Bloomberg: Huawei Posts Record Earnings on Network Equipment Sales

Huawei Technologies Co., China’s biggest maker of phone network equipment, posted record sales and earnings on demand from wireless carriers for gear.

Revenue rose 8.5 percent to 239 billion yuan ($38 billion) in 2013, the Shenzhen, China-based company said in a statement today. Net income for the year was 21 billion yuan, it said, or 36 percent more than it reported the previous year.

Huawei is broadening its product lineup with smartphones, tablets and business-computing products and services as it fights cybersecurity concerns that have restricted access for its network equipment in the U.S. and Australia. The closely held company got 65 percent of revenue from outside China as it targets more sales to larger customers.

“Thanks to the favorable global macroeconomic and industry environment, as well as the effective execution of our company strategy, Huawei basically achieved our business targets for 2013,” Eric Xu, Huawei’s deputy chairman and rotating chief executive officer, said in the statement.

Sales at Huawei’s carrier network unit rose 4 percent to 166.5 billion yuan, while the consumer business boosted sales 18 percent to 57 billion yuan. The enterprise division increased revenue 32 percent to 15.2 billion yuan, according to the statement.

The company’s worldwide smartphone sales last year trailed only Samsung Electronics Co. (005930) and Apple Inc. (AAPL) as Huawei boosted its share of the global market to 4.9 percent from 4 percent the previous year, researcher International Data Corp. reported in January.

Source: Bloomberg

WSJ: Small Is Beautiful in Chinese Web Stocks

Until recently, the three giants had been mostly content to expand on their own turf: Alibaba Group Holding in e-commerce, Baidu BIDU -0.23% in search and Tencent Holdings TCEHY +3.53% in games and messaging. Now, a flurry of deal making—five significant acquisitions this month alone—has the trio stomping all over each other's turf and beyond China. Alibaba's planned $15 billion initial public offering in New York has heightened investor attention.

Tencent has taken the fight to Alibaba with an investment in JD.com, a direct rival in online retail. Tencent's investment in second-place search engine Sogou, owned by Sohu.com, S is a direct attack on Baidu. Alibaba's stake in Sina's Twitter  -like Weibo is aimed at Tencent's messaging prowess.

The battle has spilled abroad, with Alibaba and Tencent both investing in U.S.-based chat startups, and Tencent investing in a Korean gaming company. Tencent's WeChat also is working to develop an audience overseas to challenge Facebook's WhatsApp and others.

 

Foreign players such as Facebook and Twitter are boxed out by Beijing. And Google  withdrew in 2010. This has created a hothouse in which the largest domestic players hold even more sway. The small guys have little choice but to choose sides.

Since the start of 2013, Baidu has spent more than $2.4 billion on acquisitions, Alibaba over $1.9 billion and Tencent at least $1.3 billion, not counting the value of two businesses it traded to JD.

The deals aren't huge yet, especially relative to the size of the acquirers. But as the frenzy continues and competition intensifies, heavy spending on marketing and promotions is eroding profitability.

Operating margin at Tencent fell to 28% in the fourth quarter of 2013 from 39% two years earlier. Baidu's margin fell to 28% from 51% over the same period, and the company warned investors not to expect any profit growth this year despite rapidly rising revenue.

In this environment, potential acquisition targets may prove better investments. A few publicly listed companies are now conspicuous for their lack of affiliation with any of the major players.

Following Tencent's investment in Leju, the online unit of Chinese real-estate broker E-House (China) Holdings,  it wouldn't be surprising to see a rivals take an interest in much larger Internet real-estate site Soufun Holdings,  which has dominant market share in online-property advertising.

Each of the big three now competes in online video, and Alibaba this month acquired a controlling stake in ChinaVision Media Group, a film studio that can help provide content. Stand-alone site Youku Tudou  is wrestling with Baidu's video for the top spot by monthly users. Youku is money-losing due to the high cost of content, but its video library could be a valuable resource for one of the big three.

Travel is another hot spot. Baidu has a majority interest in bookings site Qunar Cayman Islands,  while Tencent holds a minority stake in rival eLong. But Ctrip.com International,  the largest travel site by revenue, is independent.

These companies range from market values of $4.5 billion for Youku to $6.1 billion for Ctrip, so deals for minority stakes would likely be in the same range as recent ones.

