Apple’s quarterly numbers are out and not quite as booming as anticipated. The company reported “earnings of $9.32 per share ($8.8 billion total) on $35 billion in revenue,” reports The Verge.
“It’s a $1.5 billion gain over last year’s profit in the same quarter, but missed analyst estimates of $10.37 earnings per share,” notes the post.
“We’re thrilled with record sales of 17 million iPads in the June quarter,” commented Apple CEO Tim Cook. “We’ve also just updated the entire MacBook line, will release Mountain Lion tomorrow and will be launching iOS 6 this fall. We are also really looking forward to the amazing new products we’ve got in the pipeline.”
Sales of the iPhones took a predictable dip as consumers are choosing to wait for the iPhone 5’s expected fall release.
“Apple’s major new hardware release this quarter was the MacBook Pro with Retina display, but the new laptop didn’t move the needle much on Mac sales: just four million, about a two percent increase over the year-ago quarter,” reports The Verge.
Not surprisingly, sales of the new iPad and the discounted iPad 2 remain strong.
In its Q2 2012 earnings report, Netflix reports that its subscriber base for domestic streaming is 23.94 million, up from the 23.41 million it reported for Q1.
As continues to be the trend, numbers are going up for streaming services and down for physical DVD rentals.
This is true for Netflix, which “added more than 530,000 domestic streaming subscribers in the quarter but reported a decline of 850,000 subscribers to its domestic DVD service,” according to CNET.
“While that means the total number of Netflix’s net U.S. subscriptions shrunk by 320,000, the company still managed to increase the number of U.S. subscribers by 420,000,” explains the article. “The difference between subscriptions and subscribers is that ‘unique subscribers’ counts people and not the types of accounts. So, for example, if people dropped their DVD subscription they might have remained as a streaming customer and weren’t counted among the ‘net new subscription additions.'”
Netflix CEO Reed Hastings has suggested that DVD subscriptions would drop. He’s right, of course, but “what’s shocking is that customers aren’t moving over to streaming at the same pace they’re dropping their DVD subscriptions,” notes the article.
According to CNET: “Netflix reported a profit of $6 million, or 11 cents per share, for the second quarter on revenue of $889 million,” marking a 91 percent decrease in profit from last year’s $68 million earnings.
“We have yet to see Hulu Plus or Amazon Prime Instant Video gain meaningful traction relative to our viewing hours, but as we continue to build a domestic profit stream they are likely to increase their efforts to gain viewing share,” says Hastings. “Redbox Instant by Verizon, once they launch, will face a big challenge to break into the top 3 of subscription streaming services.”
Coinstar subsidiary Redbox is finally getting closer to making its streaming service a reality.
“In February the DVD vending company announced a partnership with Verizon that would finally usher the Walmart staple into the 21st century,” and provide a streaming option for customers, reports Engadget.
According to the press release: “The venture’s services will offer all of the convenience, simplicity and value of Redbox new release DVD and Blu-ray Disc rentals combined with a new content-rich video on-demand streaming and download service from Verizon.”
Sources indicate that “Redbox Instant by Verizon” will enter an internal alpha this week, meaning it will begin to test out and fine-tune the service. A beta program is expected in the coming months before the service goes live sometime later this year.
“For consumers eager to have an alternative to Netflix, Amazon, Hulu, and HBO Go, the news is bittersweet in its hurry-up-and-wait nature,” notes Fast Company in a related post. “Redbox Instant will be a subscription-based service, as executives at both Coinstar and Verizon have indicated, but the company will still not provide any insight into subscription rates, studio content, or how the physical and digital parts of the service will be combined.”
The joint venture will be managed by newly appointed CEO Shawn Strickland, who formerly served as a vice president for Verizon FiOS.
Six months after losing its longtime chief marketing officer Leslie Kilgore, Netflix has announced a replacement: former Warner Bros. executive Kelly Bennett.
Kilgore left during a tumultuous time at Netflix, during which subscribers were denouncing the company for splitting up its DVD and streaming services and implementing a rate hike as part of the restructuring.
