mocoNews

Obama Campaign Nominates Square To Gather Mobile Contributions

Tom Krazit — Mon, 30 Jan 2012 12:53:39 PST

It’s an election year, which means politicians are frantically trying to raise money for their campaigns. President Obama’s re-election campaign has decided to add Square’s mobile payments technology to its arsenal and is deploying the company’s credit-card readers to its staff.

Square makes a card reader that plugs into an iPhone or Android phone along an application that lets pretty much anyone take payments using credit cards. Politico reported Monday that the Obama campaign plans to use the devices during the run-up to November’s election, which was confirmed by a Square representative.

It’s a nice boost for Square, which has been trying to buck the NFC-based mobile-payments system that several other industry giants have been pushing. Unlike those other approaches (which I think will eventually have merit) Square’s technology is much easier to get up and running: companies like Google (NSDQ: GOOG) that are trying to gain acceptance for Google Wallet need people to buy an NFC-equipped Android phone as well as convince retailers to stock the right equipment.

Analyst Estimates Amazon Has Sold 6 Million Kindle Fires

Tom Krazit — Mon, 30 Jan 2012 11:47:24 PST

Given Amazon’s reluctance to disclose hard numbers regarding the number of Kindles it has sold and the interest in the Kindle Fire as a tablet competitor, we’re left with estimates that hopefully used some sort of scientific method. One Wall Street analyst thinks he has a number.

Stifel Nicolas’ Jordan Rohan put out a research note Sunday (spotted by AllThingsD) with an estimate that Amazon (NSDQ: AMZN) sold 6 million Kindle Fires during the holiday season. Amazon’s take on an Android tablet has probably made the most impact among consumers looking for iPad alternatives, mostly because of its price tag, but Amazon has consistently danced around providing actual shipment totals for its Kindle division.

The company would only say that it had sold “millions” of the Kindle Fire in announcing post-holiday “numbers,” but it seems pretty likely that the Kindle Fire is faring much better than the Motorola (NYSE: MMI) Xoom, Samsung Galaxy Tab, or BlackBerry Playbook in the market. Amazon releases its quarterly earnings tomorrow, which gives the company an opportunity for clarification that they will most likely decline.

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T-Mobile UK Re-Introduces Unlimited Data, Betting Few Will Gulp It All

Ingrid Lunden — Mon, 30 Jan 2012 16:20:14 PST

T-Mobile in the UK today announced “The Full Monty,” a group of mobile plans offering unlimited voice, texts and data, without any fair-use restrictions. While other carriers are looking to restrict data use they claim costs too much to carry, T-Mobile’s groundbreaking offer appears like a sacrifice on margin to gain market share. But is it?

Maybe not: Almost exactly a year ago, T-Mobile UK was (ironically!) the subject of a backlash when it suddenly informed its customers that it would be changing the caps on its data usage and putting them down to 500MB from 3GB.

In the event, it ended up partly reversing that policy after a lot of public outcry. But not before revealing an interesting fact: most people on its network, it said, didn’t use more than 200MB in a month.

Mobile data consumption—the thing that gives carriers a margin headache these days—is definitely on the rise as more people take up smartphones. Similarly, mobile data consumption per user is also on the rise as those consumers get bombarded with more apps, more rich-media ads, and more interesting mobile internet sites.

But for the majority of people, mobile data use is perhaps not rising as drastically as multiple, unlimited gigabyte allowances would have you believe:

Ben Fritsch, head of propositions for T-Mobile UK, puts the amount of mobile data usage growth over the last year for his network at “over 250 percent”. More specifically, research published by Nielsen in the U.S. last month showed that mobile data usage over one year grew between 91 percent and 256 percent, depending on the age group. If you apply those numbers to 200MB and assume that the UK is following similar growth as the U.S., data usage has grown to between 290MB and 450MB used per month.

Cisco (NSDQ: CSCO) meanwhile projects that the average UK user will consume just over 4GB in mobile data by 2015, but as of the end of 2010 that figure was less than 300MB.

So although T-Mobile could be giving out an unlimited offer, it may well be banking on the premise that people will not be using it as nearly much as they could.

There is a caveat to this, but again only for the most pro-active of consumers: T-Mobile will let people tether other devices to the same connection to share the data love. Consuming a video on a tethered laptop or tablet could see that data spike go up significantly higher for those who are happy to do this via a 3G data connection.

The Full Monty tariffs range in price between £36 and £61 ($56 and $96) per month on 48-month deals, and give users a range of phones along with them, including some of the market’s current bestsellers like the iPhone 4S. That puts the Full Monty on the pricer range of the tariff spectrum—for example when you compare them to those offered by Orange UK, which shares network with T-Mobile in the Everything Everywhere JV in the UK, which combined is currently the country’s largest operator. Phone tariffs that include some allowance for 3G mobile data sell for as low as £10 per month in the UK.

The Full Monty tariffs also include unlimited calls and unlimited texts, with the higher-priced options also blowing off a 2,000-minute cap to mobile numbers on other networks. But all of them also have a number of exceptions in small print. “Calls to 08 (including 0870) or 070 numbers are premium rate numbers and excluded from your inclusive allowances,” T-Mobile writes. Plus, “Calls to 0800, 0808, 0845 and other 08 numbers cost 40p/min,” and: “Picture messages are not included within the allowance.” And international numbers, of course, would also be charged at a higher rate, as would roaming calls and data.

The other important thing to point out here is that while T-Mobile is getting some publicity bang for its buck in putting out an unlimited plan, it’s not a given it will be making its way to the rest of the T-Mobile footprint, including the U.S. or the rest of Europe, any time soon. When asked whether there were plans to take The Full Monty on a world tour, a spokesperson told paidContent, “Not at present.”

The point here is that while offering something “unlimited” to users can appear very generous and very competitive, it’s always worth checking how much you actually use your phone, and where, before forking out for an unlimited, and actually quite premium-priced, plan. It looks like it’s a calculation that T-Mobile has made quite keenly itself.

