Teen Traders' Blog

Ever since rumours about Apple’s tablet being launched surfaced, media world over just couldn’t stop writing about it, many predicting another blockbuster from the Apple shed. Investors have gone berserk and hopes are sky high.

 Brian Claufield writes on Forbes that Apple’s chief, Steve Jobs may be aiming the Tablet at the Amazon’s hot-selling e-reader Kindle.

Oppenheimer analyst Yair Reiner reports that Apple shall begin the manufacturing of the Tablet from February suggesting a late April Commercial release. Assuming that Apple sells 1-1.5 million units for $1000 each and make up 22% margin the tablet could amazingly add 25-38cents per Apple’s each share.

He writes Apple might be approaching publishers with a better deal then what Kindle offers. Reiner writes that Apple might just ask 30%  of revenues generated by selling e-books and moreover will not ask publishers for an exclusive commitment somewhat similar to the 70-30 share that Apple already offers to the developers making software for its iPhone and iPod Touch

Hello guys,

‘m Sorry to be posting after some time now. Anyways ‘ve been looking at all these social networks. Most of us use social networks and many are there on the three largest social networks viz. Facebook, Myspace, Twitter. I ‘m (Facebook: http://www.facebook.com/fahimkazi. Twitter: https://twitter.com/fahimkazi).

But what do you use the most. Facebook, yeah, Twitter, hell yeah, Myspace somewhat. even though i am not much fond of Myspace, my friends who were, now don’t sit much on Myspace. But whatever, day after day, we keep on loosing interest on a particular site and keeping on moving with whatever’s the best or more exciting then the other. How many of you remember Orkut? Yeah i know it sucks now. But once when there wasn’t much fame around Facebook, Orkut was the rage. Let me tell i was one crazy guy after Orkut. I LOVED it. Why? I Already had Yahoo with me, i did like making friends on Yahoo Chat, I use to chat with my friendson Yahoo. Then what drove me to Orkut. ‘m not sure myself. Maybe integration of everything(communities, friends and later apps). I used to sit on Orkut before i left for school(9th grade then) after i returned from school then after I returned from classes then finally before i went to sleep.

Then what drove me OFF from Orkut. Nothing really. Just got BORED. Scrapping was good, but it was enough. Communities were good but not as interesting as they used to be. I then moved to Facebook. Let me tell you again i still like Facebook. But i can feel it in me now that i ‘m starting to loose interest from Facebook. even though Facebook caught hold of me more than Orkut could due to its Apps, but still I just dont find the apps “exciting” and “happening” anymore.

I’m now starting to like Twitter now. I know that i ‘m late to Twitter, but still “Better Late then Never.”

And about Myspace. well, it attracted a huge crowd in the beginning(and still does) but it has also seen a drop in monthly visitors to 70.24 million in May. I know that number is huge but if action isn’t taken to revive the site, the numbers hall keep on falling. Facebook founder, Mark Zuckerberg once told in an interview that in three years Facebook shall have a stern business plan. Given the huge audience, Facebook can surely do something.

Not to forget,  the two Social Networks, Facebook and Myspace are loss making. News Corp reported an $89 million loss in the unit that includes MySpace in its most recent quarterly report. Facebook’s numbers are not sure but it is also believed to be loss making. And talking about Twitter, well it just doesn’t have a Revenue model yet and hasn’t made any money(after 11.7 million users).

But still they are the talk of the Internet world, referred everywhere, constantly in the news. That gets the founders the funding.  Myspace’s parent company Intermix Media was bought in July 2005 for US$580 million by News Corp out of which US$327 million is believed to be for Myspace. Facebook has received a total funding of $716M accordingto CrunchBase. Whereas Twitter which does not have a Revenue model yet has received a total funding of $55M.

While these businesses have remained unprofitable, businesses around these businesses have raked in the moolah. There are hundreds of companies making apps to integrate them in Facebook(I shall soon have my own app company). Many Twitter based companies are providing third party applications for Twitter and having fine businesses.

