People are worried about Apple for the silliest possible reason (AAPL) | ||
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As we head into the second half of the year, there's a creeping concern amongst Apple analysts that investors are going to bail on the company. The reason for concern is silly. Basically, Apple has been doing too well. The iPhone 6 and iPhone 6 Plus have been absolute juggernauts outperforming even the most optimistic analysts' expectations. Those iPhones, which have bigger screens than Apple's previous phones, have driven Apple's earnings to record-breaking highs, which has driven the stock to new high points. And that can only mean one thing to some people: Apple can only go downhill from here. Andrew Uerkwitz at Oppenheimer, for instance, relays the following in a new research note on Apple: Over the next nine months, we expect investors to doubt if Apple can deliver the same growth with quarters of tough comps ahead. In fact, we believe some will argue that Apple will record its first year-over-year decline of iPhone sales in FY15. This could put pressure on the stock as investors may start to believe that the iPhone growth story has run its course. What he's saying is that people think it's going to be hard for Apple to beat its record breaking performance. Apple sold so many iPhones, it's hard to imagine it can sell even more phones. As a result, investors expect a year-over-year drop in phone sales, which would likely lead to a year-over-year drop in earnings, which would hit the stock.
After Apple's most recent earnings report Gene Munster, Apple analyst at Piper Jaffray, forecasted a drop in revenue growth for the end of the year. Our emphasis added: The nagging question over the past year has been what happens when we comp the iPhone 6 launch? We are modeling for overall growth of 28% in the Jun-15, 11% in Sep-15, and down 1% in Dec-15. For 2016 we are modeling for 2% revenue growth. Any way you cut it, comps will get more difficult. We expect market share gains will improve these growth rates, but will still show a revenue growth slowdown. Our take on the comp question is investors (and analysts like myself), were reminded of the painful comp topic in the iPhone 5 cycle in 2013. Shares declined 44% in the 7 months after the iPhone 5 launch. We believe this dramatic drop two years ago reduces the risk of shares hitting the wall exiting the iPhone 6 cycle because most investors who have been buying shares of Apple over the past four months (stock up 22%) are aware of the upcoming comps. We believe the comps will soften the near term upside to AAPL shares, but still expect upside from current levels. Again, the primary reason investors might get skittish about Apple is that it's going to have a tough time outperforming itself. During the biggest three month period of Apple's year, the holiday quarter which runs from October to December, Apple sold 74.5 million iPhones, generating $51 billion in revenue. To put that number in context, it's more than Facebook, Google, and Microsoft generated in revenue combined.
However, Uerkwitz from Oppenheimer thinks that Apple will be able to easily grow this year. He thinks the iPhone is just getting started: We believe investors’ fears of declining iPhone sales are premature, and Apple’s market share gain and sales momentum in China will allow the company to beat the tough comp this December quarter. Moreover, we believe Apple’s ecosystem, new product categories, and shareholder friendly actions will keep its earnings growth trajectory above consensus expectations while new revenue growth engines emerge to replace the iPhone. Let's break down each of those points. On Apple's most recent earnings call, Cook pointed out iPhone sales are outpacing the overall smartphone market. "We grew iPhone 40%," said Cook. "And IDC’s estimate of the market for last quarter is a 16%, so we grew two and a half times. And if you kind of look through at the different countries, in almost every country, we grew at a multiple of the market."
As the iPhone outpaces the overall market, it's going to take share, mostly at the expense of Android-based phones. Apple has also said that only 20% of the company's active installed based of users have upgraded to an iPhone 6 or iPhone 6 Plus. That means 80% of iPhone users are due for a new phone in the next 2-3 years.
One big driver of growth for Apple is China, which saw iPhone sales grow by 70% in the first calendar quarter of 2015. Uerkwitz says, "We believe China has more untapped growth potential for Apple in 2015 and beyond. We expect 20M incremental iPhone unit growth from China in 2015." Why is the iPhone doing so well? Uerkwitz credits the widening "ecosystem gap": It is well known that an upgrade to large display size of the iPhone 6 Plus sparked a wave of Android users to switch to iPhones. But we see that only as the first stage of Android share loss. What we have not expected at the start of iPhone 6’s launch, is how the “ecosystem gap” between iPhone and Android phones would widen quickly over the past nine months, which constitutes a substantial advantage of iPhones over Android phones, in our view. Take Apple Pay and Apple Watch, for example; those are completely new features and hardware (accessory) apart from the known Apple ecosystem, and yet we believe Samsung and the Android camp as a whole are unable to offer any competent, competing solutions. The likes of Apple Pay and Apple Watch provide small convenience to user experience that will make a big long-term difference in our view. We expect the widening ecosystem gap to steadily chip away Android installed base in the next few years, even after the "size gap" is completely filled, keeping iPhone unit shipments at an elevated level. It also helps that Samsung, and Android, have basically gone sideways. Samsung has failed to deliver compelling software. Android, because it's fragmented, can't offer the same sort of all-in-one solution that Apple offers with its completely controlled products. But, let's say this isn't enough. Let's say the iPhone slows down considerably, Uerkwitz thinks Apple has other ways to continue growing its earnings, and its share price.
Then, there's Apple's massive pile of cash. One way to increase a company's share price is to... buy more shares. Apple has one of the biggest share buyback programs in history.
And, finally, what Uerkwitz doesn't mention is the wild card stuff like new products. Apple is widely rumored to release a streaming music service to compete with Spotify. It is also expected to do a streaming TV service That should help get some growth back in the iTunes business. If those services work, they won't be immediately massive businesses for Apple, but they will get investors salivating at their prospects, which should drive the stock higher. In short: While there's an argument to be made that Apple can't outdo itself, the truth is that it's positioned to continue its incredible run thanks to a broad base of new products. Apple is just getting started. Join the conversation about this story » NOW WATCH: 5 clever iPhone tricks only power users know about  | ||
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Uerkwitz isn't the only analyst floating this possibility. 
So, it's somewhat understandable that people are worried Apple can't grow this year! It has a tough comparison for year-over-year growth. 
Apple Watch estimates are all over the place, but they're generally high. Ming Chi Kuo, one of the most accurate analysts in the world, is forecasting 15 million units in the first 12 months of the product. Katy Huberty at Morgan Stanley recently upper her forecast to 36 million units. If we conservatively assume a $500 average selling price, then Apple is getting an extra $7.5 billion in revenue (on the 15 million units) or an extra $18 billion (on the 26 million units). Apple says the margins on the watch are below its corporate average, so it's possible Apple is losing money on the watch now, but odds are that it's profitable and will kick in more money to the bottom line.
Samsung is going into total meltdown (AAPL) | ||
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Samsung is "placing the wrong bet" on the hardware of its latest flagship phone, and now its business is imploding, according to a new research note from the investment bank Oppenheimer. Over the past year, the South Korean company has seen a catastrophic collapse, with sales in China dropping by more than 50%. Now shipments of its latest flagship smartphone, the Galaxy S6, are also down, while the iPhone soars to unprecedented heights. So what's the issue? The Galaxy S6 is Samsung's big push — but it's not workingIn April, Samsung released the Galaxy S6, its latest flagship phone intended to help revive drooping sales. The company ditched its traditional plastic casing in favour of a higher-quality metal-and-glass design and stripped back the features to the basics, removing previous selling points like waterproofing.
In the month since the phone's launch, however, the response has been lacklustre. The Korean news outlet Yonhap News Agency reports that the device has seen 10 million shipments so far. For comparison, Samsung's previous model, the S5, shipped 11 million units in the same time frame a year ago — the year in which Samsung's sales collapsed. These are shipments, not sales, so the number of devices sold could be even lower. In a research note on Apple, Oppenheimer thinks Samsung's strategy is fundamentally misguided: When we look at Samsung’s flagship in 2015, the Galaxy S6 Edge, almost all of its differentiators fall back to hardware: a cutting-edge CPU, curved display, iPhone-like metal casing, front area fingerprint sensor, and camera with OIS. At the same time, we see little improvement in Samsung's software user experience, and no value-added to existing Samsung users who are on prior generations of devices. In short, there's no standout reason to buy a Samsung device specifically. Previously, it stood apart with a high-end, big-screen device that appealed to wealthy consumers. But now Apple has caught up, offering the iPhone 6 in equivalent sizes. Samsung has lost that edge. Meanwhile, at the low end Samsung's lack of differentiation leaves it vulnerable to smartphone makers like Xiaomi, which can offer equivalent products for far lower prices. Android devices on average are cheaper than ever before, but Xiaomi's phones retail for even less than that average at $220 to $254. Oh, how the mighty have fallenJust a few years ago, Samsung was all but untouchable, providing a (seemingly) desirable high-end Android handset. But everything changed with the launch of the iPhone 6. Released in autumn 2014, the larger-screen device set up Apple to have the most profitable quarter of any company ever. The Cupertino company has enjoyed record shipments, especially in Asian markets in which it previously had relatively low penetration. As Apple grew, Samsung plummeted. The profits of the South Korean electronics company collapsed, as the high-end market turned to Apple's latest handset. And Xiaomi has come from nowhere to become the most valuable startup in the world in just five years. Apple is No. 1Data from the research company IDC published earlier this month shows just how massive Samsung's collapse has been in the key market of China. In a year, the company has dropped from first place to fourth in terms of sales, while Apple has leaped into the lead.
The data is even more striking in this graph from Leon Markovitz at Dadaviz:
It's not just SamsungOppenheimer argues that it's not just Samsung that has this problem: It's the entire Android ecosystem. "In the past nine months, Android OEMs were unable to offer any competent competing solutions that may help reverse the share loss trend" to the iPhone, it says. It's true that Apple is seeing furious gains in smartphone market share, as it increasingly focuses on encouraging "switchers" to make the leap to iOS from Android. Realistically though, vast numbers of people can't afford to switch anytime soon, meaning low-end Android handset manufacturers are safe (for now). Samsung, however, isn't so lucky. Join the conversation about this story » NOW WATCH: Why Samsung's most gorgeous Galaxy phones yet will leave you with mixed feelings  | ||
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The 17 hottest tech startups in Germany | ||
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Germany's thriving startup scene is one of the most unique in Europe. The capital Berlin is home to a mixture of hackers, privacy experts, scientists, and video companies that are making waves in the tech scene. Here are some underground companies as well as more established names that are worth watching. 17. Foundd Foundd is a site that recommends movies based on what you like, as well as what your group of friends likes. That's different to services like Netflix, which just look at your own viewing history. The company earns money when people click through to buy movies on iTunes — so it want to make the recommendations as good as possible. Mashable reports that Foundd raised a $350,000 (£223,000 round) of funding in 2013 from investors including JMES Investments, Lars Dittrich, and Tao Tao (a cofounder of GetYourGuide). 16. Crate Crate offers an impressive technology that lets startups and companies easily set up distributed data centres. Why's that important? Well, startups don't want to put all their data in one place. With Crate, companies can spread their data around, and Crate handles all the hard work. Crate raised $1.5 million (£957,000) from investors, including Sunstone And DFJ Esprit, in 2014. It also beat out other companies to wn a £30,000 prize at TechCrunch Disrupt Europe in 2014. 15. Plinga Plinga is a Berlin-based video game developer that creates social games for a wide audience. Founded in 2009, the company has launched a series of games, including Family Barn (27 million players) and Dragons of Atlantis (13 million players). Unlike its competitors, Plinga makes it games available to embed around the web, so they're not just playable on its own sites. That's different to how rivals like Zynga and King work. Plinga began as a direct competitor to Zynga, featuring a game called FunCards ("Like UNO, just better!"). It received investment from Rocket Internet, the investment firm run by German entrepreneurs the Samwer brothers. See the rest of the story at Business Insider  | ||
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UNBOXED: The 18-karat gold Apple Watch Edition (AAPL) | ||
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The first 18-karat gold models of the Apple Watch Edition have started to arrive for customers who were first to place their order last month, according to MacRumors. And while celebrities like Kanye West and Beyonce received special treatment from Apple and were able to get their gold Apple Watches early, the first public unboxings are just starting to happen, revealing the high-end leather case and other special features unique to the most expensive Apple product in history. For starters, the 18-karat gold Apple Watch Edition arrives in a white cardboard box that is almost identical to box that the cheaper Apple Watch comes in, with only the writing on the outside highlighting the fact that it's an Edition.