The biggest stand-alone player, with a market value of $11.4 billion, is Qihoo 360 Technology.  It provides security software and operates China's third-largest search engine behind Baidu and Sogou, now part-owned by Tencent. A strategic alliance with a bigger player is possible, perhaps cemented by the sale of a stake in one of its units.

The big three are well positioned to capture users and traffic on China's Internet. But as they compete to scoop up minnows, investors might want to look beyond the hunters to the prey.

WSJ: Asian Shares Enjoy End-Quarter Pickup

    The Wall Street Journal reports,"Asian stocks were mostly higher on Monday, at the end of a quarter that was characterized by poor performances in China and Japan and reviving fortunes in Southeast Asia.

The declines in the region's two largest economies, with Japanese stocks on track for their worst quarter in nearly two years, marked a reversal of a key investment trend from late last year when investors shifted away from Southeast Asian markets to North Asian countries that they expected to benefit from a pickup in the global economy".

But investors have shied away from Japan and China, with the Nikkei Share Average down 9.4% so far this year and the Shanghai Composite Index 3.7% lower. Sentiment has been soured in Tokyo by the potential economic impact of a hike in the local consumption tax, which will take effect on Tuesday. China however, has been bogged down by persistently poor economic data, as well as rising fears of debt defaults in the corporate sector.

Indonesia and the Philippines however have enjoyed healthy gains, up 11.6% and 8.7% respectively, with investors moving back into these markets after heavy selling last year as investors tried to prepare for the impact of the U.S. reversing its easy money policies. Indonesia in particular has rallied ahead of an election in July, as well as easing concerns over the country's current-account deficit.

On Monday, Asian stocks maintained the positive momentum from the previous week ahead of a wide range of economic events scheduled to occur over the coming days. On Tuesday, China will release its official manufacturing data and Australia's central bank will make a decision on interest rates, while at the end of the week attention will be on the U.S. labor report.

Australia's S&P/ASX 200 added 0.9% and South Korea's Kospi was up less than 0.1%. Japan's Nikkei gained 0.8% after the dollar pushed a total of 0.6% higher against the yen on Friday, stabilizing on Monday—the greenback was last at ¥102.84. The Philippines PSE added 0.7%.

In China, Hong Kong's Hang Seng Index added 0.2% and the Shanghai Composite Index was down 0.4%. 

EU-China strategic partnership can shape global order: Van Rompuy

The comprehensive strategic partnership between the European Union (EU) and China can play an important role in shaping the global order, president of the European Council Herman Van Rompuy has said.

In an exclusive interview with Xinhua prior to the visit of Chinese President Xi Jinping to Brussels -- the first ever by a Chinese president to EU institutions -- Van Rompuy underlined that neither the EU nor China had the potential to solve global problems alone.

"International financial turbulences, climate change or modern information technologies do not respect national borders," Van Rompuy said. However, much could be achieved "while working constructively together for the global good," he added.

Since November 2009, Van Rompuy has served as the first full-time president of the European Council -- the EU institution comprising the heads of its member states that oversees the general political direction and priorities of the Union.

The former Belgian prime minister and economist at the National Bank of Belgium was reelected for a second term as European Council president running until November 30 this year.

Xi's iconic visit to the capital of the European Union, from March 31 to April 1, will have "a very full agenda, commensurate with our global responsibilities," Van Rompuy said.

The Chinese president's trip will include meetings with Van Rompuy, European Commission President Jose Manuel Barroso and European Parliament President Martin Schulz. Topics ranging from sustainable development, G20, climate change to trade and investment relations are expected to be on the table.

"We will review the progress made in the negotiations on the bilateral investment agreement, which aim to ensure investment protection and market access for investors on both sides," Van Rompuy stated.

For the last nine years, the EU has been China's biggest economic partner. Official figures show bilateral trade in goods between China and the EU grew four-fold in a decade, reaching 434 billion euros (597 billion U.S. dollars) in 2012.

"The EU is the world's largest trading block and the biggest economy. We are thus in a unique position to promote an open global economy and an open trade and investment environment, together with China," Van Rompuy said.

During the talks, practical cooperation on security and defence issues will also be examined, such as joint naval exercises on counter-piracy in the Gulf of Aden, he said.

Source:  Xinhua

Sino-French trade sees rapid growth for a decade

For the past decade we've seen rapid growth in trade between China and France. From 2003 to 2013, bilateral trade volume jumped from 13 billion U.S. dollars to nearly 50 billion.

