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Internet Financial News

Last Build Date: Tue, 08 Jan 2013 09:20:16 EST


Social media driving IR evolution
Social media offers a better user experience than investor relations websites, says Dominic Jones in a compelling post in which he argues...... that social media investor relations has reached a tipping point:[...] company disclosure channels that once seemed innovative " such as investor relations websites, webcasting and PR wire services " are struggling to stay relevant as investors grow accustomed to receiving information from companies in real-time on their favorite social networks in formats that are easier to access and use. These changes are irreversible [...] the audiences for investor relations information are changing how and where they access and use company financial disclosures. They are moving away from the old PR wire channels and engaging with companies directly on their websites, and through social media when companies make themselves available in those channels.A large and growing number of companies have recognized this. While they may have initially started using social media for marketing or PR purposes, they've quickly realized that investors also are using social media and want to receive information where it's now most convenient for them.In fact, hundreds of companies will use social media this quarterly reporting season. Most will use Twitter, but growing numbers will also use Facebook, YouTube, SlideShare and StockTwits. And more companies are coming on board every week, which in turn is driving more investors to use these channels.I can't say this loud enough: SOCIAL MEDIA IS NOW MAINSTREAM, and companies that haven't yet started using social media in their IR programs are in danger of finding themselves talking to increasingly smaller audiences.We have reached the tipping point for social media in investor relations. If you're not using social media in your IR program yet, you need to make it a priority and start right away.Jones examines in some detail the example of what US aluminium producer Alcoa is doing with multiple social channels, including Facebook and Twitter, as part of its integrated approach to investor communication, embracing the social with the traditional.He also references a host of other companies in North America and Europe " probably the most heavily-regulated parts of the world from a financial communication point of view, with tight parameters on what's permitted and what's not in terms of using the web and 'new media' " and what they're doing on Twitter, along with great screenshots of their tweets; the list includes Boeing, Ericsson, Daimler, Union Pacific, Vocus, Roche, Amgen, Rio Tinto and more.Dominic makes it clear in his post that social tools and channels have not replaced traditional methods of communicating investor and related information: the website, the earnings announcement and call, etc. They're still very much part of the IR landscape.But it's equally clear from the well-researched examples in the post that the writing is very much on the wall for companies that continue to rely only on those traditional communication methods.Read the full story: Social media investor relations reaches tipping pointComments[...]

Financial Business New Update
(image) News Corp Says It's (Really, Really) Ready To Sell MySpace (Mashable) Not a real surpise, but its rare that a company is so vocal in their disdain.

And then there's:MySpace Begging Users To Come Back
  • Sony Music Sales Down 14.5% Last Quarter. (Billboard) Currency fluctuations including a stronger Yen contributed.

  • Rdio tunes in $17.5 million financing round (FMC) Industry vet Rob Cavallo has joined the Rdio board.

More Music Industry News & Commentary:

  • What the Citigroup takeover means for EMI - Nobody expects Citigroup to hold on to EMI, but its fate will affect artists and songwriters on the major label's roster. (Guardian) And then there's Guy Hands Two Terrible Mistakes.

  • Amos Lee's Mission Bell, debuted at #1 with just 40,500 sold, the lowest #1 in chart history, Iron and Wine was right behind Lee at #2 with 39,000 copies. (FMQB)

  • Amazon's Facebook Integration Is The Future Of Commerce (SAI) Think about this for music...

  • Downtown has inked a multi-year publishing administration and joint venture with LA's Check Your Pulse, the publishing arm of Pulse Recording.

  • Will the Music Industry Ever Learn From Its Mistakes? (Gigom

  • Single Track Downloads Dominate. (PCWorld)

  • Crowdfunding: raising money from strangers. (Indie

  • Music Video Made on Microsoft Kinect Is Ghostly and Lovely. (Mashable)

  • UK Music Lobbyist Says Rethinking Fair Use Is 'Intellectual Masturbation' (Techdirt)

YouTube: Free Music Now Pays As Well As Paid
(image) Citing growing traffic, a 200-300% jump in advertising revenue over the last year and an imporved Content ID system that allows...

