TIME Microsoft

Microsoft Desperately Wants You to Stop Using Windows XP

The Microsoft Windows XP log-in screen is displayed on a lap
Chris Ratcliffe—Bloomberg/Getty Images

The 12-year-old operating system still runs on approximately 30 percent of web-connected PCs, but the tech giant wants to kill it off by offering upgraders $100 toward a new computer or tablet, plus free tech support and data transfers

Windows XP is the operating system that refuses to die. The software is now 12 years old—a dinosaur in the fast-moving technology sector—but runs nearly 30 percent of all Internet-connected desktop PCs, according to analytics firm Net Market Share. Microsoft is planning to end support for the OS on April 8, and it’s going to increasingly dramatic measures to convince reluctant customers to upgrade.

Earlier this month the company offered XP users a $50 gift card if they purchased a new PC on the Microsoft online store. Now the company is sweetening the pot by offering a $100 discount on Surface Pro 2 tablets and a range of laptop and desktop computers. Microsoft is also throwing in 90 days of free technical support and free data transfer to help people move their data over to a new machine. The promotion runs through June 15.

It’s not clear how effective the promotion will be in killing off Windows XP since the people keeping the OS alive aren’t just tech novices who need a website to tell them if they’re running XP or not. The operating system is popular in schools because many districts buy refurbished computers that come installed with the software. Ten percent of federal government computers still use the software, according to The Washington Post. Forrester Research estimates that six percent of corporate computers will still be on XP come April, and small businesses in particular are likely to ignore Microsoft’s pleas to upgrade. The oddest Windows XP diehards are ATMs—95 percent of the banking machines run on the ancient software. All these groups will be more susceptible to viruses and malware once Microsoft stops providing security updates for the software next month.

Microsoft may take further steps after they officially pull the plug on XP, such as a free or low-cost version of Windows 8.1 that is rumored to be in the works. Ultimately, though, the company may find itself in the same predicament in five years’ time. The four-year-old Windows 7 is the most popular OS in the world right now, with a market share of nearly 50 percent.

TIME facebook

The Free-Marketing Gravy Train Is Over on Facebook

Facebook CEO Zuckerberg addresses the audience during a media event at Facebook headquarters in Menlo Park
Robert Galbraith—Reuters

Over the past several months, Facebook has been reducing the organic reach of Pages. A recent study found that companies' posts dropped from reaching 12% of their followers in October to just 6% by February

Facebook and its popular Pages platform have been a cornerstone of most companies’ social-media marketing strategies for years. But if the brands, organizations and celebrities that use Pages want to continue to reach Facebook’s 1.23 billion monthly users in the future, they’re going to have to pay up.

Over the past several months, Facebook has been reducing the organic reach of Pages. Even if a person Likes a company or organization on the social network, they’re unlikely to naturally see that Page’s content in their News Feed. In a recent study of more than 100 brand Pages, Ogilvy & Mather found that companies’ posts dropped from reaching 12% of their followers in October to just 6% by February. The tech blog Valleywag reports that Facebook is planning to dial reach down to 1% to 2% of followers eventually.

Facebook declined to comment on the percentage of fans that see posts from a typical Facebook Page (the last publicly disclosed figure was 16% in the summer of 2012), but the company admitted in December that posts from Pages are reaching fewer users. Facebook attributes this change to increased competition as more people and companies join its service. The typical user is inundated with 1,500 posts per day from friends and Pages, and Facebook picks 300 to present in the News Feed. Getting squeezed out are both posts from Pages and meme photos as Facebook shifts its focus to what it deems “high quality” content.

The solution for brands with declining engagement, according to Facebook, is to buy ads. “Like many mediums, if businesses want to make sure that people see their content, the best strategy is, and always has been, paid advertising,” a spokeswoman said in an emailed statement.

The transition to paid marketing on what has long been a free-distribution platform may be a tough sell for some brands, particularly small organizations or individuals who have built up audiences over years. So far, though, pressing the screws to Pages hasn’t hurt Facebook’s bottom line — the company generated $7 billion in ad revenue in 2013, and research firm eMarketer projects that figure will grow to about $10.8 billion this year. That’s good news for the company’s investors, but maybe less so for the people suddenly being asked to fund the social network’s financial growth.