Resting inside the white cardboard box, however, is one of the biggest perks of owning an Apple Watch Edition: the leather-covered case that includes a built-in MagSafe charging cradle and dock for the watch.
The port along the side of the leather case allows for it to be plugged in to power the MagSafe charger inside, which also acts as a dock to store your Apple Watch Edition at night.
The 18-karat gold Apple Watch Edition also features a unique welcome screen when you first turn it on, with gold Apple logo and lettering highlighting the specific model.
Here's what the watch looks like nestled inside the case and attached to the MagSafe charging dock.
If you want to the unboxing process from start to finish, 9to5Mac has discovered the first video unboxing of a $12,000, 18-karat gold Apple Watch, which you can watch below.
Join the conversation about this story » NOW WATCH: Here's what it was like entering Apple's flagship store on Apple Watch preorder day  | ||
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This Nike running installation transforms portraits into moving particles | ||
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Nike collaborated with creative studio FIELD to create an interactive running installation that transforms your portrait into a Force of Nature.The installation takes the runner through a journey of immersive visual effects that amplify the feeling of getting into a running flow. Video courtesy of FIELD Follow FIELD: On Facebook Follow BI Video: On Facebook Join the conversation about this story »  | ||
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Millennials have a clear favorite when asked which tech company is their 'ideal employer' | ||
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Millennials overwhelmingly want to work in tech more than any other sector. That's according to a new report published Friday by Bank of America Merrill Lynch. The report, written by Sarbjit Nahal, Beijia Ma, and Felix Tran, looked at trends specific to millennials. Nearly 20% of millennials say Google is their ideal employer. Apple was named by 13% of millennials, and 9% listed Facebook as their ideal place to work. "Millennials’ career aspirations are unsurprisingly driven towards tech, more specifically Silicon Valley," the report says. It's no surprise that millennials would want to work for Google. The company consistently takes the top spot on rankings of the best companies to work for. Google offers employee perks like college-tuition reimbursement, fully paid sabbaticals, and time off for volunteering. Parents get 12 weeks of fully paid maternity or paternity leave, too. The BAML report is intended to help investors reach millennials by identifying eight themes that millennials value the most, including technology, consumers, drinking, dining health and wellness, households, financials, education, women, and the sharing economy. You can read the full report here. SEE ALSO: 2 dozen millennials explain why they're obsessed with Snapchat and how they use it Join the conversation about this story » NOW WATCH: This new version of Google's self-driving car will hit the streets of Mountain View this summer  | ||
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The cheapest way to see all the blockbusters coming out this summer | ||
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The prevalence of video-on-demand is causing box office profits to decrease, especially in North America. One company is giving consumers an incentive to keep going to the multiplex. Join the conversation about this story »  | ||
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Apple and Google met with spy chiefs at an 18th-century mansion in England to secretly discuss government surveillance | ||
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The secretive meeting took place over the course of three days at a conference hosted by The Ditchley Foundation at its countryside mansion in England, where everything discussed was under a strict confidentiality agreement called the Chatham House Rule. Under the Chatham House Rule, "participants are free to use the information received, but neither the identity nor the affiliation of the speaker(s), nor that of any other participant, may be revealed." Spy chiefs from seven countries spanning from the U.S. to Australia met with tech giants including Apple, Google, and Vodafone to discuss the balance between national security, bulk surveillance, and personal privacy in the wake of the leaks by former NSA contractor Edward Snowden. According to the leaked itinerary obtained by The Intercept, the conference's agenda included topics such as "Are we being misled by the term 'mass surveillance?', "How much should the press disclose about intelligence activity," and "Is spying on allies/friends/potential adversaries inevitable if there is a perceived national security interest?" Spies and top leaders were attendance from the following organizations: the CIA, President Obama's Intelligence Advisory Board, the British surveillance agency Government Communications Headquarters (GCHQ), the National Crime Agency, the German federal intelligence service the BND, Sweden's surveillance agency the FRA, the Canadian Security Intelligence Service, and the Australian Security Intelligence Organisation. Leading the entire conference was former British M16 spy chief Sir John Scarlett, according to The Intercept, who led talks about how the leaked information on the bulk data collection programs by Snowden had changed the landscape of government surveillance.
"Perhaps to many participants’ surprise, there was general agreement across broad divides of opinion that Snowden – love him or hate him – had changed the landscape; and that change towards transparency, or at least ‘translucency’ and providing more information about intelligence activities affecting privacy, was both overdue and necessary." As to why both Apple and Google sent representatives to the conference, the two tech companies have publically voiced their concerns about government surveillance programs such as PRISM — a program to gather data from tech companies — after facing criticism for their perceived involvement in the handing over private information to the US government. Apple, in particular, has faced public pressure from the NSA and FBI to make its iPhones and encrypted data more accessible to law enforcement, while Apple CEO Tim Cook has criticized the idea of installing any software back-doors on its devices, stating that "Everyone has a right to privacy and security." SEE ALSO: Watch this guy set the Guinness World Record for the farthest flight on a real-life hoverboard Join the conversation about this story » NOW WATCH: We did the math: Is Uber really cheaper than a taxi?  | ||
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Top representatives from Apple and Google met with spy chiefs at an 18th-century mansion last week to talk about the growing public concern over government surveillance, 
"Away from the fetid heat of political posturing and populist headlines, I heard some unexpected and surprising comments from senior intelligence voices, including that ‘cold winds of transparency’ had arrived and were here to stay," investigative reporter Duncan Cambell told The Intercept after attending the event. The Obama administration just effectively ended one of the NSA's most controversial programs | ||
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That would mark the first time since October 2001 that US phone calls weren't collected en masse from America's three-largest telecommunications providers. The Obama administration did not ask the FISA court, a secret court overseeing surveillance issues, for another 90-day extension of the order needed to continue the collection of domestic phone records. “We did not file an application for reauthorization,” an official from the Obama administration told the Guardian on Saturday morning. While the president has not asked to extend the program, Senate Republicans, led by Mitch McConnell, will reportedly continue to work to keep the program — and other elements of the Patriot Act — intact. The USA Freedom Act, which would ban bulk collection of data by the NSA but renew an expiring provision permitting the FBI to access business records and other American communications metadata, was approved by the House of Representatives earlier this week. The act, however, was defeated in the Senate on Saturday morning. “This is a high-threat period,” McConnell (R-Kentucky) said after the Senate rejected the legislation and did not agree on an extension after June 1. McConnell had attempted to get the Senate to pass a temporary extension of Section 215 of the Patriot Act. The section, known as the business-records provision, gave intelligence agencies authorization to seek communications data if “the records are relevant to an ongoing foreign intelligence investigation.” An appeals court ruled earlier this month that most of the NSA’s surveillance and collections efforts were not permitted by Section 215. The court directly attributed revelations about the collection programs and its defeat in court to Edward Snowden, who released of hundreds of thousands of documents he gathered while working for a government contractor in 2012 and 2013.
The Guardian said that the GOP leader would have to overcome the appeals court’s ruling, public dissatisfaction with government surveillance, and the procedural defeat of the surveillance programs in Congress in order to pass his bill. “The Senate is in gridlock, but the tides are shifting,” said Michael W. Macleod-Ball, acting director of the American Civil Liberties Union’s Washington legislative office, told The New York Times. “For the first time, a majority of senators took a stand against simply rubber-stamping provisions of the Patriot Act that have been used to spy on Americans," he continued. "It’s disappointing that the Senate couldn’t coalesce around far-reaching reform, but in its absence the Senate should simply let the expiring provisions sunset.” The Times notes that "the once-secret program, which began in October 2001 ... has never been the difference maker in thwarting any terrorist attack, according to testimony and government reports." SEE ALSO: Snowden just scored a big victory Join the conversation about this story »  | ||
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McConnell, whose bill would continue all phone-records collection by the FBI and NSA, and the rest of the Senate will meet again on May 31. McConnell’s measure has support from members of the intelligence community. How you could end up spending thousands on Kate Upton's 'Game of War' | ||
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You may not know anything about "Game of War: Fire Age," but you've probably seen its ads featuring supermodel Kate Upton. With $40 million invested in advertising, "Game of War" has become the second-most-profitable game on the iPhone despite being free to play. Like Las Vegas, it's profitable because it's designed from the ground up to take your money. Produced by Corey Protin Follow BI Video: On Facebook Join the conversation about this story »  | ||
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One of the best iPhone games of the year is on sale right now | ||
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One of the best and most beautiful iPhone games of the year, Alto's Adventure, is currently on sale at half price for a limited time, and you can pick it up today for only $0.99. The game, which lets you play as the mountain man Alto as he snowboards his way down an endless mountain in pursuit of his escaped llamas, features gorgeous artwork and survival-based gameplay that makes it both addictive and delightful to look at. You're introduced to Alto as his beloved llamas escape down the mountain. It's your job to catch them, and snowboarding past a llama captures it and gives you some points.
It's a little bit absurd to make a point system based on the number of llamas you collect but that's part of what makes Alto's Adventure so much fun. You can also collect coins to purchase new riders and upgrades in the village shops. Alto's Adventure doesn't have any in-app purchases, so you won't be tempted to drop real money. As you make your way down each mountain, there's also obstacles to jump over, ramps to launch off to perform back flips, and ribboned rails to grind on. It's all physics-based gameplay, which helps you get into the game's rhythm while giving you cues like showing how fast you're going by how long Alto's scarf drags in the wind. The game's controls keep things simple: Just tap the screen to jump, tap and hold to back flip, and if you can get your snowboarder onto a rail he'll grind it automatically. If you string together a series of jumps, flips, and grinds, you gain more points, which gives the game a bit of a competitive feel like the classic Tony Hawk's Pro Skater or SSX Tricky games of old.
Each level has a different set of objectives that ask you to capture a certain number of llamas, nab a particular number of coins, or successfully jump over a certain number of obstacles. But the most striking aspect of Alto's Adventure is the game's art style, which combines dynamic lighting and weather effects to create beautiful environments that stand out. The more you play, the more tiny details you notice, and the game's piano-based score makes headphones a must. At the end of the day, Alto's Adventure feels a bit like a mixture of Tiny Wings, Monument Valley, and SSX Tricky, and the result is gorgeous game that's fun to play too. Alto's Adventure is currently available as universal app for iPhone, iPad, and iPod Touch, you can download it for $0.99 over at the App Store. SEE ALSO: Netflix is getting a new design next month — here's what it looks like Join the conversation about this story »  | ||
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How a 17-year-old high school dropout got two Silicon Valley bigshots to invest $500,000 in his app | ||
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Jason Marmon just turned 18 a few days ago. That's a real milestone in anyone's life. But his 17th year was so spectacular, it's going to be hard to beat. When he was 17, he dropped out of high-school (with his parents' blessing) after he co-founded a New York startup called HomeSwipe with two other co-founders. His business partners are Michael Lisovetsky, now 22 (whose tech career started in middle school) and Dean Soukeras, 43, an experienced entrepreneur. Last year, they launched an app of the same name, HomeSwipe, which they dubbed the "Tinder for apartment hunting" because you swipe through listings to find the apartment you want. The team raised a $500,000 seed round in the most unusual fashion, too, with the backing of A-list VC Tim Draper and tech billionaire Marc Benioff. Benioff was himself a wiz-kid teen coder and does his fair share of angel investing. And all of it happened because Marmon saw a post from Lisovetsky on Facebook asking for help with a "great idea." Draper UniversityTheir story actually begins in 2014 when Lisovetsky attended Draper University.
