GrubHub, Seamless Merging

Two of the nation’s largest online food delivery businesses said they are merging in a deal that they hope will drive more orders, in more cities, through their platforms.

GrubHub and Seamless, which allow consumers to easily order online from various restaurants, are part of a group of fast-growing businesses that standardize local services under a national umbrella. Think restaurant reservations, where OpenTable dominates, or car services, where privately held startups such as Uber are making significant inroads.

“Internet sites are able to aggregate local merchants, and we’re right in the sweet spot,” said Matt Maloney, GrubHub chief executive, in a phone interview.

The services did not disclose financial terms of the deal, which is subject to regulatory approval. It is expected to close by August, the services’ executives said.

Online takeout services allow consumers to browse hundreds of menus online, along with reviews by fellow diners, and then order from the service, which notifies the restaurant. The services store payment information, cutting back on the time it takes to order food.Restaurants like the services because they cut back on phone calls at peak times.

Last year, GrubHub and Seamless coordinated $875 million in takeout sales, resulting in more than $100 million in combined revenue, they said in a statement.

But the overall U.S. takeout business is worth around $69 billion annually, with most of those sales coming from diners picking up the phone and calling the restaurant. “Our number one competitor is the paper menu,” Maloney said.

Both companies have attracted significant backing, including more than $84 million for Chicago-based GrubHub from investors such as Benchmark Capital and Lightspeed Venture Partners.

New York-based Seamless’s backers include private-equity firm Spectrum Equity, which paid $50 million two years ago for a minority stake in the business.

GrubHub is the larger of the two services, covering 20,000 restaurants in 500 cities. Maloney, its founder and chief executive, will become CEO of the combined company, while Seamless CEO Jonathan Zabusky will serve as president.

Seamless currently works with 12,000 restaurants in 40 cities, including in London.

The combined company will have 600 employees.

 

Dell Profit Tumbles 79% On Slowing PC Sales

Dell reported another quarter of anemic profits and falling revenue on Thursday as CEO Michael Dell continues his fight to take the company private.

Dell’s profit for the quarter, ended May 3, was $130 million, down 79 percent from $635 million in the same quarter a year earlier. Revenue declined 2 percent to $14.07 billion.

Dell’s PC division was particularly hard hit. Sales for the quarter were down 9 percent to $8.9 billion, Dell said, and the group’s operating profit skidded 65 percent lower to $224 million. Laptop sales were hit especially hard.

Its enterprise business showed mixed performance. Sales of servers and network gear were up 14 percent but storage was down 10 percent. Dell’s services division reported a 2 percent increase in revenue.

Dell is trying hard to build an enterprise software business, which it hopes will eventually generate higher profits than its PC division. The software group reported an operating loss for the quarter, however, as Dell invested in new sales and R&D staff.

Dell’s earnings for the quarter on a pro forma basis, which excludes one-time items, were $0.21 a share, well off the analyst forecast of $0.35 a share, according to Thomson Reuters.

In a statement, CFO Brian Gladden said Dell’s profits were affected by steps it took to improve its competitiveness. “We’ll also continue to make important investments to support our strategy and drive long-term profitability,” he said.

Michael Dell announced in February that he planned to take the company private in a deal with Silver Lake Partners valued at $24.4 billion. The company founder has said he wants some breathing room to focus on long term investments without the constant scrutiny from Wall Street.

 

 

DreamWorks To Buy YouTube Awesomeness TV Channel

DreamWorks Animation SKG Inc has agreed to acquire teen- oriented YouTube network AwesomenessTV to secure an online platform to showcase family-focused movie franchises such as “Shrek” and “Kung Fu Panda.”

DreamWorks said on Wednesday it will pay about $33 million in cash to acquire AwesomenessTV, with additional payments of up to $117 million ifearnings targets are met in 2014 and 2015. The transaction is expected to be completed this month, it said.

AwesomenessTV is a network of 55,000 YouTube channels, with 14 million subscribers, that feature online talk shows, sketch comedy and scripted and reality series aimed at teens. It is among the original channels that Google Inc-owned YouTube helped bankroll over the past year and a half.