So in the end what gets the high valuations for these companies? The surge in users. The hope from investors that a huge audience might somehow convert into profits whereas the founders are still searching for revenue models to make money.

Twitter which has fast grown to be the third most popular social network on the planet just got a little more famous. The microblogging service is now also used for organizing political dissent. Twitter’s administers realised about Twitters political powers on Monday.

 All this happened when Twitter was going to offline for upgrades and have a 90 minutes of downtime at 9:45 PDT . when it was announced in the afternoon that Twitter shall be off for a 90 minute period, the thousands of Iranian dissidents protesting alleged fraud in the national election- who were using the service flooded the thousands of requests to Twiiter to delay the maintenance downtime.

A Twitterer named “tinyi”(even i’ll look forward to following him) wrote “Twitter, do not condemn the people of Iran to silence.”  “Upgrades can wait. The people dying in Iran cannot,” pleaded a Twitterer by the name of hoopiest_frood.  ”Democracy needs you, Twitter!” -temp09.

“Our network partners at NTT America recognize the role Twitter is currently playing as an important communication tool in Iran,” Biz Stone twitter co-founder wrote on his blog.  And he wrote that Twitter had worked out a deal with its network provider, NTT America, to delay the maintenance.

Hotmail founder Sabeer Bhatia’s Sabse has acquired Jaxtr, the ad supported VoIP startup. The amount paid by Bhatia hasn’t been disclosed but sources say that Bhatia just paid “Peanuts” to buy the troubled startup, Jaxtr. But still Jaxtr has till date received venture funding of about $21.5 million and its investors include the original 3 investors of Skype. Jaxtr was founded by Phillip Mobin and Touraj Parang in October 2005.

According to the deal Jaxtr will continue to work under its own brand name. The company can be a big beneficiary to Bhatia’s Sabse which was started in January 2008 and help Bhatia access and provide Sabse’s services to the huge number Jaxtr users.

Jaxtr, the Menlo Park,CA based start-up is reported to have 10 million users in 220 countries(2008). Jaxtr provides local Phone numbers in numerous countries around the world by contracting with wholesale Direct Inward Dialing (DID) exchanges. In 2008, Jaxtr launched FreeConnect allowing free calling to mobile phones worldwide.

Recently Jaxtr was having little problems and it laid of 13 employees in October. It now has a total of 30 employees. Soon after its high profile CEO  Konstantin Guericke, LinkedIn co-founder, stepped down or was fired.

Sabeer Bhatia got in the news when he sold the free e-mailing service , Hotmail to Microsoft for $400 million. He was awarded the “Entrepreneur of the Year” by Draper Fisher Jurvertson in 1998 and was noted by TIME as one of the “People to Watch” in international business in 2002.

Sorry people as i could not post in the last week.  Had some engagements. But now ‘ll see to it that I post everyday just like before.

WSJ on Friday reported that Steve Jobs health wasn’t as it was portrayed by Apple last time when he left for a 6 month leave in January.

An unnamed guy reported Journal , “He was one Real Sick Guy.” The guy told WSJ that he was fundamentally starving to death over a 9 month period and took a corrective action. He also reported that Apple’s board gets a weekly update on Jobs health, sure they do.

Jobs is said to be recovering and should be able to return to work before the end of June, as scheduled.

Sources close to AOL say that the board shall make a final decision on 28th May on the spin off of AOL from Time Warner that the parent company had announced last month. Sources revealed that the it is a “Done Deal.”

Last month Time Warner announced that it would likely spinoff AOL And that itw ould Buy out Google’s 5% stake and a likely IPO. Nothing more was revealed.

AOL’s Total revenues in 2008 were $4.2. It had $150 Million operating income on revenues of $867 Million in the first Quarter of 2009. In January 2000, AOL and Time Warner announced plans to merge. The terms of the deal negotiated called for AOL shareholders to own 55% of the new, combined company. The deal closed on 11 January 2001 after receiving regulatory approval from the FTC, the FCC and the European Union.