“While the moves were driven by Netflix CEO Reed Hastings, the company’s communication with its customers proved to be the company’s real downfall,” suggests TechCrunch. “Recently, the company has been in the midst of a turnaround, but it was still in need of a new marketing chief.”
After nine years working at Warner Bros. and experience on international campaigns to promote films, “Bennett is well-positioned not just to help Netflix rebuild its brand in the U.S., but could also be instrumental in the company’s international expansion,” according to TechCrunch.
“Kelly has been a pioneer in developing incredible digital campaigns for some of the biggest box office hits in recent years,” said Hastings in a press release. “We are delighted Kelly is bringing creative and marketing expertise to Netflix as our streaming business becomes increasingly global and our focus intensifies on commissioning high-quality original programming for our more than 26 million members.”
Expanding upon its eCrime Unit founded in December 2011, California Attorney General Kamala Harris has announced the creation of the Privacy Enforcement and Protection Unit.
“The Privacy Unit will police the privacy practices of individuals and organizations to hold accountable those who misuse technology to invade the privacy of others,” explained Harris in a statement.
“The creation of the Privacy Enforcement and Protection Unit reflects growing concern among regulators at both a state and federal level that privacy in the information age hasn’t been adequately addressed,” reports InformationWeek.
“A series of online privacy controversies such as Google’s bypass of privacy controls in Apple’s Safari browser earlier this year and Apple’s compilation of unprotected location data on iPhones last year have piqued the interest of lawmakers,” adds the article.
The department aims to protect consumers by enforcing laws of online privacy, identity theft and data breaches — in addition to non-tech issues related to health, financial privacy and government records.
“Harris was responsible for working with Amazon, Apple, Facebook, Google, HP, Microsoft, and RIM to form an agreement earlier this year that requires app developers to include privacy policies in an effort to promote transparency,” reports The Verge.
“The Attorney General’s office will meet with these companies soon to ensure their compliance with the California’s Online Privacy Protection Act, and has said that the state will sue companies and developers who don’t take the policy seriously,” notes the post.
Amazon is expanding its digital media R&D efforts with a new 47,000 square-foot facility in Central London.
The company is bringing together design and development teams from streaming rental firm LOVEFiLM and Pushbutton (which creates digital media interfaces for Amazon’s platforms) at its Digital Media Innovation Hub.
According to Amazon, the main goals for the Hub are “the creation of interactive digital services for TVs, game consoles, smartphones and PCs; the development of the digital media experience on Amazon websites around the world; and the building of services and APIs that power that digital media experience.”
SlashGear explains that digital media is the “cornerstone” of Amazon’s Kindle products that are “primarily intended to encourage users to buy or rent more content.”
“That same strategy is tipped to be at the heart of Amazon’s upcoming smartphone,” notes the post. “The handset would be Android-based but heavily reskinned, ousting Google’s own content stores in favor of Amazon’s own media and app distribution.”
YouTube is cleaning up its act. The popular video site will now push users to use their full names when commenting or uploading. The site will also ask users to display the identity associated with their Google+ account.
For those users who decline to use their full name or Google+ identity, Google pushes for an explanation, requesting users to select from options such as “my channel name is well-known for other reasons.”
“Making commenters use their real names and Google+ accounts was the obvious first step toward bringing civility to YouTube, which Google is eager to polish into a venue more attractive to business owners, advertisers, and creative filmmakers,” writes Wired.
“It’s easy to imagine that offering Google+ YouTube accounts is just a first step toward hiding, and eventually eliminating, comments from anonymous accounts,” notes the post. “Such simple steps would do more to improve the perceived quality of YouTube content than any upgrade to surround sound or high-definition video.”
“Of course, forcing people to own their identities can help to elevate the discourse on YouTube videos, which is definitely in dire need of a makeover,” adds BetaBeat. “But can a community that has relied on anonymity for so long really be convinced otherwise?”
“However, we realize that using your full name isn’t for everyone,” notes the YouTube blog. “Maybe people know you by your YouTube username. Perhaps you don’t want your name publicly associated with your channel. To continue using your YouTube username, just click ‘I don’t want to use my full name’ when you see the prompt. Stay tuned for more ways to use this username in other Google products and services in coming months.”