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Reports: Barnes & Noble Partnership With Waterstones; New Nook

Laura Hazard Owen — Mon, 30 Jan 2012 05:37:10 PST

Two separate reports published this weekend suggest that Barnes & Noble (NYSE: BKS) is close to a partnership with UK bookstore chain Waterstones and, perhaps separately, will release a new Nook this spring.

The first article is from Bloomberg. According to ” to a person familiar with the situation,” Barnes & Noble will partner with the UK’s Waterstones to add the Nook to its roughly 300 locations. Barnes & Noble VP digital content Theresa Horner said last month that the company would bring the Nook to the UK “in the not too distant future” and a partnership with Waterstones has been rumored since last year.

The second article is from the New York Times (NYSE: NYT). It reiterates the idea that B&N’s first international stop will be Waterstones, and also reports:

At [Barnes & Noble’s] labs in Silicon Valley last week, engineers were putting final touches on their fifth e-reading device, a product that executives said would be released sometime this spring. (A Barnes & Noble spokeswoman declined to elaborate.)

It’s unclear from those sentences whether the fifth e-reader is related to a Waterstones partnership or is a new device for U.S. audiences. We also don’t know if it’s a dedicated e-reader or a tablet.

Barnes & Noble declined to comment on both reports.

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RIM In Trouble In Europe? Not In The UK, It Claims

Ingrid Lunden — Mon, 30 Jan 2012 05:17:32 PST

RIM (NSDQ: RIMM) is taking a beating at the moment from handset makers like Apple (NSDQ: AAPL) and Samsung, which have eaten into a smartphone market share that it took years for the BlackBerry maker to build on both sides of the Atlantic. RIM, however, claims that it is still the company to beat in one of its key markets, the UK—although its lead is narrowing.

The news comes amid a report in the New York Times, based on statistics from Forrester, that indicate that while Apple is hurting RIM most in North America, in Europe it is Samsung that is the Canadian company’s bete noir.

According to figures out today from research firm GfK, BlackBerry has managed to hold on to its title as the best-selling smartphone brand in the UK market for the second year running. It took 26.3 percent of all sales in December and averaged 27.7 percent of all sales in 2011.

That must be some relief to the company, but is still lower than figures that GfK released at the same time last year for 2010. That year, RIM’s BlackBerry devices took 28.2 percent of all smartphone sales for 2010, and did significantly better during the crucial holiday shopping season, taking 36 percent of all sales during the month of December. In 2011, the iPhone 4S by all accounts made a big splash in terms of sales for the month of December, which would have most definitely dampened RIM’s sales.

GfK’s figures also appear to run contrary to others released by WPP’s Kantar Worldpanel ComTech, which found that, in fact, it was Android that took the lion’s share of sales in the UK market in the final quarter of 2011. It claimed that RIM took only 16.1 percent of sales in the UK for the 12 weeks that ended December 26—a decline of 7.3 percent—while Android took just under 44 percent of sales, growth of 8.4 percent. Apple’s share grew the most, by 12 percent, to end at 34 percent of all sales.

RIM in a statement today said that its global subscriber base grew by 35 percent in December, and now stands at 75 million, with 8.5 million of them in the UK.

We have reached out to GfK to ask how RIM’s sales in the UK compared with the rest of Europe, and to see if it can shed a bit more light on why its numbers vary so much from those of Kantar’s.

Perhaps most damaging to RIM is that while its share in consumer purchases appears to be eroding, so too is its enterprise share. Forrester says that in a survey of enterprise users RIM (at 26 percent) is nearly level with Android (27 percent) and iOS (24 percent) among business users globally.

While RIM faces some delays in rolling out the newest edition of its BlackBerry OS, BlackBerry 10, it is releasing an incremental upgrade to the existing BlackBerry 7 “in the coming months.” That will include NFC capabilities through BlackBerry Tag and the ability to make your RIM handset into a mobile hotspot.

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Farewell, Yahoo Apps, We Hardly Knew Ye: Deals, News Plus Eight Others Gone

Ingrid Lunden — Mon, 30 Jan 2012 03:29:37 PST

Looks like new CEO Scott Thompson is wasting little time starting to get Yahoo’s house in order: just a few weeks into the new CEO’s tenure, the internet company is pulling support for 10 of its less-popular mobile apps.

In a blog post from Friday afternoon—the traditional time that many companies like to break bad news—Yahoo (NSDQ: YHOO) announced that it would stop developing and supporting 10 apps that it offers across various mobile platforms. They are Yahoo! Meme (iPad and iPhone); Yahoo! Mim (iPad); Yahoo! Answers (Android); Yahoo! AppSpot (Android and iPhone); Yahoo! Deals (iPhone); Yahoo! Finance (BlackBerry); Yahoo! Movies (Android); Yahoo! News (Android); Yahoo! Shopping (iPhone) and Yahoo! Sketch-a-Search (iPad and iPhone).

As you can see, the list is a mix of some of Yahoo’s more popular online brands and some services it created especially for mobile users, but all have one thing in common: they weren’t being used much by consumers. In the words of Yahoo itself, it is removing the apps as part of its effort “to continuously measure and scrutinize what’s working and what isn’t” as part of a new “mobile first” strategy.

What isn’t working? Yahoo has for years now been steadily falling behind Google in terms of how it has tackled the mobile opportunity.

This latest move seems like a particularly damning admission in the case of popular online brands such as Yahoo’s news and finance portals: it is yet another demonstration that Yahoo has failed to find mobile traction with consumers in some more obvious areas.

Meanwhile, others like Meme (Yahoo’s microblogging network), Deals and Shopping (mobile commerce initiatives) are signs that Yahoo’s attempts at creating me-too services to mimic those from more popular brands—like Twitter in the case of microblogging, or Groupon (NSDQ: GRPN) in the case of deals—have not come to much, either, at least on some platforms.