Lisovetsky took part in the program in the summer of 2014, when he was in college. He already had one success in the tech world. When he was in middle school, he created a web hosting site called FazeWire that was acquired for a small but undisclosed sum. He was clearly Draper University material, and after he completed it, he got to work on a couple of other ideas. But they didn't work out and the "team fell apart," he said. He was not discouraged. He had been through this before. He had taken a course at the Founders Institute in 2013, an entrepreneur training and startup launch program. That's where he met Soukeras. "We were working on different companies separately that failed," he said. "At Draper, there were a lot of people working on 'Tinder for X' companies and for a long time, I couldn’t understand it," he said. He stayed in touch with Soukeras and one day asked him what swipe could be used for besides dating. Soukeras, who worked in real estate for years and is a broker in New York, didn't miss a beat. "Real estate," he answered. And "that's how the idea was born," Lisovetsky said. Lisovetsky then realized the "value of the [swipe] interface is to take a large amount of data and make it simple to interact with it." He then reached out to Marmon by posting a message on a Facebook group for young coders where they both belonged. Marmon saw the message and signed up to help. They went straight to Draper looking for seed financing. Instead, Draper issued them a challenge. He said he was traveling to New York in two weeks and would meet with them and take a look at their app. "Show me some progress by then," Draper told them. They got busyIn two weeks, Marmon and Lisovetsky not only finished a prototype, but finished the whole app and submitted it to Apple's App Store, where it was accepted. They even secured a few users. Both of them knew how to code quickly. They had cut their teeth on hackathons.
He told them to get more investors that would add to the sum he was willing to contribute. He wanted them to bring the total seed round to $500,000. They got busy and managed to secure $400,000 (including Draper's promised money), they told us. Then they stalled out. Instead of giving up, they went back to Draper and asked for ideas. He introduced them via email to Benioff. Seven minutes later Benioff replied: "I'm in," his email said. (Naturally, they've kept that email.) They had their $500,000. Dropping outWith all this going on, Marmon was spread thin. A senior in high school, he was going to class in the morning, commuting to the office, working late, sleeping a few hours, and doing it over again.
"It wasn't just one conversation, but an extended dialog," he tells us. They balked at first, but then started to believe him, that this company was "a great opportunity" and worth suspending his high school education. In the end, he left high school, and "they were very supportive," he told us. He might go back to school one day, he tells us, possibly through alternatives such as online school. 'Embarrassing'There was one problem with the launch of their company. The first version of the app, built in less than two weeks, was a mess. "I'm going to admit it it, the first version of the app was embarrassing. The app looked ugly. It was broken. It was bleh," Lisovetsky told us.
With the $500,000 seed money, they hired two people, classmates of Lisovetsky's from NYU. (After Draper University, Lisovetsky finished his business degree.) And they got busy on an new-and-improved app, launched earlier this month. "Now, with the new version launched earlier this month, I feel pride in what we've done," Lisovetsky says. These young co-founders laugh that all of the seed money has gone to pay their employees and they can barely "afford food and transportation." Next up: A business modelHomeSwipe isn't generating income yet, but they've got an interesting plan to get there. They will charge realtors a small transaction fee every time a user requests information on a property.
When conversation takes place, the realtor will be charged a fee, and will be happy to pay it. They're adding more cities, too. They just launched Chicago and are planning for more. Clearly, $500,000 isn't enough to get them there. So they're hitting Sand Hill road this week, with a ton of pitch meetings lined up, Lisovetsky tells us. And they're full of confidence that they'll get their funding. That's because, in the six months since the app has been live, it has had over 47,000 downloads, is supported by 2,200 New York real estate agents and is showcasing 85% of NY rental inventory market, Lisovetsky tells us. Join the conversation about this story » NOW WATCH: 70 people were injured while filming this movie with 100 untamed lions  | ||
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It's a 7-week Silicon Valley live-in entrepreneurship program for promising young people.
Draper was so impressed, he agreed to fund them, but first, he issued another challenge.
He started talking to his parents about dropping out.
Meanwhile, Soukeras was doing his part and signing up New York realtors like mad. HomeSwipe doesn't go out and scrape other real estate sites. Realtors submit their listings directly to HomeSwipe.
They are working on an in-app chat function that lets users talk to realtors about a property right from the app. Watch this guy set the Guinness World Record for the farthest flight on a real-life hoverboard | ||
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It's 2015, and that means we're starting to see real-life hoverboards, just like "Back to the Future Part II" predicted years ago. The latest functional hoverboard comes from Canadian inventor Catalina Alexandru Duru, who recently set the Guinness World Record for "Farthest flight by a hoverboard." To claim the title, Duru needed to travel for more than 50 meters, but he wound up floating over the water for a total distance of 275.9 m (905 ft 2 in), according to a Guinness World Records blog post. Duro achieved the record using a prototype hoverboard of his own design that utilizes four propellers to keep him aloft while he hovered above Lake Ouareau in Quebec, Canada.
The hoverboard's design also allowed for Duro to control his flight using only his feet, which has led him to claim that his hoverboard is "the first real-life hoverboard." "I wanted to showcase that a stable flight can be achieved on a hoverboard and a human could stand and control with their feet," Duro told Guinness World Records. And while Duro conduct his record-breaking flight above water, he says the board works on other surfaces as well, and is capable of reaching "scary heights," according to the blog post. You can watch Duro achieve his world record from start to finish in the video below.
SEE ALSO: Netflix is getting a new design next month — here's what it looks like Join the conversation about this story » NOW WATCH: Kids settle the debate and tell us which is better: an Apple or Samsung phone  | ||
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This Berlin fintech company has the most simple-but-brilliant way of boosting your cash savings we've ever heard | ||
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Business Insider took a brief trip to Berlin as part of Socialbakers' Engage 2015 conference to meet with a bunch of startups in the city's thriving tech scene. Of all the companies we saw, WeltSparen (or SavingGlobal, its English-language brand) was the one that really blew our minds. It is working on a banking business that is so simple it's brilliant. It could totally change the way you handle money in your savings account, and earn you a lot of extra cash in the process. The company's founders — alumni from McKinsey, Deutsche Banke, and Goldman Sachs — noticed that within Europe, different banks in different countries offer wildly different rates of interest. That is a weird phenomenon: In an efficient, competitive market that is supposed to be governed by a single currency from the European Central Bank, all local banks should offer similar interest rates. (Those rates are close to 0% right now.) But they don't. From the lowest rate to the highest, the difference between interest rates can be more than double, as this chart from SavingGlobal shows (apologies for the image quality):
With a bank in Italy offering nearly twice the interest of a bank in Spain, you'd be crazy to keep your cash savings in Spain. EU law gives consumers the right to open bank accounts wherever they want in the continent, but ever since the crash of Icelandic banks in 2008 people have tended to avoid foreign banks. So SavingGlobal has developed a web site that lets people register once, and then dump their money at any cooperating bank in any country they want, for a fixed term of at least one year. If you're an avid saver this is a dream come true (especially when interest rates begin rising again as the economy strengthens). Why get 1% in Spain when you can get 2% in Italy? Even better, SavingGlobal is working to end the "hook offers" that banks have used to exploit customers in Europe for years. These offers entice customers to open new accounts at high rates of interest. But then, after a few months, the offer term expires and the rate resets back to nearly zero, or the cash is automatically rolled over into a low-interest account. Because opening new accounts is tedious work, customers tend to just leave the money there. Banks that offer accounts through SavingGlobal cannot use hook offers or rollovers, SG's head of Europe Katharina Luth told Business Insider. Cooperating banks get exposed to new customers, and pay SavingGlobal a commission for bringing them in, so the customer isn't charged for SG's services. In return, customers get higher rates of interest. The company has a long way to go before everyone can take advantage of it, according to CEO Tamaz Georgadze. For now, it is only available in Germany although a Europe-wide launch is planned. And customers must have at least 10,000 euros to invest. (That limit is coming down to 5,000 soon.) It's also, unusually, a desktop-only product. (A mobile app will be launched eventually but the target market of older, interest-chasing savers is heavily desktop-based anyway.) And, as Georgadze says, "the background logistics are difficult." The company must persuade each individual local bank to join up as a partner and let foreign customers sign up for accounts. It took SavingGlobal 15 months to get its first two banks to agree. Now the company has 10 banks on board. Here are some of the stats:
SavingGlobal is hoping to become "Amazon for deposits." In theory, the SavingGlobal model could eventually be rolled out globally. The main barrier to this is local banks' failure to be cool with doing digital business — most banks in most countries still require customers to physically walk into an actual bank in order to make a first deposit. Join the conversation about this story » NOW WATCH: Here's what happens when you drop an Apple Watch face down on cement  | ||
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The unlikely story of a 23-year-old Venezuelan who makes 6 figures playing video games in America | ||
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“Back in Venezuela, you worry every day about what you are going to do, what job you will get, how you are going to keep yourself going,” Ruiz recently told Business Insider. “I thought life in the United States would be easier, more advanced, less stressful.” These days, Ruiz gets paid to play "League of Legends," the world’s most popular competitive video game. He’s a star on Team Liquid, a professional team in the North American League of Legends Championship Series (LCS). He earns about $100,000 a year from salary, sponsorships, and revenue from the streaming website Twitch. Like all of his teammates, Ruiz practices 10 hours or more a day with few breaks. He spends his little off-time browsing Reddit, binge-watching Netflix, hanging out with his girlfriend, or video-chatting his family in Venezuela. On a recent Monday, Ruiz sat hunched on an air mattress in his team’s cramped duplex in Santa Monica. Dressed in athletic shorts, a T-shirt with Team Liquid’s stenciled horse logo, and rimless glasses, Ruiz looked more like a studious athlete than the slacker-gamer stereotype. As he fidgeted with his hands and rubbed his knees, the quiet gamer recounted his improbable journey to the US. It started with a game. Obsessed with games from the start
As a child, games fascinated him. The first one he ever owned was the classic Nintendo 64 game, "Super Mario 64." He was 5 years old. “Every day after school I would play it — I would sit there for hours,” Ruiz says. Ruiz associated gaming with the US because most of the games he played — including “Super Mario 64” — were in English. He taught himself to understand English so that he could know “what the hell was going on” in the games.
“I told my mom, ‘Every kid has one at school. It’s important for your grades,’” Ruiz says with a smile. The computer was a hand-me-down Pentium IV. He was amazed and hooked it up to the internet. The first thing he did was download a popular strategy game, “Age of Empires 2.” The 47-megabyte file took a week to download. “I didn’t realize how slow the computer was until we got another one years later. I just thought that was how all computers were,” Ruiz says. Finding a community of gamersBeing one of the first kids on the block with a computer was exciting, but the real thrill came when the soft-spoken teenager started visiting his mother’s internet café. There he found a community of gamers who shared his enthusiasm. The kids stayed for hours playing games he hadn’t heard of. The commute to the café was an hour long, but Ruiz began making it every day after school. For a kid very much in his shell, the café gave Ruiz a social outlet. The most popular games at the café were multiplayer online battle arena games, or MOBAs, like “Defense of the Ancients” and “Heroes of Newerth.” Unlike most games of that time, MOBAs were free and downloadable. When Ruiz was 17, the café gamers introduced him to "League of Legends," a new MOBA that became the next game of choice at the café. He hated the game at first. While League was similar to the other MOBAs, Ruiz thought it wasn't as freeform as other MOBAs, and required strategies he didn’t like using. Ruiz is an impatient person, he says, and if he doesn’t get a game at first, he quits. It wasn’t until a year later that Ruiz started playing "League of Legends" seriously. He began by exploiting a loophole.