TIME Television

Sony and Microsoft Are in New Kind of Break-Neck Race

Customers buy Sony Computer Entertainment Inc.'s PlayStation 4 video game console box during the launch event in Seoul, South Korea, Dec. 17, 2013.
SeongJoon Cho—Bloomberg/Getty Images

It’s been a while since video game consoles were just about video games. Sony’s PlayStation 2 was initially a hot seller partially because it came equipped with a DVD player in the early days of that technology. Microsoft’s Xbox 360 and the PlayStation 3 offered a wide range of distractions besides games thanks to digital stores for movies and native apps for services such as Netflix and HBO Go. The next step in the transformation of the game console into an entertainment center? Original TV shows made exclusively for your Xbox or PlayStation.

Both Sony and Microsoft are prepping original programming for their newly launched PlayStation 4 and Xbox One consoles. On Wednesday Sony revealed that it is developing an hour-long supernatural drama series called “Powers” that will air on the PlayStation Network, the service that PS3 and PS4 owners use to play games online and stream video content. That’s in addition to the Internet-based TV service Sony has planned that will feature live programming from cable networks. The company didn’t disclose whether the new show would be bundled with the pay-TV service but cast them as independent initiatives.

Sony is actually playing catch-up to Microsoft, though. The software giant launched Xbox Entertainment Studios in 2012, a production outfit helmed by former CBS executive Nancy Tellem that will make television-like programming for the console. The marquee project is a live-action series based on the popular Halo video game franchise that will be produced by Steven Spielberg. Other shows in the works include a documentary about the video game industry crash of 1983, a reality series about urban soccer leagues and a show based on the life of rapper Nas, according to Deadline.

For these tech giants, expanding consoles’ functionality beyond video games is a necessity in a world of multi-purpose devices. Gadgets that serve a single purpose (like Nintendo’s poorly performing Wii U console, for instance) no longer appeal as much to consumers, says Brian Blau, research director in consumer technologies at Gartner. “They have to show value in many different arenas,” he says.

Even without original shows, consoles have already proven formidable entertainment hubs. Microsoft revealed years ago that gamers spend more time streaming video content like Netflix and ESPN than playing Xbox games online. Ten percent of all digital movie rentals and purchases were made through Xbox consoles in 2013, according to research firm IHS Screen Digest. The PS3 has also been successful beyond gaming, with its users spending 17 million hours per week using entertainment apps on the console. It’s the most popular device for streaming Netflix to the TV, at times even eclipsing Netflix usage on the PC. “The game consoles have both been significant players in the rise of [Internet-based] video consumption,” says Dan Cryan, the research director for digital media at IHS Screen Digest.

Strong original content will only heighten the appeal of the consoles to casual gamers seeking a versatile entertainment device. Though the shows announced so far skew heavily toward the young male demographic typically associated with PlayStation and Xbox, Blau predicts the companies will craft content with a wider appeal as their consoles hit cheaper price points. “They really want to bring in a wider portion of the family in front of the television and even get some of the non-gamers in the family to pick up the controller,” he says.

Still, it’s not clear whether Microsoft and Sony will be able to craft shows that can compete with the glut of online video content coming from the likes of Netflix, Hulu, Amazon and Google. Sony already has huge production studios that have made hit TV shows like Breaking Bad. But analysts say the company has had trouble creating synergy between its Hollywood studios and its consumer electronics divisions in the past. Microsoft has little background in television, but neither did Netflix before it spent hundreds of millions of dollars to commission critical hits like House of Cards and Orange Is the New Black. Microsoft strong-armed its way into the gaming industry by buying up talent and racking up huge monetary losses—it could do the same to establish itself as a player in television content.

Even as the giants of gaming are expanding to video, though, other tech companies are eyeing their video game turf. Amazon acquired the game developer Double Helix in February, perhaps to provide content for the company’s upcoming set-top box. Rumors persist that Apple is prepping a new Apple TV device that will include an app store for video games, and last year the Wall Street Journal reported that Google was developing a video game console running on its Android operating system.

The basic functionality of living room gadgets from all tech companies is likely to look increasingly similar in the coming years. That will heighten the importance of exclusive content—be it a hit video game or a popular television show—to stand out from the crowd. “These devices are now acting as effectively entry points for a smorgasbord of entertainment,” Cryan says. “The more value you add to that, the more people will use them and the more appealing they become.”

MORE: The History of Video Game Consoles – Full

TIME Mobile

Chinese Tech Giant Alibaba Thinks This Is the Next WhatsApp

Fackbook Acquires WhatsApp For $16 Billion
Justin Sullivan—Getty Images

Alibaba Group, the Chinese Internet giant that already has businesses similar to Amazon, eBay and PayPal, wants a piece of the messaging space too. The company has given $215 million in funding to a quickly growing messaging app called Tango.

