TIME Companies

Google Inks $542 Million Venture Deal to Fund Mysterious Startup

2013 Google Developer Conference Continues In San Francisco
An attendee tries Google Glass during the Google I/O developer conference on May 17, 2013 in San Francisco, California. Justin Sullivan—Getty Images

The four-year-old firm Magic Leap aspires to blend computer generated images into the physical world

Google and several other leading tech firms have pooled $542 million in venture capital funding for Magic Leap, a secretive, Florida-based startup that is rumored to be working on virtual reality eyewear.

The deal, one of the largest venture capital fundraisers to date, would value the company at nearly $2 billion, two sources close to the negotiations told the Wall Street Journal. Two senior Google executives will join Magic Leap’s board of directors.

Little is known about Magic Leap beyond an eye-popping video of what the company hopes to achieve with its technology: a projection of life-like imagery that seamlessly blends with the physical surroundings. This deal echoes Facebook’s acquisition of Oculus Rift, a virtual reality headset that immerses users in graphically rendered 3-D worlds.

Both technologies point to a gamble within the tech industry that interfaces will ultimately break free from the confines of 2-D screens and form more immersive user experiences.

[WSJ]

MONEY stocks

3 Things to Know About IBM’s Sinking Stock

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Niall Carson—PA Wire/Press Association Images

IBM's shares plunged 7% Monday after a disappointing earnings report. Can tech's ultimate survivor transform itself one more time?

International Business Machines INTERNATIONAL BUSINESS MACHINES CORP. IBM -3.4713% has long enjoyed a unique status on Wall Street — a tech growth powerhouse that investors also see as a reliable blue chip, with steady profit growth and a hefty dividend. But with the rise of new technologies like cloud computing, Big Blue has struggled to maintain that balancing act.

Now investor confidence has suffered a big blow.

On Monday the company announced the results of a pretty lousy quarter. IBM’s third-quarter operating profit was down by nearly one fifth, and the company failed to generate year-over-year revenue growth for the 10th consecutive quarter.

Big Blue also revealed plans to sell-off its struggling semiconductor business, a move that involves taking $4.7 pre-tax billion charge against IBM’s bottom line. Actually, it is paying another company to take this unit off its hand.

While CEO Virginia Rometty acknowledged she was “disappointed” with IBM’s recent performance, she’s also pledged to turn the company around, led in part by IBM’s own foray into the cloud.

Now, you don’t get to be a 103-year-old tech company without learning to adapt. That’s what IBM famously did in the ’90s, when the computer giant started to shift away from profitable PC hardware in favor of consulting and service contracts for businesses.

But Monday’s dismal earnings show just how hard repeating that trick could turn out to be.

Here’s what else you need to know about the stock:

1) You can’t really call IBM a growth company anymore since its sales aren’t rising.

When it comes to revenues, IBM ranks behind only Apple APPLE INC. AAPL 2.7165% and Hewlett-Packard HEWLETT-PACKARD CO. HPQ 2.7203% among U.S. tech companies. On a quarterly basis, though, sales have actually shrunk for 10 periods in a row, including a 4% slide in the third quarter. The big culprit is cloud computing, in which businesses can access computing services remotely via the Internet.

Since the 1990s, IBM’s model has been premised on selling powerful, expensive computers to large businesses, then earning added profits on contracts to help firms run those machines. But the cloud lets companies rent, not buy, this computing power. “You only pay for what you use,” says Janney Montgomery Scott analyst Joseph Foresi. The result: IBM’s hardware revenues sank 15% last quarter.

2) IBM is racing to be a leader in cloud computing, but with mixed results.

The company has identified four alternative areas of growth. One is the cloud, the very technology eating into IBM’s hardware sales. Big Blue has spent more than $7 billion on cloud-related acquisitions. It’s also going after mobile, IT security, and big data, the analysis of information sets that are too large for traditional computers. An example of that is Watson. IBM’s artificial-intelligence project, which won Jeopardy! in 2011, is being marketed to businesses in finance and health care.

These initiatives have promise, but IBM’s size is a curse. For instance, the company’s cloud revenues jumped 69% to $4.4 billion last year, but with nearly $100 billion in overall sales, “it’s hard to move the needle,” says S&P Capital IQ analyst Scott Kessler.

