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Verizon Profit Jumps 40 Percent on Wireless Subscriber Growth

Verizon Communications Inc. said its third-quarter profit improved 40 percent as the largest U.S. phone carrier continued to build up its base of wireless and FiOS customers.

Verizon last month agreed to purchase Vodafone Group PLC’s 45 percent stake in Verizon Wireless for $130 billion, granting Verizon full control of their joint venture. To help fund the deal, Verizon sold $49 billion in bonds, making it the largest corporate-debt sale in history.

Verizon reported a profit of $2.23 billion, or 78 cents a share, up from $1.59 billion, or 56 cents, a year earlier. Excluding special items, per-share earnings were 77 cents in the latest quarter. Revenue improved 4.4 percent to $30.28 billion.

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Google Spent $1.3B on Acquisitions So Far This Year, Mostly on Waze

In the first half of 2013, Google spent $1.31 billion on 16 acquisitions, it said in a financial filing today.

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Shutterstock/Fussypony

The largest of those was the mapping startup Waze, which cost $966 million. (We had previously reported that the deal was worth $1.1 billion, as it included an estimated $100 million in performance payouts to staff, which wouldn’t be included in this filing.)

Google explained a little of its math for the Waze deal today: $847 million in goodwill, plus $188 million in intangible assets, minus $69 million of net liabilities assumed.

Other disclosed acquisitions in the first half of this year included Makani Power and Wavii. But there were a lot more deals, too: 15 non-Waze acquisitions of companies and intangible assets cost Google $344 million.

Also in the quarter, Google sold a company of its own: Motorola Home. Arris paid $2.238 billion in cash, plus $150 million in closing adjustment and $175 million in stock, resulting in a net gain of $747 million that was included in second-quarter earnings.

And, lastly, Google cut a bunch of Motorola-related jobs through the Home sale as well as layoffs. In the second quarter, Motorola dropped to 4,599 employees from 15,152. Restructuring has brought cumulative charges of $839 million, Google said.

Google’s Answer to the Great Chromecast/Netflix Giveaway Mystery: There’s No Mystery — We Sold Out

sold out

Why did Google kill its Chromecast/Netflix promotion a day after it launched?

It didn’t, exactly. And neither did Netflix.

Here’s a new statement from Google on the end of the deal, which gave Chromecast buyers three months of free Netflix: “Due to overwhelming demand for Chromecast devices since launch, the 3-month Netflix promotion (which was available in limited quantities) is no longer available.”

And here’s a tiny bit of clarity about what that means, as far as I can tell after speaking to people at both companies: Google bought a fixed amount of Netflix subscriptions to bundle with its $35 Web TV gadget, and it sold out.

Feel free to wonder whether Google dramatically underestimated demand for Chromecast, or if it is very happy to have sold out in a day (right now, Gabe Rivera and his robots think this is the most compelling story in tech).

Also feel free to wonder whether the end of the promotion will do anything to dampen enthusiasm for the Chromecast.

My hunch: At an effective price of $11, it was basically free, and thus a very attractive impulse buy. And, at its list price of $35, it is still very, very cheap for a piece of consumer electronics. And it’s probably going to continue to sell well.

(Image courtesy of Shutterstock/Humannet)

Samsung Accounted for a Third of Smartphone Sales Last Quarter, While Apple’s Share Fell

Samsung’s second-quarter smartphone shipments hit 76 million last quarter – up 56 percent from the prior year, and giving the company a 33 percent share of the global market.

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iStockphoto | aluxum

Apple, meanwhile, shipped 31.2 million iPhones, a 20 percent year-over-year rise, and good for second place worldwide. However, that trailed the overall smartphone industry, and meant that Apple’s market share fell to 14 percent – its lowest level since the second quarter of 2010, according to market research firm Strategy Analytics.

“The current iPhone portfolio is under-performing and Apple is at risk of being trapped in a pincer movement between rival 3-inch Android models at the low-end and 5-inch Android models at the high-end,” Strategy Analytics’ Neil Mawston said in a statement.

Overall, smartphone shipments hit 230 million for the second quarter, up 47 percent from a year earlier, and representing 59 percent of all mobile phones sold.

