TIME Advertising

Watch: Roger Federer Tries Out Google Glass in New Ad

Tennis star Roger Federer is offering fans a look at the world from his point of view. The 17-time Grand Slam winner stars in a new spot for Google Glass in which viewers can see just what he sees when he’s smacking forehand winners across the court. In the video, Fed rallies with fellow tennis pro Stefan Edberg and makes some time in his busy schedule for a pint-sized fan.

Google has been ramping up the marketing for Glass as it prepares the product for a consumer release. A beta version was available for purchase from Google’s website but appears to be sold out.

TIME Media

Netflix Will Have to Spend a Fortune for Its International Expansion

Netflix
Justin Sullivan--Getty Images

Netflix is displaying Frank Underwood levels of ambition with its latest announcement. The streaming service is planning to expand to six new European countries later this year: Germany, Austria, Switzerland, France, Belgium and Luxembourg.

With 36 million U.S. subscribers and 13 million internationally, Netflix has the most room for growth abroad. The company has an estimated 1.5 million subscribers in the UK and is available in more than 40 countries total. France and Germany will be two of the largest markets that Netflix has entered so far.

The expansion will put a hurt on Netflix’s balance sheet, though. The company’s international division has always been a money pit—it lost $274 million on operations abroad in 2013 alone. Not only does Netflix have to provide technical and customer support across a wide variety of languages, but it also must negotiate streaming rights for programming for each individual country.

That may help explain why Netflix spent about $19.30 per user internationally in the first quarter of 2014, compared to just $14.50 per user in the U.S. In its last earnings report, Netflix said that its current international operations will be profitable by the end of the year, but Chief Financial Officer David Wells said upcoming expansions will be just as pricey as previous ones.

Netflix believes it is spending now to profit later. CEO Reed Hastings has said that international customers will eventually generate 70 to 80 percent of Netflix’s revenue. That’s why company is now creating content specifically tailored to this audience, such as an upcoming show about a family that owns a soccer club that will be in Spanish.

TIME Advertising

Google Wants to Put Ads in Your Refrigerator

A Google logo is seen at the garage where the company was founded on Google's 15th anniversary in Menlo Park, California
Stephen Lam—Reuters

Updated 12:53 p.m.

Remember how advertisements were crammed into Tom Cruise’s every waking moment in Minority Report? That, apparently, is Google’s vision of the future.

In a letter to the Securities and Exchange Commission disclosed Tuesday, the tech giant revealed that it has hopes to place marketing messages in currently ad-free objects like refrigerators and thermostats. “A few years from now, we and other companies could be serving ads and other content on refrigerators, car dashboards, thermostats, glasses, and watches, to name just a few possibilities,” the company wrote.

Google was trying to explain to the SEC why it doesn’t need to disclose to its investors the size of its mobile business. Because the definition of mobile devices is changing so quickly, it would be “misleading and confusing” to investors to break out mobile usage and revenue, the company said. When there are ads on our fridges and attached to the ceilings of our homes, it will be even harder to define “mobile,” according to Google. “Our expectation is that users will be using our services and viewing our ads on an increasingly wide diversity of devices in the future, and thus our advertising systems are becoming increasingly device-agnostic,” the company wrote. Other tech companies such as Facebook, Twitter and Yahoo regularly disclose figures related to mobile growth.

The disclosure, first reported by The Wall Street Journal, illustrates exactly why Google is so gung-ho about the “Internet of Things,” the move toward turning previously “dumb” gadgets like watches into connected devices that can interact with other computers. The company is already placing its Android mobile operating system into cars through a partnership with automakers and pushing it into smartwatches through an optimized OS called Android Wear. Earlier this year, Google also bought Nest, a company that manufactures smart thermostats, for $3.2 billion. At the time, Nest said that it would not broaden its privacy policy, which currently limits use of users’ personal data to “providing and improving Nest’s products and services.”

A Google spokesman clarified the implications of the SEC letter. “We are in contact with the SEC to clarify the language in this 2013 filing, which does not reflect Google’s product roadmap,” the spokesman said. “Nest, which we acquired after this filing was made, does not have an ads-based model and has never had any such plans.”

