Microsoft ropes in Seinfeld to bring more zest to advertising

The Windows Operating System is a massive money-earner for Microsoft; together with Microsoft Office, the software earns a huge portion of the total revenues for Microsoft. However, it has been 2 decades now since Microsoft rolled out the Windows brand and took a commanding share of the computer desktop software market. Users are slowly getting tired of this brand name, and seeking a cooler alternative, are latching onto the Mac platform in bigger numbers (they have not moved on in very high figures, but even a percentage decrease in Windows sales would be worrying for Microsoft). Another section of users have got introduced to the Mac through the Mac option of being able to load both the Mac and Windows on the same Mac machine; and there would be a number of such users who would find the Mac software more compelling (and of course, there are a number of Ads that show Mac users as cool, while Windows users are shown as nerdy). So what does Microsoft do ? It recruits Seinfeld to star in some ads designed to bring a cool look to the Windows platform:

Microsoft Corp., weary of being cast as a stodgy oldster by Apple Inc.'s advertising, is turning for help to Jerry Seinfeld. The software giant's new $300 million advertising campaign, devised by a newly hired ad agency, has been closely guarded. But Seinfeld will be one of the key celebrity pitchmen, say people close to the situation. He will appear with Microsoft Chairman Bill Gates in ads and receive about $10 million for the work, they say.
The attempted image overhaul comes as Microsoft executives privately acknowledge that Windows - the company's most important brand - has grown stale and has been battered by Apple's “Mac vs. PC” ads. Microsoft's immediate goal is to reverse the negative public perception of Windows Vista, the latest version of the company's personal-computer operating system.

The company must be really worried. Normally, the Mac has always been derided by Microsoft, and not worthy of attention; so the campaign to hire a popular comedian (even though his shows stopped production in 1998) along with a new Ad agency smacks of an effort to try and get back some freshness, some new enthusiasm among its market base.

Google's future besides search

Google is a company that has a lot going for it. It has a reputation of being a great place to work, the leader in the area of search (a field that it essentially took over and made it the big size that it currently is), and has some solid public relations going for it (the fact that it continues to vanquish Microsoft means that more people see it in a positive light). The stock of the company continues to remain high. But all good things have to come to an end. Slowly, the sheen is starting to wear off and there are more critical analysis of the company that are starting to emerge. One major area for critical analysis is about the success of the company in fields other than search:

Google has been the world's hottest technology company for almost six years now. The Mountain View company not only completely dominates the search engine business, but it's had an absolute lock on Silicon Valley's psychology. Every new beta product that debuts generates enormous attention and seems to promise to revolutionize one more slice of the Web and communications. Just this week came the latest numbers from comScore indicating that Google increased its search market share over Microsoft and Yahoo. And the takeover squabble between those two has just reinforced the perception that Google has an almost unassailable position as the leading technology company.
"Name me anything they've been successful in beside search," Chowdhry said. "I think the board and management of Google need a total overhaul." OK, that's harsh. On the other hand, according to Google's own securities filings, the company expects its margins on advertising to continue to shrink and its revenue growth in this area to continue to slow. In addition, all those high-profile ventures the company has launched, and the acquisitions it's made, have yet to contribute much to the bottom line. In a filing with the Securities and Exchange Commission, the company noted that revenue from services such as YouTube, Google Checkout and a host of others "were not material."

Youtube in particular was much mocked (especially among the online community), since a purchase of $1.6 billion is not a small amount and a lot of analysts were unable to figure out as to how Google will make money on this transaction. It's other purchases such as Picassa, and initiatives like Google Earth, are seen as cool, and fitting into the ad space in the long term theme of things, but are a very long way away from making money. No one of its stockholders would grudge the purchase of something like Doubleclick, but stuff such as Picassa do not seem to make sense.

Apple willing to let BestBuy sell iPhones

Apple has a gold mine in the shape of it's iPhone, a device that continues to generate significant customer demand, and in fact so much demand, that if a customer wants to buy an iPhone in a AT & T store, there is a waiting time of around a week. Outrageous, some people would say, it's a device after all. But the iPhone has turned out to be such a hot device that people queue up to buy the iPhone, and Apple has sold millions of them so far. However, Apple hasn't exposed the phone in the retail market outside of the Apple and AT&T stores, and this restriction must still be limiting the number of phones they are able to sell. Well, it looks like they have re-considered; there seems to be an agreement to allow BestBuy to stock iPhones in BestBuy stores. Given that BestBuy is the largest electronics goods retailer, seems like Apple could expect a bump in the sales:

