The tech business week: cost of Apple outage, Alibaba to invest US$200m in Snapchat


16 Mar 2015

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A digest of the top business technology news stories from the past week, beginning with the news Apple may have lost a potential US$32m in app sales.

Apple misses out on US$32m in app sales after massive App Store glitch

While the world reacted to Apple’s iTunes, App Store and other services going down for 12 hours, the most profitable company on Earth is concerned with the fact it lost a potential US$32m in app sales.

Apple apologised for the outage last week that left users seeing nothing but an error message when they tried to make purchases. The consumer tech giant said an internal DNS error caused the downtime.

The Inquirer reported that given Apple makes some US$65m every day on App Store sales alone, its outage would equate to almost half of that amount.

Alibaba to invest US$200m in Snapchat – values social network at US$15bn

E-commerce giant Alibaba is planning to invest US$200m in mobile messaging app Snapchat in a round that could value the company at around US$15bn.

The investment will add to the growing coterie of companies that Alibaba has been investing in, including Tango, ShopRunner and Lyft, sparking speculation that the Chinese company is moving into the US market by stealth.

Rumours of Alibaba’s interest in Snapchat emerged as early as July last year when it was revealed talks were under way.

Up Periscope! Twitter buys video start-up

Microblogging site Twitter’s buying spree continues with the news it has acquired a start-up called Periscope that hasn’t formally launched its first product yet.

It is believed Twitter may have paid as much as US$50m for Periscope, which enables video streaming from smartphones.

The acquisition is understood to have closed a month ago.

Gigaom site shuts down over money troubles

Tech and science website Gigaom has felt the wrath of its lenders and visitors to the site have been presented with a message telling them the site will no longer be able to operate.

Operating since 2006, Gigaom was included among most of the big names on the US tech news scene, but according to the statement from management posted on Gigaom’s website, the company “recently became unable to pay its creditors in full at this time”.

The company is now in the process of trying to hold onto its assets, but there is little knowledge as to what will happen with the Gigaom brand and whether it will be sold to a new party or dissolved.

Ericsson to cut 2,200 jobs in Sweden in bid to save US$1bn

Swedish communications technology giant Ericsson is to cut 2,200 jobs in its home country – mainly in R&D and supply – in a bid to achieve cost savings of more than US$1bn.

The job cuts are part of an overall set of efficiency measures that will run until 2017 globally.

Ericsson said it plans to excel in core areas such as radio, core and transmission and telecoms services by funding growth in areas such as IP networks, cloud, TV and media. As part of this, the company is establishing three global ICT centres with a common test and development strategy.

But the strategy also involves headcount cuts and savings in costs.

Google CFO Patrick Pichette to retire from internet giant

Google’s chief financial officer Patrick Pichette is to retire from the search giant.

Pichette is credited with instilling financial discipline at Google amidst a time of rapid expansion into new areas, including driverless cars, smartphones, computers and even the ill-fated Google Glass project. The company makes revenues of more than US$66bn a year.

He is also credited with helping to sensitively guide Google’s HR evolution, from a feisty start-up with a handful of employees to a veritable army of 53,000 workers.

In a Google+ post, Pichette said the decision to retire was prompted during a holiday that brought him and his wife to the peaks of Mount Kilimanjaro and she asked him would he not like to retire and explore the rest of Africa.

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