While the popular messaging service WhatsApp prides itself on its simplicity, Tango attempts to roll multiple services into a single program. The app offers games, free messaging, voice calls and a social network to share songs and photos. Tango has racked up 70 million monthly users and 200 total registered users over the last four years. Now, it also has major backing from one of the largest Internet companies in the world.

“Tango has exhibited tremendous growth because of its unique approach to combine free communications, social and content,” Joe Tsai, executive vice chairman of Alibaba Group, said in a press release. “We were simply blown away by the vision and quality of the team at Tango and believe they have a disruptive way of looking at the mobile and messaging opportunity.”

Alibaba now has a 20 to 25 percent stake in Tango, valuing the company at $1.1 billion, according to Forbes. The startup received a total of $280 million in its most recent funding round, with previous investors chipping in along with Alibaba. The messaging app is the latest to get a huge investment from a tech giant. WhatsApp was bought by Facebook for an eye-popping $19 billion in February, and the voice-and-messaging app Viber was purchased for $900 million by Japanese online retailer Rakuten just a week earlier.

Alibaba’s moves are being closely watched as it preps for a public offering in the U.S. in the coming months. The company could raise as much as $15 billion in its IPO, which would make it the largest Internet company to go public since Facebook in 2012.

TIME Advertising

Harsh Samsung Ad Throws Shade on Pretty Much Everybody

Samsung has gotten into a habit of taking potshot at its competitors in its commercials. The tech giant recently mocked the faux-gravitas of Apple ads and basically called the people that wait in line for new iPhones total suckers. Today, the gloves really come off as Samsung criticizes Apple, Microsoft and Amazon all in the very same commercial.

The spot, centered on the tagline “It Can Do That,” highlights the advantages of Samsung’s Galaxy pro tablets over other devices in the market. A man in a business meeting pulls up his email account in the middle of a video chat while his iPad-owning colleague looks on helplessly. (The iPad can’t run two programs on-screen at once.) Later, another man’s bulky Microsoft Surface tablet hogs all the space on a coffee table with its mouse, keyboard and charger. At a book club meeting, a group of women with Amazon Kindles are shocked that one member’s Galaxy does things besides “books.” Really, the condescending smile of the Galaxy owner at the end who believes her tablet’s display is crisper than the “retina thingy” on her friend’s iPad sums up the tone of the commercial pretty well.

Samsung has long tried to market its way to dominance in the tech sector. The company spent an estimated $14 billion on marketing in 2013, compared to $3.1 billion by Amazon, $1.1 billion by Apple. The iPhone and the iPad are still the best selling smartphone and tablet in the world, but going negative is often a strategy for second-place contenders anyway. Samsung’s current name-calling echoes Apple’s own “Mac vs. PC” ads in the mid-2000s and Microsoft’s current “Scroogled” campaign against Google.

TIME coca-cola

LeBron James Gets His Own Soda

Miami Heat forward LeBron James smiles after a 100-96 win over the Cleveland Cavaliers at Quicken Loans Arena
Miami Heat forward LeBron James smiles after a 100-96 win over the Cleveland Cavaliers at Quicken Loans Arena, Mar 18, 2014. David Richard—USA Today Sports/Reuters

Miami Heat star LeBron James is partnering with Sprite to introduce 'Sprite 6 Mix,' a specially branded cherry- and orange-flavored version of the popular lemon-and-lime soft drink. The new beverage hits store shelves nationwide for a limited time this month

LeBron James already has a best-selling sneaker line and a cartoon series on YouTube. Soon, he’ll have his own beverage, too.

The NBA All-Star is partnering with Sprite to release Sprite 6 Mix, a cherry and orange-flavored version of the lemon-lime soda. The drink will be available for a limited time nationally starting this month. Sprite 6 Mix will feature a crown on its label — a reference to the basketball player’s nickname, “King James” — and will be the company’s first soda developed in tandem with a celebrity.

James earned $42 million in endorsement deals in 2013, leading all NBA players, according to Forbes. He’s been a pitchman for the Coca-Cola Company, which owns Sprite, since he first entered the NBA in 2003. James has helped the company advertise several of its brands in that time—making improbable full-court three-pointers for Powerade, trying a court case for Vitaminwater and challenging Yao Ming to a battle of cultural stereotypes for Coca-Cola itself.

