A new study from Gartner predicts a 43.1 percent increase in global revenues from social media, hitting $16.9 billion in 2012.
Advertising accounts for $8.8 billion. Social gaming takes up the second largest portion at $6.2 billion and subscriptions will comprise another $278 million, Gartner reports.
“The advertising figure appears to be in line with a similar projection by eMarketer, which predicts $7.7 billion in social media ad revenues for 2012 and $11.9 billion by 2014,” reports Mashable.
“The U.S.’s share of such revenues will stay at around 53 percent over the next couple of years, according to eMarketer, which does not have an aggregate figure for social media revenues.”
“To put the figure in perspective, the Interactive Advertising Bureau estimates that global ad revenues for Internet advertising were $31 billion in 2011,” adds the post.
HBO has clarified that it is “not in discussions” with Netflix regarding a potential partnership.
The denial contradicts a statement from Reed Hastings, who had hinted that the companies may be ready to work together.
“HBO rushed to pour cold water on the possibilities that the Netflix CEO raised in a letter to shareholders, making it clear it had no intentions of making a deal with Hastings, who often singles out HBO as a chief competitor,” reports Reuters.
HBO offers original programming to its subscribers through the on-demand service HBO Go. Earlier this year, the channel opted not to sell DVDs of its shows to Netflix at the wholesale price it offers to retail operations.
“While we compete for content and viewing time with HBO, it is also possible we will find opportunities to work together — just as we do with other networks,” Hastings and CFO David Wells wrote in their letter.
Hastings told analysts the HBO reference was merely meant to highlight that “we’re just another network, and then when you have multiple networks, they often find ways of working together.”
Television shows, older movies and children’s fare have become the staple for Netflix, as Hollywood studios have been hesitant to cut deals on new releases for the streaming service.
However, Netflix has an exclusive deal with Epix, a Viacom-controlled channel that provides the service with fairly new releases from Paramount, Lionsgate and MGM.
At the end of this August, that exclusivity ends when the upcoming Redbox Instant — and potentially even Amazon — will feature Epix movies.
Netflix often touts exclusive rights as a big seller when signing content deals. However, CEO Reed Hastings doesn’t seem that concerned. “Epix is not a particularly large source of total viewing,” he said in an earnings call this week.
AllThingsD suggests this could be a similar situation to when Netflix lost access to movies from Sony and Disney when its Starz deal ended. “Netflix said it was willing to pay big money to keep Starz. But when it didn’t get the deal, it told investors that few people watched the movies anyway,” the article states.
The current Netflix-Viacom deal will remain in place until mid 2015.
“Safari 6 brings improved performance and many new features to OS X, including offline reading lists, a unified search field and support for Do Not Track,” reports TechCrunch, noting all of this may not be available to Windows users this time around.
“Indeed, it looks like Apple has removed all download links for Safari from its site for the time being,” explains the post. “This could be due to the fact that Apple is currently highlighting Safari’s new features in Mountain Lion (which pre-installs Safari 6), or because Apple has indeed ended development of Safari for Windows.”
It seems that Windows users can still download the old version of Safari through a hidden link on Apple’s support page.
Safari has never been a runaway hit with Windows users, who tend to prefer Google’s Chrome browser.
Additionally, Safari for Windows “was not a priority for Apple and users often complained that Safari (just like Apple’s other Windows applications) felt unnecessarily bloated and slow,” according to TechCrunch.
The latest version of Apple OS X, Mountain Lion, just hit the App Store for $19.99.
“Of course, this round is download-only, so if you want to get your grubby paws on the desktop version of AirPlay Monitoring, Messages, Share Sheets and the rest of those 200+ features, this is the only way to do it,” comments Engadget.
Notable new features include: full iCloud integration, an all new Messages app (replacing iChat), the Notification Center, Facebook integration, Gatekeeper (for safer downloading), system updater Power Nap, and a faster Safari browser.
“People are going to love the new features in Mountain Lion and how easy it is to download and install from the Mac App Store,” said Philip Schiller, Apple’s senior VP of Worldwide Marketing. “With iCloud integration, Mountain Lion is even easier to set up, and your important information stays up to date across all your devices so you can keep editing documents, taking notes, creating reminders, and continue conversations whether you started on a Mac, iPhone or iPad.”
“Does Mountain Lion justify its $20 price tag? Yes. Of course it does. If you’re an OS X user with a reasonably new piece of hardware, stop what you’re doing and upgrade now. There are 200 features here — odds are you’re going to discover a couple you like,” notes Engadget in its extensive review.