As for what is working, Yahoo says that it will continue to support a number of other apps: for now, News and Finance will continue, for example, on iOS; as will Sports, Mail, Messenger and Flickr. Yahoo is also pressing on with two new apps it launched last year, IntoNow, a GetGlue-like ‘check-in’ app for TV and other entertainment viewing; and Livestand, a Flipboard-like aggregated magazine (pictured).

But given that it’s easy enough to describe these apps in terms of popular competing services, one has to wonder if their days will also be numbered if take-up doesn’t take off.

Yahoo also notes that some of the technology in the de-commissioned apps, meanwhile, will be making its way into some of the apps that are staying online.

In his plans for building up Yahoo’s audience, usefulness and credibility once again, Thompson has made a point of talking up Yahoo’s culture of innovation—he mentioned it on his first conference call after taking the job; and again last week during his first quarterly earnings call. This should be the company’s way of making space to be able to execute on some of those ideas, and indeed Yahoo says it will be releasing new mobile products this year.

In that sense, it’s probably a step in the right direction. Thompson still has a very big task ahead, though, to convince an increasingly more distracted consumer base that this slightly tired Internet brand is one worth watching for the future.

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Your iPhone Has To Be Made In China, And Apple Can't Absolve Your Guilt

Tom Krazit — Mon, 30 Jan 2012 03:02:09 PST

“For a quarter of a century, Washington and Wall Street have wanted China to become an integral part of the world economy. Their wish has been granted, and now it’s time to come to grips with the implications.”—Jeffrey Garten, Yale, June 2002 (BusinessWeek)

Ten years after those words were written we still find ourselves wringing our hands over how much American prosperity is derived from Chinese manufacturing. A series of articles from The New York Times (NYSE: NYT) this week on Apple’s tricky relationship with the company that builds the iPhone and iPad makes it clear that while society may occasionally recoil at the human cost required to build our flashy mobile toys, when it comes to consumer electronics there is no Plan B.

A predictable series of questions emerged in the wake of those reports, which didn’t break a ton of new ground on the business practices of Foxconn but did well to explain how conflicted the tech industry can be about China. Foxconn, an electronics manufacturing giant headquartered in Taiwan that employs hundreds of thousands of people in China, has been Apple’s most important partner during its climb to the top of American business, cranking out the 315 million iOS devices that Apple (NSDQ: AAPL) has sold over the last five years at a reliable clip and an attractive price.

Why doesn’t Apple build the iPhone in the U.S.? How much do its executives really know about conditions in these factories? If they do know, why do they tolerate it? If they don’t know, how could they be so naïve as to not wonder at how tens of thousands of iPhones emerge from a drab factory in the middle of China overnight?

The answer to the first question is easy. China is the world’s workshop, having invested heavily in manufacturing and infrastructure over the last 20 years, and its advantages in consumer electronics are maybe even more pronounced. A complex network of electronics producers and suppliers has sprung up in cities like Shenzhen and Chengdu, much the same way that London and New York are centers of finance and Los Angeles dominates entertainment production.

There’s nowhere else in the world you can build a modern smartphone or tablet as cheaply, easily, and reliably as the massive factories of companies like Foxconn, which operate on a scale that is difficult to comprehend. The price for doing business with companies like Foxconn is living with the knowledge that these products are being built by people who have signed up for a modern-day version of indentured servitude.

So what can be done about that? Can foreign companies really force their suppliers to adhere to a standard pretty far above the basic requirements (assuming there are any) of their local governments?

They certainly do try. Clothing and sporting-goods companies were the ones in the crosshairs a decade ago, when a series of reports on the horrifying conditions that were employed to produce $120 Air Jordans prompted companies like Nike and The Gap to impose conditions on suppliers and adopt codes against doing business with companies that exploited their workforce.

So how are they doing?

Nike actually hasn’t released a supplier responsibility report in a few years. The Gap released one for 2010 in which it found that more than 50 percent of the 320 factories it buys from in “Greater China” did “not equip machinery with operation safe devices and inspect on a regular basis” and that somewhere between 10 percent and 25 percent forced workers to work seven straight days on occasion and “did not pay overtime & incentives as required.”

Apple released far more detail about its suppliers in its 2012 supplier report, which was obviously constructed with the knowledge that the Times was planning a series of articles around the same time. Apple also went a little further in saying whether or not it had stopped doing business with a particular supplier over issues detailed in the report, something The Gap did not include.

As should be clear by now, Apple is only being singled out by the Times because it is at the top of the tech heap, and while that may be fair game given Apple’s unbelievable profit, it overstates the ability of the company to act as a macroeconomic force.

Apple CEO Tim Cook told employees Thursday that the company is doing everything it can. In a company-wide e-mail sent in response to the Times articles and obtained by 9to5Mac.com, Cook wrote:

We know of no one in our industry doing as much as we are, in as many places, touching as many people. At the same time, no one has been more up front about the challenges we face. We are attacking problems aggressively with the help of the world’s foremost authorities on safety, the environment, and fair labor.

The truth is that an entire consumer electronics industry depends on these factories for their livelihoods; the dozens of companies and millions of people that have made a handsome living on the spread of mobile technology, gaming consoles, and high-definition televisions into everyone’s lives. And China depends on the demand for its manufacturing services driven by Western consumers who want quality goods at a low price, knowing that few other operations are able to hit those targets as consistently as its homegrown manufacturing base.

U.S. tech companies have a very complicated relationship with China. It’s the world’s largest potential consumer electronics market and is home to the world’s best tech manufacturing companies, but it is run by a government that encourages censorship, tolerates working conditions that other countries made illegal many years ago, and favors domestic companies to an unnerving degree.

Engagement in hopes of changing the situation on the ground has yet to work, as anyone who worked for Google (NSDQ: GOOG) in early 2010 will readily attest. So what can Apple do to improve working conditions at its Chinese suppliers?

It could use some of its $97 billion cash hoard as a carrot and the threat of losing its formidable business (Foxconn has no customer more important than Apple) as a stick. But unless Apple is willing to incur significant risk and set up its own manufacturing facilities governed by its own principles within China (something which, to be clear, may not be permitted by either China or the U.S.) it is dependent upon suppliers that have different standards when it comes to the well-being of their employees. And changing the labor laws of a foreign country is not necessarily a project that a U.S. company can throw money at and cross its fingers hoping everything works out.

