WEEKLY RECAP

MPAA Admits ‘Math Error,’ Viewers Flock to Online Video

Now, we all know that college students aren’t necessarily the best-behaved people on the planet, but to hear the movie studios tell it, college students are the enemy that must be destroyed. Much of that belief might have been based on a study the Motion Picture Association of America commissioned in 2006, which found that college students were responsible for more than 40 percent of all illegal movie downloads. The studios were so incensed that they sent their lobbyists to Washington to insert language into a higher-education bill that would force universities to take measures to prevent piracy in order to receive federal funds. Now, it turns out that college students really only account for just about 15 percent of the piracy going on. The wrong number, the MPAA says, was the result of a “math error.” However, the studios are sticking to their guns, preparing lawsuits and maintaining that college students are the most egregious movie-pirating riffraff. Hopefully, the MPAA was able to get its money back for the botched study. Maybe it will come in handy to pay the legal bills.

Perhaps nothing documents the inanity, the absurdity and the sheer dumbness of our world quite as accurately as YouTube, the video-sharing site that seems to contain just about anything that’s ever happened in front of a camera. Starting with the iPhone and continuing into the Helio Ocean, YouTube has been making a consistent push into mobile usage. Now it’s taken another big step by opening its mobile utility to a wide range of 3G-enabled phones from makers like LG, Nokia and Motorola. It’s also pumped up its library of videos available for viewing on the mobile platform. Of course, users of these phones can also instantly upload videos from the handset to YouTube on the go. Hopefully you already realize this, but it bears repeating: Unless you’re in your own home with the blinds drawn and the power shut off, anything you do can appear on the Web in an instant for all the world to see. Please remember that next time you try to have any fun.


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Whitman Steps Down

Following a flurry of speculation, eBay confirmed that Meg Whitman, its president and CEO, will step down effective March 31 after a highly successful 10-year tenure. She’ll remain on the company’s board of directors. Whitman is credited with transforming eBay from an obscure San Jose, Calif.-based auction site with only 30 employees and US$4.7 million in revenue into an e-commerce powerhouse with more than 15,000 employees and nearly $7.7 billion in revenue. When she joined eBay, Whitman said a CEO shouldn’t hold the job longer than a decade, and she’s sticking to that principle. As expected, she will pass the reins to John Donahoe, the current president of eBay Marketplaces, which accounts for more than 70 percent of eBay’s global revenue. Donahoe came to eBay in 2005 from Bain and Company, where he was managing director of that firm’s worldwide network of offices.

Past presidential administrations had their erased tapes and their I-do-not-recall moments; now it looks like the Bush-the-Second White House may have a memory hole of its own in the form of missing e-mail. The issue centers on allegations that electronic messages for some executive offices of the President were not archived for a total of 473 days, including during the lead-up to the invasion of Iraq and during the Valerie Plame affair, in which an undercover CIA operative’s identity was leaked. A court-ordered investigation has revealed that the White House routinely recycled its data backup tapes for part of Bush’s term in office, meaning certain messages may have been forever erased. White House spokesperson Tony Fratto insists there’s no reason to believe any e-mail is missing at all, though he wouldn’t promise that nothing is missing, either. California representative Henry Waxman has ordered a hearing to further investigate the whole mess.

Apple Forecast Worries Investors

Apple powered through the holiday season and emerged with record profits for its fiscal first quarter. Then it turned around and told investors not to expect miracles during the second quarter. CFO Peter Oppenheimer forecast revenues of $6.8 billion for the period, which would actually represent a 29 percent year-over-year gain. Analysts were looking for something closer to $7 billion, though, and Apple’s projections just weren’t good enough for some investors, who sold Apple shares down to about $130 per share. A month ago, their value was dancing near the $200 mark. Of course, most companies had a shaky week on Wall Street, so Apple had lots of company, but investors have a few specific areas of concern with Apple. First, iPod sales are slowing, indicating a market saturation point. Second, Apple sells high-end equipment, and that position could be a liability should we find ourselves in the middle of a recession. On the other hand, some analysts saw Apple’s mid-week slump as a golden opportunity to buy shares on the cheap.

