Weekly Digest
Weekly Digest Issue No. 547
06-01-2011
by Deirdre McArdle
Tablets and 3D to dominate CES | Appy New Year from Amazon
Facebook gets major cash injection
It's been a terrific start to the new year for Facebook, which this week raised a whopping USD500 million in new funding from Goldman Sachs and Russia's Digital Sky Technologies. According to the Wall Street Journal, Goldman is ploughing USD450 million into the social network, with Digital Sky Technologies investing USD50 million. The deal values Facebook at USD50 billion, up from a previous estimated valuation of USD15 billion in 2007 when Microsoft bought a 1.6 percent stake for USD240 million. This increased valuation is good news for other shareholders, including Elevation Partners, which counts Bono as one of its founders. Its stake in Facebook jumped to USD750 million from an initial investment of USD210 million.
As part of Goldman's deal with Facebook, the investment bank is also creating a fund through which its clients can buy shares in the social network. It is expected that this fund will create an additional USD1.5 billion. Those high-net worth Goldman clients interested in a slice of Facebook will be required to make a minimum investment of USD2 million and agree not to sell their shares until 2013, the Wall Street Journal reports.
In receiving this investment Facebook will be able to stay a private company for longer, following an emerging trend among Silicon Valley internet firms. According to a Wall Street Journal report, this tactic reflects the heightened regulatory environment surrounding public companies. However, commentators still suggest that Facebook is likely to launch an IPO by 2012. For now, the social network hasn't detailed how it will use this USD500 million funding, although reports imply it could snap up a few complementary firms, or continue to grow its workforce, which stood at 1,700 in November 2010.
Tablets and 3D to dominate CES
The annual Consumer Electronics Show (CES) in Las Vegas traditionally brightens the mood in early January. The event showcases all the latest upcoming gadgets and devices we can expect to see hitting the shops during the year. This year it looks like the event will be dominated by tablets, with manufacturers lining up to announce their latest devices. Samsung revealed the Sliding PC 7, a Windows-based tablet with a sliding keyboard and touchscreen; RIM unveiled its previously announced PlayBook tablet and plans for a 4G model later in the year; and Toshiba debuted what it is calling its Next-Gen Android tablet, which will run on Android 3.0, otherwise known as Honeycomb.
The upcoming Android 3.0 operating system also featured in two other high-profile announcements: LG revealed details of a 4G tablet, to be called the T-Mobile G-Slate, and Motorola gained much of the early headlines with the launch of its 4G tablet, the Xoom, which will be available from the first quarter of the year.
Aside from tablets, 3D televisions have also been hot on the agenda at this year's CES. Samsung announced its plans to add seven new 3D TV models to its range, while Panasonic also said it was expanding its 3D TV portfolio. LG announced its LW6500 3D TV, which it said will come with "comfortable" 3D glasses. Perhaps most intriguing, Toshiba debuted 3D TVs that don't require the user to wear 3D glasses at all. 3D glasses are widely acknowledged as one of the main drawbacks of 3D TV adoption; many of the glasses are big, expensive and uncomfortable to wear. Toshiba's no-glasses technology has been available in TVs in Japan for a couple of months. It'll be interesting to see how the technology is received in other markets.
In a study released to coincide with the launch of the event, the CES trade group predicts that global electronic retail sales will approach USD1 trillion for the first time in 2011. The study estimates 2011 gadget sales of USD964 billion, up 10 percent from USD873 billion in 2010.
Appy New Year from Amazon
This week Amazon became the latest player to enter into the app store market with the launch of the Amazon Appstore. The online retailer has opened a portal for developers interested in developing apps for the store, which will focus exclusively on Android-based apps. In a blog post on Tuesday the e-tailer said an app store was "the logical next step for Amazon in mobile".
Amazon has form in the app world, having recently launched a shopping app called Amazon Price Check and a Windowshop app for the iPad, as well as a number of Kindle-related apps. Indeed, commentators have long expected Amazon to step into the app market. Its entry will certainly rock the boat, especially considering its vast experience in the e-commerce sector, as well as its millions-strong customer base. The store will open to consumers later this year, according to the Wall Street Journal.
There's no doubt that apps are playing a growing role in the way we use the internet and mobile devices. One just has to look at social networking giant Facebook, where the use of apps has rocketed, particularly when it comes to games such as Farmville and, more recently, Cityville. Zynga, the company behind both games, launched Cityville just over a month ago. Since then monthly user figures have soared and, according to the application page, there are currently over 84 million users actively playing the game, making it the largest app on the Facebook platform by some margin (the insanely popular Farmville has a reportedly 58 million active users). It's expected that within the next two weeks or so Cityville will become the first app/game to hit the 100 million user figure on Facebook.
Microsoft left redfaced after Hotmail issue
The New Year kicked off on a low note for Microsoft as issues with its Hotmail service hit thousands of users. The problem, which occurred over the New Year weekend, saw over 17,000 Hotmail users temporarily lose all of their e-mails. Complaints started flooding in to Microsoft's online message board over the weekend, as users discovered their emails had disappeared. In some cases, new e-mails were mistakenly sent to deleted mail folders. In all 17,355 people were affected.
In a blog post on 3 January, Chris Jones, senior vice president of Microsoft's Windows Live business, blamed "mailbox load balancing between servers" for the issue, and said that users' mails had been restored. However, later on 3 January and into 4 January a number of users were still posting on the forum about lost e-mails. It's not clear at this stage if these cases are isolated or related to the Hotmail issue. The incident is a real blow to Microsoft as it tries to position Hotmail to compete more effectively against webmail rivals Yahoo Mail and Google's Gmail.
Apple bitten by iPhone alarm bug
Elsewhere, Apple bore the brunt of iPhone users' ire when a glitch in its alarm application caused many users to oversleep on the first two days of 2011. The glitch meant that alarms that were set for one-time use only, as opposed to a regular alarm call, failed to go off, with users flooding onto Twitter to complain about being late for appointments, work, etc.
Apple acknowledged the issue but didn't reveal any details about the exact nature of the glitch; however, according to the Wall Street Journal some commentators said the problem was primarily affecting the iPhone 4 and older models that were updated with the latest software.
This isn't the first time the alarm function on the iPhone has caused problems; just a few months ago the repeat alarm function failed to recognise the end of daylight savings time, with users in the US, Europe and Australia getting an unintentional one-hour lie-in. I'd like an app for that.
Caped Koala Studios has built a virtual world for kids, combining education and social networking 