The Business of Tech

Apple + Education
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Apple launches iBooks 2 e-Textbook platform (video)

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Apple announces free iBooks Author OS X app for publishing books to the App Store

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iBooks 2 lets authors set textbook prices in exchange for Apple exclusivity

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Apple revamps iTunes U and intros dedicated app (video)

Apple At It Again

They're now in the textbook business

Under Apple’s new textbooks plan, though, McGraw-Hill will try something different: It will sell its books directly to each student (the student could either pay out of pocket, or the school could fund the purchase via a voucher/code), who will use the book for a year, then move on. They’ll be able to keep the digital text, but won’t be able to resell it or pass it along to another student, and McGraw-Hill anticipates that another set of students will buy new books the following year.

So Terry McGraw figures that over five years he’ll generate the same total sales selling $15 e-books as he would selling $75 books. It’s not a total push, because in this model, Apple will take an undisclosed cut of sales — McGraw-Hill execs wouldn’t go into details, so let’s assume for now that it’s Apple’s standard 30 percent — but presumably McGraw-Hill can make some of that up by forgoing the costs of print and distribution.

http://allthingsd.com/20120119/apples-new-math-or-why-a-15-ebook-equals-...

Transformative?

Into all that...enter Apple. The company isn't, at all, transforming educational norms; what it is doing, though, is what it's best at: identifying transformative currents and building the right tools to navigate them. iPadded textbooks are still textbooks, but they're personalized textbooks. They take advantage of the emotional connection people, and especially young people, feel to their devices. They encourage, rather than frown on, active note-taking. They demand, rather than curtail, exploration. They create a kind of kaleidoscopic experience: video, text, audio, all whirring and whirling into each other in a self-guided tour of history or chemistry or biology. They invite students to create learning environments that, though standardized on one level, are, on another, uniquely theirs. And that changes everything.

http://www.theatlantic.com/technology/archive/2012/01/a-brief-history-of...

SOPA Blackouts (?)

Facebook Open Graph launches with 60 new partners, brings new verbs to Timeline

Kodak files Chapter 11 bankruptcy, expects to complete restructuring by 2013

Google Down

Google Page layout algorithm improvement

Google: What The Heck Happened To Them In Q4?

Holy crap, what the hell happened to Google in the fourth quarter?

The Internet giant reported a quarter that missed Street expectations on almost every single metric.

•Gross revenue was $10.6 billion, around $100 million below Street estimates.

•Net revenue, ex traffic acquisition costs, was $8.1 billion, well below the Street at $8.4 billion.

•Revenue was up 8% sequentially, while the Street had been expected 13% growth.

•Revenue from Google owned and operated sites was $7.3 billion, up 29% from a year ago; Morgan Stanley analyst Scott Devitt has been looking for 35% growth.

•Paid clicks jumped 34%, ahead of the 22% Morgan had expected, and up from 28% in Q3, but cost-per-click fell 8%, while Morgan had expected a 3% increase.

•Adjusted EPS was $9.50 a share, below the Street at $10.56.

As you can tell from the drop in the stock price after hours, the Street is not happy.

•“We view Google results generally negatively, with strength in lower quality network revenue and weak CPC trends highlight that Google may be stretching to drive growth,” Devitt writes in a research note this afternoon.

•Stifel Nicolaus analyst Jordan Rohan writes this afternoon that the quarter lacked the FX boost the company received in Q3, “which set expectations too high.”

•Citigroup analyst Mark Mahaney writes that interest and other income was minus $18 million in the quarter, versus his estimate of $260 million to the good; and he notes that the effective tax rate was 22%, rather than the 19% he had been expecting. Those two factors trimmed profits of $1 a share, he says. Mahnaey says U.S. revenue was “in-lineish” but that international gross revenue was up 6%, below his forecast of 9% growth.

While CEO Larry Page said on a post-earnings conference call that he is “very happy with our results,” which he called “pretty exciting,” I think the Street’s interpretations is that they are not very happy about the results, and that they are pretty confusing.

GOOG in late trading is down $56.97, or 8.9%, to $582.60.

http://www.forbes.com/sites/ericsavitz/2012/01/19/google-what-the-heck-h...

Google+ 60% Engagement

Despite what I and other reporters think we heard, and despite what Googlers were posting on Google+, the written version of Page’s comments has a slightly different — but very important — change to the wording:

“I’m also pleased to announce that there are over 90M Google+ users — well over double what I announced just a quarter ago on our earnings call. Engagement on + is also growing tremendously. I have some amazing data to share there for the first time: +users are very engaged with our products — over 60% of them engage daily, and over 80% weekly.”

I’ve bolded the important part: Page’s written comments aren’t about how many Google+ users actually use Google+, they’re about how many Google+ users engage with all of Google’s products.

That’s a big difference

http://marketingland.com/no-google-doesnt-have-a-60-percent-engagement-r...

Microsoft

Microsoft beats the Street with record Q2 revenues of $20.9B

Software titan Microsoft beat Wall Street expectations with record second quarter revenues of $20.9 billion, a 5 percent increase from the same quarter last year.

“We delivered solid financial results, even as we prepare for a launch year that will accelerate many of our key products and services,” said Microsoft CEO Steve Ballmer, in a statement. “Coming out of the Consumer Electronics Show, we’re seeing very positive reviews for our new phones and PCs, and a strong response to our new Metro style design that will unify consumer experiences across our phones, PCs, tablets, and television in 2012.”

For Q2 2012, Microsoft’s operating income was $7.99 billion compared to $8.17 billion in the year-before quarter. Net income was virtually unchanged at $6.62 billion versus $6.63 billion in the year-before quarter. Diluted earnings per share amounted to $.78 per share against $.77 per share a year ago.

The company barely beat Wall Street’s revenue estimates, as some analysts were expecting earnings of $.76 per share. Microsoft beat that by two pennies per share.

Microsoft’s Business Division had an especially strong quarter with $6.28 billion in revenue, a 3 percent increase from the prior-year period. The company was fueled by sales of Microsoft Office 2010 licences, of which it has sold about 200 million since its launch 18 month ago. Revenue generated from SharePoint and Exchange also grew by 10 percent (or more) versus the year-before quarter.

On top of that strong business-focused performance, Microsoft’s Server & Tools category posted $4.77 billion in second quarter revenue, an 11% increase from a year ago.

“We saw strong demand for our business products and services, despite the soft PC market and continuing economic uncertainty in key parts of the world,” said Peter Klein, chief financial officer at Microsoft, in a statement. “We delivered record earnings per share by continuing to manage our costs while investing for future growth.”

The company’s only major drop in revenues by division appeared in its Windows/Windows Live Division with revenue of $4.74 billion, a 6 percent decline from the year-before period. The Online Services Division reported revenue of $784 million, a 10 percent increase from the year before.

Finally, Microsoft’s Entertainment & Devices Division posted revenue of $4.24 billion, an increase of 15 percent from the year before. That highlights the success of its Xbox 360 game console and the motion-controlled Kinect sensor. Microsoft has sold 66 million Xbox 360 consoles and 18 million Kinect sensors to date. And the Xbox Live service now has 40 million members, a massive increase of 33 percent from the prior-year period.

http://venturebeat.com/2012/01/19/microsoft-q2-record-earnings-21b/