TIME compensation

Target’s Ousted CEO Will Make $15.9 Million in Severance

Target Bob DeRhodes
Exterior signage of the Target Store in Torrance, Calif. Patrick T. Fallon—Bloomberg/Getty Images

The man who led Target during a data breach that compromised the personal information of as many as 110 million customers will make $15.9 million through his severance package, according to a newly released SEC filing.

Greg Steinhafel, who worked at Target for 35 years and was named CEO in 2008, was fired from the company earlier this month following last fall’s massive data breach, in which hackers stole credit and debit card information for 40 million Target customers and names, phone numbers, addresses or email addresses of 70 million customers. The breach was one of the largest security lapses in corporate history.

The monetary package is a combination of direct severance pay, pension funds and vested stock awards. In addition to the $15.9 million, Steinhafel will continue to draw his base annual salary of $1.5 million, as well as benefits, while he serves in an advisory role until August. In 2013 Steinhafel earned $13 million in total compensation, down from $20.6 million the previous year.

Target is not yet done reshuffling its executive suite. Today the company announced that it was firing the president of its Canadian division and realigning its merchandising team in the U.S. to improve performance.

TIME Gadgets

Microsoft Unveils New Surface Pro 3 Tablet

SurfacePro3Primary_Web
Microsoft

Microsoft is ready for its third crack at the tablet market. The company today unveiled the Surface Pro 3, its thinnest, lightest and largest device in the line yet.

Billed as “the tablet that can replace your laptop,” the Surface Pro 3 furthers Microsoft’s goal of creating a device that offers the productivity benefits of a PC with the portability and comfort of an iPad. The Pro 3 boasts a 12-inch screen, 1.4 inches larger than the Surface Pro 2’s and 1.3 inches smaller than the size of the smaller MacBook Pro. The device is also lighter than the previous Surface Pro at 1.76 pounds and thinner at 0.36 inches.

The Surface Pro 3 goes up for pre-order on Wednesday, starting at $799 with an Intel Core i3 processor, 64 GB of memory and 4 GB of RAM. Higher-performing models are priced at $999, $1,299, $1,549 and $1,949. The keyboard cover, which gives the device its laptop-like functionality, costs $129.99.

“We are not building hardware for hardware’s sake,” Microsoft CEO Satya Nadella said at an event in New York debuting the new device. “We want to build experiences that bring together all the capabilities of our company.”

Microsoft has spent some time attempting to address some of the clumsier aspects of typical laptop-tablet hybrids. The Surface Pro 3’s keyboard cover, for instance, can magnetically attach to the device’s screen to give it a greater level of sturdiness. The company says the keyboard cover’s trackpad is also 68 percent larger than the Surface Pro 2’s. And the device’s kickstand is more flexible, allowing users to place the device’s screen at any angle they choose.

The company spent a lot of time demoing apps that illustrated the Surface’s versatility. The stylus (Microsoft calls it a pen) used on the Surface is a key differentiating factor from the iPad, and Microsoft claims it has eliminated parallax from the Surface Pro 3, the slight pause that often occurs between writing on a touchscreen and the device registering the input. Microsoft corporate vice president Panos Panay demonstrated the speed of the pen on the Surface Pro 3 screen with a New York Times crossword puzzle app, a tablet-friendly version of Adobe Photoshop and scriptwriting software FinalDraft.

Microsoft still faces an uphill battle in the tablet market. Surface sales reached $494 million in the first quarter of 2014, a 50 percent increase year-over-year. But the company loses money on each device it sells, and its business pales in comparison to Apple’s iPad, which had sales of $7.6 billion in the most recent quarter.

