May 2012

AT&T eyes lower subsidies, shared data plans

AT&T is hoping to help its margins by lowering smartphone subsidies and the company also aims to boost revenue with a new offering that would allow consumers to share their data allowance between tablets and smartphones.

Now that growth is slowing for U.S. contract customer operators, including No. 2 U.S. mobile operator AT&T and its rivals Verizon Wireless and Sprint Nextel Corp are looking for new avenues for expansion, while they try to control costs. Verizon Wireless is a venture of Verizon Communications and Vodafone Group Plc. AT&T has already said it would keep 2012 smartphone sales limited to 2011 levels to cut down on upgrade costs. Like its rivals, AT&T shoulders some of the cost of smartphones to offer discounts to customers who sign on for two years. Ralph de la Vega, the head of the company's mobile business, also suggested he would push to reduce subsidies for the phones it does sell. He declined to give a specific estimate for subsidy levels.

Wireless carriers boost capacity for NATO

The combination of dignitaries and protesters means a lot more people reaching for their cellphones.

AT&T is beefing up its network capacity, and unlike some other NATO-related goodies that will leave town with the heads of state, the extra coverage at McCormick Place and Hyatt Regency and J.W. Marriott hotels will remain. AT&T already is rolling in portable cellphone towers, or COWs (industry-speak for cell on wheels), at Grant Park and Daley Plaza. It's also putting up additional antennae to boost coverage inside McCormick Place and at the Hyatt Regency and J.W. Marriott hotels. Chicago-based U.S. Cellular also added capacity to its network to accommodate the expected spike in wireless usage during the summit. Verizon Wireless said it has taken measures to meet anticipated demand but declined to discuss capacity changes around the summit, citing security concerns. Sprint has added a mobile cell site near McCormick Place, as well as additional capacity inside the convention hall and four other buildings in the area.

Iran threatens to sue Google over dropping Persian Gulf

Iran's Foreign Ministry threatened to take legal action against Google for dropping the name Persian Gulf from its Google Maps and leaving the waterway between Iran and Arab states nameless, state television reported. "One of the seditionist acts taken as part of the soft war against the Iranian nation has been Google's shameless act to drop the name 'Persian Gulf' which is ... against historical documents," Foreign Ministry spokesman Ramin Mehmanparast was quoted as saying. "We have put on our agenda to make an official complaint against Google," he said, according to state television.

Twitter Implements Do Not Track Privacy Option

It’s no secret that Facebook is worth about $100 billion because it collected personal data about its users. A lot of data. Although Twitter tracks its users too — albeit in a much less aggressive way — the company has decided to take a different route.

It announced that it is joining Mozilla, the maker of the Firefox Web browser, and giving its users the ability to opt-out of being tracked in any way through Twitter. Twitter is doing this by enabling the Do Not Track feature in the Firefox browser that enables people to opt-out of cookies that collect personal information and any third-party cookies, including those used for advertising. The Do Not Track functionality will only work if a Web site agrees to acknowledge it.

Facebook (and Microsoft) vs. Google

When a young tech company with outsized ambitions goes public, somewhere an older tech company dies a little on the inside.

So it was eight years ago with Microsoft, then the biggest, baddest technology company in the world, when Google sold shares to the public. The I.P.O. filled Google’s gas tanks, fueling a series of business battles in the years to come with Microsoft (search, applications, mobile), many of which have not gone in Microsoft’s favor.

As Facebook inches toward an I.P.O., it’s Google’s turn to feel the sting of a younger competitor passing a key milestone that will fill its war chest and, if history repeats itself, lead to a new wave of battles over the Internet. Google has already moved forcefully into Facebook’s home turf of social networking with Google Plus.

Sprint CEO Says Company Will Wait To Consider Mergers

For Sprint Nextel, now isn’t the time for a merger.