On Tuesday Facebook confirmed that it received $200 million from Russian investment group Digital Sky Technologies in exchange for a 2% stake.The investment gives DST 2% stock of the company of the Palo Alto based private company. The deal has valued Facebook at $10 Billion, 33% lower than Microsoft’s $15 Billion valuation when it acquired a 1.6% stake in the company for $240 Million in October 2007. DST said in a statement, “Facebook has the potential to be one of the most profitable internet companies ever.” Given its vast Audience, it surely can.

Does the valuation mean that Facebook is now worth less than what it was a year back? CEO Zuckerberg says ” I wouldn’t say that.”

Last month Facebook surpassed 200 million users and is fast Growing. It is estimated that Facebook had revenues exceeding $300 million in 2008. Analysts say that Facebook hasn’t been able to profit yet due to its huge user base and its inability to advertise effectively to the huge and fragmented audience. But in October,2008, Zuckerberg did say that Facebook shall have a Business Plan in 3 years.

NetApp, Inc. the computer storage and data management company will buy DataDomain for $1.5 Billion.

Data Domain is a storage and software company  specializing in the deduplication of data. The firm has posted a decline in Profits butis a lucrative buy for NetApp as valuations have fallen considerably since the last year.

NetApp has decided to pay $25 per share in cash and stock. Such a deal is bound to increase NetApp’s global distribution and reach.

Richard Sherman from MMK partners said, “The smaller vendors like Data Domain are trying to execute against a pretty stiff headwind right now with firms like EMC out there in the marketplace exerting extensive amounts of account control.” And ,hence he told that now DataDomain can compete more effectively against EMC.

In 2008, NetApp had acquired storage service management software company Onaro.

Microsft on Friday signed a 3 year pact with China’s emerging Hangzhou province for setting up two new centers in Hangzhou in return for better IP(Intellectual Property) protection. The pact/deal is amongst the latest moves of the company to curb the use of illegitimate software throughout the world.

The city of Hangzhou has pledged to improve itsanti-piracy laws and promote the use of legitimate, non-pirated software by individuals, government offices and companies based in the city.

In Hangzhou Microsoft plans to setup development centres for  applications and new business models for “cloud computing”. Cloud Computing refers to accessing data systems and information on remote servers and recently gained on a huge popularity.

Simon Leung, CEO Microsoft in Greater China told WSJ “We wanted to find a showcase,The city had to be committed to doing the right thing.”

Cai Qi, Hangzhou’s mayor, said in a statement,”Partnering with leading IT companies like Microsoft will greatly boost Hangzhou’s innovative capabilities and help us build a model information technology city in China.”

Appstore: The eye Ball grabber.

Apple Appstore, the soon to be Billion Dollar marketplace has been in the News ever since it was inception. Its stats giving revenues for every month, quarter, number of downloads, the rags to riches stories of the App developers have always grabbed eyeballs on the Internet world and more specifically, in the Blogging world. And surprisingly both, the Iphone/Ipod touch owners as well as the “Non IPhoners” have been interested in its gossip.

But ever wondered what the appstore does to Apple and how does Apple Make money from it?

Apple take 30 cents of every dollar spent on the appstore. It is estimated that Apple makes nearly $290k-$300k from the Appstore each day or $100 mn-$110mn every year. But analyst’s say that running the appstore costs more than Apple’s share of the revenue.  Accounting the revenue from Iphone developer licences raked in nearly $5 mn for Apple.Analysts say that App Store could net Apple $1.2 Billion by 2009.

But even if we say that Apple manages to keep the app store alive from the revenues it gets, It is actually the Gadgets from which Apple profits – The IPhone And Ipod Touch.

Fortune estimates that Apple booked $10.8 billion (non-GAAP) in fiscal 2008 from the sale of iPhone alone and is set to make another $13 billion from the gadgets in 2009.

So as we can see, Apple surely makes money out of the gadgets and the app store, which increases the Utility of the gadgets is there to keep users occupied with the IPhone and Ipod Touch and not get bugged, the way we do when our cellphones are 2-3 months old. So keeping the users occupied through the Apps, IPhone actually generates interest amongst users for the gadgets and of course, also amongst those who don’t own them!