TIME Companies

GoPro’s Next Crazy Stunt: Going Public

The GoPro Hero 3 with intergrated WiFi is displayed at the 2013 International CES at the Las Vegas Convention Center on Jan. 9, 2013 in Las Vegas.
The GoPro Hero 3 with intergrated WiFi is displayed at the 2013 International CES at the Las Vegas Convention Center on Jan. 9, 2013 in Las Vegas. David Becker—Getty Images

The head cam maker revealed in its S-1 filing Monday that it had over $1 billion in revenue last year and raked in $60 million in profits. It hopes to raise $100 million through its public offering and will trade as GPRO on Nasdaq

Action camera company GoPro is getting ready to go public. The wearable camera manufacturer, whose incredibly resilient devices are often used to film extreme sports, is seeking to raise $100 million in an initial public offering in the United States, the company revealed today.

Founded in 2004 with a wrist-mounted, waterproof camera used for surfing, GoPro is now the biggest camera brand in the world. The company sold 3.8 million HD cameras in 2013 alone and generated nearly $1 billion in revenue (up from $526 million in 2012 and $234 million in 2011). The company’s profits have increased steadily in recent years, rising from $25 million in 2011 to $60 million in 2013.

Because the company operates in such a narrow market, it’s not clear how much more it can grow just hawking durable cameras. Revenue growth in 2013 was slower than it was in 2012. GoPro is attempting to increase the strength of its brand by making it easier to share footage shot with its cameras. The downloadable software GoPro studio allows users to easily edit photos and videos, then share them online. A GoPro mobile app provides similar functionality. Between them they’ve helped make GoPro a ubiquitous force in the world of online video—clips with “GoPro” in the title racked up more than 1 billion views in the first quarter of 2014.

GoPro will trade on the Nasdaq under the ticker symbol GPRO.

TIME Companies

U.S. Charges Credit Suisse Over Tax-Fraud Scheme

SWITZERLAND-US-BANKING-BUSINESS-CREDITSUISSE
Fabrice Coffrini—AFP/Getty Images

Credit Suisse pleaded guilty to federal criminal charges Monday for helping clients avoid tax payment by sending money overseas. The global banking giant will pay a total of $2.6 billion in penalties

The Swiss bank Credit Suisse pleaded guilty Monday to helping U.S. citizens commit tax evasion over the course of several decades, the Department of Justice announced. Credit Suisse will pay the Department of Justice, the Federal Reserve and the New York State Department of Financial Services a total of $2.6 billion in penalties, the largest payment ever in a U.S. criminal tax case. The banking giant is the first global financial institution to face a criminal conviction from U.S. authorities in more than a decade, Bloomberg reports.

Credit Suisse bankers aided thousands of wealthy Americans in concealing their money from U.S. authorities, the Department of Justice said. The bank helped American clients set up shell accounts to shuttle their money overseas and then solicited false IRS documents to make the accounts seem legitimate. According to a U.S. Senate subcommittee report released in February, Credit Suisse recruited new clients at bank-sponsored events, like golf tournaments in Florida and a gala in New York. In one instance, a Credit Suisse employee handed a client secret bank statements hidden in a copy of Sports Illustrated during a breakfast meeting. Credit Suisse had 22,000 U.S. customers with about $13.5 billion in their Swiss accounts in 2006, the “vast majority” of which was undeclared to U.S. authorities, according to the report.

“This case shows that no financial institution, no matter its size or global reach, is above the law,” Attorney General Eric Holder said announcing the conviction. “Credit Suisse conspired to help U.S. citizens hide assets in offshore accounts in order to evade paying taxes. When a bank engages in misconduct this brazen, it should expect that the Justice Department will pursue criminal prosecution to the fullest extent possible, as has happened here.”

As part of its deal, Credit Suisse must disclose its cross-border activities and cooperate in requests for account information from the U.S. government. The bank must also provide info about other banks that helped transfer funds into secret accounts and close the accounts of Americans who improperly report their assets to the U.S. government.

The move comes as part of an overall crackdown by the Department of Justice on offshore bank accounts. As part of the same investigation, the Department of Justice has indicted eight Credit Suisse executives since 2011. Two of them have pleaded guilty to criminal acts.

Credit Suisse earned $2.6 billion in profits in 2013 and generated $28.3 billion in revenue.