The truth is pretty simple: the modern consumer electronics industry couldn’t exist without companies like Foxconn. And Apple can’t just take its ball and go home: there’s nowhere else in the world one can find an industrial system that could replace what China has built, and attempts at building an alternative might take decades.

Apple is right to keep pressure on its suppliers to improve conditions, and critics are right to ask the company to do even more. But even Apple doesn’t have the clout to reverse two decades of economic history that has led to the status quo, in which low-cost Chinese manufacturing props up the consumer-driven U.S. economy.

How much change Apple can really bring to an irreplaceable partner born of a country without enough respect for the basic human rights of its people?

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Report: Facebook IPO Could Arrive Next Week With Hopes Of $10 Billion

Tom Krazit — Fri, 27 Jan 2012 11:12:55 PST

The long-awaited Facebook IPO might arrive as soon as next week, according to a new report. When the company does get around to filing the paperwork it will set Facebook on the path toward one of the richest IPOs in tech history.

Facebook could raise as much as $10 billion when shares of its stock are sold to the public, and the usual “people familiar with the matter” are telling the Wall Street Journal that the first step could come by next Wednesday. It is believed to be preparing an offer that values the company between $75 billion and $100 billion, according to the report.

That will also allow the public to get a peek at Facebook’s financial statements, a chance to see how effectively the social giant is making money on its 800 million users. Facebook is believed to be solidly profitable, unlike a few other tech IPOs from last year, and is increasingly making Google (NSDQ: GOOG) nervous with its ability to provide extremely targeted data to advertisers.

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Jesta Digital Finally Kills Bitbop Mobile Video Service

Ingrid Lunden — Fri, 27 Jan 2012 10:20:06 PST

It looks like the death spiral that was the Bitbop mobile video service is finally no longer. PaidContent understands that the service—once built and owned by News Corporation (NSDQ: NWS) and sold, along with the rest of Fox Mobile, to IT services company Jesta when News Corp. couldn’t make a business out of it—is today laying off most of the staff that worked on Bitbop and shutting down the service.

According to a source, there are about 50 people getting laid off—people who worked on the Bitbop mobile video service. A small group will stay on to help with the final wind-down of operations, which should take about four weeks. The services that were live in the U.S. and Germany are getting shut down today, we have been told.

There were once big hopes for Bitbop, but things took a challenging turn as competition in the form of Hulu, Netflix (NSDQ: NFLX) and others invested heavily in their streaming services and delivering them to mobile devices.

However, this is not the end of Jesta Digital. The Jamba ringtones business—a German company that News Corp. once paid nearly $400 million to purchase in 2008—is still a healthy cash generator, and it will continue to operate.

Bitbop is understood to have some 20,000 subscribers who pay $9.99 per month to receive premium mobile video services. But with the service never getting a coveted outlet via an iPad app, it’s had a hard time scaling up, and with many of its original content deals up for renewal at the moment, it looks like it became clear that Bitbop’s business model was no longer sustainable.

Earlier in January, we noted the problems at the company, including some executive departures. At the time, Jesta told paidContent in a statement that it would continue to develop new mobile products in the future, without specifying what they were.

We will update this story as we learn more.

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Former Palm CEO Rubinstein Leaving HP After Demise Of WebOS

Tom Krazit — Fri, 27 Jan 2012 09:52:19 PST

Jon Rubinstein, the former Palm CEO who revived the company under WebOS but was never able to produce a breakthrough product after HP paid $1.2 billion for Palm, is leaving HP (NYSE: HPQ). His departure is not exactly a surprise, coming six months after he was reassigned just before HP began to wind down its mobile strategy.

Rubinstein, a former Apple (NSDQ: AAPL) executive who played a key role in the development of the iPod and the iPhone, had been working in a fuzzy role within HP’s Personal Systems Group after ceding day-to-day control of the WebOS business unit to Stephen DeWitt in July. Of course, by August the WebOS business itself was put out to pasture following then-CEO Leo Apotheker’s decision to halt development of the Touchpad.

His next destination, however, will be quite interesting. AllThingsD, which first reported the news, said that the timing of his departure was related to a commitment made to HP following the Palm deal in 2010 to stay on for 12 to 24 months.

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Analyst: Google Threat To Big Ad Agencies Like WPP, Publicis 'Unwarranted'

Ingrid Lunden — Fri, 27 Jan 2012 07:26:53 PST

Google (NSDQ: GOOG) is a massive player in the digital advertising world, but given that this remains only a part of the overall ad market, the Internet giant will not soon pose a real threat to big ad agencies of the world like WPP, Interpublic and Omnicom, according to a report out today from Pivotal Research Group.

Pivotal, which today initiated coverage on WPP, Interpublic and Omnicom, wrote in a lengthy report that its analysts “remain skeptical” the companies that have made a big splash in online advertising, like Google, Microsoft (NSDQ: MSFT)—or presumably Facebook—will ever actively compete with agencies.

The reason for this, they write, is that digital media companies will want to retain their margins, which are “signficantly higher” than those that big agencies get for their services. Pivotal’s analysts also emphasize that agencies still continue to offer a greater degree of independence to brands when advising on how and where to spend ad dollars online.

There have been a few hits and misses up to now among internet companies that have tried to bring their ad technology to non-online mediums: Google in 2009 pulled out of its own attempt at serving radio ads; but it continues to have a business in selling TV ad inventory (with one recent deal, with Cox, announced during CES earlier this month).

Despite that, Google, it seems is just a big fish in a still-small pond: according to ZenithOptimedia, in 2011 digital advertising made up just under 16 percent of total ad spend worldwide, or $73.8 billion. Google last week reported that it made $36.53 billion in advertising revenues, just under half of ZenithOptimedia’s estimated total.