3) The stock is now much cheaper than its tech peers, but it may deserve to be.

Investors willing to wait and see if these moves will transform IBM may take comfort in the fact that the stock looks cheap. What’s more, the shares yield 2.4%, vs. 2% for the broad market. This could make the company look like a good value.

But investors should tread carefully, says Ivan Feinseth, chief investment officer at Tigress Financial Partners. He notes IBM has spent $90 billion on stock buybacks in the past decade, which has kept the P/E low by increasing earnings per share. Yet none of that money was invested for growth, as evidenced by IBM’s sluggish annual growth rate. It is hard to imagine IBM outmuscling Amazon AMAZON.COM INC. AMZN 2.9783% , Cisco CISCO SYSTEMS INC. CSCO 2.5294% , Microsoft MICROSOFT CORP. MSFT 1.8149% , HP HEWLETT-PACKARD CO. HPQ 2.7203% , and Google GOOGLE INC. GOOG 1.0944% in the cloud — and there are better values in tech.

TIME Gadgets

Android 5.0 Lollipop: What’s New and When Can You Get It?

The next sweeping overhaul of Android — Android 5.0 Lollipop — is just around the bend. Here’s a look at some of its most notable additions, along with some insight as to when you might be able to get your hands on it.

What’s New?

Android 5 Lollipop
Google

The most noticeable difference is the overall look and feel of the operating system. Google’s using what it calls “Material Design,” making extensive use of animations and layered elements to deliver what the company promises is a more intuitive experience.

In layman’s terms, let’s just say there’s more swooping and sliding. And you’ll notice a more uniform design across Android devices in general — phones, tablets, watches, TV gadgets, car audio systems and more. If you have multiple Android gadgets, they’ll work together more harmoniously than before.

You can see a bit of how Material Design looks up until about the 30-second mark of this video:

Battery life should be an improvement. Developers will be able to better fine-tune their apps so they don’t use as much juice, and there’s a new power-saving mode that lets you squeeze up to 90 extra minutes out of your phone if you can’t find an outlet. When you get around to charging your phone, it’ll tell you how long it’ll be until it’s at 100%.

Security gets beefed up as well, with encryption turned on by default to prevent data from being accessed on lost or stolen devices. (Authorities aren’t too happy about this.) Note that you can turn encryption on yourself if you’re running an earlier version of Android. Here’s how (follow up until the part about resetting your phone). For an extra layer of security, you’ll be able to unlock your phone or tablet only when it’s in proximity to your Android smartwatch.

There are also some cool new multi-user features, like being able to use a friend’s phone in guest mode. And if you log in with your Google credentials, you’ll be able to make calls and access your messages, photos and other data as though you were using your own phone.

Notifications also get a much-needed overhaul. They’ll now be ranked and presented based on priority. Ideally, messages from people you want to hear from will be most prominent, while some obscure app telling you it’s been updated won’t get as much screen time. You’ll be able to finesse how often you’re notified with a new “priority” mode that’ll only let certain people contact you or will let you turn off notifications altogether between certain hours.

On newer phones, you’ll enjoy fewer button presses. If the hardware supports it, you’ll be able to say “Okay, Google” to wake the phone up to help you search for something or set reminders without touching it. Some phones will simply wake up when you pick them up or double-tap the screen.

You can see a more complete list of features here; scroll down to the bottom and click the “See All Features” link.

When Can I Get It?

It depends on your device and your carrier. Google’s “Nexus”-branded devices (Nexus 4, 5, 6, 7, 9 and 10) will have access to Android 5.0 sometime in November. Certain “Google Play edition” devices (the HTC One M8 and the Moto G, almost certainly) should see the update around the same time. The new Nexus 9 tablet is the only device with a firm date — November 3; the big-screen Nexus 6 smartphone is due “in stores in November,” says Google.

The official word is as follows:

Android 5.0 Lollipop, which comes on Nexus 6, Nexus 9 and Nexus Player, will also be available on Nexus 4, 5, 7, 10 and Google Play edition devices in the coming weeks.

After that, things get even murkier. Dan Graziano over at CNET has a roundup of moving-targets HTC, Samsung, Motorola, LG and Sony, so keep an eye on that post as it’s to be updated as things progress.