The game’s ranking system is designed to match players with others with equivalent skills, by progressing them through a ladder of leagues ranging from Bronze to Challenger. Rather than climb the ladder, Ruiz played multiple accounts. He’d practice on an account until he reached a difficult level where the game forces players to fight at a disadvantage against much higher-level players. Instead of battling through, he’d abandon the account. He preferred crushing players below his skill level. “I liked being able to outplay people and to abuse the mistakes that people make,” Ruiz says. As Ruiz got better, he began competing in online tournaments but had a tough time because of his shoddy internet connection, a constant problem in Venezuela. Often, on the day of the tournament, his internet connection slowed and delayed his actions mid-game. For a game relying on speed and reaction time, it was a huge disadvantage. Sometimes, his slow connection prevented him from playing at all. Around the same time, Ruiz began attending college to study engineering. He took to the new environment with vigor and stopped playing games for his first semester. For a time it looked as if he might put games behind him. “I was getting good grades. I socialized a lot. I was excited about the career,” Ruiz says. After the semester ended, he received a dose of reality about the job market in Venezuela. Former engineering students told him that, if he was lucky, he would get a low-paying government job and, if he wasn’t, he’d end up driving a taxi. “Why would I spend six years studying engineering just to become a taxi driver?” Ruiz says. A 'cheat code' for life
His reputation as a top player created a lot of demand for his services. Before long, he was making $2,000 a month boosting accounts for Americans who paid in US dollars. This was a big deal in a country as dollar-hungry as Venezuela. When he sold the dollars to locals for bolivars, he made three or four times what he would make in an engineering job. “It felt like a cheat code,” Ruiz says. At first, Ruiz would boost for a couple of hours a day in between classes. As he gained more clients, he played more and more. His grades slipped. He was making so much money that he decided college wasn’t worth it anymore. “My mom wasn’t OK with it. She told me I was crazy and didn’t understand what I was doing. When I started supporting the family [with my earnings] she understood,” Ruiz says. Ruiz quickly ascended the game’s ranks when he was playing on his own account. It didn’t take long for the pros to notice him. A risk | ||
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Two years ago, 21-year-old Diego “Quas” Ruiz flew from Venezuela to Los Angeles for a job playing video games. It was a drastic move. Ruiz had no friends or family in LA, and he didn’t know how long his newly formed team would last. But for him America promised more stability than his native country.
As Ruiz got older, he desperately wanted to try computer games. There was one problem: Computers were expensive and rare in Venezuela. Luckily, Ruiz’s mother had purchased an internet café adjacent to the pharmacy. He persuaded her to bring one of the older units home.
The realization killed Ruiz’s enthusiasm for school. While he didn’t drop out, Ruiz returned his attention to gaming. He’d heard about a lucrative side job for skilled "League of Legends" players called ELO-Boosting. Top gamers could earn a fee by playing on other people’s accounts to help them attain high ranks. 
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This 23-year-old gave up a corporate job to make $5,000 a month reselling thrift store clothes through an app | ||
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Back in 2012, when she was a student at the University of Arkansas, Alexandra Marquez downloaded the Poshmark app on a whim. She'd seen it mentioned on social media and was immediately intrigued by the concept. While it looks similar to Instagram, Poshmark allows you to sell clothing just like you would on eBay. "I was super addicted from the start," the 23-year-old says. "It was a great way to make money." Although many of Poshmark's 700,000 sellers use the app as a way to clean out their closets, Marquez had always been interested in running her own business. She began searching thrift stores for gently used items from department store brands and buying them to resell on the app. "I'm not going to lie, it was pretty challenging at first," she says. On average, she made $500 a month when she started out — not an insignificant amount, but not enough to live on, either. Initially, she didn't know which brands and styles would sell on the app, and which wouldn't, so she spent time studying what was popular. Then, she'd go out and buy those items. To get her listings noticed, she also focused on perfecting her photography skills. After a year and half, she became a suggested user on the app, meaning that all new users were invited to follow her. That exposure led to more sales, and she began making around $5,000 a month.
By then, she'd graduated from the University of Arkansas and taken a full-time job at a marketing company earning a $50,000 salary. But after a year, she left to focus on her clothing sales full time. "It was a great job, but I decided the corporate world wasn't for me," she explains. Now, she devotes three or four days of her week to shopping, with the goal of posting several new items every day. Local boutiques in Bentonville, Arkansas, where she lives, often sell their overstock to her at a discount. In addition to making regular visits to thrift stores, she also buys gently used clothing and accessories directly from women in her area. Most of the clothing and accessories she sells are priced from $40 to $250, and she determines her prices by seeing what similar items have sold for on the app. Besides buying clothing that she'll later resell at a profit, Marquez doesn't have many costs that go into her business. She doesn't have the overhead of a bricks and mortar store, and doesn't even need to have her own website. Poshmark covers the shipping costs and credit card fees for each transaction, so she just pays a commission on each sale: $2.95 for anything under $15, and 20% on anything over $15. After that, she's left with a take-home pay of around $5,000 per month. Though being self-employed gives her the flexibility to work from anywhere and choose her hours, she admits that she's constantly on the app, no matter where she goes or what time of day it is. "I look at my phone from the time that I wake up until the time that I go to bed … and sometimes also when I get up in the middle of the night." Typically, she lists around 75 new items each month, and ships out anywhere from 15 to 40 sold items each week. After her bills are paid, Marquez puts most of her extra money back into her business by buying more inventory to sell on the app. She doesn't live extravagantly, since her income isn't as predictable as it was in her corporate job, and she can't count on making the same amount of money each month. "The only downside is the unpredictability of sales," she says. Like any retail business, hers has seasonal fluctuations, and a slow month could mean she takes home $3,000 instead of $5,000. But for now, she's happy to trade some stability for the chance to be her own boss. SEE ALSO: 11 tips to start earning money doing what you love, from people who have done it Join the conversation about this story » NOW WATCH: 70 people were injured while filming this movie with 100 untamed lions  | ||
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Elon Musk didn't like his kids' school, so he made his own small, secretive school without grade levels | ||
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Elon Musk didn't like his kids' school, so he started his own, the inventor and entrepreneur said in an interview on Beijing Television. The school is called Ad Astra — which means "To the stars" — and is small and relatively secretive. It doesn't have its own website or a social media presence. Christina Simon, who writes about private elementary schools in Los Angeles, has done some digging around Ad Astra. She says she's been in contact with a mother whose child attends Musk's school. The mother told Simon that the relatively new Ad Astra School is "very small and experimental," and caters to a small group of children whose parents are primarily SpaceX employees. Musk says in the interview that Ad Astra, which is a year old, currently has 14 kids and will increase to 20 in September. His grand vision for the school involves removing grade levels, so there's no distinction between students in 1st grade and 3rd. Musk is "making all the children go through the same grade at the same time, like an assembly line," he says in the interview. "Some people love English or languages. Some people love math. Some people love music. Different abilities, different times," he says. "It makes more sense to cater the education to match their aptitudes and abilities." Musk pulled his kids out of their school and even hired one of their teachers away to start Ad Astra. "I didn't see the regular schools doing the things I thought should be done," he says.
"It's important to teach problem solving, or teach to the problem and not the tools," Musk says. "Let's say you're trying to teach people about how engines work. A more traditional approach would be saying, 'we're going to teach all about screwdrivers and wrenches.' This is a very difficult way to do it." Instead, Musk says it makes more sense to give students an engine and then work to disassemble it. "How are we going to take it apart? You need a screwdriver. That's what the screwdriver is for," Musk explains. "And then a very important thing happens: The relevance of the tools becomes apparent." So far, Ad Astra "seems to be going pretty well," according to Musk. "The kids really love going to school." "I hated going to school when I was a kid," Musk told his interviewer. "It was torture." When Musk was a child living in Pretoria, South Africa, he was viciously bullied as a student. His classmates pushed him down a concrete stairwell. In one instance, he was beaten so badly that he needed to go to the hospital. Here's Musk recounting that horrific experience:
His difficult experiences both at home — where he had a strained relationship with his father — and at school would eventually lead Musk to leave South Africa for the United States. You can watch Musk's full video interview below. SEE ALSO: How Elon Musk schedules a typical week Join the conversation about this story » NOW WATCH: Elon Musk is terrified of what Larry Page is doing  | ||
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THE PROGRAMMATIC-ADVERTISING REPORT: Mobile, video, and real-time bidding drive growth in programmatic | ||
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The embrace of programmatic ad-buying tools is fueling a dramatic uptick in the share of digital ads sold through programmatic platforms, particularly those focused on real-time bidding or RTB. Total US programmatic ad revenue will top nearly $15 billion this year, according to BI Intelligence estimates. RTB, particularly mobile and video RTB, are spearheading growth. In this all-new in-depth research from BI Intelligence that updates our popular July 2014 report on programmatic, we find that the US digital-ad market will reach a programmatic "tipping-point": For the first time this year, programmatic transactions will be a majority (52%) of non-search digital-ad spend. We estimate 30.6% of total digital-ad spend will go to programmatic real-time bidding (RTB) platforms, and 21.7% will go to non-RTB programmatic. Access The Full 21-Page Report And Data Sets By Signing Up For A Trial Membership » Here are some of the key takeaways:
The report is full of charts, data, and case studies that can easily be downloaded and put to use. In full, the report:
To access the full report from BI Intelligence, sign up for a 14-day trial here. Members also gain access to new in-depth reports, hundreds of charts and datasets, as well as daily newsletters on the digital industry. Join the conversation about this story » NOW WATCH: Forget Kim Kardashian — the 'butt selfie' queen of Instagram is a 21-year-old from Long Island  | ||
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The 31-year-old convicted of running a huge criminal website asks to be spared a life sentence | ||
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Ross Ulbricht, the mastermind behind the Web's most famous black market, has run out of options and is now pleading with a judge not to send him to prison for life, Bloomberg reports. Prosecutors said that Ulbricht was the "Dread Pirate Roberts," the person who ran the infamous online marketplace called Silk Road where people could buy just about anything, especially drugs. Ulbricht was convicted in February. And with sentencing scheduled for May 29, Ulbricht, 31, is now asking for mercy from the court. He sent a letter to the Manhattan federal judge asking to be spared the maximum penalty, life in prison, Bloomberg reports. In the letter he called Silk Road a "naive and costly idea." Prosecutors said Silk Road helped transact about $200 million worth of anonymous drug sales using the virtual currency bitcoin and that drugs bought from Silk Road were linked to six overdose deaths. Ulbricht's defense attorneys at first argued that Ulbricht was not Dread Pirate Roberts. After his conviction, they argued that Ulbricht should get a new trial because he wasn't allowed to review materials demonstrating his innocence, but a judge rejected the request for a new trial, calling evidence of Ulbricht's guilt "overwhelming." Then they argued that Silk Road made buying drugs safer. Although Silk Road is gone, there are other sites engaged in questionable online activities accessible through a part of the internet known as the "dark web" or "deep web." Ulbricht's sentence could serve as a warning to those others. Join the conversation about this story » NOW WATCH: Watch these giant container ships collide near the Suez Canal  | ||
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Amazon is launching an Etsy killer (AMZN) | ||
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Amazon is introducing Amazon Handmade, a marketplace for handmade goods, aimed directly at competing with Etsy, the Wall Street Journal is reporting. The way that Amazon is recruiting sellers for Amazon Handmade is typically aggressive: Select Etsy sellers are receiving targeted emails urging them to come over to Amazon. "We’re offering artisans like you a first peek at Handmade, a new marketplace for handcrafted goods,” the emails say, per that Wall Street Journal report. The news comes just days after Etsy shares tanked 24% after reporting earnings — its first-ever earnings report as a public company — at a net loss of 84 cents per share. While Etsy has 20.8 million "active buyers," the company says, analysts believe its growth is hampered by the spread of mass manufactured and counterfeit goods, as well as items that infringe on intellectual property. Meanwhile, Amazon has a bunch of legs up over Etsy here, including access to its vast Amazon Prime shipping and distribution network and 278 million active accounts. One important thing we don't know yet: the commission structure for Amazon Homemade. Etsy takes 3.5% of the price and a flat 20 cents per listing, but Amazon charges its own 3rd-party sellers a 15% commission. If Amazon sticks to that structure, it'll have trouble luring Etsy sellers away. SEE ALSO: A Twitter cofounder's VC firm just raised a $123,456,789 fund to build 'world-positive' companies Join the conversation about this story » NOW WATCH: Jeff Bezos: Why I Always Tell Employees Not To Pat Themselves When Our Stock Is Up  | ||
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Cannes readies Palme d'Or closing ceremony | ||
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Cannes (France) (AFP) - After nearly two weeks of showing stirring, sleek and thought-provoking movies -- and a couple of duds -- the Cannes Film Festival ends Sunday with an awards night to declare the winner of its coveted Palme d'Or. US directing duo the Coen brothers head a jury of top actors and filmmakers chosen to decide which of the 19 competition entries will walk away with the 20,000-euro ($24,000) gold-and-crystal trophy. Two runner-up films will also get prizes, along with awards for best director, actor, actress and screenplay. Critics have hailed this year's crop, which revealed a remarkably strong contingent from Italy, two noted Chinese-language pictures, a couple of American features seemingly destined for Oscar acclaim, a raw Holocaust movie and a mixed bag of French fare.