So what is the bigger threat to agencies? It may surprise you to hear Pivotal’s opinion: IT services firms along the lines of Accenture and IBM, who are building platforms to help execute media campaigns, and to leverage the business and strategic consulting positions they already have with these brands. One recent deal, in which Deloitte picked up a mobile app developer called Ubermind—one of whose biggest clients is Apple (NSDQ: AAPL), among a number of other big brands—very much attests to this theory of the encroaching role of the IT services company.

One more possible competitive threat—another surprise here—are some of the businesses that have traditionally been seen as the recipients of agencies’ work: publishers. Pivotal cites both Hearst and Meredith (NYSE: MDP) as two publishers that have built up positions in ad technology like search engine marketing, areas where ad agencies are also looking to get more business. This, too, comes as no surprise: many of these publishers have seen their ad revenues in traditional business like print magazines get eroded over time—a trend that looks set to continue—and so they too need to look at new aspects of the advertising business model to find new sources of income.

Big agencies, of course, are not standing by idly, either—they are all spending serious money building up their digital assets. WPP is highlighted by Pivotal for thinking ahead on multiple fronts is not just investing into digital ad businesses, but doing so particularly to build out their holdings in emerging regions, like Asia.

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Can A Streaming Audiobooks Service Work?

Laura Hazard Owen — Fri, 27 Jan 2012 05:50:07 PST

Audiobooks.com, a cloud-based streaming audio service for iOS and Android, launches this week as a would-be competitor to the Amazon (NSDQ: AMZN) owned-Audible.com. Considering how many people listen to audiobooks while they are in transit, though, is a streaming service actually a workable solution?

Audiobooks.com charges users $24.95 per month to listen to an unlimited number of audiobooks from a catalog of around 11,000 titles. Compare that to Audible.com, which has a catalog nearly ten times as large—over 100,000 titles for individual download—and requires users to purchase download credits. At Audible, one credit generally corresponds to one audiobook and a one-credit monthly plan is $14.95 (after an limited-time introductory rate).

Audiobooks’ pitch is that users can listen to as many audiobooks as they want “with no need to return audio books, no long-term contracts and no time constraints on audio book use.” The audiobooks sync automatically, so a user can stop listening on one device and pick up the story again later on a different one. The service works on iOS and Android as well as laptops and desktop computers. “There are no storage constraints because the content resides on the cloud,” the company promises, “and users can access and play audio books instantly with no downloading necessary.”

Yet as anybody who has tried to use the Pandora (NYSE: P) app on a 3G connection while walking around knows, streaming content can be a hassle without a WiFi connection. Since many people listen to audiobooks while they’re on the move—in the car or on the train, for example—relying on a cloud-based streaming service seems less than ideal, and in many cases it would be impossible. Sure, cloud-based streaming means the content isn’t taking up space on mobile devices, but many audiobooks are at least several hours long and so on a 3G plan data usage would be considerable. “This is a tricky question because audio book titles vary in size. “We suggest having at least 150MB of storage available,” the company says.

Audiobooks.com general manager Ian Small says “the cloud-based service delivers the book in parts so it will allow some time for lost connection—average a few minutes but we can increase this based on customer feedback.” And he says a Q2 2012 update to the Audiobooks.com app “will have the logic for ‘airplane mode’ preparation where the end user will be able to download the title to the app on their phone over WiFi and not need a 3G connection.” Overall, he says, “we’re limiting how much in advance we put on the portable device to save using up too much of their data plan.”

The service is clearly in its early stages and the selection is limited compared to Audible’s, but Audiobooks.com says titles from “Recorded Books, Simon & Schuster (NYSE: CBS), HarperCollins Random House Audio and Blackstone Audio” are available and more are being added. I have asked the company for more details on how publishers are compensated and will update the post with the new information.

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Twitter Faces Censorship Backlash

Charles Arthur — Fri, 27 Jan 2012 04:56:19 PST

The social network Twitter is facing a storm of criticism from users, after revealing that it has implemented a system that would let it withhold particular tweets from specific countries.

The company has insisted that it will not use the gagging system in a blanket fashion, but would apply it on a case-by-case basis, as already happens when governments or organisations complain about individual tweets.

The new system, which can filter tweets on a country-by-country basis and has already been incorporated into the site’s output, will not change Twitter’s approach to freedom of expression, sources there indicated.

In theory it could have been used last year in the UK to block tweets exposing details hidden by superinjunctions about celebrities, or in 2010 when Trafigura used a superinjunction to block the Guardian and BBC from revealing details about a report on activities in Africa.

A number of superinjunctions have been abandoned after details leaked on Twitter, to the displeasure of some judges.

However, activists in countries such as Syria or China might be concerned that they would be unable to see information they need to know.

Twitter insists that the system will only formalise a system it already uses, where tweets are blocked or deleted following full judicial process. Being able to limit tweets to particular countries, rather than blocking them altogether, expands its ability to “let tweets flow”.

In a blogpost, it points out that France and Germany restrict pro-Nazi content; under the US’s First Amendment, tweets with such view would be legal in the US while illegal in those countries.

Google (NSDQ: GOOG), Yahoo (NSDQ: YHOO), eBay (NSDQ: EBAY) and Facebook already use similar systems to control what content is shown in which countries.

In China, Google indicates when a search result has been censored. In the same way, blocked tweets will say: “This tweet from [username] is withheld.” The blocking can work at the individual tweet or account level.

But some users have been critical of the move, which has already seen an update to Twitter’s API, the means through which programs access and show tweets.

Every tweet includes fields such as the user’s name, time of the tweet and the tweet’s content. But now it will also include a “withheld_in_countries” field.

Terence Eden, a London-based mobile developer, complained on Twitter: “I don’t want to develop on an API which contains a ‘withheld_in_countries’ field. What’s next, a ‘for_your_own_good’ field?” He added: “I helped develop a Twitter client that Chinese pro-democracy activists used. Guess that’s dead now. Thanks, Twitter.”