As for whether or not your device is eligible to get Android 5.0, there’s a loose 18-month window for certain Android devices. Google’s official word: “Devices may not receive the latest version of Android if they fall outside of the update window, traditionally around 18 months after a device release.” And that’s only for Nexus and Google Play devices; check with your carrier to see if they can shed any light on your situation. If you’ve had your phone for more than a year, you might be on the fence depending when the phone was initially released.

TIME technology

FBI Director Implies Action Against Apple and Google Over Encryption

FBI Director James Comey testifies at a Senate Judiciary Committee hearing on "Oversight of the Federal Bureau of Investigation" on Capitol Hill in Washington
FBI Director James Comey testifies at a Senate Judiciary Committee hearing on "Oversight of the Federal Bureau of Investigation" on Capitol Hill in Washington May 21, 2014. Kevin Lamarque—Reuters

The law enforcement chief made it clear, however, that he was speaking only for his own agency and not others

FBI Director James B. Comey has expressed exasperation at the advanced data encryption technologies that companies like Apple and Google say they will offer their customers, and implied that the government might attempt regulations to ensure a way around them.

“Perhaps it’s time to suggest that the post-Snowden pendulum has swung too far in one direction — in a direction of fear and mistrust,” Comey told the Brookings Institution in a speech Thursday. Comey also spoke of the need for a “regulatory or legislative fix” to hold all communications companies to the same standard, “so that those of us in law enforcement, national security and public safety can continue to do the job you have entrusted us to do, in the way you would want us to.”

But in response to questions from reporters and Brookings experts, the FBI director made it clear that he was only talking on behalf of his own organization and thus could not speak for the NSA or other intelligence agencies, reports the New York Times.

This is not the first time that Comey has spoken out against Apple and Google’s move to give users complete control over data encryption, but the implications of legislative action against these companies is a step forward in government efforts to thwart it.

While Apple and Google have not commented on Comey’s latest remarks, technology companies have previously said that the move toward personal data encryption will not slow down, and will in fact probably be stepped up.

“I’d be fundamentally surprised if anybody takes the foot of the pedal of building encryption into their products,” Facebook’s general counsel Colin Stretch told the Times. He added that encryption was a “key business objective” for technology companies.

TIME Security

Watch: What You Need to Know About the POODLE Bug

Third security flaw discovered this year, but researchers say it's not as powerful as Heartbleed

The POODLE bug may sound silly, but it can cause some serious damage.

POODLE, which stands for Padding Oracle on Downloaded Legacy Encryption, makes it possible for hackers to snoop on a user’s web browsing. The problem is an 18-year-old encryption standard, known as SSL v3, which is still used by older browsers like Internet Explorer 6.

SSL protects data exchanged between a website and user, indicated by a green pad lock icon. If you’re a home user, don’t panic — you’re not at high risk. But, just to be safe, one solution is to upgrade your web browser.

TIME Gadgets

Google Unveils ‘First-of-its-Kind’ Android TV Streaming Device

Nexus Player Google

Nexus Player will stream movies, music and in a "first-of-its-kind" twist, online games

Google announced a “first-of-its-kind” device on Wednesday that will stream content from Android TV to home television sets, marking the search giant’s latest push to make televisions a little more web savvy.

The Nexus Player is a hockey-puck shaped device that will stream movies, music and videos through Android TV, which includes partnerships with Netflix and Hulu. The player comes with a spare, voice-controlled remote that can take verbal search commands for movie titles or names of performers.

What separates the device from rival set-top boxes such as Roku or Apple TV is its ability to double as a gaming system. A gamer can switch seamlessly from playing on the television to any other Android-compatible tablet or smartphone, though the game controller is sold separately.

 

TIME Google

This Is Google’s Massive New Nexus 6 Android Phone

Bigger than an iPhone 6 Plus and a Samsung Galaxy Note 4

Google unveiled its latest phone, the Nexus 6, Oct. 15. It’s big. Very big.

The first device to run Android 5.0, codenamed Lollipop, features a massive 6-inch display, larger than Samsung’s Galaxy Note 4 and Apple’s iPhone 6 Plus. The device packs a Snapdragon 805 processor, 13-megapixel rear camera, 2-megapixel front camera, and two front-facing speakers. It will be available in 32GB and 64GB versions, in either white or blue. An unlocked Nexus 6 will cost $649.