TIME Tech Policy

Sprint to Pay Record $7.5 Million for Violating Do-Not-Call Rules

A Sprint Store Ahead Of Earnings Figures
Bloomberg—Bloomberg via Getty Images

Wireless carrier Sprint is being dinged with a $7.5 million fine for calling and texting people who placed their phone numbers on the company’s do-not-call registry, which is supposed to protect Americans from unwanted telemarketing communications. According to the Federal Communications Commission, Sprint failed to log some consumers’ do-not-call preferences due to “human error” and “technical malfunctions.” The $7.5 million sum is the largest fine ever doled out by the FCC for violating do-not-call policies.

“When a consumer tells a company to stop calling or texting with promotional pitches, that request must be honored,” Travis LeBlanc, acting chief of the FCC Enforcement Bureau, said in a press release. “Today’s settlement leaves no question that protecting consumer privacy is a top enforcement priority.”

In addition to the fine, Sprint must designate a senior manager to oversee its do-not-call implementation and file annual compliance reports with the FCC for two years. Sprint was hit with a $400,000 fine in 2011 for similar violations.

The Federal Trade Commission manages a national Do Not Call registry that allows people in the United States to opt out of receiving telemarketing calls. Many large companies such as Sprint that engage in telemarketing are also required to manage their own internal do-not-call lists.

 

TIME video

Here’s How Netflix Is About to Change Radically

The Netflix company logo is seen at Netf
AFP/Getty Images

Using Netflix will not always involve scrolling through endless lists of movies served up by genre or because you watched one episode of Buffy the Vampire Slayer last summer. A Netflix executive says in the future, the streaming service may not throw hundreds of choices at people all at once.

During a keynote speech during an Internet Week event in New York, Chief Product Officer Neil Hunt said Netflix was going to focus on developing more personal recommendations to help alleviate the paradox of choice users feel when trying to sift through thousands of movies and TV shows. “You won’t see a grid and you won’t see a sea of titles,” Hunt said. The company could automatically serve users three or four viewing options based on their tastes. Still, Hunt said it was “somewhat unrealistic” to believe Netflix would ever deliver a completely linear, algorithm-driven experience, the way Pandora does with music.

Netflix has already been experimenting with more efficient recommendations. The company last year introduced Max, a recommendation assistant that serves users up a single movie after they answer a few questions about their mood. Netflix is also working to improve its recommendation algorithm to better tease out what emotional elements people like about certain shows instead of just offering suggestions based on genre or actor.

At TIME, we’re still hoping Netflix heeds our suggestion and allows for user-generated playlists of its content, so people can mix and match television episodes the same way they assemble mixtapes. Such a feature could yield lists that are actually useful.

TIME directv

How the NFL Could Blow Up the AT&T-DirecTV Merger

Direct TV
Reed Saxon—AP

Forget the federal regulators—it’s actually NFL commissioner Roger Goodell who could have final say in whether AT&T’s proposed $48.5 billion acquisition of DirecTV comes to pass.

AT&T is trying to swallow up the satellite television provider to get access to its 20 million U.S. subscribers, large international footprint and healthy cash flow. But those American customers may start jumping ship if DirecTV fails to keep hold of its most valuable exclusive property, the National Football League’s all-you-can-watch Sunday Ticket package. DirecTV’s contract with the NFL for Sunday Ticket, which offers live coverage of every out-of-market game each Sunday, expires at the end of next season. In an SEC filing, AT&T revealed that if the deal is not renewed, it reserves the right to back out of the merger. DirecTV won’t be on the hook to pay AT&T damages for the botched deal as long as the company uses “reasonable best efforts” to woo the NFL.

For now, the merging companies say NFL negotiations are on the right track. On a conference call with investors Monday morning, DirecTV CEO Mike White said both he and AT&T CEO Randall Stephenson had already talked to Goodell and that negotiations for NFL Sunday Ticket should be completed by the end of the year. “I am still highly confident that we are going to get our deal done,” he said.

DirecTV pays about $1 billion per year for Sunday Ticket, which has around 2 million subscribers. The fact that football has been placed at the crux of this mega-merger will give Goodell significant leverage to ask for even more money at the negotiating table. The cost for Sunday Ticket could rise by as much as 40 percent to $1.4 billion, according to the Los Angeles Times.

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