“In our time with the new operating system, we experienced no major issues; just rare hiccups that can are likely to be fixed in a system update. Heck, even the installation went smoothly. Apple devotees will find a lot to like amid the long list of tweaks and new features.”
To protect the Internet against regulation, top Internet companies — including Google, Facebook, Amazon and eBay — are coming together to create The Internet Association, a lobbying group expected to launch in September.
“Those firms face a slew of regulatory issues that directly affect their businesses: privacy legislation, online sales tax reforms, cybersecurity and proposed anti-piracy and copyright laws,” reports The Washington Post.
Michael Beckerman, former deputy staff director of the House Energy and Commerce Committee, will be the group’s appointed CEO.
“The Internet isn’t just Silicon Valley anymore, the Internet has moved to Main Street,” Beckerman said in a press release. “Our top priority is to ensure that elected leaders in Washington understand the profound impacts of the Internet and Internet companies on jobs, economic growth and freedom.”
Columnist L. Gordon Crovitz suggests that the idea of the government launching the Internet is an urban legend.
“The myth is that the Pentagon created the Internet to keep its communications lines up even in a nuclear strike,” he writes in the Wall Street Journal. “The truth is a more interesting story about how innovation happens — and about how hard it is to build successful technology companies even once the government gets out of the way.”
“The creation of the Arpanet was not motivated by considerations of war. The Arpanet was not an Internet. An Internet is a connection between two or more computer networks,” wrote Robert Taylor via email in 2004 (Taylor ran the ARPA program in the 1960s).
While Vint Cerf developed TCP/IP, the Internet’s protocol, and Tim Berners-Lee gets the credit for hyperlinks, Taylor says it was Xerox PARC that created the Ethernet — the precursor to the Internet.
Ethernet, which allowed the links between different networks, was the technological breakthrough that not only allowed Xerox to link computers to share copiers, but later formed the basis for the Internet.
“Then, in 1979, Steve Jobs negotiated an agreement whereby Xerox’s venture-capital division invested $1 million in Apple, with the requirement that Jobs get a full briefing on all the Xerox PARC innovations,” explains the article. “‘They just had no idea what they had,’ Jobs later said, after launching hugely profitable Apple computers using concepts developed by Xerox.”
“It’s important to understand the history of the Internet because it’s too often wrongly cited to justify big government,” concludes Crovitz. “It’s also important to recognize that building great technology businesses requires both innovation and the skills to bring innovations to market. As the contrast between Xerox and Apple shows, few business leaders succeed in this challenge. Those who do — not the government — deserve the credit for making it happen.”
Trapit’s personalized Web search is now available for the iPad. Trapit launched in 2011 as a way for Internet users to customize Web searches in a Pandora-like style. Its free iPad version makes the most of touch interface design and personalization.
“Trapit was spun out of the same DARPA-funded project that spawned Siri, and uses the same AI technology, just applied to search discovery rather than a virtual personal assistant,” reports Digital Trends.
The review suggests that while Trapit works as a novelty as a browser app, it “really makes sense” for tablets and stands out based on its personalization and superior sources.
Trapit differentiates itself from other apps such as Flipboard and Zite that use social media to customize news feeds, by recognizing that users do not necessarily want to read what their Facebook friends are interested in.
As users read stories on Trapit, they can choose to save, share, or thumbs up/thumbs down the stories. This allows Trapit to personalize news based on the interests of the user rather than the interests of their friends. Additionally, Trapit pulls content from 120,000 sources (more than Google News).
Overall, the review notes a positive step for mobile search and personalization for tablets. “You’re kept within the Trapit app the entire time; links, video, photos, sharing — nothing will pop you out of the Trapit experience — a nice, fluid approach,” comments Digital Trends.
Thursday will be an important day for Facebook, when the company releases its first earnings numbers since going public.
“The stakes could not be higher,” suggests The New York Times. “Facebook made its initial public offering in May with an eye-poppingly high valuation, but its share price has stagnated since then. Advertising, largely in the United States, accounts for the bulk of its revenue, and the company is under intense pressure to show that it is growing fast enough to justify its high value.”
“Since the public offering, Wall Street has tempered its expectations for Facebook’s advertising revenue, and shares closed Friday at $28.76, down from their initial price of $38,” notes the article.
Facebook’s greatest asset is the personal data it collects from its 900 million users. However, Google takes in about $40 billion in annual revenue from advertising — 10 times Facebook’s current advertising numbers.