Eden, who describes the move as censorship, said it would be difficult to work around because Twitter will identify which country a user is in by their internet address. “You can spot the censorship, but it’s hard to route around it,” he said.

Twitter says it will continue to post requests for the blocking or censoring of tweets the Chilling Effects site where it has recorded requests to remove tweets from its service.

Nokia Tottering At The Top Of Mobile Rankings; Apple Leading Smartphones

Ingrid Lunden — Fri, 27 Jan 2012 04:04:27 PST

With most of the major handset makers having reported earnings for the quarter that ended in December, analyst houses are laying out their rankings in global smartphone and overall mobile shipments. Nokia (NYSE: NOK) has just about managed to keep its top position overall, while Apple’s phenomenal quarter has put it into pole position among smartphone makers—but only by a fraction of a percentage point.

New figures from Strategy Analytics show that Nokia, with shipments (which Nokia terms “sales”: more on that below) of 113.5 million, has continued to hold on to its position as the number-one phone maker in Q4. Its lead has narrowed by quite some way over last year: it was at 26.9 percent for the quarter and 25.5 percent for the year, compared to 30.9 percent and 33.3 percent for the quarter and year in 2010.

Samsung, shipping 95 million units, made smaller gains than Nokia lost: 1.1 percent on the quarter and 0.5 percent on the year to claim the number two-slot.

What stood in its way to overtaking Nokia? Apple (NSDQ: AAPL). On the strength of its smartphone-only portfolio, it made the biggest gain in market share of the top-three, picking up 4.3 percentage points for the quarter on shipments (like Nokia, Apple calls them “sales”) of 37 million units, to take an 8.3 percent share of the market for the quarter, and 6 percent for the year.

That’s sort of comparing apples with oranges, though. When comparing like-for-like: Apple has edged past Samsung for the quarter with a 0.4 percent lead in market share in smartphones, while over the whole of 2011, Samsung just about still leads Apple, with a 0.9 percent lead.

Nokia trailed the two by nearly twelve percentage points for the quarter, a big reversal from a year ago when it was well in the lead as the biggest-single smartphone maker.

Figures out today from IHS iSuppli, meanwhile, add in two more handset makers to the mix. It says that Sony (NYSE: SNE) Ericsson (NSDQ: ERIC) took the number-four slot after the first three (ranking them in the same order as Strategy Analytics); with Motorola (NYSE: MMI) just behind, with six million and five million devices shipped, respectively. IHS did not include RIM (NSDQ: RIMM), HTC or LG (SEO: 066570)—other notable vendors—in its rankings; they have not reported quarterly figures this week.

In both smartphones and mobile devices overall, “Others” grew numbers in unit terms and made an annual gain on market share to become the biggest group for 2011 market share in Strategy Analytics’ figures. That means still a lot of competition out there from many handset makers, with none of them having a significant enough share to merit placement in the top-three.

On a services level, that speaks to a continuing and strong amount of device fragmentation. That will continue to slow down revenue growth in other areas like mobile content and advertising—areas where it pays for there to be scale to charge the biggest prices. (Case in point: can you imagine what TV advertising or content production would be like if distributors and media buyers had to format ads for different TV set models?)

On shipments versus sales. While these numbers can be instructive, they can also be confusing: If you look at Strategy Analytics’ “shipments” numbers, they are the same as the “sales” numbers that companies like Apple and Nokia reported this week. Neil Mawston, executive director for Strategy Analytics’ global wireless practice, says vendors “tend to use those words interchangeably” even though one refers to actual devices in people’s hands, while the other is for devices that have been shipped to distributors, but not necessarily sold. “They can be open to interpretation,” he admitted. “A lot of companies use smoke and mirrors,” so Strategy Analytics uses other measures such as “channel checks” to measure shipments.

On RIM. It’s notable that RIM didn’t appear in the top-three smartphone makers, so I asked Mawston about their prospects: He says they are “not too far behind number-three” at the moment in overall rankings and smartphones, “and if they had a good quarter or two they could get close.” But the trend so far has been that RIM’s been slowing down and “not providing too much competition” globally. He didn’t mention Motorola or Sony Ericsson, which made iSuppli’s global ranking.

On Samsung. Mawston believes Samsung will stay ahead in smartphones, even with Apple’s strong Q4: “It just has more price points, appeals to both post and prepaid customers, and has a bigger distribution network among carriers,” he said, adding that Apple may well give it a run for its money. “They may trade places for a few quarters.”

He notes that Apple has a massive retail presence in some countries like the U.S. but ultimately it’s the carrier network that really gives device makers that extra leg up in worldwide sales—a key pillar of Nokia‘s fightback strategy, too. “The key thing with carriers is that they can subsidize the iPhone [or another device]. Without operator subsidies, [smartphones] would be nowhere near as large right now.”

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Samsung: Smartphones Up 30 Percent But You Have To Guess How Many We Sold

Tom Krazit — Thu, 26 Jan 2012 18:15:09 PST

Samsung may be king of the Android smartphone world, but it’s playing hard to get. The company declined to release smartphone sales figures late Thursday in reporting record earnings, but it is clearly faring better than some Android competitors against Apple’s iPhone juggernaut.

Record profits were the big story for Samsung during the fourth quarter, in which it recorded $4.7 billion in profit according to Reuters (NYSE: TRI). Revenue was up 13 percent to 47.3 trillion won ($42 billion) and profit rose 16 percent compared to last year. Samsung is of course a huge conglomerate, with businesses ranging from mobile phones and televisions to semiconductors and refrigerators.

Samsung’s mobile unit reported a 54 percent increase in revenue and a 74 percent increase in profits, hours after fellow Android rival Motorola (NYSE: MMI) reported a loss for its fourth quarter. Samsung has had the upper hand in the Android world for several months despite Google’s pending purchase of Motorola, with devices like the Samsung Galaxy S II and Galaxy Nexus leading the way. But it provided no data on tablet sales, several months after the launch of the Galaxy Tab, something even Motorola was able to disclose.