- Frontrunners: 'Carol', 'Son of Saul' -
Standouts include "Carol", an American lesbian drama starring the stunningly versatile Australian actress Cate Blanchett; "Son of Saul", a first feature from a Hungarian director set in the Auschwitz extermination camp; and "My Mother", a touching Italian movie about a director's crisis and loss. Others were "Youth", another Italian-directed movie but filmed in English with Michael Caine, Harvey Keitel and Jane Fonda; and "The Lobster", a weird but funny Greek-directed movie starring Colin Farrell. "The Assassin", a slow-moving Taiwanese martial arts movie starring actress Shu Qi, won over art-house reviewers for its rich aesthetics. Which way the jury will jump is anyone's guess. Joel and Ethan Coen, the makers of Oscar-winner "No Country for Old Men" and the 1991 Palme d'Or winner "Barton Fink", could be swayed by movies with menace, or oddball humour, or extraordinary production values. But the opinions of the other members of the panel also have to be taken into account -- for instance, Mexican director Guillermo del Toro (known for fantasies such as "Pan's Labyrinth), Canadian wunderkind filmmaker Xavier Dolan, and actors Jake Gyllenhaal and Sienna Miller.
- Ice bucket vote -
After rule changes in past years, the Palme d'Or cannot be shared and must go to just one of the movies. The awards for best actor and best actress cannot go to performers in the Palme winner. Usually, the nine members of the jury put their choice of winner on a bit of folded paper in a champagne ice bucket to be drawn out. "The Sea of Trees", an American melodrama starring Matthew McConaughey and directed by past Palme winner Gus Van Sant, is seen as least likely to figure in their deliberations. Critics unanimously gave the trite movie a thumbs-down. Likewise, a French movie relating a true tale of 17th-century incest, "Marguerite & Julien", was widely panned. Whichever way the prize ceremony goes, the festival will be remembered for a varied and mostly interesting line-up. As well as a flawed but ambitious triptych by Chinese director Jia Zhang-ke, "Mountains May Depart", and notable performances from French actor Vincent Lindon in "The Measure of a Man" and British actor Tim Roth in "Chronic", some out-of-competition films generated buzz. Those non-contenders included dystopian sci-fi desert derby "Mad Max: Fury Road", which has gone on to bumper box-office success, "Inside Out", a new animation movie seen as putting Pixar back onto a winning slate, and "Amy", a documentary about the short and tragic life of superstar singer Amy Winehouse.
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Cedenio dominates Merritt at Ponce Grand Prix | ||
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Ponce (Puerto Rico) (AFP) - World champion LaShawn Merritt settled for second place behind rising star Machel Cedenio in the 400m at the Ponce Grand Prix athletics meeting. Trinidad and Tobago's Cedenio, the 2014 world junior champion, won the one-lap race in 44.97sec, while America's Merritt, winner of world titles in 2009 and 2013 and Olympic gold in 2008, clocked 45.42sec. Third place went to Dominican Gustavo Cuesta (45.89). Two other marquee names failed to shine in the event. Dominican Luguelin Santos, the 2012 Olympic silver medalist, finished fifth in 46.19sec, while US veteran Jeremy Wariner was sixth in 46.22. Wariner, Olympic gold medalist in 2004 and world champion in 2007 and 2009, is trying at the age of 31 to relaunch his career after three seasons disrupted by injury. He was part of the winning US 4x400m relay team at the IAAF World Relays in Nassau earlier in May. Puerto Rican star Javier Culson gave home fans little to celebrate. The 2012 Olympic bronze medalist in the 400m hurdles was beaten by Jeffery Gibson of the Bahamas. Jason Richardson, America's 2012 Olympic silver medalist in the 110m hurdles, won his event in 13.34sec, holding off Cuba's Yordan O'Farril (13.35). Join the conversation about this story »  | ||
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Peace activists make rare crossing of North-South Korea border | ||
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Paju (South Korea) (AFP) - An international group of women peace activists, led by American feminist Gloria Steinem, made a rare crossing on Sunday of one of the world's most militarised borders between North and South Korea. The group of 30 activists rode by bus through the demilitarised zone (DMZ) separating the two Koreas in what Steinem described as a "triumph" for peace and reconciliation, dismissing criticism that the women had allowed themselves to be used as propaganda tools by the North. "I'm so confident that once it is clear what we have experienced, these objections will go away," Steinem told reporters on the South Korean side of the border. Detractors argued that the group's peace mission had played into the North's hands by refusing to directly criticise Pyongyang for its dismal human rights record. They also suggested the activists' interactions with North Korean women in Pyongyang were meaningless given that those women were likely specially selected by the authorities. "I know we had real human exchanges with North Korean women," Steinem insisted. - Can't change North's image - "Nothing we do can change the image of North Korea. We are trying to make person by person connections, so that there is understanding," she added. The group had originally wanted to cross the DMZ through the Panmunjom "truce village", where North and South Korean soldiers stand just metres apart in a permanent, Cold War face-off over the border. But South Korea opposed the plan and the women finally agreed "with regret" to Seoul's preference for a road crossing on the western part of the border. They were also prevented from walking on foot over the actual border line, and had to move by bus instead. Despite its name, the DMZ is one of the world's most heavily militarised frontiers, bristling with watchtowers and landmines, and crossings through the land border are extremely rare. With this year marking the 70th anniversary of the division of the Korean peninsula, the women said they wanted to draw attention to the need for a permanent peace treaty to replace the armistice that halted -- but technically never ended -- the 1950-1953 Korean War. The group, which includes Nobel peace laureates Leymah Gbowee and Mairead Maguire, has also highlighted the anguish of divided families who have had little or no contact since the separation into North and South. - 'We don't believe in war' - "We are here today because we don't believe in war," Maguire said after passing through immigration on the South side. "You can get to human rights when you have a normal situation and not a country at war," said Maguire, who won the 1976 Nobel peace prize for her co-leadership of the women's peace movement in strife-torn Northern Ireland. "The sooner we get a peace treaty signed... and normalise relationships... the quicker we will get to human rights," she added. The group was to attend a peace rally later in the day, which some South Korean conservative groups have threatened to disrupt after North Korea's state media published comments by some of the women -- later denied -- praising North Korea's founder leader Kim Il-Sung. Praising North Korea or promoting its ideology is a criminal act in the South. In an editorial in the Washington Post last week, Abraham Cooper of the Simon Wiesenthal Center and Greg Scarlatoiu of the Committee for Human Rights in North Korea, had blasted Steinem and her fellow activists for allowing North Korea to engage in "human rights theatre intended to cover up its death camps and crimes against humanity". Join the conversation about this story »  | ||
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Ethiopia votes with ruling party set to return | ||
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Addis Ababa (AFP) - Ethiopia, Africa's second-most populous country, holds its first general election on Sunday since the death of strongman Meles Zenawi, whose successor Hailemariam Desalegn is all but certain to stay in office. Over 36.8 million Ethiopians have registered for Sunday's polls, but analysts say the election falls far short of open competition. Western observers were not invited and the opposition alleges the government has used authoritarian tactics to ensure a poll victory. One of the main opposition candidates, Yilekal Getinet, accuses the government of "closing" political space. "Electoral defeat is not on the cards for Ethiopia's ruling party, but it is vital for the country's development that it engages more effectively with dissenting voices," said Jason Mosley, from Britain's Chatham House think tank. Posters of the ruling Ethiopian People's Revolutionary Democratic Front (EPRDF) dominate the capital Addis Ababa. Polls open at 6:00 am (0300 GMT) on Sunday and close at 6:00 pm (1500 GMT), with initial results expected within two to five days, and final official tallies on June 22. The ruling EPRDF has been in power for over two decades and is confident of a win, but insists the result will be decided on its economic record alone. Ethiopia is now one of Africa's top performing economies and a magnet for foreign investment. Rights groups -- which routinely accuse Ethiopia of clamping down on opposition supporters and journalists, and of using anti-terrorism laws to silence dissent and jail critics -- said Saturday the polls would not be free or fair due to a lack of freedom of speech. "The government people came to go door to door asking to register as voters and to promote the EPRDF," said Tessama, a student in the Kazanches district, where luxury hotels and poor housing stand alongside each other. "For me, all I see is that prices increase." Addis Ababa dismisses such criticism, with government spokesman Redwan Hussein telling AFP that voters would choose their representatives based on performance. "If they want to give us another chance they will vote for us," he said. "If they have a grudge, they will not." - 'Logistical hurdle' - Ethiopia, whose 1984 famine triggered a major global fundraising effort, has experienced annual economic growth of more than 10 percent over the last five years, according to the World Bank. Former Marxist rebel-turned-leader Meles, who died in 2012, was succeeded by Prime Minister Hailemariam, who has said he is committed to opening up the country's political system to allow more space for opposition parties. The Election Commission will deploy some 40,000 observers at 45,795 polling stations. The only foreign election observers are from the African Union, which has sent a team of 59 officials. The European Union and the US-based Carter Center, which monitored 2005 and 2010 elections, were not invited back this time. "While symbolically significant... the polls are more of a logistical hurdle for the ruling party than a competitive, democratic exercise," Mosley said. The ruling EPRDF won 2010 elections in a landslide. Those polls were peaceful, in contrast with 2005, when opposition accusations of irregularities sparked violence that left 200 people dead. The opposition won 172 seats in that vote, but only one in 2010. This time, that solitary incumbent opposition MP has chosen not to run again. Meanwhile, polls in the constituency of the single independent legislator seeking reelection were postponed Friday, after he complained there had not been "enough time and space" for campaigning. Join the conversation about this story »  | ||
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Indonesia begins search for migrant boats | ||
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Jakarta (AFP) - Indonesia has begun search and rescue operations for stranded migrant boats carrying Bangladeshis and ethnic Rohingya from Myanmar, an official said on Sunday, after it dropped a hardline policy of refusing them sanctuary. Jakarta sparked international outrage by turning away vessels filled with desperate migrants, among thousands stranded at sea since a Thai crackdown on human-trafficking in early May threw the illicit trade into chaos. Along with neighbouring Malaysia, the government changed approach Wednesday with an announcement that they would take in boat people provided they could be resettled or repatriated within a year. While Indonesian fisherman have helped hundreds of stranded Rohingya and Bangladeshis to shore, so far there has been no official rescue effort from Jakarta. But four naval ships, two pontoons and a patrol aircraft have now been deployed in a search which started Friday evening, Indonesian military spokesman Fuad Basya told AFP. "We have officially received an order from President (Joko Widodo) to carry out search and rescue operations, whether in the Indonesian territory or international waters," he said. "We will save the migrants and take them to shore," he said, adding that as of Saturday evening, no new boats had been sighted. The Malaysian government announced Thursday that its navy and coastguard would be mobilised for search operations but so far it has not reported any rescues either. More than 3,500 migrants have swum to shore or been rescued off the coasts of Malaysia, Indonesia, Thailand and Bangladesh since the crisis erupted earlier this month. Boatloads of starving Rohingya and Bangladeshis have been abandoned by smuggling syndicates and left to fend for themselves. Join the conversation about this story »  | ||
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Struggling BlackBerry announces new round of layoffs | ||
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Montreal (AFP) - BlackBerry is laying off an unspecified number of workers around the world as the struggling smartphone manufacturer tries to make its device business profitable. The Canadian company, based in Waterloo, Ontario, said the cuts will impact those working on the software, hardware and applications side of the business. "As the company moves into its next stage of the turnaround, our intention is to reallocate resources in ways that will best enable us to capitalize on growth opportunities while driving toward sustainable profitability across all facets of our business," BlackBerry said in a statement to AFP on Saturday. A spokeswoman declined to provide additional information about the cuts. The company currently employs about 7,000 people internationally. BlackBerry, which only a decade ago was a titan in the smartphone business, has been forced into a major reorganization focusing more on software and services since being overtaken in the market for mobile devices. An IDC survey showed BlackBerry managed to capture just 0.4 percent of global smartphone sales in 2014. "One of our priorities is making our device business profitable," BlackBerry said. "At the same time, we must grow software and licensing revenues. You will see in the coming months a significant ramping up in our customer-facing activities in sales and marketing."