Sprite 6 Mix will get a 15-second TV spot all its own this spring. Whether James’ new soda will reach the cultural ubiquity of rap star Nelly’s energy drink Pimp Juice remains to be seen.

TIME eBay

Carl Icahn Has a New Plan to Spin Off PayPal

Icahn Enterprises L.P. To Ring The NASDAQ Stock Market Closing Bell
Scott Eells—Bloomberg/Getty Images

Activist investor Carl Icahn has hatched a new plot in his ongoing quest to get eBay to spinoff its online payment service PayPal. In a letter to eBay shareholders released Wednesday, Icahn advocates for a partial IPO of PayPal, in which eBay would sell off 20 percent of the company in a public offering. “PayPal is a tremendous company, but it is on the verge of going to war against strong adversaries, and only with the benefits of being an independent company…will PayPal be capable of winning that war.,” Icahn writes in the letter.

The missive rattles off several reasons that a PayPal IPO makes sense from Icahn’s view. An independent PayPal would create greater value for shareholders, he argues, and money raised from the offering could be used to recruit more talent and make strategic acquisitions. An independent management team and board of directors would also benefit PayPal, Icahn says, because the company would be able to more easily pursue partnerships with companies that could potentially threaten eBay’s business. Icahn also imagines that other tech companies that are hungry to enter the online payments space, like Facebook, might buy a stake in PayPal if given the opportunity.

The proposal is a step back from Icahn’s original hope of getting PayPal to go entirely independent. But eBay still has no interest in parting with even a portion of the payments service. “We continue to believe PayPal and eBay together is the best path to creating sustainable, long-term shareholder value in the future,” the company said in an emailed statement, noting that eBay’s share price has risen by more than 400 percent in the past five years. “Together, PayPal and eBay have strong, real synergies that benefit both businesses. These synergies cannot be easily addressed in arm’s length commercial agreements.”

The issue is expected to be presented for a vote at eBay’s annual shareholders meeting this spring.

TIME Mobile

The Mobile Ad Market Is Exploding Because of These Two Companies

Apple iPhone
Justin Sullivan—Getty Images

The once-tiny mobile advertising sector is seeing huge growth, mainly thanks to the efforts of Google and Facebook. The two tech giants led a 105 percent gain in mobile ad spending in 2013, according to research firm eMarketer. In total, marketers spent almost $18 billion for ads on phones and tablets last year. That figure is projected to rise in 2014 to $31 billion, comprising about one-quarter of overall digital ad spending.

Facebook, somewhat surprisingly, has been the biggest beneficiary of the quick shift to mobile. Less than two years ago the company’s stock price was plummeting because of doubts that the social network could replicate its desktop-based ad business on smartphones. But the company began cramming ads directly into users’ news feeds and selling more mobile-native products, like ads that let users install a new app with just a few clicks. Now the majority of Facebook’s ad business comes from mobile, and its share of the total mobile advertising market is projected to pass 21 percent this year, up from just 5.4 percent in 2012. A newly released video ad product and increased monetization of the photo-sharing app Instagram will help keep Facebook’s mobile business humming.

Google, meanwhile, is watching its long-held dominance of the mobile ad market slowly erode. The company is still the juggernaut of the sector, netting 49 percent of mobile ad revenue in 2013. But last year was the first time Google didn’t collect a majority of overall mobile ad spending, and eMarketer projects that its share will slip to less than 47 percent this year. The company’s business model, selling ads related to users’ search queries, faces headwinds on mobile. Instead of visiting search engines, mobile users often pull up specific apps like Yelp or Amazon to find information. Compounding Google’s problems is the fact that the company’s mobile ads cost significantly less than their desktop ads, according to The New York Times. Facebook, on the other hand, has a smaller legacy desktop business to unravel, and the social network has claimed that its mobile ads cost more than its desktop ones.

Still, both companies are expected to remain atop the mobile mountaintop for the foreseeable future (Twitter is a distant third in mobile ad revenue, with a 2.4 percent share). eMarketer predicts Facebook will pull in $6.8 billion via mobile this year, while Google will earn $14.7 billion. That’s still a large gap, but the chasm between the two giants is closing fast.