YouTube has spent more than $100 million to help about 150 media partners create and promote specialized YouTube video channels dedicated to topics ranging from food to sports. The idea is to improve the quality of videos on YouTube and to attract a bigger share of television advertising dollars.

AwesomenessTV was founded by Brian Robbins, an executive producer of TV shows, including “One Tree Hill” and “Smallville.” Hollywood talent firm United Talent Agency helped Robbins set up AwesomenessTV in 2010, negotiating its early venture capital funding, the deal with YouTube and the sale to DreamWorks.

Under the deal with DreamWorks, Robbins will take an executive role at the movie studio to develop a digital family channel. DreamWorks movie franchises include “Shrek,” “Kung Fu Panda,” “Madagascar” and current box office hit “The Croods.

DreamWorks CEO Jeffrey Katzenberg has talked about creating a family-themed cable channel since last July, when the company acquired characters such as “Casper the Friendly Ghost” and “Lassie” through its purchase of Classic Media.

On Tuesday, Katzenberg said the company was still pursuing the idea.

“On the cable side of it, again we continue to explore that. We continue to have interest,” Katzenberg told analysts on a conference call after the company released quarterly earnings.

 

Hollywood talent firm United Talent Agency helped Robbins set up AwesomenessTV in 2010, negotiating its early venture capital funding, the deal with YouTube and the sale to DreamWorks.

 

Samsung Snatches More Mobile Phone Market Share From Apple

Samsung Electronics Co Ltd snatched more smartphone market share from its biggest rival, Apple Inc in the latest quarter, with sales of its phones surging to account for one third of the global market.

Sales of the iPhone 5 helped Apple’s volumes grow 6.6 percent to 37.4 million phones in the quarter from a year earlier, but that was not enough to stop its share of the market dropping to 17.3 percent from 23 percent, research firm IDC said.

A flood of cheaper Android-powered devices from the South Korean maker lifted its shipments about 60 percent to 70.7 million, giving it a 32.7 percent of the market, up from 28.8 percent a year earlier.

During the first quarter Samsung shipped more smartphones than the next four vendors combined, IDC said.

The research firm said it was eager to see how new phones from Samsung using its Tizen operating system will look and fit into the company’s product line-up.

Of the top five vendors, only Apple lost market share, with LG Electronics Inc, Huawei and ZTE Corp making incremental gains.

 

 

Sluggish iPhone Growth Hits Apple’s Profits

Apple’s net profit fell during the second quarter of 2013 as the company’s iPhone shipment growth slowed down, based on year-over-year comparisons.

Apple recorded a profit of US$9.5 billion for the second quarter ending on March 30, falling from the $11.6 billion profit reported in the same quarter last year. The company’s revenue was $43.6 billion, growing from $39.19 billion in the year-ago quarter. Analysts expected revenue to be $42.33 billion.

IPhone sales grew, totaling 37.4 million units, compared to 35.1 million in last year’s second quarter; however, in that period last year unit shipments increased by 88 percent year over year. Mac sales were flat, totaling just under 4 million units during the quarter.

The company recorded fast growth with iPads, with shipments totaling 19.5 million during the quarter, compared to 11.8 million in the previous year’s quarter.

Apple CEO Tim Cook in a statement said that new products are in the pipeline.

“Our teams are hard at work on some amazing new hardware, software and services, and we are very excited about the products in our pipeline,” Cook said in a statement.

Announcements could be made at the company’s annual Worldwide Developers Conference, for which a date hasn’t been announced. WWDC is usually held in June in the San Francisco Bay Area.

Apple had no major product releases in the previous quarter. In February, the company upgraded the MacBook Pro with Retina display and MacBook Air laptops with faster processors and more storage.

Apple expects revenue between $33.5 billion and $35.5 billion for the third quarter.

 

 

Xerox Looking To Transform Into Services As Printer Business Fades

Printer and copier maker Xerox Corp forecast current-quarter earnings below estimates as it quickens efforts to transform itself into a technology services provider.