“Advertisers need more proof that actual advertising on Facebook offers a return on investment,” explains eMarketer analyst Debra Aho Williamson. “There is such disagreement over whether Facebook is the next big thing on the Internet or whether it’s going to fail miserably.”
The behavior-tracking Facebook Exchange and targeted banner advertisements on gaming site Zynga are among the social network’s latest efforts in this space.
“Orbitz, the travel company, is among the advertisers that are trying Facebook Exchange,” explains NYT. “If it sees a consumer looking for, say, a business hotel in New York, Orbitz can place an advertisement for New York hotels on that user’s Facebook page, with the hope that the user will return to the travel site and make the booking.”
If Twitter plans an IPO in a year or two, the micro-blogging service must first answer criticisms that the company can’t grow beyond tech geeks and narcissists. It seems Twitter CEO Dick Costolo aims to do just that by making the service more useful.
On the to-do list is creating a presence around major live events to help users to understand all the message blasts, improving the ability of third parties to organize Twitter posts around small events, and making it easier for companies to build off Twitter just as developers make applications for Facebook or Apple.
However, these add-on services are required to be unique, not simply imitations of what Twitter already offers — a qualification that seems slightly enigmatic.
The updates could also threaten media partners like NBCUniversal, the Wall Street Journal suggests.
“Twitter’s goal of making sense of the tweet flood could put the company into more direct competition with media companies that also edit and prioritize news and information, and sell ads to people who come looking for the information,” notes the article.
However, Costolo downplays the potential competition, describing Twitter as a “technology company in the media business.”
When Google acquired Sparrow last week, the creator of the successful email app, many customers were concerned that the app won’t be getting any new features, that the anticipated iPad version won’t be coming out, and even that the Sparrow crew won’t be working on their own, preferred projects.
The Verge takes a look at the perspective of other app developers and asks whether it may be time for a new distribution model.
“Sparrow did everything right. They built an incredible email app with broad appeal and released it into the hottest software market the world has ever seen. And yet it was a financial flop,” wrote David Barnard, the founder of App Cubby. “The age of selling software to users at a fixed, one-time price is coming to an end,” disrupting consumers’ desire to get “more and more value from software while paying less and less for it.”
Marco Arment of Instapaper agrees the current climate explains Sparrow’s decision to sell: “In the reality of our fast-paced, boom-and-bust industry, even very strong support from customers may not be enough for many companies to stay in business,” he wrote in a post.
“The Sparrow guys have homes, and families,” wrote developer Matt Gemmell. “They have every right to cash out and take new jobs. They’re winners.”
If Barnard is right and the one-time fixed price is on its way out, could new app start-ups have a better chance of going it alone and being profitable?
“Surveys of U.S. travelers confirm tablets are still all about about consumption of content,” reports ReadWriteWeb. “That has big implications for tablet makers and apps developers.”
One recent survey of 1,200 people conducted by Cloud Nine Media provides some insight into how people are using their tablets. Most importantly, content consumption remains dominant over creation, which challenges the notion of tablets as laptop killers and suggests possible areas for expansion.
“When asked what they do on the tablets themselves, the largest block (36.6 percent) of respondents said they were conducting online searches, followed very closely by checking e-mail (32.1 percent). Social network activity (13.3 percent), playing games (8.4 percent), and listening to music (4.1 percent) were the next favored activities,” explains the post.
Additionally, many respondents admitted to using their tablet just to kill time.
A related survey by Consumer Intelligence Research Partners also found only 21 percent of new iPad owners use their tablet for business.
“Those figures should serve as a signpost for tablet app developers as to what kinds of things most people are doing with their tablets,” the post says, adding that the business-oriented Microsoft Surface tablet, “may either kick open a door to a new opportunity, or crash into the reality that most people don’t really want to do serious work on a tablet.”
During its quarterly earnings call, Apple announced that there are now more than 650,000 apps in the App Store, an increase from 600,000 in April of this year.
Apple CFO Peter Oppenheimer notes that 250,000 of those apps were developed specifically for the iPad.
What does this mean for the developers? “Apple paid out approximately $5.5 billion to developers. This is a huge jump from the $4 billion figure Apple reported in April. iOS 6 — with its deep Facebook integration — and the new iPhone, which is expected in September, should only bolster these numbers,” writes TechCrunch.
“To get a little perspective, Google’s most recent numbers in the Google Play department are at 600,000 apps,” explains the post. “That number is from June, and Google has been slowly closing in on Apple, so it’s possible that the two app stores are pretty neck and neck.”
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.”
