February 2012

The $1.6 Billion Woman, Staying on Message

Sheryl K. Sandberg, Facebook’s chief operating officer, sees herself as more than an executive at one of the hottest companies around — more, too, than someone who will soon rank among the few self-made billionaires who are women. She sees herself as a role model for women in business and technology.

In speeches, she often urges women to “keep your foot on the gas pedal,” and to aim high. Her call isn’t simply about mentoring and empowering. It is also about business strategy. A majority of Facebook’s 845 million users are women. And women are also its most engaged users. So Sandberg is playing to a powerful and lucrative demographic, as well as to the advertisers who want to reach it. Inside Facebook’s headquarters in Menlo Park (CA), she is considered a not-so-secret weapon for recruiting and retaining talented women as well as men. She and Mark Zuckerberg will need the best brains they can find to sustain Facebook’s astonishing growth.

Netflix less about flicks, more about TV

Like most fresh faces that arrive in Hollywood, Netflix wanted to be a movie star. But now it's learning what many in Tinseltown have known for decades: Movies are sexy, but the real money is in television.

Launched in 1997 with a goal of eliminating the drive to the video store, Netflix became a hit with consumers and helped push the movie rental chain Blockbuster into bankruptcy. By charging customers a small monthly fee for unlimited DVDs by mail, then expanding into Internet streaming in 2007, it amassed almost 25 million subscribers in the U.S. and in 2011 had revenue of $3.2 billion. For most of that time, Netflix was all about flicks. More than 80% of the discs it shipped and virtually all of its streaming content when that service began consisted of movies. Not anymore. More than 60% of the 2 billion-plus hours of video streamed by Netflix subscribers during the fourth quarter of 2011 originated on the small screen.

Amazon Has Tried Everything to Make Shopping Easier. Except This.

Much of the discussion about Amazon is focused on its digital side, yet the company is relentlessly expanding into the physical.

It has announced five new United States warehouses since late December, all with more than a million square feet. It is testing out delivery lockers in New York and Seattle for those who cannot receive their goods at home. It has been experimenting with a grocery delivery service in Seattle for several years. It has expanded its Prime $79 annual shipping fee program, hoping members will order more of everything. In all sorts of ways Amazon is trying to remove the obstacles from home delivery. Does anyone remember how mail order once meant getting things a month later? Now Amazon thinks two days is too long. One major reason the retailer seems to be giving up its hard-line position on charging customers sales taxes is that it wants to build its warehouses close to major population centers. If it does that, it cannot argue that it is exempt from collecting state taxes because it lacks a physical presence in a state. But the increased business from faster delivery might be a worthwhile trade-off to charging the tax.

A New Resource for Hiring Programmers Has Become Entirely Too Successful

GitHire is one of a few tech-job sites that home in on talent by analyzing a programmer’s code available on the Internet and online presence and then assigning a rank relative to his or her peers. The goal is to find “diamonds in the rough,” said Rhett Creighton, who co-founded the site with Dane Jensen — talented but obscure candidates an employer might never otherwise discover. When GitHire, based in Austin (TX), began operations three weeks ago, it did so with a bold promise: it would find five talented programmers, who could be interviewed by phone — for a $1,000 fee. Instantly, it was flooded with more orders than it could handle and raised the fee to tamp down interest.

Privacy concerns grow in India

The Indian government’s recent announcement that it taps nearly 300 new phones every day has sparked a debate about privacy in a country that traditionally views such concerns as an ugly offshoot of Western individualism.

Indians tend to stress identities of family and community over any others. But a growing desire for privacy and what many say is a government assault on it are creating tension in this nation of 1.2 billion people. The reasons for the shift, experts say, include changing family structures and lifestyles among the urban middle class, as well as a mass media explosion and the Internet, just as the government has begun tapping more phones and using surveillance cameras in more public places. The constitution does not guarantee a right to privacy here, nor does the country have a data protection law to guard against the misuse of personal information. But the government has proposed a wide-ranging privacy law, and a coalition of organizations and activists, including the newly formed advocacy group Privacy India, is trying to help shape it.

Facebook’s new friend request: Political insiders

Facebook is friending the feds. The company has put political veterans in key executive roles and board positions.

It’s also quickly built up a powerhouse Washington lobbying operation and established a political action committee to make it easy for employees to donate to candidates. It will need those relationships, experts say, as it tries to ward off regulations and investigations over its privacy practices — which are among the greatest risks to its unbridled growth, the company revealed this week in a federal filing for its planned stock offering. Facebook has studied mistakes by older rivals, such as Google and Microsoft, and is responding quickly, experts say, by strategically hiring experienced Democratic and Republican operatives. The company has brought on key operatives from the past three administrations.

Apple, with iPad, is top PC maker

The largest PC maker in the world is — Apple? Hard to believe, maybe, but according to the latest analysis from Canalys, Apple shipped 120 million PCs last year, if you include the iPad. Apple shipped just 5 million Macs, but iPad shipments outstripped that number threefold, and the company had a six-point gain in the market over a year ago. The hardest-hit PC makers last year were Acer, Dell and Hewlett-Packard, which is often given the title of the largest PC maker in the world.

Disclosure Rule the First Step Toward Quotas

[Commentary] In a recent column, former Federal Communications Commission staffer Steve Waldman asks, "Do broadcasters believe that they even have a public interest obligation anymore?" He answers “Yes,” but only if the obligation "remains devoid of meaning." Jessell’s answer: “Yes, but only if broadcasters get to decide what the public interest is just as all other media do. They don't need or want guidance from Washington. The day is long past when content regulation can be justified on one segment of a TV medium that now also includes cable, satellite and the Internet.” TV stations, Jessell argues, are perfectly transparent. If you want to know what a station is doing or not doing to serve the public interest, however you want to define it, all you have to do is turn on the TV and watch. It's all right there on the screen. No secrets.

Slim Gives Tips for Switching IPhone Plans From AT&T

Billionaire Carlos Slim’s US mobile carrier is giving users instructions for switching their AT&T iPhones to his prepaid calling plans, showing them how to disable software aimed at preventing customers from defecting.

The site for Slim’s Straight Talk service, sold through Wal-Mart Stores, directs users of the Apple device who have trouble switching away from AT&T to a website that provides information. AT&T has a 9 percent stake in Straight Talk’s parent, America Movil SAB, and has members on the board of Slim’s wireless carrier. America Movil, the biggest U.S. prepaid wireless carrier, is using a Straight Talk unlimited $45 monthly smartphone plan to attract Verizon Wireless and AT&T users. The iPhone instructions are part of Straight Talk’s aim to begin in the next 30 days offering small chip cards, known as SIM, that can be inserted into phones bought from stores, AT&T or T-Mobile USA, said Walter Piecyk, a BTIG Inc. analyst in New York.

FCC Sets USF/ICC Reconsideration Pleading Cycle

On January 12, 2012, the Consumer and Governmental Affairs Bureau released a Public Notice listing the 24 petitions for reconsideration of the Federal Communications Commission’s Universal Service Fund/Intercarrier Compensation Transformation Order. Oppositions will be due February 9, 2012, and replies to oppositions will be due February 21, 2012.

Benton

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