“Clearly, the time is not ideal based upon where our shares are currently trading,” said Chief Executive Dan Hesse. Still, Hesse said he thought regulators would be willing to consider wireless industry mergers, despite blocking the $39 billion tie-up last year of AT&T and T-Mobile USA. In February, Sprint nearly approved a deal to buy pay-as-you-go rival MetroPCS Communications, and last year it considered buying Deutsche Telekom AG’s T-Mobile, according to people familiar with those discussions. Like its competitors, Sprint is seeking access to more of the wireless airwaves, or spectrum, that fuel customer and revenue growth. The carrier is focused on its ongoing $5 billion network upgrade project, Hesse said. Ideally, Sprint would concentrate on the project through next year, then “let’s talk about consolidation in 2014 when we have this behind us,” he said, noting that he hoped the carrier’s stock price would improve relative to its competitors.

White House’s cybersecurity official retiring

The White House’s cybersecurity coordinator said that he is stepping down at the end of this month after a 2.5-year tenure in which the Administration has increased its focus on cyber issues but struggled to reach agreement with lawmakers on the best way to protect the nation’s key computer networks from attack.

Howard Schmidt, who oversaw the creation of the White House’s first legislative proposal on cybersecurity, said he is retiring to spend more time with his family and to pursue teaching in the cyber field. Schmidt leaves at a time when the administration still has much work to do to ensure the protection of the computer systems of companies that provide electricity and other critical services. He will be succeeded by Michael Daniel, chief of the White House budget office’s intelligence branch. Daniel has worked at the Office of Management and Budget for 17 years, the past 10 handling cybersecurity issues.

Facebook co-founder Saverin targeted by US senators for tax ‘avoidance scheme’

Sens. Charles Schumer (D-NY) and Bob Casey (D-PA) announced plans to introduce a bill to respond to Facebook co-founder Eduardo Saverin decision to renounce his US citizenship and become a resident of Singapore.

The move drew criticism as reports pointed out that the move would save Saverin — who owns a part of Facebook — millions of dollars in taxes after the company goes public. Saverin has denied that he is moving for tax purposes, and has said that his decision was based solely on his business investments. Casey’s office said the bill is called the “Ex-PATRIOT” Act, which stands for the “Expatriation Prevention by Abolishing Tax-Related Incentives for Offshore Tenancy” Act. Under the proposal, “any expatriate with either a net worth of $2 million or an average income tax liability of at least $148,000 over the last five years will be presumed to have renounced their citizenship for tax avoidance purposes,” according to a release from Schumer’s office, and they would pay 30 percent capital gains tax — the same rate as people pay in the US. If an expatriate can prove he or she has a legitimate reason for renouncing U.S. citizenship, no penalties will apply. The bill would tax any prospective gains an expatriate who has renounced his or her citizenship in the past ten years who did so for purposes of tax avoidance.

NPR sees sharp downturn in advertising revenue, leading to talk of cuts

National Public Radio’s new chief executive is signaling that there may be some static ahead for the radio and digital news organization. Halfway through its fiscal year — and six months into Gary Knell’s tenure as chief executive — Washington-based NPR has seen a sharp downturn in corporate “underwriting,” or advertising revenue. The falloff has led to projections of an annual operating deficit and internal discussions about staff and program cuts. Another problem area: The strong audience growth that NPR’s news and entertainment programs experienced over the past decade appears to have flattened, a potentially worrisome development because more stations are carrying NPR’s programs. The increasingly bearish climate poses a challenge for Knell.

Silicon Valley needs humanities students

[Commentary] Quit your technology job. Get a PhD in the humanities. That’s the way to get ahead in the technology sector.

That, at least, is what philosopher Damon Horowitz told a crowd of attendees at the BiblioTech Conference at Stanford University in 2011. Horowitz is also a serial entrepreneur who co-founded a company, Aardvark, which sold to Google for $50 million. He is presently the In-House Philosopher / Director of Engineering at Google.

Wait, you say, that’s insane. At a time when record numbers of people, among them those with high-level degrees, are receiving public assistance, what kind of fool would get a degree in a subject with no clear job prospects beyond higher education or teaching? In Silicon Valley, engineers are honor students and everyone else is taking remedial math. Venture Capitalists often express disdain for startup CEOs who are not engineers. Silicon Valley parents send their kids to college expecting them to major in a science, technology, engineering or math (STEM) discipline. The theory goes as follows: STEM degree holders will get higher pay upon graduation and get a leg up in the career sprint. The trouble is that theory is wrong.

Benton

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