France is now the fourth biggest source of investment into China from the EU. Up until 2013, there are over 4,600 investment projects from France into China. Those projects combined are collectively worth nearly 13 billion U.S. dollars.

The number of French companies in China reached 163 last year, up 15.3% versus 2012.

Recent forays into France by Chinese firms have also garnered plenty of attention. Fosun Group's purchase of a 7% stake into a French leisure group and Chinese car maker Dongfeng's investment in Peugeot Citroen were some of the big deals.

Source:  CCTV

Britain faces problem with current account deficit

Revisions to economic statistics revealed the British economy is still on track for recovery but faces a problem with the current account deficit, economists said Friday.

The British GDP growth in the final quarter of 2013 remained unchanged at the third revision at 0.7 percent, a figure economists welcomed as healthy.

This contributed to the 2013 growth of 1.7 percent, 0.1 percent down on previous revisions, but still the best since 2007, and a huge improvement on 2012's 0.3 percent.

However, economists were worried about the size of the current account deficit, revealed in the revised statistics.

The current account deficit was 22.4 billion pounds (about 37.2 billion U.S. dollars) in Q4 2013, almost the same as the previous quarter's 22.8 billion pounds, a record, leaving the Q4 deficit 5.4 percent of GDP and at 71 billion pounds for 2013.

Simon Wells, chief British economist with HSBC Global Research, said, "Despite a fall in the trade deficit in Q4, the overall current account deficit remains huge. A further fall in the deficit on the income account, to a record low, meant the current account deficit was 5.4 percent of GDP in Q4."

Wells cautioned, "Unless the income position improves, the UK may find it harder to run its persistent trade deficit. This could eventually weigh on sterling and/or growth."

Wells said the income deficit jumped to a record 10.3 billion pounds in Q4 from 5.9 billion pounds in Q3, and a turnaround on the position up to the end of 2011 when the UK ran a surplus.

Improved global growth may provide a solution to that by lifting earnings on British investments abroad.

"In the mid-2000s, the UK earned positive income from its investments abroad but this has turned negative since the financial crisis," said Wells.

Forecasts for growth used by the government rely on an improvement in Britain's income position to narrow the current account balance, said Wells.

"But if the income account continues to deteriorate, the UK could find it harder to sustain its persistent trade deficit. Eventually, this could mean that lower sterling and/or slower growth may be needed to narrow the current account deficit, which was 4.4 percent of GDP in 2013 the widest since 1989," said Wells.

Further warnings about the recovery came from the household savings ratio, which was estimated at 5.1 percent in 2013 compared with 7.3 percent in 2012, showing that consumers had raided their savings and this had been a big driver of economic recovery.

David Kern, chief economist at industry representative body the British Chambers of Commerce (BCC), said the economic recovery remained on course.

He added, "It is good news that growth was better balanced in Q4, with a fall in the trade deficit and an increase in business investment. However there is little doubt that the further efforts are needed to place the recovery on a broader footing as we are still too reliant on consumer spending."

Business investment growth in Q4 was unchanged at 2.4 percent, the fourth consecutive quarter of expansion. But it remains 19 percent below its early-2008 peak.

Net trade contributed strongly to growth, with export growth revised up markedly to 2.8 percent quarter-on-quarter. The emerging recovery in the eurozone, Britain's largest trading partner, had helped.

"If recovery is to be sustainable, we have to ensure that there is more support for those looking to invest and expand into overseas markets," said Kern. (1 pound = 1.66 U.S. dollars)

Source:Xinhua

China Private equity funds can now directly enter stock markets

China is allowing private equity funds to directly open accounts and enter the equity markets.

According to China Securities Depository and Clearing Corporation, the newly revised Securities Investment Fund Law has brought private equity funds under its supervision.

They are banned though from opening new accounts for the purpose of new share subscriptions and share speculation purposes.

Source: CCTV

Strong Aussie dollar signals healthy economic recovery, too much appreciation not welcomed

The Aussie dollar on Friday morning hit 92.72 U.S. cents, its highest level in four months and a level which makes exporters uncomfortable.

Many importers and exporters believe that their ideal level for the dollar is 85 to 90 U.S. cents. When the Aussie dollar rises over 92 cents, the competitiveness of exporters is weakened, according to a survey of Citi.