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Poles to vote in presidential cliffhanger | ||
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Warsaw (AFP) - Poles vote Sunday in the second round of a too-close-to-call presidential election with incumbent centrist Bronislaw Komorowski trying to fend off the populist challenge of conservative newcomer Andrzej Duda. Sunday's result is also being billed as a pointer to the outcome of the country's autumn general election. After nearly eight years in power, the centrist Civic Platform (PO), in which Komorowski once served as minister, is running neck and neck in the polls with Duda's right-wing opposition Law and Justice Party (PiS). Even so, the cerebral Komorowski, a 62-year-old communist-era dissident, was stunned by his razor-thin defeat in the first round to his energetic challenger on May 10. Duda, a 43-year-old lawyer and MEP with a populist streak, scored a one percent victory by winning over disillusioned voters with promises of generous social spending, an earlier retirement age and lower taxes. "I'm waiting for the promised 500 zloty (121 euros, $134) in benefits per child -- and I have five," Duda voter Malgorzata Dorota Slizankiewicz wrote Saturday in a comment to his official Facebook campaign page. "I just wonder where you'll get the money, Mr Duda," she added, echoing widespread misgivings over the feasibility of his promises. Head of state since 2010, Komorowski is by contrast a seasoned defence specialist who has won support from the Polish-born former US national security advisor Zbigniew Brzezinski as well as a bevy of Polish actors and athletes. But analysts said Sunday's vote was too close to call. "The victory of one or the other will be a narrow one and is impossible to predict on the basis of polls," Stanislaw Mocek, a political scientist at the Polish Academy of Sciences told AFP. Duda was narrowly ahead of Komorowski with 51 percent in an opinion poll conducted May 18-20 and released Friday by the Polska The Times daily. Two other surveys also showed Duda with a paper-thin lead, but a Millward Brown poll put Komorowski on top. The Polish head of state acts as commander in chief of the armed forces, heads foreign policy and is able to introduce and veto legislation. - Power play - Analysts suggest that Komorowski's struggles are in large measure a signal from voters to his friends in the PO. In power since 2007, the party is seen as having failed to keep its promises in key areas like administrative and tax reform. The rival PiS, led by controversial ex-premier Jaroslaw Kaczynski, knows wooing disillusioned voters is key to its ambitions for a comeback both in the presidency and parliament. Kaczynski -- whose twin brother the late president Lech Kaczynski died in a 2010 plane crash in Russia -- is making no secret of his wish to return to power. A Duda win could pave the PiS's way in parliament. After his defeat to Komorowski in the 2010 presidential election, the 65-year-old Kaczynski floated the upbeat Duda as his party's candidate and has himself kept a very low profile during campaigning. - Winning over the undecided - Komorowski and Duda were kissing babies and shaking hands nationwide right up to the last hours of the campaign, trying to win over the undecided. Who captures the support of those people who voted for anti-establishment rock singer and political newcomer Pawel Kukiz in the first round is key. He scored a surprise third place with 20 percent thanks to disillusioned voters, especially young Poles struggling in the job market. A country of 38 million people, Poland is the only EU member to have avoided recession over the last quarter century. Its economy is set to expand by 3.5 percent this year, yet joblessness has remained stubbornly high at 11.3 percent. "On Sunday, Poland will choose between two factions. First, that of reason and predictability represented by Komorowski, who is well-known to Poles," Mocek said. "And second, that of faith and unpredictability embodied by Duda, because this isn't an independent politician: behind him lurks Jaroslaw Kaczynski," he insisted. Join the conversation about this story »  | ||
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As antitrust case looms, 'Peak Google' debated | ||
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Washington (AFP) - As Google faces an antitrust probe from European regulators, some analysts are questioning whether the California tech giant's dominance has already peaked. While Google remains one of the world's biggest companies with overwhelming dominance of Internet search, its prospects are less rosy in a tech landscape rapidly shifting to mobile devices and social media, say some industry watchers. Debate heated up last year after a blog post titled "Peak Google" from technology analyst and consultant Ben Thompson, who argued that Google is losing momentum. Thompson said Google may in the same boat as IBM in the 1980s and Microsoft around 2000 -- "a hugely profitable company bestride the tech industry that at the moment seems infallible, but that history will show to have peaked in dominance and relevancy." Google has for years been the leader in Internet search and has turned advertising linked to those searches into a highly lucrative business. But its shares have struggled since hitting an all-time high in early 2014 and it has little to show for ventures in other areas: self-driving cars, Google Glass, Internet balloons, health care, Google TV mobile payments, home automation and its Google+ social network, among others. Even in online advertising, Thompson argues, Google is losing ground to rivals like Facebook which integrate ads in "the stream," sometimes called "native ads," in a different approach from that of Google. "All of the things that make Google great at search and search advertising... are skills that don't really translate to the more touchy-feely qualities that make a social service or content site compelling," he said. In the mobile world, its free Android operating system dominates the smartphone market -- another potential concern of EU regulators. But Google has failed to get a major revenue lift from Android. That's because on mobile devices, users spend most of their time using apps, which leave Google out of the picture. Roger Kay at Endpoint Technologies Associates said this shift cuts into Google's strength. Growing use of apps such as Yelp or Open Table takes away from Google's ability to search and deliver advertising for those queries, he noted. "Google's business model is very narrow. It's just a single pillar which is holding the company up," Kay told AFP. - Fighting for mobile - Google, which opens its developers conference Thursday, is working to adapt to mobile, but it's not clear if it is too late. Data from research firm eMarketer shows Google's share of global digital ad dollars has held at around 31 percent over the past three years, while Facebook, Twitter and others have gained. For mobile ads, Google has seen its share drop to around 35 percent this year from 46 percent in 2013, losing to others such as Facebook and China's Alibaba and Baidu. "I wouldn't say Google is a sinking ship, but they are trying to plug a thousand leaks," says eMarketer analyst Jeremy Kressmann. Mobile is crucial because Google lacks access to user data on apps installed on Apple iOS devices, making it harder to deliver relevant, targeted messages, the analyst said. Facebook, says Kressmann, has better data glean from social network profiles and "likes" to get the best ads at the right time. "They know a lot more about who each Facebook user is, where they are located, so they can get more granular," he said. "It's very attractive to an advertiser to have that knowledge." While Google's free Android operating system has a market share of around 80 percent, the company gets little revenue from it. Android was designed as a way to feed users into other Google services, but it hasn't always been effective, says Jan Dawson of Jackdaw Research. "In many ways Google is losing control over Android and losing a way to monetize it by using it as an entry into the Google ecosystem," Dawson said. Dawson noted that Google services are stripped out of Android for most Chinese smartphone users, and that other manufacturers such as Amazon have "forked" the Android system to direct users elsewhere. - Alternate search engines - The shift to mobile has also fueled interest in new search companies which are trying to out-Google the leader for smartphone users. Investors have poured more than $100 million into venture-backed mobile search startups over the past three years, according to the research firm CB Insights. Some of these new firms such as Quixey, Swiftype, Wildcard and Vurb aim to help people search through the app world where Google lacks a presence. These firms use "deep linking, creating new ways to mimic web links by allowing users to go directly into different parts of a mobile app and gaining valuable data on where those users came from," CB Insights said. Kay argues that any effort by the EU to impose new business methods on Google could accelerate the trend which is eroding its dominance, similar to what happened with Microsoft during its antitrust battles. "If you put Google through a legal wringer it will be very timid," he said. But Dawson said Google may learn lessons from Microsoft, which is reinventing itself with new products and a different business model. "Google is a dynamic company and has the potential to make that transition more quickly and weather it better," he said. Join the conversation about this story »  | ||
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Ireland celebrates after huge 'Yes' to gay marriage | ||
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Dublin (AFP) - Ireland on Sunday celebrated a historic referendum approving gay marriage, as the once all-powerful Catholic Church reflected on the need for a "reality check" to keep in touch with changing times. Jubilant "Yes" supporters partied into the night after final results on Saturday showed 62 percent of votes in favour and 38 percent against in a country where being gay was a crime until 1993. The gay community "has given all of Irish democracy one of its greatest days," wrote Irish Times columnist Fintan O'Toole. "It has given our battered republic a new sense of engagement, a new confidence, an expanded sense of possibility," he said. It was the first time ever that gay marriage had been approved by popular vote and many supporters of the referendum expressed their joy through Twitter with the hashtag #WeMadeHistory. Ireland will become the 19th country in the world to legalise same-sex marriages once the necessary legislation is approved as expected by the summer. Niall O'Connor in the Irish Independent highlighted the role of young people in driving a colourful campaign in which social media played a key role. "The Celtic Tiger generation has let out an emphatic roar," he said. "The once unshakable influence of the Catholic Church over Middle Ireland has been confronted." All of Ireland's 43 constituencies except one voted in favour of the measure and the 60-percent turnout was far higher than in previous referendums, as thousands of expatriates returned home on packed ferries and planes to cast their ballots. - 'Social revolution' - Congratulations poured in, including a tweet from Prime Minister David Cameron, who legalised gay marriage in Britain, saying the result made it clear "you are equal if you are straight or gay". US Vice President Joe Biden, who is of Irish descent, wrote: "We welcome Ireland's support for equality. #LoveWins". A string of Irish celebrities had backed the campaign and rock band U2 posted a photo on Instagram with the words "In the name of love..." -- one of their most famous songs. The referendum asked voters whether or not they approved the statement: "Marriage may be contracted in accordance with law by two persons without distinction as to their sex." Legalising gay marriage is a seismic change in Ireland, where the Roman Catholic Church has traditionally been hugely influential. The majority of Irish people still identify themselves as Catholic and abortion is still banned except in cases where the mother's life is in danger. But the Church's influence has waned in recent years amid growing secularisation and after a wave of child sex abuse scandals that discredited the clergy. "I think the Church needs to do a reality check right across the board... Have we drifted away completely from young people?" Diarmuid Martin, the Archbishop of Dublin, told national broadcaster RTE. "It's a social revolution that didn't begin today," said Martin, who voted "No" and had argued that the rights of gay people should be respected "without changing the definition of marriage". Join the conversation about this story »  | ||