“Much of what we do online releases dopamine into the brain’s pleasure centers, resulting in obsessive pleasure-seeking behavior,” reports The Atlantic. “Technology companies face the option to exploit our addictions for profit.”
Companies are actively seeking to exploit our newest addiction — the Internet — by creating a “compulsion loop.” Game companies, for example, hook players by rewarding them with new content when they achieve a goal which leads them to work harder to achieve and receive even more.
Neuroscience has been able to track how Internet activities can stimulate the neurons of the ventral tegmental area of the midbrain leading it to release the neurotransmitter dopamine to the brain’s pleasure areas.
But this behavior goes well beyond games. “We now believe that the compulsion to continually check email, stock prices, and sporting scores on smartphones is driven in some cases by dopamine releases that occur in anticipation of receiving good news,” explains the article. “Indeed, we have grown so addicted to our smartphones that we now experience ‘phantom smartphone buzzing,’ which tricks our brains into thinking our phone is vibrating when it isn’t.”
The author, Bill Davidow is trying to manage this situation by actively creating walls around his virtual environment. He answers email only at the office. And when spending time with his wife, daughters and grandsons, he puts the iPhone away. Still, he recognizes, “There is, of course, no simple solution to this problem.”
“I’m learning that to function effectively and happily in an increasingly virtual world, I have to commit a significant amount to time to living without it,” concludes Davidow.
Just how leery is the American public when it comes to information they read online?
A new study from Harris Interactive found that 98 percent of Americans do not trust information located on the Internet.
According to the survey of 1,900 respondents, 94 percent believe “bad things can happen as a result of acting on inaccurate information online.”
The top reasons for distrusting online content: too many ads (59 percent), outdated information (56 percent), self-promotional information (53 percent) and unfamiliar forums (45 percent).
“The 94 percent who worried that ‘bad things’ could happen were mostly concerned about wasting their time (67 percent),” notes Mashable. “Other fears included getting a computer virus (63 percent), losing money (51 percent), risk of fraud (51 percent) and damaging their credibility (36 percent).”
Only one-third of Web users are comfortable with Facebook’s use of personal information for providing targeted ads, suggests a new poll by Harris Interactive.
By contrast, Amazon faired much better with 66 percent saying they trusted the online retail giant with their personal data for product recommendations.
Google came in just above Facebook, with 41 percent of those polled feeling comfortable with Google’s ad offerings based on past searches.
“Facebook, owner of the world’s largest social network, uses data about people’s preferences to help advertisers market their wares,” reports Bloomberg. “It agreed in November to settle complaints by the Federal Trade Commission that it failed to protect user information or disclose how the data would be used.”
The survey of 2,262 American adults online also found that 81 percent of people trust grocery stores’ use of their information for tailoring coupons.
Consulting firm Capgemini reports that brick-and-mortar stores are finally realizing the importance of customer relationship management. A new study found that more than half of shoppers believe physical stores will serve solely as showrooms by 2020.
“According to the report, which was based on interviews with 16,000 consumers from 16 countries, 51 percent of respondents said that, in the next eight years, they expect retail locations to be showrooms for selecting and ordering products,” reports GigaOM. “In developing markets, the study said the percentages were higher but that at least one third of the respondents in more developed markets agreed with the assessment.”
In recent months, it has become clear that cost-conscious shoppers are leaning toward the “showrooming” trend — checking out new products in a store, but then making their purchases online where better deals and price comparisons are clicks away.
The growth of online shopping sites, mobile phones and shopping apps have led to new options for smart shoppers. “As more consumers reference their mobile phones in-store (52 percent according to a recent Pew study), many are realizing that they can find better prices or deals elsewhere, often online,” notes the post.
Some retailers are fighting the trend with new initiatives intended to keep customers happy. Retailers such as Walmart, Macy’s and Sears are increasing customer support with the implementation of payment booths, drive-through customer service centers, pickup locations and other services that blend online and offline.
Best Buy recently announced it will redesign its stores to become more Apple-like, including new features such as a product support center (similar to Apple’s Genius Bar) and the ability to pay from the floor rather than standing in line at the register.
“As the Capgemini report found, the digital shopper isn’t just digital and expects to be served seamlessly across all channels, physical and digital,” concludes GigaOM. “That goes for Amazon shoppers, too.”