"An optimal exchange rate from a trade perspective is one where importers and exporters can both find some advantage. Now that the currency has appreciated beyond this level, we're moving into positive territory for importers and headwinds for exporters," Citi's trade and treasury solutions head Scott Southall said.

The preliminary PMI figures for March, which measure activity in China's manufacturing sector which were released on Monday, showed that the industry had slowed down for the third straight month. But the weak data from China just dragged Aussie dollar temporarily to 90.5 cents, from then on the Aussie appreciation rallied for four days.

It seems strange that in spite of recent price fall of iron ore, copper and weak economic data of China, the Aussie dollar continued to rise unaffected. The market logic read the whole thing the other way round. The traders are betting that China will roll out some stimulus measures to stabilize its economy.

Last week Chinese authorities approved five railway projects worth 142 billion yuan (25.03 billion Australian dollars). Surely Beijing wants a soft landing of the economy and any sharp drop of economic activities will hurt the job market and cause instability of the society, which is totally unacceptable for the Chinese government.

On Wednesday, Reserve Bank governor Glenn Stevens expressed positive attitude towards Australian economic outlook at the Credit Suisse Asian Investment Conference in Hong Kong.

"We are going to have a boom in residential construction over the next couple of years. That is very much on track," Stevens said.

He also said there was early, encouraging evidence the handover from mining to non-resources industries in the Australian economy was underway.

Clearly, Stevens is confirmed that his low interest and low exchange rate policy is working well, especially in the property market. Also he is not worried about potential domestic housing bubble.

"There are some people who think that Australia is in a bubble, " Stevens said, "You can never be 100 percent sure. But the price to income ratio has been around four times ... for about 10 years, so a very long-running bubble, if it is a bubble. Most do not last that long."

Stevens' upbeat speech pushed Aussie dollar even higher, although he still believes that Aussie dollar is too high.

"The long-running equilibrium of the exchange rate is probably lower and we have been quite consistent in saying that," he said.

While some analysts said the Aussie dollar could climb higher in the near future, the expected strengthening of the U.S. dollar as the American economy recovers and Fed tapering will eventually push the exchange rate lower.

"Stevens explicitly used the word 'welcome' for tapering in his speech. He is very much assuming that the U.S. dollar does strengthen on the back of that normalization of Fed policy, so this could just be a temporary bout of Aussie strength. Given some time ... the Aussie will come back anyway," said Westpac's senior currency strategist Sean Callow.

Source: Xinhua

theguardian: NSA revelations 'changing how businesses store sensitive data'

      The Guardian reports, "A survey of 1,000 business leaders from around the world has found that many are questioning their reliance on "cloud computing" in favour of more secure forms of data storage as the whistleblower's revelations continue to reverberate.

The moves by businesses mirror efforts by individual countries, such as Brazil and Germany, which are encouraging regional online traffic to be routed locally rather than through the US, in a move that could have a big impact on US technology companies such as Facebook and Google.

Daniel Castro, a senior analyst at the Information Technology and Innovation Foundation, said the study confirmed "anecdotal evidence that suggests US tech firms are going to be hit hard in the coming years by a global backlash against technology 'made in America'".

"The Snowden revelations have led to a paradigm shift in how IT decision-makers buy technology," he said. "Now companies are not just competing on price and quality, they are also competing on geography. This might be the final nail in the coffin for the vision of a global, borderless internet."

"The Snowden revelations have led to a paradigm shift in how IT decision-makers buy technology," he said. "Now companies are not just competing on price and quality, they are also competing on geography. This might be the final nail in the coffin for the vision of a global, borderless internet."

Ian Brown, from the Oxford Internet Institute, said the survey revealed a significant level of concern among business leaders: "We'll have to see over the next year how much impact this type of reaction has on the bottom line of US tech companies, but it will give them even more incentive to put pressure on the Obama administration and US Congress for significant surveillance reform."

The survey of 1,000 information and communications technology decision-makers from France, Germany, Hong Kong, the UK and the US was carried out by NTT Communications. It found that, following the Snowden revelations, almost 90% had changed the way they use the cloud – a storage service that allows data to be accessed from anywhere in the world but which is more susceptible to online surveillance.

The study also found that almost a third of those questioned were moving their company's data to locations where they "know it will be safe", and 16% said they had delayed or cancelled their contracts with cloud service providers.