Xerox, whose shares were little changed at midday, also offers services such as managing toll systems and healthcare programs to counter sluggish growth in its printers and copiers business, which accounts for about 40 percent of its revenue.

Services is now the larger part of the company’s business and lower margins in IT and business process outsourcing is dragging overall margins.

The company said it expects second-quarter revenue from its document technology business, which includes printers and copiers, to decline in the mid-single digits. Revenue fell 9 percent to $2.14 billion in the business in the first quarter.

Based in Norwalk, Connecticut, Xerox moved into business services with its purchase of Affiliated Computer Services Inc (ACS) for $5.5 billion in 2009 – the company’s biggest deal in its 106-year history.

Xerox said it plans to quicken the pace of a restructuring plan kicked off in the last quarter of 2012 and included a 2-cent restructuring charge in its second-quarter forecast.

Xerox said it expects flattish revenue for the full year, compared with previous expectations of up to a 2 percent growth, it said on a conference call with analysts.

The company said it was on track to reach its target of adjusted EPS of $1.09 to $1.15 for the full year and to generate operating cash flow of $2.1 billion to $2.4 billion.

“Europe remains weak. US remains stable, but weak. We have not seen a pickup in the US,” Xerox CEO Ursula Burns said on a conference call with analysts.

“We did see a slowdown, a bit of a slowdown, in some developing market economies. But our business model is fairly resilient in the developing markets,” she said.

 

 

 

 

Are Smartphones Killing GPS Gadgets?

First they killed MP3 players, then they came after the point-and-shoot camera market and now it seems smartphones are poised to destroy the market for dedicated navigation devices.

Berg Insights now estimates that shipments of navigation devices dipped from 33 million units in 2011 to 28 million last year. The negative trend is set to continue and by 2017 only 17 million standalone navigation devices will be shipped.

Shipments of navigation devices are still growing in some markets, such as Eastern Europe, South America and India. However, as smartphone penetration increases in emerging markets, the positive trend will probably come to an end.

So what’s next for makers of navigation systems? The future is clearly app-centric, but they will have to come up with new features and new monetization schemes to compete with mapping apps from Google, Nokia and Apple.

Courtesy-Fud

Nokia Sees Improving Windows Phone Sales

Nokia’s sales of smartphones running Windows Phone continued to improve in the first quarter, and its net loss shrank year on year, even as overall revenue declined.

The company reported first-quarter sales of US$7.63 billion, down 20 percent year-on-year, and a net loss of $272 million, smaller than the year-earlier loss of $928 million.

Nokia sold a total of 61.9 million mobile phones during the first quarter, of which 6.1 million were smartphones (including 5.6 million Lumia devices). A year earlier, it sold 82.7 million phones, of which 11.9 million smartphones, and more than 2 million of those were Lumia devices. (Nokia does not categorize phones in its Asha range, even the touch-screen models, as smartphones.)

Since then, Lumia’s fortunes have gone up and down: Nokia sold 4 million in the second quarter; 2.9 million in the third quarter and 4.4 million in the fourth.But the increase seen during the first quarter is good news, according to Blaber.

“This is undoubtedly a sign that its moving in the right direction,” Blaber said.

 

The timing of this sales boost is critical because of the pressure Nokia’s mobile phones have come under, as overall unit sales dropped by 25 percent. It is clear that Series 40-based phones, and the Asha range in particular, are coming under pressure from Android, according to Blaber.

 

“This is the first quarter in a very long time where the smartphone business is showing more positive signs than the mobile phone business,” Blaber said.

 

 

Microsoft Exploring Touch-Enabled Smart Watches

Microsoft is developing designs for a touch-enabled smart watch, joining a number of other large competitors like Samsung Electronics and Apple who are said to be working on similar devices, according to a recent report.

Executives at suppliers to Microsoft told The Wall Street Journal that the company was sourcing components for the prototype of what could potentially be a “watch-style device.”

Microsoft has, for example, requested 1.5-inch displays from component makers for the prototype, an executive at a component supplier told the newspaper. It is unclear whether the company will decide to go ahead with the watch, the newspaper added.