The new phone will go on sale in November. Google says the Nexus 6 will be available through AT&T, T-Mobile, Verizon Wireless, US Cellular, and Sprint.

[Google]

MONEY online shopping

3 Reasons Google’s Same-Day Shipping Looks Like a Game Changer

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Nick and Laura Allen—AP

Google already dominates search. If the big expansion of a same-day shipping service proves successful, it could be on its way to dominating online shopping too.

On Monday, Google announced that the express online shopping-and-shipping service it has been testing for months in northern California and parts of Los Angeles and New York City is expanding to three more cities: Boston, Chicago, and Washington, D.C. The service, originally dubbed Google Shopping Express and now shortened to just Google Express, allows shoppers to place orders online or via mobile device with partner retailers such as Walgreens, Costco, Staples, Barnes & Noble, and Sports Authority. Google promises same-day shipping on all such orders, at a cost of $4.99 per delivery or flat subscription plans of $10 monthly or $95 a year.

Former Google CEO Eric Schmidt mentioned this week at a conference that Google’s biggest rival isn’t Yahoo or Bing but is in fact Amazon.com, and the expansion of Google Express into Amazon’s online shopping turf is a clear indication that Google takes this rivalry very seriously. While Amazon is still the most dominant player in e-retail, Google’s newly expanded service is arguably superior and a better value compared to anything Amazon currently offers. Here are three reasons why Google’s service is particularly compelling:

1. Same-day delivery that’s “free.” Consumers increasingly demand free shipping with online purchases. Things have gotten to the point that free shipping is so readily available—via a coupon code here or reaching a minimum purchase threshold there—that the idea of paying for delivery can now be a deal breaker.

Thus far, the phenomenal success of Amazon Prime has most clearly demonstrated the power of shipping when it’s not only reliably free but speedy as well. Prime subscribers receive free two-day shipping on most orders placed via Amazon.com, and the service has proven so popular and indispensable that enrollment numbers have continued to climb even after prices rose recently from $79 to $99 annually.

Overnight and same-day shipping are more costly services than two-day delivery, however, and Amazon Prime members must pay extra for these expedited options—typically $5.99 for same-day shipping, where and when it’s available. That’s on top of an annual subscription fee.

Like Amazon Prime, Google Express is available via subscription, priced at $95 per year (just a smidge under the cost of Prime) or $10 per month. Members then get free same-day delivery of all orders with a minimum purchase of $15. (As an alternative, nonsubscribers can pay a flat $4.99 delivery fee per order.) One of the big differences between Amazon Prime and Google’s subscription service is that the former includes two-day shipping at no additional charge, whereas the latter covers same-day delivery. Prime has many other benefits—free video streaming, for instance, not to mention a much broader selection of products than Google’s service—but in terms of speedy shipping, Google Express has the edge.

Bear in mind that you’re paying for whichever service you choose. These services are presented as featuring “free” shipping, but that’s silly. Subscribers pay a membership fee to cover the costs of shipping, and there’s nothing free about it. “Prepaid” may be a better way to describe the shipping offered by these services. A subscription is a potentially good value in the same way that an all-you-can-eat buffet is a smart buy for someone who eats (or orders online) a lot, but it can be a waste of money for others.

2. Same-day delivery of stuff you actually need that day. Based on the success of Amazon Prime, plenty of consumers are more than OK with two-day shipping on the vast majority of online purchases. After all, when you’re buying a new TV, or a winter coat, or batteries or coffee pods or a Christmas gift for your aunt, or any other thing you might purchase at Amazon, there are generally no pressing needs that might require you to be in possession of them on the very day you place the order.

Likewise, same-day shipping would seem to be less of a necessity for the products typically purchased from Google Express partners such as Sports Authority, Guitar Center, and Toys R Us. It’s often a different story, though, for the goods one needs from drugstores and supermarkets, because when you need cold medicine or diapers or food on the dinner table, you tend to need them right away—not two days after placing an order. The normal approach in these situations is to handle the errand the old-fashioned way, by making a physical run to the store. But because Google Express’s early partners include Walgreens and grocery chains such as Giant, Stop ‘n Shop, and Whole Foods, these kinds of everyday errands can be crossed off your list quickly online, without even the need to pay extra for same-day delivery. (Same-day delivery from another Google partner, 1-800FLOWERS.com, is probably even more of a necessity among certain shoppers on certain anniversaries and birthdays.) For the sake of comparison, Amazon has already introduced an online grocery service in select markets with same-day and overnight delivery, but its subscription runs $299 per year.

