Lenovo iPhone Killer

Lenovo has been busy finalizing their new smartphone code named the “OPhone”. Compared to the iPhone it looks to be a killer device. Some Chinese bloggers got their hands on one and did a comparision against the iPhone. The dimensions closely mirror Apple’s iPhone but there are some surprises like a 5MP camera with a flash and a 16GB micro SD slot.

Early in December photos leaked on the OPhone and it was rumored to be built on Google’s Android platform. This would be a big step up from Google’s G1 device in many ways. Lenovo and China Mobile could have a legitimate iPhone killer on their hands. Time will tell but if this is build on Android, Google is quickly closing the gap on Apple.

Facebook Loses $14 Billion In Value

Facebook has lost $14 billion in value in less than a year. With a 140 million users and growing Mark Zuckerberg’s social network company has gotten a reality check.The value of Facebook has been a hotly debated topic.

Last October Microsoft solidified Facebook’s value to the world, $15 billion. Microsoft got a paltry 1.6% stake in the company for $240 million.  Some thought that Steve Ballmer had lost his mind. But what people didn’t realize is how smart he really was. To Microsoft, $240 million is a rounding error, so if they were really crazy they would have bought more of Facebook at an insane valuation. What was brilliant about this move was it established a public valuation for Facebook that was so high and unjustified no one on the planet would touch them. Unless you are Li Ka-shing the Chinese billionarie that put up $60 million at that valuation. Essentially it was a poison pill for anyone that would try to acquire them. (hint, hint, Google)

Even Facebook internally didn’t believe the $15 billion valuation. According to inside sources they were offering employees options at $10 billion and some employees got options at $5 billion. Mark Zuckerberg recently canceled a employee stock buying program when no company would agree that Facebook was worth $4 billion. So what is it worth now? Valleywag was reporting rumors of of people willing to sell their stock at $2.50-4.00, that would put Facebook’s valuation at $1.3 billion. If you look at the numbers Facebook is worth much less.  Read more

Steve Jobs Goes Missing From MacWorld

Apple announced today that Steve Jobs will not being doing the keynote at the much anticipated MacWorld in January. Philip Schiller, Apple’s senior vice president of Worldwide Product Marketing, will be taking his place. This news is certainly going to stir more speculation around Steve Jobs’s health concerns. Or its a tactic to clearly lower expectations on the show.

Apple also said they are no longer going to participate in MacWorld, which is in partnership with IDG. With consumer demand at an all time high for Apple products it seems they don’t think they need these types of industry events to build awareness of their products. Tomorrow wont be good for Apple’s stock (AAPL).

If I was Steve Ballmer I would be breathing a sigh of relief. Giving a keynote at CES two days after MacWorld would make anyone a little nervous.

Microsoft Launches First iPhone App Seadragon

Microsoft’s Live Labs group launched Seadragon Mobile on the Apple iPhone. Its available through the iTunes app marketplace. Seadragon Mobile enables you to view gigapixel images from any device.  Microsoft calls the technique of viewing large images “deep zoom” and its a key technology in their Photosynth product.

What is interesting about this move is Microsoft is making Seadragon Mobile available on Apple’s iPhone even before you can get it on the Windows Mobile platform. Is this a change of heart for Microsoft? Probably not. Seadragon Mobile uses graphics accelerated hardware and there are not many devices on the market today that take advantage of those capabilities. Microsoft is probably using this as an opportunity to test some technology early and also doing a little bit of hedging.

Google OS Coming Out of Beta

Google’s Chrome Web browser is really an operating system in disguise. Google’s ambition is to build an ecosystem that uses Chrome and Google Gears in a world of HTML and javascript. The key to Google building critical mass behind this effort will be to get broad and pervasive distribution of the Chrome browser. To do this they are going to need to pre-install it on OEM machines. Google is finding out that no OEM on the planet will ship anything that is still in beta. Last time I checked Gmail is still in beta after 4 years.

Google’s Chrome Web browser (aka Google OS) is coming out of beta testing according to a TechCrunch report. Marissa Mayer, Google’s vice president of user experience, told TechCruch’s Michael Arrington that it would be coming out of beta soon but no date was given.