The company would only say that smartphone shipments increased 30 percent compared to the past quarter, which analysts interviewed by Reuters interpreted as around 36 million units, just shy of the 37 million iPhones that Apple (NSDQ: AAPL) sold during its first fiscal quarter. It’s quite disappointing that Samsung would take a cue from Amazon (NSDQ: AMZN) and Nokia (NYSE: NOK) in declining to report actual shipment totals, but it’s understandable why the company may not welcome direct comparisons with competitors.

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Spotify Not Throttling Americans, Subs Hit Three Million

Robert Andrews — Fri, 27 Jan 2012 06:47:27 PST

Early last week, a six-month promotion period, during which U.S. users were exempted from Spotify’s five-plays-per-song, 10-hours-per-month limits, was due to end for the first of the service’s American adopters, if reports were to be believed. But that apparently hasn’t yet happened.

U.S. users are apparently still enjoying desktop streaming with no such limits, if the absence of gripes in social media is anything to go by.

Reasons are not clear, but Spotify is a firm believer in using limited desktop free to drive premium subscriptions. It has been also been experimenting with 48-hour free trials and with free retention periods for cancelling subscribers, as it figures out the most attractive freemium levers to push.

Conversion and adoption

It appears to be working. Speaking during an event at Universal Music Group in London on Thursday, Spotify chief content officer Ken Parks revealed Spotify has now hit three million paying subscribers. That’s up from 2.5 million in November, when Spotify said it had 10 million active users and a 15 percent premium conversion ratio. Now Spotify says it is converting 20 percent to paid; it did not update the active-users count, though mathematics suggests it is 15 million.

This success, as was already known, is driven by ringfencing mobile for premium-only. “This is the one thing people are willing to pay for,” Parks said. “We don’t think there’s a big willingness for people to pay for streaming to the PC.”

Sitting alongside Parks, Universal’s global digital chief Francis Keeling said: “The one thing Spotify has taught us is the necessity to have a free trial period to get consumers to see how good these services are.” Spotify’s Parks added: “Users who are exposing their listening on Facebook are three times as likely to become paid subscribers.

“The vast majority of customers are paying 120 dollars, pounds or euros every year, which is around twice the amount the average user purchases on a download service every year.”

More revenue streams

Where next? Free is not just a premium conversion tool; advertising to free users makes up a sizeable minority of Spotify’s revenue. But Parks said: “We’ve got at least a couple of different revenue streams. Those won’t be the only ones over time.” He told paidContent e-commerce may become Spotify’s third revenue plank.

Now that Spotify has an in-app platform for third-party services like gig ticket seller Songkick, Spotify could take a cut from transactions third parties process inside Spotify, Parks suggested, albeit only speculatively.

Absentees punishing

Separately, Parks made a pitch to the small number of artists and labels withholding their music from streaming services like his over payouts.

“Withholding a record from Spotify doesn’t mean that it’s not available for streaming,” he argued. “All of this stuff is available on YouTube (NSDQ: GOOG). You’re just pushing them to somewhere it’s not monetisable.

“There’s illogic behind withholding a record. What you really want to do is reward the people who are spending $120 a year, rather than punish them by not making the records available on the platform.”

Most Spotify refuseniks have been cottage-industry, artist-owned labels or artists themselves, citing low payouts from label royalties. But EMI’s Coldplay also withheld its latest album from streaming services for the time being.

Sitting alongside Parks, Universal’s global digital chief Francis Keeling, whose own label - the world’s largest - includes some artists holding out from Spotify, echoed Parks’ comments: “The only thing those artists are doing are alienating their fanbase.

“Our agreements with artists are on a case-by-case basis. Over time, we’re trying to convince our artists that streaming services are the right thing to do and these services should be supported.”

Refuseniks make up just a tiny fraction of Spotify’s total addressable label partner base. Spotify explains that it mostly pays labels, not artists.

Motorola Lost $285 Million In 2011 Selling Phones

Tom Krazit — Thu, 26 Jan 2012 13:46:54 PST

Having already warned investors that its fourth quarter was going to be rough, Motorola (NYSE: MMI) didn’t disappoint when the actual numbers arrived Thursday. Smartphone shipments were up slightly but the company continues to lose money on mobile sales while everyone waits for a ruling on the Google (NSDQ: GOOG) deal.

Revenue was in line with the lowered guidance Motorola provided in December of $3.4 billion. Excluding special items, earnings per share were $0.20, far greater than expectations of $0.06, but using the GAAP standard Motorola recorded a net loss of $80 million compared to a net income of $80 million in last year’s fourth quarter.

Smartphone shipments came in at 5.3 million units, up from 4.9 million units a year ago, while tablet shipments remained anemic at just 200,000 units. For the full year Motorola shipped 18.7 million smartphones and 1 million tablets, it said.

But Motorola’s mobile division had a scary year: the group recorded an operating loss of $285 million for the full year, and an operating loss of $70 million in the fourth quarter. Motorola didn’t make any money selling phones last year, either, losing $70 million for the full year.

Those totals include sales of regular old feature phones, still a big part of Motorola’s overall business. The company sold 10.5 million mobile devices in the fourth quarter and 42.4 million devices for the year.

Motorola is still waiting to hear if regulators will approve Google’s bid to purchase the company for $12.5 billion, and as a result it no longer holds the customary conference call following the release of an earnings report.

(Updated 4:46 p.m. ET: I changed the original headline and a couple of references in the text to make it clear that Motorola’s losses were across all of its mobile devices, not just smartphones.)

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Distimo: When It's Time For A Mobile App Sale, Choose Your Price Wisely

Tom Krazit — Thu, 26 Jan 2012 15:03:49 PST

In an insanely crowded mobile apps marketplace, pricing is one of the ways to stand out from the competition: for better or worse. Distimo shared some data Thursday on app-pricing strategies as well as the old-fashioned retail concept of the sale.

