April 2012

On the morning of Sunday, April 8, Facebook Inc.'s youthful chief executive, Mark Zuckerberg, alerted his board of directors that he intended to buy Instagram, the hot photo-sharing service. It was the first the board heard of what, later that day, would become Facebook's largest acquisition ever, according to several people familiar with the matter.

Zuckerberg and his counterpart at Instagram, Kevin Systrom, had already been talking over the deal for three days, these people said. Negotiating mostly on his own, Mr. Zuckerberg had fielded Mr. Systrom's opening number, $2 billion, and whittled it down over several meetings at Mr. Zuckerberg's $7 million five-bedroom home in Palo Alto. Later that Sunday, the two 20-somethings would agree on a sale valued at $1 billion. It was a remarkably speedy three-day path to a deal for Facebook—a young company taking pains to portray itself as blue-chip ahead of its initial public offering of stock in a few weeks that could value it at up to $100 billion. Companies generally prefer to bring in ranks of lawyers and bankers to scrutinize a deal before proceeding, a process that can eat up days or weeks. Zuckerberg ditched all that. By the time Facebook's board was brought in, the deal was all but done. The board, according to one person familiar with the matter, "Was told, not consulted."

The battle for control of Sirius XM Radio is coming down to a chicken and egg argument. Liberty Media says it needs approval from the Federal Communications Commission to take "de facto" control of Sirius before it takes steps to exercise such control. Sirius argues the FCC shouldn't grant such approval because Liberty hasn't taken such steps.

A shareholder is deemed to have de facto control of a company if it has less than 50.01% but a big enough stake effectively to be in charge. Liberty since 2009 has held preferred stock that is convertible into 40% of Sirius stock. But unless Liberty converts its preferred shares, it can't vote for all directors and is limited to designating fewer than half the board seats. Liberty asked the FCC last month for approval to take "de facto" control. Sirius responded March 30 saying the petition should be rejected, partly because the media conglomerate hasn't taken actions such as buying more stock.

The White House issued a statement criticizing a House cybersecurity bill after top administration officials briefed lawmakers on the threat of cyber attacks.

In a statement, National Security Council spokeswoman Caitlin Hayden said any cybersecurity legislation should include strong privacy protections and should set mandatory security standards for critical infrastructure systems, such as electrical grids and water supplies. "The nation’s critical infrastructure cyber vulnerabilities will not be addressed by information sharing alone," Hayden said. "Also, while information sharing legislation is an essential component of comprehensive legislation to address critical infrastructure risks, information sharing provisions must include robust safeguards to preserve the privacy and civil liberties of our citizens. Legislation without new authorities to address our nation’s critical infrastructure vulnerabilities, or legislation that would sacrifice the privacy of our citizens in the name of security, will not meet our nation's urgent needs," she said, without explicitly mentioning CISPA.

The House is set to vote on the Cyber Intelligence Sharing and Protection Act (CISPA) next week.

The US wireless market, long the fastest-growing sector in the telecommunications industry, looks like it’s headed for a wall.

Sales of wireless contracts, the most lucrative segment of the business because it locks in monthly payments over long periods, may have shrunk for the first time ever in the first quarter. One big reason for the sharp reversal: Soaring iPhone sales in late 2011 may have satiated consumers’ appetites for wireless plans. A decline would mark a turning point for the previously rapid-growth business, leaving carriers such as AT&T, Verizon Wireless and Sprint Nextel fighting over a shrinking pool of customers. A slowdown also forces device manufacturers such as Apple and Samsung Electronics to battle more intensely for customers.