“The smartphone industry’s shipment growth rate, which is higher today than a year ago, is being driven by surging demand for 4G models in developed regions like the US and 3G models in emerging markets such as India,” Neil Shah, senior analyst at Strategy Analytics, said in a statement.

Korea’s LG doubled shipments from a year earlier to 12.1 million units, enough to give it five percent global market share and the No. 3 spot, just ahead of China’s ZTE and Huawei, each of which shipped more than 11 million smartphones.

Activision to Buy Back Most of Vivendi’s Controlling Stake

Activision Blizzard Inc. said it has reached an agreement to buy back nearly $6 billion worth of Vivendi SA’s holding in the company, ending months of negotiations over the fate of the videogame giant.

Santa Monica, Calif.-based Activision said Thursday it will buy 429 million shares for about $13.60 per share, reducing Paris-based conglomerate Vivendi from being majority shareholder. Activision said it would fund the purchase with $1.2 billion in cash on hand from its domestic accounts and approximately $4.6 billion in debt financing from banks including J.P. Morgan and Bank of America Merrill Lynch.

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Apple Takes Home Three Brand of the Year Awards

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Here’s an achievement certain to be trotted out at Apple’s next big media event. Harris Interactive on Thursday declared the company the top U.S. brand across a trio of consumer electronics categories – the only three in which it’s rated.

According to Harris Interactive’s 2013 EquiTrend survey, which polls some 38,000 U.S. consumers about their brand preferences, Apple dominated not only the tablet segment, but the mobile phone and computer segments, as well.

Quite the hat trick, and one Apple has pulled off for two years running now, beating out some serious competition. In the computer category, Apple bested Hewlett-Packard, Dell and Sony; in the tablet category, it surpassed Amazon, Google and Samsung; and in the mobile phone segment, it beat HTC, Samsung and LG.

Said Harris Interactive senior VP Manny Flores, “… What really stands out is that in all three of the categories Apple brands are measured – Computer, Tablet and Mobile Phone – its Brand Momentum scores are in the top 30 of all 1,500 brands evaluated in the study.”

And that’s worth noting. Harris Interactive’s Brand Momentum category measures – among other things – ubiquity, future outlook, leadership and popularity. In the eyes of U.S. consumers, Apple clearly meets its brand promise.

Yet Another Way to Get a Super-Cheap Web TV Box

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What’s that? You say you’re intrigued by the notion of a Web TV box, but $35 for a Google Chromecast is too rich for your blood?

Here you go – if you live in the U.K.: Satellite TV service BSkyB has rolled out a Web TV box for 9.99.

That works out to about $15, and what that gets you is essentially a rebranded Roku HD box – BSkyB invested in Roku last year, and once again this spring – tailored to support BSkyB’s Now TV streaming subscription service. That also means that the box won’t support BSkyB rivals Netflix and Amazon/Lovefilm.

You can see more specs and details here, but the big picture is that this shows yet another approach to distributing Web-to-TV hardware: Rather than have consumers buy the gadgets directly from the manufacturer, a programmer/distributor sells the box and subsidizes the cost.

Expect to see more of this in the future. For starters, note that Roku’s other investors include 21st Century Fox, Dish Network and Hearst, which owns both TV stations and stakes in TV networks including ESPN.

Meanwhile, Apple is in talks with Time Warner Cable about an Apple TV tie-up; for now, that deal doesn’t call for the cable operator to sell Apple’s boxes, but you could certainly imagine a pact where it does.

And remember that Amazon, which tried to buy Roku last year, has its own TV box in the works, which will be optimized for Amazon’s own video offerings.

T-Mobile’s Latest Promo Offers Entire Lineup of Phones for No Upfront Payment

T-Mobile is continuing to shake things up.

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The No. 4 U.S. carrier on Friday announced a promotion that will offer its entire lineup of phones for no upfront payment. It isn’t really dropping the price of phones, just spreading the entire cost of the phone over 24 months instead of using a mix of an initial down payment and monthly payments.

Still, the move shows the flexibility T-Mobile has since moving to a model in which it separates the cost of the phone from its monthly service.