Google’s strategy with Chrome is puzzling in many ways. Firefox is an open source Web browser with just over 20% market share world wide. Google is a big financial contributor to the Mozilla organization that builds Firefox. Yet Google takes an approach that makes them start at a base of zero and directly compete with one of their biggest partners. More fragmentation will make it far more difficult to galvanize the developer community around a platform. Google will have a long uphill battle to fight on this one.

Google’s Android Party Gets Bigger

Today Google’s Android party got a lot bigger. Fourteen of the world’s largest mobile phone and chip makers, including Sony Ericsson, Vodafone Group, and ARM Holdings joined the Open Handset Alliance and pledged support for Google’s Android platform. Almost all of these members had existing Linux platforms they supported. Its not surprising that they are interested in using a common Linux platform that is more standardized and easier to support. Not to mention the big G is backing it.

Netflix and Tivo Team Up

Netflix has been on a rampage of sorts doing deals to get distribution of their online service. Engadget broke the story tonight that Netflix and Tivo teamed up to offer Netflix’s on demand service. Now people can access thousands of movies both standard definition and HD movies from their Tivo.

Similar to the Xbox 360 Netflix service that recently came out, the functionalty is at no additional cost, you just need a Netflix account to use it. Engadget also got an early hand on experience. They said it is not as flashy as the Xbox 360 experience but the performance was noticably better. Netflix is certainly making a major bet on online distribution and they are moving fast to lock up key distribution channels from Blockbuster.  The recent deal that Microsoft and Blockbuster made to create a Live Mesh application is going to make this a game of chess and not checkers. 

Read more

Interview with Mark Zuckerberg

TechCrunch’s Michael Arrington, recently interviewed Facebook CEO Mark Zuckerberg. They talked about a variety of topics, but there were a couple things that were interesting. Facebook has but a lot of investment behind its platform and it recently launched its Facebook Connect service which we wrote about. Zuckerberg talks about the ways he views first party applications verses third party applications.

Zuckerberg says, “There’s this big question about whether we’ll compete with applications. The approach that we take isn’t that there’s some rule that we won’t compete with applications, but we just think that in general it’s not good for us to.”

What he is really saying is I will build first party applications when it’s in Facebook’s best interest. Anything that is really, really important to the community will be strategic to Facebook. Like music, Zuckerberg goes on to confirm that Facebook is working on a music application. Read more

Apple to Sell $99 iPhone at Walmart

According to BGR Apple(AAPL) is planning on selling a $99 iPhone at Walmart(WMT). If this is true, everyone in the mobile business should get a little scared. This means that Apple has hit a very important price point. Most of the 1.2 billion phones sold every year are below $100 price point. This will make sales of iPhone sky rocket at levels not seen since iPod. Now it seems Apple has the largest retailer on the planet behind them and Walmart and Apple are primed to sell 10′s of millions of units. Engadget even has pictures of at&t manuals with Walmart logo on them. Looks real to me.

Nokia who owns over 40% of the phone market should start getting a little worried. They sold over 430M units last year and their bread and butter segment was at price point below $100 for low end feature phones. This move by Apple can be a real game changer if it proves to be true.

Google Three Hours From Antitrust Case

Sanford Litvack, the hired gun for DOJ, was just three hours from filing the formal antitrust compliant against Google (GOOG) and Yahoo (YHOO). In an interview with The AM Law Daily, Litvack says, “We were going to file the complaint at a certain time during the day. We told them and three hours before, they told us they were abandoning the agreement.”

The never-filed government complaint would have charged that the agreement violated Sections 1 and 2 of the Sherman Act. Litvack went on to say, “It would have ended up also alleging that Google had a monopoly and that [the advertising pact] would have furthered their monopoly.” Litvack clearly wanted this to happen, “Of course I was looking forward to it,” he says. “We felt pretty good about it, we felt pretty confident.” 

Google certainly avoided a near disaster but it was foolish from the very beginning to even pursue the deal. When you have over 70% market share in the search business, you already have monopolistic network effects that will make it nearly impossible for anyone to compete with you. Why bother locking up an extra 20% and awaking the sleeping giant, the DOJ.

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