If you’re a mobile developer who isn’t sure about the whole “freemium” thing—as in, getting customers in the door for free and finding 400 little ways to charge them once they’ve arrived—application pricing is critical. Those who have erred on the high side and aren’t getting the response they would like should consider a sale: in Apple’s App Store average revenue rose 41 percent on the first day of a sale and by 22 percent over the course of 15 days, Distimo said in a new report on app pricing.

You still have to be smart about choosing the new price. Applications on the expensive side of things, those up around $10, tended to lose revenue overall if they made a timid cut to the price, Distimo said. But steeper cuts paid off: “For example, offering a discount of one dollar on an application that normally costs $7.99, lowers the revenue, whereas offering a discount of three dollars on average increased the revenue by 131 percent,” the app-marketing company wrote in the report.

Those considering a change to the price of their app can sign up to download the full report here. The report covers the activity in Apple’s App Store and Google’s Android Market during the last three months of 2011 in the U.S.

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Tablets: Apple's Lead Narrows Among Widening Field Of Android Makers

Ingrid Lunden — Thu, 26 Jan 2012 16:52:06 PST

With the tablet market now overtaking PC sales, all eyes are on which platform will dominate this next generation of computing devices. A report out today from Strategy Analytics said that for Q4 it was Apple (NSDQ: AAPL), the company that effectively created the market for tablets two years ago with the iPad—although its lead is continuing to narrow amongst an ever-increasingly crowded field of Android tablet makers.

Apple, it said, remains the single-biggest company in tablets. Almost mirroring 15 million in iPad sales that Apple said it achieved for the quarter, SA says the iPad accounted for 15.4 million all shipments (not sales) in the quarter, compared to 10.5 million shipments of all Android-based tablets.

In terms of market share, that worked out to 57.6 percent for the iPad versus 39.1 percent for all Android tablets. Overall the market saw overall tablet shipments of 27 million units for the quarter, representing growth of 150 percent over the year before. For all of 2011, there were 66.9 million shipments, 260 percent higher than 2010.

The new report (link here) made very little of Microsoft’s tablet effort to date. It only has one percent of the market, and accounted for 400,000 shipments. Just as it had to do with smartphones, Microsoft (NSDQ: MSFT) will effectively be starting from scratch when it launches its next-generation OS, Windows 8, later this year. Rather damningly, the PlayBook from RIM (NSDQ: RIMM) doesn’t make it into the individual rankings, and instead gets lumped into “other” category with possibly a few straggling sales from the now-discontinued TouchPad from HP (NYSE: HPQ) running on WebOS.

Frustratingly, Strategy Analytics does not break out any estimates for how individual Android makers have done, although it does note that Amazon (NSDQ: AMZN), Samsung, and Asus (in that order) are driving volumes among the “dozens” of models on the market at the moment.

However, this does raise another issue: Given the ongoing fragmentation in the market—Amazon’s “forked” version of Android for the seven-inch Kindle Fire, for example, being very different from that of the Honeycomb-version of Android used in the Galaxy 10.1—and the fact that this fragmentation does not represent much cohesion in terms of services, how useful it is to count all Android tablet shipments in one category, and, more generally, how accurate are those shipment figures when it comes to actual sales?

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AT&T: The iPhone Was Good, But Not Good Enough To Hold Off A Q4 Loss

Ingrid Lunden — Thu, 26 Jan 2012 07:38:15 PST

A set of quarterly results today from AT&T (NYSE: T) that underscored some of the aftershocks the carrier is feeling in the wake of its failed bid to buy T-Mobile USA. The carrier swung to a loss and failed to meet analysts’ estimates on earnings, partly down to a $4 billion charge it took for ending negotiations with Deutsche Telekom (NYSE: DT), after meeting what appeared to be insurmountable regulatory opposition to the deal.

The $4 billion charge—$3 billion in fees and $1 billion in wireless spectrum to T-Mobile USA—put a big dampener the quarter, which otherwise saw big gains in what the carrier refers to as its “growth engines”: wireless services and specifically those around smartphones; wireline data, including its U-verse TV service; and business services.

Overall revenues were $32.5 billion for the quarter, coming in above analyst estimates according to a poll from Yahoo. Excluding the charges, earnings per share were $0.42, which missed average analysts’ estimates of $0.43. The total net loss for the quarter was $6.63 billion.

iPhone juggernaut. It’s been a year since AT&T lost its exclusive grip on the iPhone in the U.S. but such is the power of the Apple (NSDQ: AAPL) brand in wireless right now, and AT&T’s continuing hold on its original iPhone customers, that the carrier nevertheless continues to get great dividends out of its association with it. AT&T said that it made 7.6 million iPhone activations for the quarter, with overall smartphone sales totaling 9.4 million devices.

AT&T didn’t spell out exactly how many iPhones it sold of those activated—and indeed some could have been bought directly from Apple unlocked. But if you assume that most would have been bought directly via AT&T, that works out to AT&T accounting for some 20 percent of the 37 million iPhones Apple sold in the last quarter, and iPhone accounting for some 80 percent of AT&T’s smartphone sales.

It also shows that despite some of the negative press that AT&T has faced over the quality of its wireless data network, it is still holding on to its customers over competitors Verizon and Sprint (NYSE: S). In its earnings earlier this week, Verizon noted that it had sold 7.7 million smartphones and seen 4.3 million iPhone activations in the quarter.

Correspondingly, AT&T said it saw a 10 percent growth in wireless revenues to $16.7 billion. Wireless data revenue growth is outstripping that of mobile revenues overall: it was $5.9 billion, up nearly 20 percent on a year ago, which AT&T says was driven by internet access, app usage and messaging.

AT&T’s fixed digital content play isn’t doing so bad, either. Revenues for its U-verse high-speed broadband and TV service were up by almost 44 percent over a year ago, and partly offset declines in DSL. Still not by enough: total revenues for wireline services were down by 1.4 percent to $14.9 billion.

AT&T does not break out tablets as an individual category and instead groups them with other non-phone “branded computing devices” like aircards. It said it had its best-ever quarter for the category, with sales of 571,000 with total subscribers now numbering 5.1 million, a rise of 70 percent.

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