“The number of reasons not to switch to T-Mobile this summer is ZERO,” T-Mobile CEO John Legere said in a statement. “This is a fantastic offer and we’re making it easier than ever for customers to get the latest amazing devices.”

Under the new promotion, which starts on Saturday, customers can get a 16 gigabyte iPhone 5, for example, for no upfront fee and 24 monthly payments of $27 per month. The Samsung Galaxy S4, BlackBerry Q10 and HTC One are all $25 per month, while the entry-level Nokia Lumia 521 is just $5 per month.

The device fee is then added to T-Mobile’s monthly service fees. Options range from a $50-per-month plan that includes unlimited talk, text and 500 megabytes of high-speed data to an option for $70 per month that includes unlimited high-speed data. Additional lines for family members cost $30 for the first extra line and $10 per additional line after that.

Though not cutting device prices, the move could nonetheless be attractive to those looking to get a new phone without a big initial cost.

Update: In a telephone interview, T-Mobile Chief Marketing Officer Mike Sievert said that the new option came in response to a move by AT&T to offer some devices for no money down.

“This is really about being fast and highly competitive,” Sievert said. “We aren’t going to cede one inch of the territory and of the momentum” it has gained from its “un-carrier” approach.

As part of its Next early-upgrade program, AT&T is offering a number of phones for no money down, with installment payments of $15 to $50 per month for 20 months. A Samsung Galaxy S4, for example, would cost $32 a month for 20 months under that program. (Customers would also pay AT&T’s standard monthly rates in addition to the device financing payment.)

Sievert did not give an end date for T-Mobile’s new offer, but said promotions such as these tend to run days or weeks, and not for months.

He also said this move was not the next step that Legere had hinted will come in the fall.

“Un-carrier 3.0 is still to come,” Sievert said.

L.A. Unified School District Wants iPads for All 640,000 Students

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Back in June, the Los Angeles Unified School District awarded Apple a $30 million contract to provide its students with iPads. Under its terms, the company will supply about 31,000 iPads to 47 LAUSD schools, each preloaded with a bunch of educational software. But evidently that’s just the first phase of the program.

According to an LAUSD representative, the nation’s second-largest school district hopes to provide iPads to all 640,000 students by late 2014. Which means it’s going to buy a few hundred thousand more iPads over the next year – though it’s not yet sure how it’s going to do it. “We’re hoping that we will get a lot of private donors,” Mark Hovatter, chief facilities executive for LAUSD, told CITEworld.

That’s very good news for Apple. If LAUSD is able to pull together the money to realize this plan, it will be purchasing hundreds of thousands of additional iPads. Which potentially means another big iPad contract in the offing, and the chance to expose thousands of kids to the iOS ecosystem.

Mark Zuckerberg to Speak on Immigration Issues at S.F. Film Premiere

Facebook CEO Mark Zuckerberg at the Facebook Home launch event.

Facebook CEO Mark Zuckerberg plans to deliver an address on immigration issues in early August, according to the San Francisco Chronicle, the first time he has spoken publicly on the matter.

The speech will include the San Francisco premiere of a new film, “Documented,” which chronicles the struggles of undocumented immigrants entering the United States.

The film was written and directed by Jose Antonio Vargas, a writer and immigration rights activist who revealed his own status as an undocumented immigrant in a widely circulated New York Times Magazine article in 2011. (Vargas also wrote a lengthy profile of Zuckerberg for the New Yorker a few years ago.)

The premiere is sponsored by and ties in perfectly with FWD.us, the sometimes controversial Zuckerberg-backed political action group focused on U.S. immigration reform. The issues that FWD.us supports are felt by many tech companies in Silicon Valley; in particular, the focus on changing certain legislation which would allow for more annual H-1B visas, ultimately granting more foreign workers entry into the U.S.

But, as the Chronicle notes, the premiere will be the first time Silicon Valley will enter the wider debate on immigration reform as a whole, rather than just focus on the expansion of visa programs in order to recruit international engineering talent.

The film debuts at San Francisco’s Yerba Buena Center for the Arts on Aug. 5.

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