Microsoft could not be immediately reached for comment.

A large number of vendors are looking at new product categories beyond smartphones and tablets.

This isn’t the first time, however, that Microsoft may be looking at watches as a product. It launched a smart wrist watch around a concept called Smart Personal Object Technology it unveiled in 2002, but withdrew it after a lackluster performance.

The Redmond, Wash., company is seeing its key PC market under threat from smartphones and tablets, and the failure of its new Windows 8 operating system to boost sales significantly. IDC said last week that first quarter PC shipments totaled 76.3 million units, down 13.9% compared to the same quarter last year. (The decline was worse than the 7.7% previously forecast by the analyst firm, and the market could be headed into further contraction, the research firm added.

 

 

Samsung Goes Even Bigger With Latest Smartphones

Samsung did it again, announcing two even larger Galaxy Mega smartphones with 5.8-in. and 6.3-in. LCD HD screens.

The Mega 5.8 and the Mega 6.3 both run Android 4.2 and will ship globally, starting in Europe and Russia in May, Samsung said in a statement. Pricing and wireless carriers have not been announced.

The trend toward bigger screens is already well-established with Samsung and other Android phone makers. Samsung’s Galaxy Note II smartphone-tablet features a 5.5-in. display, while its upcoming Galaxy S4 will have a 5-in. HD Super AMOLED display.

By comparison, the popular iPhone 5 has a 4-in.display, the first in the iPhone line with a screen of more than 3.5 inches.

Samsung also has a penchant for offering devices in a variety of sizes and form factors. Its four basic Galaxy Tabs have displays ranging from 7 to 10.1 inches.

Samsung manufactures many of its own device components, making the cost of rolling out different sizes of devices more manageable than if it relied only on third-party suppliers.

Still, the increasing sizes of the smartphones has given some analysts pause.

“How many more sizes will we have?” asked Gartner analyst Carolina Milanesi. The ideal size for one-hand usage is 4.3-in., she said, well short of what Samsung has been promoting in the past year.

She said a small person can use a smartphone with a 6-in. display, but mainly as a phone “and anything more is a push.”

Milanesi suggested that Samsung may be offering the Mega as an experiment to see what customers prefer.

“I am not sure Mega is anything other than an experiment to see what consumers like, but that can be an expensive experiment,” she said.

It may be an experiment that Samsung can afford. The Seoul-based company sells half of all the Android phones globally, and phones running Android make up nearly 70% of the entire smartphone market globally, according to Gartner and IDC.

 

 

 

GM Changes Its Mind, Decides To Re-join Facebook

After dumping Facebook almost a year ago, General Motors is back, running an advertising test on the social network.

GM, one of the country’s largest advertisers, said in an email to Computerworld that it is testing paid ads geared toward Facebook’s mobile users The ads are for the Chevrolet Sonic, a car aimed at younger drivers.

“Chevrolet is testing a number of mobile advertising solutions, includingFacebook, as part of its ‘Find New Roads’ campaign,” said Chris Perry, vice president of U.S. Chevrolet Marketing, in the email. “Chevrolet launched an industry-first ‘mobile-only’ pilot campaign for the Chevrolet Sonic that utilizes newly available targeting and measurement capabilities on Facebook. ”

The company noted that it has had ongoing dialogue with Facebook over the past year regarding potential advertising and promotional opportunities.

GM’s return to Facebook is of special note because the company pulled its advertising dollars from the social network last May, days before Facebook launched its initial public offering amid a media frenzy. GM pulled its $10 million ad campaign, saying paid ads on the site were ineffective.

While it would no longer pay for ads on the site, GM said at the time that it would continue to have a presence on Facebook and would work on building up its social media followers.

It was not the kind of news that Mark Zuckerberg, CEO and co-founder of Facebook, could have wanted coming so close to the company’s IPO, which ended up not doing nearly as well as industry analysts had anticipated.

GM’s return, even if on a pilot basis, has to be good news for the social network and could potentially pull in more mobile advertisers, said Ezra Gottheil, an analyst with Technology Business Research.