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Federer brings curtain up on French Open | ||
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Paris (AFP) - Roger Federer begins his 62nd consecutive Grand Slam tournament at the French Open on Sunday against a man who once almost condemned him to his worst loss at a major. The second seeded Swiss takes centre stage on the opening day of Roland Garros when he faces Alejandro Falla of Colombia. Falla, who only squeezed into the main draw as a "lucky loser" from qualifying, famously led Federer by two sets to love in the first round at Wimbledon in 2010 before the great Swiss fought back to win in five. Left-handed Colombian Falla is ranked 111 in the world, having been as high as 48 just two years ago, and made the fourth round in Paris in 2011. Federer, the 2009 champion, is seeded second this year and is desperate to make the most of a kind draw which dumped top seed Novak Djokovic, nine-time champion Rafael Nadal and third seed Andy Murray all in the opposite half. As a result, the 33-year-old can only face one of his main rivals for the title in the June 7 final and not before. "I was good enough to make the finals on many occasions, so I feel like I know that I have done well here in previous years," said Federer. "I hope that that can help me a little bit. I'm playing good tennis, and if I do string it all together, it could be a successful tournament." Federer, who has a 7-0 career record against Falla, is seeded to meet compatriot Stan Wawrinka in the quarter-finals. The eighth-seeded 2014 Australian Open champion starts his campaign also on Sunday against Turkey's world number 82 Marsel Ilhan. Japanese fifth seed Kei Nishikori is also in action on Sunday against Paul-Henri Mathieu, the 33-year-old Frenchman, now ranked at 123 and who has won just one tour match all year. Nishikori has yet to get beyond the fourth round in Paris but retained his claycourt title in Barcelona this year as well as making the semi-finals in Madrid. He also has the added benefit of 1989 French Open champion Michael Chang as coach. In the women's draw, last year's runner-up Simona Halep, seeded three, gets play underway on the main Philippe Chatrier court against Evgeniya Rodina, the world number 91 from Russia who has never won a main draw match in Paris. Serbian seventh seed Ana Ivanovic, the 2008 champion, starts her campaign against Kazakhstan's Yaroslava Shvedova, a quarter-finalist in 2010 and 2012. In other standout matches on the first day, Ernests Gulbis, who knocked Federer out of the competition last year on his way to the semi-finals, faces Igor Sijsling of the Netherlands. Gulbis has just two wins all year to his name. French 14th seed Jo-Wilfried Tsonga, a semi-finalist in 2013, takes on Swedish qualifier Christian Lindell, the world number 200 who is making his Grand Slam debut. Join the conversation about this story »  | ||
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Fresh air strikes and ground fighting in Yemen | ||
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Sanaa (AFP) - Saudi-led warplanes launched a fresh wave of air strikes across Yemen targeting Iran-backed rebels as fighting raged on the ground in the south of the country, witnesses said. The air raids pounded arms depots under the control of the Shiite Huthi rebels in the locality of Ghula, in Omran province north of Sanaa, residents said. They followed similar bombardments of weapons storage facilities in the capital that sparked deadly explosions, and strikes on the Dhabwa military base, which is currently under rebel control. In the western province of Hodeida, a military airport was twice bombed by coalition warplanes, according to residents. The Arab coalition has stepped up raids on positions held by the Huthis and their allies since a humanitarian ceasefire ended late on Tuesday. At Hajja in the north of the country, a gathering of Huthis was struck, killing at least 12 of the Shiite fighters, witnesses reported. Air strikes also attacked rebel positions in Dhamar, officials there said, while tank and mortar fire sounded across some sectors of the central region where heavy fighting took place, according to tribal sources. In southern Yemen, warplanes targeted rebels locked in combat with tribesmen in Ataq, the capital of Shabwa province, military officials said. The fighting killed at least 28 people, including 17 Huthis and 11 tribesmen, the sources said. In Aden, clashes raged in the north, east and west of the port city between rebels and fighters loyal to President Abedrabbo Mansour Hadi, military sources said. The Saudi-led coalition launched the air campaign against the Huthis on March 26 after the rebels seized the capital and advanced on Hadi's stronghold of Aden, forcing him to flee to Riyadh. The United Nations, which plans to hold a conference on Yemen in Geneva next week, says the violence has killed more than 1,000 people and displaced close to half a million more.
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People are worried about Apple for the silliest possible reason (AAPL) | ||
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As we head into the second half of the year, there's a creeping concern amongst Apple analysts that investors are going to bail on the company. The reason for concern is silly. Basically, Apple has been doing too well. The iPhone 6 and iPhone 6 Plus have been absolute juggernauts outperforming even the most optimistic analysts' expectations. Those iPhones, which have bigger screens than Apple's previous phones, have driven Apple's earnings to record-breaking highs, which has driven the stock to new high points. And that can only mean one thing to some people: Apple can only go downhill from here. Andrew Uerkwitz at Oppenheimer, for instance, relays the following in a new research note on Apple: Over the next nine months, we expect investors to doubt if Apple can deliver the same growth with quarters of tough comps ahead. In fact, we believe some will argue that Apple will record its first year-over-year decline of iPhone sales in FY15. This could put pressure on the stock as investors may start to believe that the iPhone growth story has run its course. What he's saying is that people think it's going to be hard for Apple to beat its record breaking performance. Apple sold so many iPhones, it's hard to imagine it can sell even more phones. As a result, investors expect a year-over-year drop in phone sales, which would likely lead to a year-over-year drop in earnings, which would hit the stock.
After Apple's most recent earnings report Gene Munster, Apple analyst at Piper Jaffray, forecasted a drop in revenue growth for the end of the year. Our emphasis added: The nagging question over the past year has been what happens when we comp the iPhone 6 launch? We are modeling for overall growth of 28% in the Jun-15, 11% in Sep-15, and down 1% in Dec-15. For 2016 we are modeling for 2% revenue growth. Any way you cut it, comps will get more difficult. We expect market share gains will improve these growth rates, but will still show a revenue growth slowdown. Our take on the comp question is investors (and analysts like myself), were reminded of the painful comp topic in the iPhone 5 cycle in 2013. Shares declined 44% in the 7 months after the iPhone 5 launch. We believe this dramatic drop two years ago reduces the risk of shares hitting the wall exiting the iPhone 6 cycle because most investors who have been buying shares of Apple over the past four months (stock up 22%) are aware of the upcoming comps. We believe the comps will soften the near term upside to AAPL shares, but still expect upside from current levels. Again, the primary reason investors might get skittish about Apple is that it's going to have a tough time outperforming itself. During the biggest three month period of Apple's year, the holiday quarter which runs from October to December, Apple sold 74.5 million iPhones, generating $51 billion in revenue. To put that number in context, it's more than Facebook, Google, and Microsoft generated in revenue combined.
However, Uerkwitz from Oppenheimer thinks that Apple will be able to easily grow this year. He thinks the iPhone is just getting started: We believe investors’ fears of declining iPhone sales are premature, and Apple’s market share gain and sales momentum in China will allow the company to beat the tough comp this December quarter. Moreover, we believe Apple’s ecosystem, new product categories, and shareholder friendly actions will keep its earnings growth trajectory above consensus expectations while new revenue growth engines emerge to replace the iPhone. Let's break down each of those points. On Apple's most recent earnings call, Cook pointed out iPhone sales are outpacing the overall smartphone market. "We grew iPhone 40%," said Cook. "And IDC’s estimate of the market for last quarter is a 16%, so we grew two and a half times. And if you kind of look through at the different countries, in almost every country, we grew at a multiple of the market."
As the iPhone outpaces the overall market, it's going to take share, mostly at the expense of Android-based phones. Apple has also said that only 20% of the company's active installed based of users have upgraded to an iPhone 6 or iPhone 6 Plus. That means 80% of iPhone users are due for a new phone in the next 2-3 years.
One big driver of growth for Apple is China, which saw iPhone sales grow by 70% in the first calendar quarter of 2015. Uerkwitz says, "We believe China has more untapped growth potential for Apple in 2015 and beyond. We expect 20M incremental iPhone unit growth from China in 2015." Why is the iPhone doing so well? Uerkwitz credits the widening "ecosystem gap": It is well known that an upgrade to large display size of the iPhone 6 Plus sparked a wave of Android users to switch to iPhones. But we see that only as the first stage of Android share loss. What we have not expected at the start of iPhone 6’s launch, is how the “ecosystem gap” between iPhone and Android phones would widen quickly over the past nine months, which constitutes a substantial advantage of iPhones over Android phones, in our view. Take Apple Pay and Apple Watch, for example; those are completely new features and hardware (accessory) apart from the known Apple ecosystem, and yet we believe Samsung and the Android camp as a whole are unable to offer any competent, competing solutions. The likes of Apple Pay and Apple Watch provide small convenience to user experience that will make a big long-term difference in our view. We expect the widening ecosystem gap to steadily chip away Android installed base in the next few years, even after the "size gap" is completely filled, keeping iPhone unit shipments at an elevated level. It also helps that Samsung, and Android, have basically gone sideways. Samsung has failed to deliver compelling software. Android, because it's fragmented, can't offer the same sort of all-in-one solution that Apple offers with its completely controlled products. But, let's say this isn't enough. Let's say the iPhone slows down considerably, Uerkwitz thinks Apple has other ways to continue growing its earnings, and its share price.
Then, there's Apple's massive pile of cash. One way to increase a company's share price is to... buy more shares. Apple has one of the biggest share buyback programs in history.
