Archive for the “News From The Net” Category


WASHINGTON (Reuters) - U.S. auto executives warned Congress on Tuesday that their industry was teetering on the brink of disaster as they pleaded for a $25 billion aid package despite political opposition to another multibillion-dollar government bailout.



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HONG KONG (Reuters) - Asian stocks fell more than 1 percent on Wednesday and the yen rose, with risk-averse investors fretting about the deepening damage to corporate profits and consumer spending despite a late rally on Wall Street.



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German software giant SAP (SAP) may be trimming its headcount, but the company is talking up a new potential market for its complicated ERP systems: Second Life.

SAP Research’s Erica Dubach:

“Virtual world retailers have a lot of the same issues as real retailers. For example, they have inventory, they have stock, they have billing, they have suppliers. SAP systems support real-world retailers on these issues and can do the same for virtual world retailers.”

Obviously, we don’t think SAP is going to be selling much software to Second Life entrepreneurs, nor do we see the upside of modeling SAP’s store-inventory experiment in Linden Lab’s crash-prone virtual world.

But give Second Life this: While general interest in in the virtual world has waned, there remains a cadre of stubbornly loyal users, some of whom are in executive roles at places like SAP, IBM, or top universities. They’re continuing to advocate for and win R&D ventures into Second Life.

See Also: IBM Drinks Second Life Kool-Aid, Makes More For Lotus Users



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mel-karmazin-cnbc.jpgA friend approached us with a potential stock pick this afternoon: Sirius (SIRI) on the theory that it had gone so absurdly low ($0.20) that it couldn’t go any lower and would probably soon go to $0.30, resulting in a 50% gain. We suggested our friend instead hoard his hard-earned cash.

Could Sirius go to $0.30? Of course. Could it also go to zero? Yes.

Mel Karmazin’s company currently has an equity market capitalization (value of the stock) of $650 million. It also $360 million of cash and $3.3 billion of debt, so its “enterprise value”–the implied value of the business itself–is about $3.7 billion. The only thing that has to happen for Sirius (SIRI) stock to go to zero is for the market to conclude that the company is worth less than $3 billion. This would wipe out the company’s stock value, leaving the company in the hands of the debt-holders.

Why might the market soon conclude that Sirius is worth less than $3 billion? Because it’s running out of cash. In the first 9 months of this year, Sirius had negative free cash flow (cash from operations - capex) of $300 million. $360 million of cash won’t last long at that burn rate.

Sirius’s stock is now low enough that it will be hard to raise capital by selling stock, and we can’t imagine who would be willing to lend the company money right now. That means the company’s cash cushion is likely to get dangerously low, perhaps forcing Sirius into a highly dilutive equity deal that will put additional pressure on the stock. So it’s not hard to see how the stock could go to zero (or close to it).

See Also: Sirius Hits $0.20



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Launching a new show called “The IFC Media Project,” Cablevision channel IFC hosted a panel today featuring Huffington Post founder Arianna Huffington, William Buckley’s grown kid, Christopher Buckley, Frank Sinatra-biographer Pete Hammil and Weekly Standard editor William Kristol.

The panel spent much of their time on stage lamenting how news has turned into a sort of info- electo- tainment bloated with shouting pundits on cable news networks. It got really good when they started shouting at each other about it.

IFC Media Project host Gideon Yago started it, saying the media ignored carnage in Iraq to the detriment of Americans.

“They don’t know people are getting wounded?” Kristol said, loudly.

“Let them seem the coffin!” said Hamill, shouting.

Kristol shouted to be heard: “Nonsense. In the real America-”

“He’s talking about blood on the ground! What Goya saw!” said Hammil, interrupting.

See Also:
Nick Denton: Media Sleepwalking Into Extinction

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zunes.jpgMicrosoft is cutting pricing on its Zune MP3 player, which hasn’t done much to disrupt Apple’s (AAPL) market-leading iPod. The new price tags, according to MobileDevicesToday:

  • 16 GB: Zune, $179; iPod $199
  • 8 GB: Zune, $139; iPod $149
  • 4 GB: Zune, $99; no iPod

We realize the economy is tough. But we still think most people will spend the extra $10-$20 to get one of Apple’s sexy new iPod nanos. (Or, for $199, an iPhone.)

The 4 GB Zune at $99 is a good price, but we think most people will want at least 8 GB of storage these days.

See Also:
Apple Mac Sales On Track, iPod Looking Better Than Expected
Microsoft Trusts Zune Ads To ‘I’m A PC’ Agency
Apple, Studios Giddy Over iPhone Gaming



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YouTube viewers give General Motors’s bailout-begging video 1.99 stars out of 5. Web video services provider TubeMogul tells us that’s the lowest rating of any video to crack YouTube’s top 100 this week. This despite the fact that the the video’s top referrer is a GM-owned site. Social media marketing 0, Angry public 1.

See Also:
The $150 Journalist Bailout



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But major indexes are at levels last seen in 2003. Hewlett-Packard earnings cheer. Automakers plead for help from Congress; Chrysler says it’s almost out of cash. Home Depot earnings are better than expected.

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NEW YORK (Reuters) - Stocks staged a late fight back on Tuesday after a choppy session in which stronger-than-expected results and outlook from computer maker Hewlett-Packard offset fears that more losses at Citigroup and other banks are yet to come.



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NEW YORK (Reuters) - Stocks staged a late fight back on Tuesday after stronger-than-expected results and the outlook from computer maker Hewlett-Packard offset fears of more losses at Citigroup and other banks.



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WASHINGTON (Reuters) - The chief executives of General Motors Corp, Ford Motor Co and Chrysler submitted testimony Tuesday to the U.S. Senate Banking Committee.



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Mark Cuban may very well be guilty of insider trading. If that’s the case, he should go to jail. But amid a global credit crisis and mortgage meltdown, is this really the investigation we care about?

My colleague Aaron Task says the SEC is too underst

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Last week, Hank Paulson announced that his original bailout plan — using taxpayer money to buy trash assets from banks — was dead and that the government would just be injecting capital into banks instead.Injecting equity is good, says Christopher Whale

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Hewlett-Packard sees a good fourth quarter and decent 2009 prospects. But sagging financial stocks stall out a morning rally, and the S&P 500 may see its lowest close since March 2003. U.S. automakers plead for more help from the government. 

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After a 24% plunge in its third-quarter profit, the jumbo retailer promises to remain ‘keenly focused’ on offering low prices — going toe to toe with rival Wal-Mart.

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