 

 

 

PC Quarterly Sales Plummet

Personal computer sales plummeted by 14 percent in the first three months of the year, the biggest decline in two decades of keeping records, as tablets continue to market share. Buyers appear to be avoiding Microsoft Corp’s new Windows 8 system, according to a leading tech tracking firm.

The huge drop over a year ago, the steepest since International Data Corp started publishing sales numbers in 1994, mark a new milestone in the apparent decline of the age of the PC as computing goes mobile via tablets and smartphones.

That marked the lowest level since the middle of 2009, according to competing data tracker Gartner Inc, which published its own figures showing an 11 percent decline on the same day.

Both firms blamed the sales drop on fading sales of netbooks, the small laptops that have been rendered obsolete by tablets, and more consumer spending going toward smartphones.

“Consumers are migrating content consumption from PCs to other connected devices, such as tablets and smartphones,” said Mikako Kitagawa, an analyst at Gartner. “Even emerging markets, where PC penetration is low, are not expected to be a strong growth area for PC vendors.”

Microsoft’s new Windows 8 actually deterred potential PC buyers, IDC said, as users felt they could not afford touch-screen models required to make the most of Windows 8, even though the system runs equally well on standard PCs and laptops.

“People think they have to have touch, and they go look at the price points for these touch machines, and they are above where they want to be and they say, ‘I guess I’ll wait,’” said Bob O’Donnell, an analyst at IDC.

O’Donnell said other users were simply uncomfortable with the new Windows system, which dispensed with the familiar start menu and uses colorful ’tiles’ to represent applications.

New Microsoft operating systems usually boost PC sales, but the lukewarm reception for Windows 8 will likely mean an even greater drop in the market this year, said Jay Chou, senior research analyst with the IDC unit that tracks PC sales.

“Users are finding Windows 8 to offer a compromised experience that doesn’t excel either as a new mobile interface or in a classic desktop interface,” he said. “As a result, many users find a decline in the traditional PC experience without gaining much from new features like touch. The result is that many consumers are worried about upgrading to Windows 8, to say nothing of business users who are still just getting into Windows 7.”

Among manufacturers, Hewlett-Packard Co saw a 24 percent decline in sales in the quarter, but narrowly held on to its title of No. 1 global PC supplier, with 15.7 percent market share. Fast-growing rival Lenovo Group managed to keep sales flat and is now just behind HP with a 15.3 percent global share.

Dell Inc, roiled by plans to go private, along with rivals Acer Inc and Asustek, all saw double-digit declines in PC sales.

Apple Inc was not immune from the decline, as some sales of its own Macs appeared to be displaced by iPads. Its U.S. PC sales fell 7.5 percent in the quarter, but it held on to its spot as No. 3 U.S. PC manufacturer, behind HP and Dell.

 

Amazon, Google Both Drop Cloud Computing Rates Again

Just as industry experts have predicted, the race to the bottom for cloud computing prices continues.

On Thursday, while announcing that the beta tag has been removed from the Google Compute Engine (GCE) cloud service, Google also reduced prices for the on-demand virtual machines by 4% across the board.

Not to be outdone, about 12 hours later — almost as if it was waiting for a competitor to make such a move — Amazon Web Services (AWS) announced a 26% drop in prices for its Windows virtual machines (VMs) on demand. Take that Google, AWS seemingly said.

Like most of the price reduction announcements from AWS, the market-leading cloud computing infrastructure as a service (IaaS) provider, this week’s announcement of a price drop on AWS virtual machines (VMs) applies to only a subset of its services, this time focusing on its Microsoft Windows products.

Pricing for the default small VM running Windows OS dropped from $0.115 per hour to $0.091 per hour, a 21% drop. Other Windows VM types also fell in price, in some cases by an even higher percentage, including high-memory (now $0.51 per hour) and high-CPU (now $0.225 per hour).