TIME newspapers

Jeff Bezos Makes His First Major Move at the Washington Post

Jeff Bezos Launches Bezos Center For Innovation In Seattle
Jeff Bezos David Ryder—Getty Images

In an effort to boost The Washington Post's web traffic and increase its national presence, Amazon's CEO struck a deal with local papers to give their paying customers free access to some of the Post's subscriber content

Just a few months after buying The Washington Post, Amazon CEO Jeff Bezos is making his first significant change to the newspaper’s business model. Starting in May, the Post will lift its online paywall for subscribers of certain local newspapers, including The Dallas Morning News, the Honolulu Star-Advertiser and the Minneapolis Star-Tribune. The deal could boost the Post‘s web traffic while also increasing its national presence in areas where it is not distributed in print.

Like many news organizations, the Post allows people to view a limited number of articles online per month, then charges $7.99 every four weeks for unlimited access. The new deal will give subscribers of other papers free access to the Post’s website as well as its smartphone and tablet apps. No money is changing hands between the Post and the local papers, according to the Financial Times.

In the future, the Post could be bundled with other newspapers and even media properties in other sectors. Washington Post President Steve Hills told the Financial Times that digital subscription services such as Amazon Prime and Spotify could one day come packaged with the Post’s content. Bezos is focused on developing “a great digital audience 10 years from now, 20 years from now” rather than immediate profits, Hills said. The newspaper division of The Washington Post Company was losing money before Bezos announced he would buy the flagship paper for $250 million in August.

TIME Music Industry

Cue the Sad Trombone: Global Music Sales Are Diving Again

Spotify
Jonathan Nackstrand—AFP/Getty Images

After a brief respite in 2012, a new report shows that global recorded music revenues slipped 3.9 percent in 2013 to $15 billion. Streaming platforms, however, continued to grow, topping $1 billion in sales for the first time

After a brief respite in 2012, music sales are once again on the decline. A new report by the International Federation of the Phonographic Industry shows that recorded music revenues slipped 3.9 percent last year to $15 billion globally.

A precipitous fall in revenue in Japan is mostly to blame. The country is the second-largest market for recorded music in the world, but sales fell by a huge 16.7 percent there in 2013 because of a decline in both physical music sales and older digital products such as ringtones. Taking Japan out of the equation, global music sales were nearly flat year-over-year, dipping by 0.1 percent from 2012 to 2013.

The biggest growth sector in the industry was once again in subscription services such as Spotify and Rdio. As the number of paying subscribers rose from 20 million to 28 million from 2012 to 2013, revenue from such platforms grew by 51 percent and topped $1 billion for the first time. Revenue from ad-supported streaming services like YouTube and the free version of Spotify also grew by more than 17 percent. In total more than a quarter of the industry’s $5.9 billion in digital revenues now comes from these free and subscription-based streaming options.

Physical music sales continued drive the majority of revenue for the industry, but likely for the last time. Physical formats comprised 51 percent of music sales last year, down from 56 percent in 2012. The rise of digital is expected to continue unabated for the foreseeable future.

The mixed data from the report cast 2013 as “a year of good news and bad news,” Universal Music Group International CEO Max Hole told Billboard. Another yearly decline—the 13th in the last 14 years—is not the step the industry wants to take as it tries to claw its way back to the heyday of the ‘90s, when global industry revenue was close to $30 billion. But executives are confident that people will one day pay for music subscription services en masse. The international CEO of Sony Music Entertainment told Billboard he expects 100 million people to sign up for music streaming services “in the near future.” The question is whether streaming will be able to rise fast enough to make up for ongoing declines in physical sales and, more recently, digital downloads. The IFPI report noted that digital download revenue dropped 2 percent last year.

Despite uncertainty about the industry’s future, the biggest pop stars are still doing quite well. Robin Thicke’s “Blurred Lines” was the biggest single of the year. Taking into account track sales and streams, it sold 14.8 million units globally. “Blurred Lines” was followed by Macklemore & Ryan Lewis’ “Thrift Shop,” which sold 13.8 million units and Avicii’s “Wake Me Up,” which sold 13.4 million units (and is now the most-streamed song ever on Spotify).

On the album front, One Direction’s Midnight Memories took the 2013 crown, selling 4 million units globally. Eminem’s Marshall Mathers LP 2 followed with 3.8 million in sales, and Justin Timberlake’s The 20/20 Experience rounded out the top three with sales of 3.6 million. Beyonce’s self-titled album, a surprise December release that was only available on iTunes its first week, even snuck into the bottom of the top 10 with 2.3 million units sold.

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