Len Padilla, from NTT Communications in Europe, said: "Our findings show that the NSA allegations have hardened ICT decision-makers' attitudes towards cloud computing, whether it is modifying procurement policies, scrutinising potential suppliers or taking a heightened interest in where their data is stored."

theguardian: Russia sets terms for Ukraine deal as 40,000 troops mass on border

     
  "Russia on Sunday night repeated its demand that the US and its European partners accept its proposal that ethnic Russian regions of eastern and southern Ukraine be given extensive autonomous powers independent of Kiev as a condition for agreeing a diplomatic solution to the crisis over its annexation of Crimea.

Sergei Lavrov, Russia's foreign minister, told reporters Ukraine could not function as a "unified state" and should become a loose federation. He made the remarks after an inconclusive meeting with John Kerry, the US secretary of state, at the Russian ambassador's residence in Paris following a day in which tensions over Ukraine deepened appreciably. Lavrov called the talks "very, very constructive".

Kerry told reporters the US and Russia agreed on the need for a diplomatic solution but made clear there had been no breakthrough, saying the Russian troop build-up along the border was creating a climate of fear and intimidation in Ukraine and was not helpful.

He called for Russia to pull back its forces and said talks on the country's future must include Kiev's leaders. "We will not accept a path forward where the legitimate government of Ukraine is not at the table. This principle is clear. No decisions about Ukraine without Ukraine."

Despite the distance between the two sides, Kerry said Washington would "consider the ideas and the suggestions that we developed tonight".

The meeting took place against an ominous backdrop of the gathering of an estimated 40,000 Russian troops on Ukraine's eastern border, and warnings from Nato and the Pentagon that the Russian military activity, ostensibly relating to routine exercises, was abnormal and could be a prelude to an invasion.

General Philip Breedlove, Nato supreme allied commander Europe and the head of the US military's European command, was ordered back to his post in Brussels during a visit to Washington after Chuck Hagel, the US defence secretary, pointed to "a lack of transparency" from Russia about the troop movements. Unlike Moscow, Washington has said it will not resort to force to resolve the crisis.

The US has called on Russia to disarm irregular forces in Crimea, admit international observers and pull its troops back from the eastern border. But speaking to Russian state television before the talks, Lavrov laid out Moscow's quite different terms. Primarily, he said, Russia was seeking a federal solution for Ukraine as part of "deep constitutional reform"".

[ChinaBang 2014] Online Design Tool VXPLO Unlashes Your Imaginations in Crating Interactive Contents without Coding

This week, TechNode got a chance to sit down with Meng Zhiping, CEO of VXPLO Interactive Group, a nominee for the cloud service award of ChinaBang 2014. He elaborated on the company’s product, development so far, as well as aspirations for the future.

VXPLO (video explorer) is a cloud based editing tool that helps designers and individual users to make interactive online shows without coding. Compared with previous developing process for an interactive web page which involves lines of codes, various devices and browsers, the graphic based editing interface of VXPLO helps users to get rid of the coding process so as to concentrate squarely on design.

VXPLO provides a new interactive media format, using original communication protocol to integrate media elements such as video, animation, webpage, images and etc. Based on cloud computing platforms (on AWS overseas and Aliyun in China), VXPLO can be easily used for online video editing, interactive web design and interactive exhibition solutions, he added.

Another highlight of the technology is that contents edited by the tool allow the users to click or tap the objects shown in videos to get the detailed information of a particular product, like the price or the site to purchase it, according to Meng. This makes a lot for sense for both individual consumers and e-commerce sites.

Meng disclosed that the company has turned to profit to book more than 10 million yuan (around US$1.6 million) of revenue last year, mainly comes from 2B business, which covers large touch screen walls (up to 30 billion pixels of display resolution) featuring multi-touch functions, cross-screen interaction projects by making mobile gadgets into remote controllers of bigger screens etc. Its enterprise customers include Tencent, NetEase, TouchMedia, Cartier, ND Media, etc. He added that the company’s revenue is expected to reach around 30 million yuan this year.

VXPLO also prepared to launch a free online editing platform for individual users around June this year, where they can edit online slideshows, digital cards, photo albums, video blogs, teaching materials and online resumes. The platform is highly compatible with all kinds of browsers and all screens. It supports HTML5, CSS3 and flash, as well as mobile gadgets powered by iOS and Android systems.