In a move that will significantly expand its retail presence in time for the holiday season, Apple has agreed to let retailing giant Best Buy sell the new iPhone 3G through its nationwide chain of Best Buy Mobile outlets starting early next month. Best Buy markets cell phones in the United States through 970 full-size stores and 16 stand-alone Best Buy Mobile shops. All U.S. Best Buy stores will carry the iPhone except for a handful of outlets located in areas where AT&T does not provide cell phone coverage.
For Best Buy, which has been angling for the iPhone business for more than a year, the deal will add Apple’s cachet to its expanding smartphone offerings and help drive traffic to new Best Buy Mobile departments within its stores. Best Buy is aggressively marketing a variety of smartphones, from RIM BlackBerry Curves to Palm Treos, and is the exclusive reseller, with Sprint (S), of the Samsung Instinct, one of the iPhone’s nearest competitors.

This will push the iPhones into the hands of a larger number of consumers, and given impulse purchases, may lead to a bump up in sales for the iPhone. After all, a consumer going to buy some other phone may come across the iPhone and decide to buy. What is not yet clear is about how the activation will be handled for these iPhones.

Yahoo shareholder meet ends tamely

With the recent agreement between the Yahoo board and the shareholder challenge of Carl Icahn which gave Carl 3 seats on the board, the issues confronting Yahoo in terms of shareholder challenge seem to have died down. Otherwise why would the proceedings from the Yahoo board meeting end like this ?

It's almost as if the past six months never happened. Yahoo's much anticipated annual meeting on Aug. 1 left its current board and co-founder and Chief Executive Jerry Yang intact, in control, and still insisting they can return to contention with runaway rival Google. Despite rampant shareholder anger that the Internet icon couldn't close any of a series of deals with Microsoft since the software giant's unsolicited $45 billion buyout bid Feb. 1, the long-delayed annual meeting was remarkable mostly for how little happened.
Nonetheless, the vote still indicates that a significant portion of shareholders remain dissatisfied with Yahoo's direction. The most pointed criticisms during the meeting came from Eric Jackson, who runs a Florida-based firm called Ironfire Capital He called for Bostock and two other directors to step down and for Yang to give up the CEO seat to a more experienced executive. "They're basically saying, 'Believe in us,'" Jackson said after the meeting. "There are too many people who have been there too long and we need new management from outside."

I don't think that this is the last anyone has heard of this entire issue. Yahoo is not likely to be able to outwit Google, and shareholders will remain dissatisfied with the performance and the share prices. Future revolts cannot be ruled out.

Net neutrality: FCC scolds Comcast, but does not fine

The subject of net neutrality has been occupying a lot of discussion bandwidth over the past several months; the basic discussion point has been about whether the internet service providers can discriminate between the different types of content flowing through their pipes. The current policy is that users have the right to do whatever they want with their internet connectivity; so if they want to do file-to-file sharing or downloading videos, then the service provider is not supposed to tell them whether this is a permissible activity or not. The various internet providers in the United States have been advocating that such a policy prevents them from being able to make improvements in their networks.
After all, the biggest flow of internet information is typically with sites that promote P2P (and for torrent and others, this is a client to client exchange without going through a central server), or with users downloading videos or watching live videos. The ISP's have wanted to be able to set limits on this, and this is something that has just been blocked by a divided decision of the Federal Communications Commission:

Federal regulators issued a warning to all Internet service providers Friday with a sharp rebuke of Comcast Corp. for blocking some customers from using file-sharing technology. By a 3-2 vote, the Federal Communications Commission found that the cable company failed to tell its subscribers about the blocking, lied about it when confronted by the commission and tried to cripple online video sites that compete with its on-demand service.
Supporters said the FCC decision would set a landmark precedent in the battle over whether Internet service providers can give priority to certain types of traffic, an issue known as network neutrality. The FCC ordered Comcast to stop the blocking and provide details about its Internet practices, but declined to fine the Philadelphia-based Internet service provider, the nation's second-largest. Public interest groups, online activists and large Internet companies fear that cable and phone companies will start charging websites for faster delivery of their content or block access to sites that offer competing services.

It is not at all difficult to believe that if ISP's are given the permission to be able to set limits on certain types of data movement, then they could take this a bit further and set up deals with sites to promote their content or let it move faster. The internet cannot be made hostage to the machinations of ISP's and their corporate interests.