchange Commission that users shifting from desktop and laptop computers to mobile devices were hurting its ability to sell advertisements, which aren’t as predominant on the mobile platforms.
ARM CEO Warren East told The Wall Street Journal that ARM will hold 10 to 20 percent of the notebook market by 2015. He stressed that ARM will be bigger in PCs than Intel will be in mobile, which sounds plausible.
East thinks Intel powered smartphones will eventually manage to grab just 5 to 10 percent of the market. East also argued that the cost of ARM chips in PCs will be comparable to smartphone chips, which means they will be dirt cheap.
The first Windows 8 tablets should hit retail sometime in November and we could see a bunch of devices in different form factors.
According to CNET’s Brooke Crothers, the first wave of Windows tablets will include more than a dozen devices, but more than half of them will be hybrid designs. So, it seems Microsoft and vendors are betting on traditional keyboards to set Windows tablets apart from the competition.
The new tablets will be based on Intel’s dual-core Clover Trail Atoms, but bear in mind that Microsoft will also release Windows for ARM chips and AMD could also enter the fray with some low-voltage APUs.
The next step for Intel is Bay Trail, a 22nm Atom that will succeed Clover Trail sometime in the future. It will also feature integrated 4G support and Intel graphics, rather than Imagination’s.
Microsoft and Intel are said to be working closely with several major vendors developing Windows tablets. Redmond is expected to launch Windows 8 for x86 in September and an ARM version is also on the way.
Digitimes is reporting that as many as 32 Windows 8 tablets will be launched by HP, Dell, Lenovo, Asus, Acer and Toshiba by the end of the year. The aim is to seize a chunk of the iPad market and reduce Apple’s share in the tablet market to 50 percent in 2013.
Of course, it is still early to say how the Windows tablets will fare against the iPad or Android tablets for that matter. They will bring a few interesting features to the table. Many corporate users will no doubt appreciate x86 and Windows compatibility and Microsoft is apparently trying to push hi-res 16:9 panels, thus giving the new a more or less standard PC form factor.
The cheapest Windows 8 tablets are expected to retail for about $300, while high end devices will go for as much as $1000.