This technology can be applied in various fields like advertising, exhibition, interactive shopping, online education etc.

The company has obtained more than 50 patents since its establishment in 2006. Headquartered in Shanghai, VXPLO has set up offices in Shenzhen, Hong Kong, Chengdu, Guangzhou with more than 40 employees. Setting eyes on overseas market, company has launched an English version and planned to establish an office in Silicon Valley latter this year.

VXPLO has received angel investments back in 2008 and supportsby Hong Kong government-backed creative digital community Cyberport. It planned to raise funds this year.

image credit: VOPLO

Ecommerce Service MMB Closes New Round of Funding Led by Tencent and MTK

MMB, an m-commerce retailer targeting at rural China markets, announced that it secured a new round of financing led by Tencent and followed by chip maker MTK and Sequoia Capital. MMB has received a combined more than 400 million yuan (around US$65 million) of funding from Far East Holding, Sequoia Capital and Tencent during 2007 to 2012.

Founded in 2006 as one of the earliest players in Chinese m-commerce sector, MMB isdedicated to provide online shopping service to grassroots users, who live in third- and fourth-tier cities or farmer-turned workers in big cities. Unlike users in cities who have access through PCs in the daytime at work or at night at home, MMB’s users made purchases through its WAP site on low-end mobile phones that are connected to 2G and more recently with 3G networks. The annual turnover of the company neared 2 billion yuan in 2013.

The company did not announce the amount of the funding, but people familiar with the matter disclosed that the capital injection exceeds 100 million dollars, as reported by Sohu.

The funds will be used in the development of its homegrown low-budget smartphone brand Big Q and the warehouses system around the country, moreover, the company will increase investments in product development and marketing.

Launched in June 2013, MMB’s Big Q smartphone brand currently has three models and targets at young users from small cities. The third generation of the product dubbed Q1 was launched on Tencent’s e-commerce platform Yixun earlier this year. The shipment of Big Q smartphone stood at around 200K last year and it is expected to reach 1 million sets this year, according to the company.

image credit: MMB

Microsoft Has Big Plans For Bing’s Entity Engine

Earlier this week, I sat down with the lead of Microsoft’s Bing Experiences group, Derrick Connell, to discuss the state of entities in Bing and the company’s vision for the future of entities in its search engines. Microsoft clearly has big plans for using entities in Bing and products that rely on it; the company plans to open up a part of this entity engine so more third-party sites will be able to highlight some of their features on Bing.

“The way we think about entities is that Microsoft wants to enable people to do more,” he told me. In the early days, search was about helping to find more, but now, he argues, “it’s moved from ‘find more’ to ‘know more.’”

Besides getting to an answer, though, search also has to be about being able to take action. That’s been at the core of Bing’s philosophy from the beginning. Microsoft often referred to Bing as a “do engine” when it first launched, for example. Since then, Microsoft has integrated more data sources and the ability to take more actions, including booking tables through OpenTable, for example (something Google also offers). It also integrated your LinkedIn profile (if you opt in to this), so search results for people will often include information about people who are in your professional network.

The question in the long run then becomes: how do you associate actions with entities? It’s pretty much impossible for a single company to be able to cover every aspect of what its users want to do online, after all.

Connell argues that the only way to do this efficiently is to create an open ecosystem that powers these actions. “We think a lot about how we can create value for everybody who is participating in this new emerging space,” he said. “And how can we bring the best set of players to the table for our users?”

Today, this means having partnerships with Yelp, OpenTable, TripAdvisor and others, and Microsoft then highlights the actions they make possible on its search engine. In the long run, though, Connell envisions an open ecosystem where any site can make actions available using a standard markup language (he mentioned schema.org as an option in our conversation). Then, when a user looks for an entity, Bing could map this to an entity provider and shorten the path users take between searching for something and putting this knowledge into action. Ideally, this could even mean taking the action right on Bing (maybe even with a single click), but Connell acknowledged that issues around identity and login management will probably mean users will have to take most actions on a third-party site.

Assuming enough third-party sites opt in to this kind of action entity system, the problem for Microsoft becomes one of relevance. “As you get more partners participating, which provider you surface becomes a relevance problem,” Connell noted. What, after all, happens if you have two competing restaurant reservations sites? Which one do you highlight? How do you keep spam out of this system if you make it completely open? Connell assumed that this is something his team can figure out and that he would rather show more than one option anyway.

