Don’t miss this special report in Time Magazine on the changing shape and the new rulers of the Internet.
Super (cheap) computer
“One Laptop Per Child” seeks to put the power of computing into each set of tiny hands.
Nicholas Negroponte set out to build a $100 laptop so that children in third world nations could get on the Internet with everyone else.
People thought he was crazy.
Intel knows he is.
But in November, Negroponte’s dream comes true when 5,000 units come off the assembly lines at Quanta Computers. Quanta, one of the world’s biggest computer manufacturers, signed on earlier to partner up with the One Laptop Per Child initiative, and the first test units are due next month. The new units, called the XO, are low power laptops that can be hand generated in areas without electrical outlets.
Fortune Magazine senior writer, David Kirkpatrick, illustrated some level of doubt about the project, especially from Intel CEO Craig Barrett, who wrote a letter to the Nigerian government:
“The OLPC represents a limited version of the modern PC, reliant on old hardware that limits its functionality.”
Wrong.
The computer actually uses an ultra-low power technology provided by–survey says–AMD, Intel’s biggest rival.
In a strategic misstep and a bad piece of publicity for Intel, already seen as the stumbling giant against the hipper AMD.
Negroponte may be idealistic, but he is actually putting computers into the hands of those who simple wouldn’t have them otherwise.
What’s more, the computer is pretty hot. It serves as a laptop and a tablet PC with energy saving features you can’t even get in most current laptops that would costs thousands. The XO has on-board audio, USB ports and limitless usage as a pull string (which replaced a hand crank) is used to power a generator manually.
This is amiable work, and it’s coming to fruition. Good for Negroponte.
Mid-week market rag: Google, Apple, NewsCorp and a lil Alcoa
Mid-week is synonymous with the Market Rag.
Firstly, Google is up in trading today after spending over a billion and a half dollars acquiring YouTube. Meanwhile News Corp is down today as the details of this trade begin to trickle down and bad news for the newspaper business continues.
According to the Wall Street Journal, News Corp tried to jump in and possibly make a counter offer to buy out YouTube, but the startup video service didn’t even return their calls, indicating one of two things: either the 20-something founders were diehard-locked-in to Google, or they were terrified that if they shopped around, their payday might slip through their fingers.
While indicative of their age, this course of action still seals a huge acquisition for the search engine leader and in all honesty, pissed off the boys at News Corp, who met according to the Journal after the deal to discuss the possibility of banning YouTube links on MySpace.com
Things remain cordial, however, as Google and News Corp executives, including Rupert Murdoch, plan to meet in Los Angeles this week. Smartly, the two companies see that despite their competition, they both can make a lot of money off each other.
Shares of Apple Computer are down slightly today as their stock option scandal churns. Federal prosecutors have begun to look into the company’s option practices, according to reports.
As a bit of breaking news, a plane crashed into a residential building in New York today, according to a CNNMoney report. CNN is also reporting that this development has dragged market prices lower this afternoon. All eyes are now focused on this development.
Finally this week Alcoa, the first blue-chip company to release its earnings, posted an 86 percent increase in net income and is reportedly having its best fiscal year in the aluminum company’s long history. Despite that, the company did not meet analysts’ expectations and predictions. This development is driving stocks downward today, and Alcoa itself is down five percent despite an 86 percent jump in income. There are clearly economic explanations for this, but it is amazing to see this be the case.
And that, my dear friends, is the rag for this week.
Google buys YouTube
As predicted in my article, The Data War, one of the big two has made a major move for the amazingly popular video site, YouTube. In a $1.65 billion deal, Google has purchased the public video sharing service, making its founders (who are in their 20s) very, very rich.
This deal also gives Google a pivotal coup in its competition with Microsoft and News Corp.
News Corp’s MySpace, the number one social networking website in the world, moved away from YouTube’s services this summer when it started its own video uploading and embedding service, indicating it was not looking to make a move on YouTube. Another possibility was for Microsoft to strike a deal and move toward video services on Facebook, which Microsoft struck an advertising deal with in August. Facebook is already one of the top internet photograph sharing websites.
The billion-dollar deal means Google sees great revenue possibilities in YouTube, as they were willing to pay a huge premium in making their largest acquisition in company history.
YouTube has risen to icon status in the Internet sub-culture, and its corporate status has been rising since inking content deals with CBS and Sony earlier.
Money remains the motivating factor. Google CEO, Eric Schmidt, said in a press conference that YouTube would be just the first in a “video revolution” and a series of investments Google would make in an effort to increase their attractiveness to potential investors.
What can you count on? Short, 10-second advertisements before video clips, more text-based advertising and advertising targeted to video categories.
All in an effort to make money on what’s free.
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