A new study from analytics firm RapidBlue has found that online ads have a strong effect on offline sales, showing “double-digit increases in both the number of shoppers and the amount of time they spent in the stores when stores ran Google AdWords campaigns,” VentureBeat reports.
“In fact, we found that the brick-and-mortar impact of online ads could be bigger than their online impact,” explains RapidBlue chief operating officer Sampo Parkkinen.
The findings should be comforting to offline retailers competing with competitive pricing from online giants like Amazon.
“We’re not really tracking the individual person,” says Parkkinen. “We’re installing our solution, which tracks mobile phones in retail outlets. Then we look at the sales metrics and how they’re fluctuating.”
“This result is astonishing and could upend the way the online advertising industry traditionally tracks costs and measures return on investment,” the article suggests, noting the success of ads are typically measured in terms of online results.
Today, Internet companies track online behavior without permission, force you to accept terms and conditions too complex to even understand, and limit one to work within their carefully constructed silos.
A new discipline called Vendor Relationship Management is being developed, which focuses on the needs of the user rather than those of sellers and third parties.
This is a recognition of the new realities of the Internet that gives individuals unprecedented power by allowing them to self-publish, syndicate their opinions, and in general, influence many others often around the world.
In the near future, “you will declare your own policies, preferences and terms of engagement — and do it in ways that can be automated both for you and the companies you engage,” reports the Wall Street Journal.
You’ll be able to knit different apps together to perform what you need. You will decide if you want to be tracked (Microsoft will turn on a “Do Not Track” feature in the next version of Internet Explorer) or if you want to receive ads (ad blockers are already a popular extension for some of the major Web browsers).
“Progress in empowering customers won’t be smooth or even, but it will happen,” notes WSJ. “Today, the supply side still reigns, but by the time of that dinner party in 2022, everyone will understand that free customers are more valuable than captive ones.”
According to a Harris Interactive survey, 44 percent of U.S. adults (18 to 44) plan to use at least two personal devices to follow the 2012 summer Olympic games.
About 14 percent say they plan to use three or more devices. Additionally, roughly one-third of those surveyed 55 and older will follow coverage on two or more devices.
“Audiences are taking advantage of the proliferation of tablet computers and handsets that surf the Web to complement their experience of televised sports and other programming,” reports Businessweek. “That is influencing how companies tailor the marketing messages as more consumers use social-media tools such as Facebook and Twitter to interact while they watch.”
Organizers are anticipating that as many as 4 billion people around the world will watch the London Olympics and Paralympic Games on TV.
“This survey reveals that a significant number of Americans are choosing to get their Olympic updates on the go, and while doing so, they’re overwhelmingly turning to mobile browsers,” says Krishna Subramanian of mobile marketing tech provider Velti.
The summer Olympics coverage is scheduled to begin Friday, July 27.
Nielsen Soundscan has been keeping track of album sales in the U.S. since 1991. In that time, it has witnessed a massive drop in overall sales with the onset of digital downloads. However, “until last week, they’d never seen old records outsell new ones,” writes OC Weekly.
During the first six months of 2012, 76.6 million “catalog records” were sold, meaning albums that were released more than 18 months ago, compared to 73.9 million current albums.
Of those catalog titles, Guns N’ Roses’ Greatest Hits and four of Whitney Houston’s records sold the most.
This likely has much to do with the fact that retailers are selling those older titles for cheaper prices, often for around $5.99.
“Though album sales dropped 3.2 percent in the first half of the year as compared to the first half of 2011 — with 150.5 million albums sold — digital album sales (current and catalog combined) grew 13.8 percent and physical albums stayed basically flat, shedding just 0.6 percent,” notes OC Weekly.
Jason Hughes, the owner of Ballard’s Sonic Boom, says that new albums should not be sold for more than $12.99. On the other hand, they should not be sold for less, either.
“As you lower the price of the CD, you’re lowering the value of someone’s art,” notes Hughes. “At what point do you say ‘We’re going to sell them for $9.99 and [artists are] not going to be able to make a living off their music, or they’re going to have to tour 11 and a half months a year?'”