The news of AWS’s price reduction was seemingly in response to the announcement by Google that same day of its Amazon-competitor cloud. In ablog post earlier in the day on Thursday, Google engineers said the beta tag has been taken off the company’s GCE. The IaaS on-demand VM service complements its Google App Engine (GAE) platform as a service (PaaS) already available on the market. Customers can now use GCE without being invited to do so by Google and without special arrangements from a salesperson, it said. There is a catch though: It requires a Gold support package, which costs $400 a month and includes 24/7 phone support and consultation on architecting the service.

As part of announcing the semi-general availability of its GCE, Google also announced a 4% price reduction of GCE prices. A standard GCE VM now costs $0.132 per hour, compared to $0.138 previously — a 4.3% reduction in price. Though slightly more expensive than AWS’s default VM, GCE’s standard single-core VM packs more compute power than AWS’s standard VM offering. GCE’s base-level VM comes with 3.75GB of memory and 420GB of local disk, while AWS’s standard offering comes with 160GB of local storage and 1.7GB of memory. Both AWS and GCE offer high-capacity VM sizes as well.

 

 

Google To Launch New Nexus 7 Tablet In July

Google Inc will offer a new version of its Nexus 7 tablet powered by Qualcomm Inc’s Snapdragon processor around July, according to two sources, as the software giant pushes deeper into the cut-price mobile hardware market.

Google is aiming to ship as many as eight million of the Asustek-made tablets in the second half of the year, throwing down the gauntlet to other low-end tablets such as Amazon.com Inc’s Kindle Fire and Apple Inc’s iPad mini, the sources with knowledge of the new product said.

Google, which gets almost all of its revenue from online advertising, wants the aggressively priced Nexus tablets to be a hit as more Nexus users would mean more exposure for Google’s ads.

The latest version will have a higher screen resolution, a thinner bezel design and adopt Qualcomm’s chip in place of Nvidia Corp’s Tegra 3, which was used in the first Nexus 7s released last year, the sources said, declining to be identified because they are not authorized to speak to the media.

In a blow to Nvidia, Google weighed both U.S. chipmakers’ processors but finally decided on Qualcomm’s for power reasons, one of the sources added.

Qualcomm and Nvidia are competing aggressively in the tablet market as they seek to expand from their traditional strongholds of cellphones and PCs respectively.

A Google spokesman declined to comment on its new tablet. Qualcomm and Nvidia also declined to respond to questions.

 

 

Microsoft Expanding Surface Pro Sales To China

Microsoft will begin offering the Surface Pro tablet in China in April, the company said.

According to the company’s Chinese e-store, the Surface Pro will go on sale April 2 at 9 p.m. local time.

The Chinese debut will be the tablet’s first market expansion since its U.S. and Canadian launch on Feb. 9. Microsoft first announced the Surface Pro’s availability on the Chinese-language Weibo social networking service.

LiveSino.net reported earlier in the day that Microsoft was introducing the tablet in China on Tuesday.

It’s been no secret that China was on the short list for the Surface Pro. Three weeks ago, Microsoft said the Windows 8 Pro-powered device would go on sale in several more markets in the second quarter, including Australia, China, France, Germany, Hong Kong, New Zealand and the U.K.

The Microsoft Store does not show prices for the Surface Pro, but another Chinese website,WPDang, said the 64GB model would cost 6,588 yuan, equivalent to $1,061. The higher-priced 128GB Surface Pro, meanwhile, will be priced at 7,388 yuan ($1,190).

U.S. prices for the Surface Pro are $899 (64GB) and $999 (128GB).

Microsoft has to hope that the Surface Pro does better in China than the lower-priced Surface RT predecessor: Research firm IDC pegged shipments — which are different, usually higher, than sales — of the latter in China at just 30,000 units during the last two months of 2012′s fourth quarter. Worldwide, Microsoft shipped approximately 900,000 Surface RTs in the same period, IDC said.

Microsoft’s Chinese move hints that stock shortages have been solved. While the Surface Pro is now ready to ship from Microsoft’s U.S. e-store, last month the 128GB configuration’s availability was spotty for several weeks following the tablet’s launch.

 

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