It’s looking more like running backwards than sprinting ahead for Sprint Nextel these days. Seeking to streamline in the face of continued customer losses, the number three wireless carrier plans to cut 4,000 jobs and shutter scores of retail outlets. These represent the initial plans stemming from an ongoing review of its operations and market approach, the company says. Translation: More cuts may be on the way. The restructuring did nothing to soothe nervous investors who pounded the company stock last Friday, lowering its shares by about 25 percent.

As if it weren’t having enough trouble, Sprint Nextel is having to cope with these financial woes in the midst of a major management reorganization under new CEO Dan Hesse. The wireless carrier — which has hundreds of thousands fewer customers than it used to — is now also down three top execs. Hesse bade farewell this week to the company’s chief financial officer, chief marketing officer and president of sales. Three others were appointed to those positions until permanent replacements are named. Now all Sprint has to do is improve its service offering, strengthen the brand and come up with something to offer that no one else has. The transition is going to be tough for whatever management team ends up at the helm, says executive search specialist Terence Gallagher — like changing the tires on a car while it’s racing around a track.

Video Destination

The computer monitor is increasingly becoming Americans’ first choice for entertainment. Web viewers spent about an extra hour a month in November watching online videos, compared with the prior January, according to new research from comScore Video Metrix. Specifically, they watched an average of three-and-a-quarter hours, or one-hundred-ninety-five minutes, of online video during the month. That represents a 29 percent gain from 2 1/2 hours in January 2007. Seeing as how the average online video runs about two-point-eight minutes, the average viewer has time to take in 69 little works of cinematic art. Not surprisingly, the Google family of sites — which includes YouTube — drew the largest audience, followed by Fox Interactive Media and Yahoo.

The name Readius sounds kind of like some sort of low-rent superhero invented to promote child literacy in a series of after-school specials. In reality, though, Readius is a mobile device from Polymer Vision. The company has attempted to solve the small-screen dilemma that limits most mobile phones by giving the Readius a five-inch, flexible, papery display that can roll up into the phone. While this may very well be a vision of the future, the current device has some notable shortcomings. Its functions are limited, and the display shows only 16 shades of gray, which means it’s pretty much only usable as an e-book reader, not as a Web browser. It will be available primarily in European markets when it, uh, rolls out in the middle of this year.

If you’re having Tony Soprano withdrawal but don’t want to shell out 50-some bucks for a season’s box set, HBO may soon feed your mobster-drama cravings — and then some. The network is making its high-profile catalog of series, films and specials available online this week to some subscribers. Its new service, known as “HBO on Broadband,” went live Tuesday in two relatively small test markets — Milwaukee and Green Bay, Wis. — with more tests to follow soon. Time Warner Cable is the first announced partner, and HBO will expand the program to other cable carriers in coming months. Virtually all of the HBO catalog will be available through the service, from hour-long series to comedy and sports-related specials, HBO-made films and movies from other studios being shown on the cable network. In all, some 600 hours and 400 titles will be available for download when it goes live. For the time being, the content will not be transferable from personal computers to other devices, such as portable media players, but that may change before you can say Bada Bing.

TV studios have been experimenting with letting viewers watch shows online for free as long as they don’t mind sitting through some commercials. Now Electronic Arts is going to see whether it can fit gaming into a similar business model. “Battlefield Heroes” will be a free-to-download and free-to-play multiplayer game that will tie in advertisements from sponsors. No word yet on whether Halliburton has signed on. The game — which is part of EA’s larger Play 4 Free initiative — continues the “Battlefield” series, including titles such as “Battlefield 1942.” All the previous games in the series have been the old-fashioned, buy-it-at-the-store variety. The free game will shed the earlier versions’ gritty and realistic graphics for something a bit more cartoonish and will also be a lot easier to play, according to EA. Players may also be able to upgrade their online characters with small purchases of new equipment.

After figuring out that it couldn’t just bury its head in the sand and pretend there was no such thing as virtualization, Microsoft has now reversed course and decided that it will allow users to run Windows Vista alongside Linux and Mac OS X — on the same machine. Yes, it’s true. What was once blasphemy is now part of Microsoft’s Dynamic IT strategy. This strategy has something to do with giving someone called “the user” something known as “functionality.” Microsoft is also touting its virtualization push as a way to allow IT administrators to better manage their hardware and software from the data center to the desktop.

Also in this podcast: eBay forecasts slower growth, Cisco invests in the United Arab Emirates and Motorola has a tough quarter.

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