And, finally, what Uerkwitz doesn't mention is the wild card stuff like new products. Apple is widely rumored to release a streaming music service to compete with Spotify. It is also expected to do a streaming TV service That should help get some growth back in the iTunes business. If those services work, they won't be immediately massive businesses for Apple, but they will get investors salivating at their prospects, which should drive the stock higher. In short: While there's an argument to be made that Apple can't outdo itself, the truth is that it's positioned to continue its incredible run thanks to a broad base of new products. Apple is just getting started. Join the conversation about this story » NOW WATCH: 5 clever iPhone tricks only power users know about  | ||
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Sweden wins Eurovision Song Contest | ||
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Vienna (AFP) - Swedish singer Mans Zelmerlow has won Saturday's Eurovision Song Contest, Europe's annual pop extravaganza in its 60th anniversary edition. In Sweden's sixth victory and its first since 2012, Zelmerlow narrowly beat Russia's Polina Gagarina and Italian pop opera trio Il Volo. Join the conversation about this story »  | ||
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I just went to Wegmans for the first time ever — now I get what all the fuss is about | ||
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It seems every time someone mentions Wegmans, the insanely popular grocery store chain prevalent in upstate New York (as well as parts of New England, Virginia, and Maryland), people go absolutely nuts. Wegmans has 85 locations, and tens of thousands of enthusiastically loyal customers at each one. It's even opening a store in Brooklyn, New York (rumored to take up an entire city block), and people are ecstatic. I grew up 60 minutes north of Manhattan. I frequented Stew Leonard's for my supermarket experience (and the A&P), and up until this weekend, I had never been to a Wegmans. I also definitely didn't buy into the hype that surrounded it. That all changed. I asked to visit Wegmans this weekend, on a trip to the Pennsylvania Main Line. It's located off of Route 29 in Malvern, in a big shopping center. I was not prepared to be won over by Wegmans. I grew up close to Stew Leonard's in Danbury, Connecticut. See the rest of the story at Business Insider  | ||
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These are the 10 most beautiful cars money can buy | ||
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. Join the conversation about this story » NOW WATCH: 6 shortcuts in Excel that will save you a ton of time  | ||
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18 essential items for the closet of the modern gentleman | ||
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. Join the conversation about this story » NOW WATCH: This is the Excel trick that will change everything about how you work with data  | ||
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Samsung is going into total meltdown (AAPL) | ||
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Samsung is "placing the wrong bet" on the hardware of its latest flagship phone, and now its business is imploding, according to a new research note from the investment bank Oppenheimer. Over the past year, the South Korean company has seen a catastrophic collapse, with sales in China dropping by more than 50%. Now shipments of its latest flagship smartphone, the Galaxy S6, are also down, while the iPhone soars to unprecedented heights. So what's the issue? The Galaxy S6 is Samsung's big push — but it's not workingIn April, Samsung released the Galaxy S6, its latest flagship phone intended to help revive drooping sales. The company ditched its traditional plastic casing in favour of a higher-quality metal-and-glass design and stripped back the features to the basics, removing previous selling points like waterproofing.
In the month since the phone's launch, however, the response has been lacklustre. The Korean news outlet Yonhap News Agency reports that the device has seen 10 million shipments so far. For comparison, Samsung's previous model, the S5, shipped 11 million units in the same time frame a year ago — the year in which Samsung's sales collapsed. These are shipments, not sales, so the number of devices sold could be even lower. In a research note on Apple, Oppenheimer thinks Samsung's strategy is fundamentally misguided: When we look at Samsung’s flagship in 2015, the Galaxy S6 Edge, almost all of its differentiators fall back to hardware: a cutting-edge CPU, curved display, iPhone-like metal casing, front area fingerprint sensor, and camera with OIS. At the same time, we see little improvement in Samsung's software user experience, and no value-added to existing Samsung users who are on prior generations of devices. In short, there's no standout reason to buy a Samsung device specifically. Previously, it stood apart with a high-end, big-screen device that appealed to wealthy consumers. But now Apple has caught up, offering the iPhone 6 in equivalent sizes. Samsung has lost that edge. Meanwhile, at the low end Samsung's lack of differentiation leaves it vulnerable to smartphone makers like Xiaomi, which can offer equivalent products for far lower prices. Android devices on average are cheaper than ever before, but Xiaomi's phones retail for even less than that average at $220 to $254. Oh, how the mighty have fallenJust a few years ago, Samsung was all but untouchable, providing a (seemingly) desirable high-end Android handset. But everything changed with the launch of the iPhone 6. Released in autumn 2014, the larger-screen device set up Apple to have the most profitable quarter of any company ever. The Cupertino company has enjoyed record shipments, especially in Asian markets in which it previously had relatively low penetration. As Apple grew, Samsung plummeted. The profits of the South Korean electronics company collapsed, as the high-end market turned to Apple's latest handset. And Xiaomi has come from nowhere to become the most valuable startup in the world in just five years. Apple is No. 1Data from the research company IDC published earlier this month shows just how massive Samsung's collapse has been in the key market of China. In a year, the company has dropped from first place to fourth in terms of sales, while Apple has leaped into the lead.
The data is even more striking in this graph from Leon Markovitz at Dadaviz:
It's not just SamsungOppenheimer argues that it's not just Samsung that has this problem: It's the entire Android ecosystem. "In the past nine months, Android OEMs were unable to offer any competent competing solutions that may help reverse the share loss trend" to the iPhone, it says. It's true that Apple is seeing furious gains in smartphone market share, as it increasingly focuses on encouraging "switchers" to make the leap to iOS from Android. Realistically though, vast numbers of people can't afford to switch anytime soon, meaning low-end Android handset manufacturers are safe (for now). Samsung, however, isn't so lucky. Join the conversation about this story » NOW WATCH: Why Samsung's most gorgeous Galaxy phones yet will leave you with mixed feelings  | ||
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Valencia claim Champions League place, Eibar, Almeria relegated | ||
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Madrid (AFP) - Valencia sealed their place in next season's Champions League as Eibar and Almeria were relegated on a dramatic final day of the La Liga season. Deportivo La Coruna came back from 2-0 down away at champions Barcelona to spoil a homage to Xavi Hernandez at the Camp Nou and stay up with a 2-2 draw along with Granada who held Atletico Madrid 0-0 at home. That point was enough to ensure Atletico go straight into next season's Champions League group stages in third, whilst Valencia twice came from behind to win 3-2 at Almeria and secure fourth. Eibar's remarkable first season in the top flight didn't have fairy tale ending as they were relegated despite just a second win in 20 matches 3-0 at home to Cordoba due to their inferior head-to-head record with Deportivo and Granada. Athletic Bilbao also secured European football for next season in the Europa League thanks to a 4-0 thrashing of Villarreal. Cristiano Ronaldo struck his eighth hat-trick of the season to seal the golden boot with 48 league goals as Real Madrid finished the campaign with a 7-3 hammering of Getafe. Javier Hernandez, James Rodriguez, Jese and Marcelo also found the net for Los Blancos, whilst Norwegian teenage sensation Martin Odegaard made his first-team debut in what is expected to be Carlo Ancelotti's final match in charge of the European champions. Xavi was making his 505th and final Liga appearance after announcing he will join Al Sadd at the end of the season after Barca face Athletic Bilbao and Juventus in the Copa del Rey and Champions League finals respectively. "I am the happiest man in the world today and for the 17 season I have been here," he told the crowd after fighting back tears. "As the coach has said this hasn't finished. We want two more titles and we want to be here with you all again in Barcelona on June 7 (after the Champions League final)." Barca looked set to save Eibar for much of the day Lionel Messi headed home Rafinha's cross to give the hosts the lead after just five minutes. The Catalans dominated for large swaths of the game and looked to have sealed the Galicians fate when Neymar unselfishly squared for Messi to make it 2-0 on the hour mark. However, Lucas Perez gave Deportivo hope with a stunning strike into the top corner seven minutes later and Salomao struck 14 minutes from time to cap a remarkable fightback. Granada also secured their top flight status for a fifth consecutive season as they and Atletico played out a bore 0-0 draw that suited both parties. Valencia's hopes of a return to the Champions League were given an almighty fright by Almeria as they twice went in front in the first-half. Thomas Partey's free-kick sneaked past Diego Alves at his near post after nine minutes, but, as so often this season, Nicolas Otamendi came to Valencia's rescue with a powerful header to equalise. Jonathan Soriano put Almeria back in front and then missed a huge chance to make it 3-1 moments later. The visitors responded once more before half-time as Sofiane Feghouli tapped home from close range and, with both teams chasing the winner, Paco Alcacer coolly slotted past Ruben Martinez 11 minutes from time. Valencia's victory rendered Sevilla's 3-2 win at Malaga meaningless as they finished a point back in fifth. However, the Andalusians can still qualify for next season's Champions League should they retain the Europa League against Dnipro Dnipropetrovsk on Wednesday. Join the conversation about this story »  | ||
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Bearded queen Conchita kicks off Eurovision jamboree | ||
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Vienna (Austria) (AFP) - Austrian bearded drag queen Conchita Wurst, resplendent in a sparkly, backless purple outfit, floated onto the stage in Vienna Saturday to begin the 60th Eurovision Song Contest, Europe's annual anything-goes pop fest. The difference this year for the clash of the catchy, corny and camp watched by around 200 million people worldwide is that Australia -- where Eurovision has long had a cult following -- is taking part. But whether hunky former "Australian Idol" champion Guy Sebastian can wow the millions watching at home and professional juries in each nation remains to be seen, with tough competition among the 27 acts. The favourite -- although the competition is notoriously difficult to predict -- is chiseled Swede Mans Zelmerlow, hoping to repeat the magic of global superstar compatriots ABBA back in 1974. A stiff challenge also comes from Russian Polina Gagarina with "A Million Voices", a paean to peace that she hopes will silence the boos that Russia's entry got last year after the annexation of Crimea. If she wins, Eurovision will be in Russia in 2016 -- a prospect not relished by Patriarch of the Russian Orthodox Church, who said Thursday the contest promoted values "repulsive to our soul and our culture". Others with good chances are Italian pop opera Il Volo, Belgian Loic Nottet, Morrland and Debrah Scarlett of Norway -- the country that holds the record for scoring zero points the most times -- and dark horse Serbian diva Bojana Stamenov. Long shots include Ann Sophie of Germany -- whose first-choice act withdrew -- Knez of Montenegro, Poland's Monika Kuszynska in a wheelchair, and shaggy-haired Austrians The Makemakes. "It's very overwhelming. I've been fortunate enough to perform on various different stages but when you get on that Eurovision stage it's like nothing else I've ever done in my life," said Australia's Sebastian. Geopolitics will again be present this year with Armenia's ballad -- described by one magazine as "feeling as long as a Wagner opera" -- widely seen as being about the 1915 mass killings by Ottoman Turkey, with the chorus "don't deny". Turkey, which refuses to recognise the killings as genocide, has been absent from Eurovision since 2012. Another no-show is Ukraine, cash-strapped from the conflict with Russian-backed rebels in its east.
- Turkeys, orcs and babushkas -
Mostly though the riotous affair, open to the 56 members of the European Broadcasting Union and a world away from its civilised black-and-white beginnings, is about not taking life too seriously. Previous entries have included six Russian grannies, Ireland's irreverent Dustin the Turkey and Finnish heavy metal outfit Lordi -- looking like orcs from "Lord of the Rings" -- who won in 2006 with "Hard Rock Hallelujah". The lyrics often make no sense, if they are in any recognised language at all, like "Diggi-Loo Diggi-Ley" by golden-booted Swedish Mormon brothers Herreys in 1984, "La La La" in 1968 or Lulu's "Boom-Bang-A-Bang" in 1969. And who can forget the chorus to Austria's 1977 entry: "Boom boom boomerang, snadderydang. Kangaroo, boogaloo, didgeridoo. Ding dong, sing the song, hear the guitar twang. Kojak, hijack, me and you." The event has also long stressed tolerance for the unconventional, as witnessed by Israeli transgender Dana International in 1998, Ukraine's Verka Serduchka in 2007 and Austria's Conchita last year. Conchita's message has been enthusiastically adopted by Viennese authorities, including with special gay-themed traffic lights. "I like the feeling because it's a little bit trashy but it's also very exciting," said one German fan attending for the first time. "I have loved this show for 15 years and watch it every year on television." Jean-Paul Philippot, chairman of the EBU, told AFP that Eurovision is "the opposite" of talent shows like "The Voice" or "The X Factor". Join the conversation about this story »  | ||
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