3. Same-day delivery on stuff that’s a hassle to buy in person. Another intriguing partner of Google Shopping Express is Costco. The warehouse membership club giant is beloved by bulk-size-loving patrons, yet much about the shopping experience is less than ideal—starting with the huge size of much of its merchandise and ending with the absence of shopping bags for carrying one’s purchases. What’s more, Costco has had some trouble attracting younger customers because fewer millennials have cars, which are all but necessities for any Costco shopping trip, and they tend to want to live in urban areas rather than the suburbs where most Costcos are located.

Many of these issues disappear when Google and its same-day delivery service enter the equation. If Google is handling the pickup and delivery, customers no longer have to worry about being strong enough to maneuver gigantic tubs of laundry detergent into shopping carts, then into one’s car. Heck, there’s no need for a car at all because, again, Google is taking care of the shipping.

While Google’s service is still in its infancy, it’s probably being helped greatly by the fact that that a popular retail brand like Costco is a partner. But who knows: Down the line, it could be that Costco membership numbers rise because same-day delivery is available via its partner, Google Shopping Express.

Read next: Google Express Expands its Same-Day Delivery Reach

MONEY online shopping

Forget Apple! Google’s Biggest Rival is Actually Amazon

Google chairman Eric Schmidt says Amazon is the company's chief competitor. The search giant is ramping up its online shopping to go head-to-head.

TIME Careers & Workplace

10 Most Lavish Job Perks in Silicon Valley

General Views Inside Zynga Inc. Headquarters
Zynga Inc. employees eat lunch at the company's headquarters in San Francisco, California. Bloomberg—Bloomberg via Getty Images

Living the dream with free booze, ball pits and helicopter rides

Everyone knows by now that tech workers in Silicon Valley get lavish perks such as round-the-clock free food and unlimited vacation days. But as competition to recruit and retain the world’s best software engineers has increased, so has the quality of the benefits. Case in point: Apple and Facebook will soon pay for female employees to have their eggs frozen. The procedure usually costs at least $10,000, according to NBC News, but apparently that’s a cost tech giants are willing to pay in order to attract top female talent.

There are plenty of more unusual perks to go around in the Valley, though. Here’s a look at 9 other real job benefits you can consider bringing up at your next performance review.

Nap Pods – Anyone who’s ever gotten caught dozing at their desk would appreciate these comfortable reclining seats that typically feature a spherical cover to help the user block out external stimuli. The pods are a mainstay at Google, among other companies.

Bike Repair Shop – Access to free bikes is common on the sprawling campuses of Silicon Valley’s biggest companies. Facebook even offers a bike repair shop where employees can bring their own vehicles for a fix-up.

Exercise Classes – Beyond having gyms on-site, many tech companies regularly offer free yoga classes. Fitbit has free kickboxing and zumba classes, and the IT firm ThousandEyes offers free massages every other week.

Booze – A San Francisco startup called Hipster was offering new employees a year’s supply of Pabst Blue Ribbon beer at one point. Though Hipster now seems to be defunct, cloud storage service Dropbox is well known for its Whiskey Fridays.

Helicopter Rides – Security camera company Dropcam offers every employee a voucher for a free helicopter ride with friends. Even wackier—the chopper is flown by Greg Duffy, Dropcam’s CEO.

Barbershop – For those in need of a fresh cut, Facebook has a barbershop on-site to meet all hair care needs.

Car Rentals – Google employees can rent electric cars on the company’s main campus for the day to run errands.

Arcades – Forget foosball—some companies have entire arcades to help employees goof off from time to time. At Eventbrite, a new arcade game is placed in the office once a month, while Facebook’s gaming room features both traditional arcade cabinets and more eleaborate gaming rigs. Other perks that help employees embrace their inner child include Facebook’s candy shop and Google’s ball pit.

Concierge Service – Because Google would rather have their employees writing code than running errands, the company offers a concierge service that will do things like help organize a dinner party or plan a home improvement project.

 

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