On Windows, Microsoft has already launched something akin to this. Apps, after all, can all integrate themselves into the Windows Search tools.

One thing Connell also stressed repeatedly in our chat is that he believes there are very few companies who can actually pull a project like this off. In his view, Microsoft could be one of them, not in the least because it can offer users access to both public and private entities. Enterprises, for example, could use this scheme to make information that only matters to their employees available to them. Through Sharepoint, Office and other tools, Microsoft could serve up a wealth of information — and actions — to its users based on these sources.

Not all of this, of course, would be relevant in a search engine, and Bing.com may not always be the best place to highlight this info. But what if you could write a document in Word and the system could bring up relevant information as you type from both public and private sources?

Chances are, this ecosystem Connell envisions won’t arrive until a few years from now. Indeed, he expects that we still have a good 10 to 20 years of advancement in this space ahead of us.

As for the good old 10 blue links that have dominated online search since its early days, Connell believes that people will always have a desire to find more and to dig deeper. “There will always be a place for 10 blue links,” he said. “But new experiences will emerge over time that will revolutionize these products.”

Source: TechCrunch Article by Frederic Lardinois 

How a musician-turned-entrepreneur built a company that generates over $400 million per year

Source: TECHINASIA
In Japan, people in the IT industry will have heard of Koki Sato (pictured above), CEO & President at Septeni Holdings. A law graduate of Rikkyo University Japan, Sato chose a path different from most of his fellow law students. Forgoing a career as a lawyer, he chose to pursue music. Of course, he still had bills to pay, so after graduation he worked at a traditional HR company called Septeni while doing music in his free time. Like most salarymen, he was just an average Joe in the company, and he immersed himself in the world of music while off the clock. Sato pursued his music dream since age 16. But as he started to get his hands dirty in the music industry, he came to realize that he couldn’t quite compete with other musicians:

After thinking long and hard, Sato decided to throw in the towel and put an end to his musical ambitions. Instead, he decided to be an entrepreneur. He wrote a list of ideas he thought could work. On it were about 50 possible businesses in industries like finance, food, and internet. He eventually chose online advertising. It was 1999, a period when companies were exploring internet advertising but didn’t quite know how to do it. There were no experts, resources, or guidelines available, and there were very few companies enthusiastic about internet marketing. “The internet can disrupt the advertising industry. Back then, I realized that there were no experts. So I thought it was a good opportunity,” said Sato. With the idea in mind, the then CEO of Septeni gave resources to Sato to venture into the world of online advertising. At age 24, Sato couldn’t imagine himself leading Septeni’s online advertising arm. His goal was to innovate on the company’s business model. In 1999, online advertising wasn’t flashy like today. Search engine marketing didn’t exist yet, and online ad banners weren’t popular due to slow internet speeds. What worked back then was email. Sato says only two or three other companies were doing email advertising at that time, but Septeni was growing the fastest. In the first year of operation (2000), Sato’s new online ad marketing department roped in $2 million in revenue. In 2001, Septeni’s sales increase by more than five times, hitting $12 million. In the same year, the corporation went public on JASDAQ stock exchange. Sato was only 26 years old at the time. Sales continued to grow like wildfire. By 2004, Septeni’s hit $63 million in sales revenue and his online advertising department had already outgrown the old HR business by a wide margin.

Septeni obviously had to adapt to new trends, which saw growing ad revenue from hot online platforms like Facebook, Twitter, and Line. Last year, Septeni’s sales broke $459 million. Backed by its success in Japan, Septeni expanded to Singapore, Vietnam, and the U.S. In the first quarter of FY2014 alone, overseas sales was bigger than its total overseas sales in all of 2013. Septeni also ventured into other new areas of business. Other projects include Axel Mark, a subsidiary that makes mobile games, Comicsmart, a subsidiary in the mobile manga business, and Vivivit, an online recruitment platform. Sato, now 39, remains as passionate as ever to continue building Septeni. He thinks the most important thing for the company to continue growing is to keep evolving with new trends. As Septeni grows to over 800 employees, Sato says the biggest challenge during business expansion is to reform the organization in accordance to the scale of its operations. “It is hard organizing people at a fast-growing big company,” Sato says. When asked what advice he would give to today’s entrepreneurs, Sato urges them to think for the longer term. “You can’t build your business like it is a sprint contest. Think as if it is a marathon,” he says.