... music rightsholders to profit from infringing content (like videos of cats singing Lady Gaga), YouTube says that free content on its site is often returning as much revenue as paid music.

"Our larger music partners on the site are making millions of dollars per month," YouTube director of content partnerships Chris Maxcy told "The other thing that's astounding is the growth in this. We've seen the monetization levels increase two to three times, just in the last year Our label partners have been pretty pleased with that level, and we expect to see that growth continue. A year from now, I'm hoping we'll be able to say 'we increased revenue and RPMs another 2-3x."

Freemium Lives!

But that doesn't mean that the Google YouTube team doesn't believe that people will pay for music too.

"We've been very focused on advertising so far, but there are users who will pay for content with their money, and users who will pay for content with their time and attention," according to Phil Farhi, a product manager from Google's YouTube monetization team.

"These are the traps that people fall into: They look at price tags for advertising (supported services) versus price tags for subscription or downloading services," he added. "But you really need to consider not just the price tag, but the scale of audience and views that you're reaching with that."

This is all great news for Spotify, MOG, Rdio, Rhapsody and other music streaming services. While the pennies that artists and labels now receive from song streams may be seen as unfair or hurting sales by some, the income from tens or hundreds of millions of ad-supported users and paying subscribers becomes a significant source of revenue.

Goldman Sachs Invests $450 Million In Facebook
(image) The perceived value of a company is often evident in the monetary attention that investors place within the organization. If the company shows...

... a promising future, the investment will often match the enthusiasm. If things look bleak, so will too the amount of the check. Given that theory, if half a billion dollars is any indication of enthusiasm for a companys future outlook, then Facebook is going to have a great time.

The investment community was quite surprised this week to learn that two Facebook investors, Goldman Sachs ($450 million) and Digital Sky Technologies ($50 million), both wrote rather large checks to the social networking industry dominant leader. But, as for the reason why, no one quite knows. Over the course of 2010, the social network giants overall value increased steadily with numbers at $33 billion in September 2010 and $41 billion in November 2010. Now, at the beginning of 2011 with this combined investment of $500 million between the two investors, the total value of the company is now placed well over a staggering $50 billion.

There is a lot of web speculation about what Facebook intends to do with this influx of cash at their disposal. Some stories circulating ponder if they will spread the wealth within their human resources pool by seeking and hiring top-notch computer web developers and programmers in the industry to help make the social site even stronger. Others speculate that they will sink the entire purse into company growth and pursue tough acquisitions that before the large investment, would not have been possible.

Whatever decision is made will likely become evident soon. Because of this large investment, Facebook now has even more attention from shareholders, other investors and the public in general. Many hopes are hinged on the idea of Facebook becoming a publicly traded company with an IPO in its future. Only time will tell.



Apple Reports Their Highest Earnings Ever
(image) Apple has announced their holiday quarter earnings and, as expected, they're huge. The company posted a record revenue of $26.74 billion...

...and record net quarterly profit of $6 billion. During this period, Apple sold 4.13 million Macs, 16.24 million iPhones, 19.45 million iPods, and 7.33 million iPads.

While Apple has seen iPod sales fall flat in recent years, sales of the iPod Touch are continuing to grow, up 27% year-over-year.

The iPod Touch now makes up more than half of total iPod sales.

Commenting in the official release, CEO Steve Jobs said, "We had a phenomenal holiday quarter with record Mac, iPhone and iPad sales. We are firing on all cylinders and we've got some exciting things in the pipeline for this year including iPhone 4 on Verizon which customers can't wait to get their hands on."

Sadly, in the wake of these impressive earnings, Jobs will be taking a medical leave of absence. This leaves COO Tim Cook at the helm of Apple; he'll take over all the day to day operations. Meanwhile, Jobs will be stepping out to focus on his health, but he'll still oversee all of the important strategic decisions.


FanBridge Acquires Damntheradio And $2 Million
(image) FanBridge has acquired damntheradio. This will extend the fan relationship management tools that the company offers to encompass a Facebook too.

This news comes as FanBridge closed a $2 million Series A financing round.

FanBridge has also taken damntheradio out of private beta and launched a fully self-serve version of the product. Artists will now be able to create their own media-rich Facebook fan pages using the service.

All of the damntheradio founders will be joining the FanBridge team full-time and be at the helm of their new San Francisco office.


New Study Show Revenue Per Visitor On Top Online Retailers
(image) Yesterday's Silicon Alley Insider's chart of the day was quite interesting as it compared...

...the dollar value of each unique visitor across some of the top websites on the internet. It's not surprising that Amazon finished at the top spot, but it was surprising to see that each of their unique visitors is worth $189. Yesterday's Silicon Alley Insider's chart of the day was quite interesting as it compared the dollar value of each unique visitor across some of the top websites on the internet. It's not surprising that Amazon finished at the top spot, but it was surprising to see that each of their unique visitors is worth $189. Comparatively, this is almost 8X greater than Google (sitting at $24/unique visitor) and nearly 50X that of Facebook ($4/unique visitor).




WMG Revenue Stream Drops As Digital Sales Grow
(image) In SEC filings this morning, Warner Music Group reported revenue of $752 million, a decline of 13% from the prior year quarter...

... (-12% on a constant currency basis). Full year 2010 revenue declined 7% to $2,984 million (-9% on a constant currency basis). Despite declining revenue, cost cutting helped grow the company's cash war chest to $430 million, perhaps in anticipation of a bid EMI.

Slow Digital Growth & Big Severance Packages:

Quarterly digital revenue grew 7% from the previous years quarter to $197 million or 40% of recorded music revenue and 26% of total revenue. Full year 2010 digital revenue rose 8% to to $759 million.

Hefty severance packages cut into profits as WMG trimmed its over-staffed executive suites which cost the company $54 million ($46 million in the recorded music division, $2 million in music publishing and $6 million in corporate) last year. That's on top of $23 million of severance charges in the prior fiscal year ($18 million in recorded music, $2 million in music publishing and $3 million in corporate).

Read the full SEC filing here.


Warner Music Plans To Bid $510 Million For EMI
(image) Terra Firma's Guy Hands and EMI CEO Roger Faxon claim they have no intention of selling EMI. But its doubtful that their largest lender...

... Citigroup agrees, and since loosing his lawsuit woth the bank, Hands may have no choice. Eager, as he has in the past to take advantage of EMI's struggles is Edgar Bronfman Jr's Warner Music Group, who The Guardian reports is once again readying a $750 million fire sale price bid for EMI's recorded music division that should be delivered to Terra Firma within weeks.

Citigroup reportedly supports selling EMI's recorded music as part of a debt reduction plan.  Another possible scenario could see Citigroup offering to cancel debt in return for taking control of EMI's profitable music publishing division. That would also clear the way for a merger of EMI and WMG.

EMI appears likely to become in breach of its loan covenants when the next review happens in March.  If that is true, the only way that Hands can avoid Citi forcing a sale or takeover appears to be if already beleaguered Terra Firma investors agree to pump still more cash into EMI.


Universal Music Group Plans Major Cuts
(image) As profits at The Universal Music Group stumbled in the first 9 months of 2010, senior executives promised new cost cutting measures...

... particularly in the U.S.There is very, very significant potential for savings," according to Phillipe Capron, Vivendi's Chief Financial Officer. A lot of fat can be taken out without hurting muscle and bones.

The worlds largest label group just reported earnings before interest tax and amortization of $334 million in the first nine months of 2010. That's down 9.3% from the same period last year and down 14.7% on a constant currency basis. Overall sales slipped 1.7%.