Tag Archives: Sources

Dropbox IPO oversubscribed: sources
March 19, 2018 6:10 pm|Comments (0)

(Reuters) – Cloud storage company Dropbox Inc’s [DBX.O] initial public offering was oversubscribed, two people familiar with the matter said on Monday, indicating healthy demand for the first big tech IPO this year even as tech stocks opened the week on sour note.

The Dropbox app logo seen on a mobile phone in this illustration photo October 16, 2017. REUTERS/Thomas White/Illustration

While investor appetite looked encouraging with three days to go before final pricing, it was not clear if that would be strong enough to lift the deal above of the initial range of $ 16 to $ 18 a share that Dropbox set last week. The offering is expected to price Thursday, and the stock will start trading on the Nasdaq on Friday.

“It is early to predict the pricing. But what I can say is that from the conversations it seems the market is interested in it and IPO seems to be bright,” a separate source told Reuters. The three sources asked not to be named as the IPO pricing process was still underway.

Dropbox’s IPO comes in what is sizing up to be a challenging week for stocks, with the U.S. Federal Reserve set to raise interest rates on Wednesday, a day before the Dropbox deal is set to close.

Tech shares also fell hard to open the week, with Nasdaq down more than 2 percent on reports of Facebook Inc’s (FB.O) latest data privacy problems.

Dropbox’s IPO also comes on the heels of an upsized deal last week from cyber security firm Zscaler Inc (ZS.O) and is being watched as a barometer of investor enthusiasm for tech unicorns – young companies valued at more than $ 1 billion – after Snapchat owner Snap Inc’s (SNAP.N) shares cratered following a much-touted IPO a year ago.

Dropbox is selling 36 million shares, and the offering could be increased by 5.4 million if underwriters exercise their right to buy more stock. At the high end of the indicated pricing, it could raise nearly $ 650 million, making it the largest tech IPO since Snap hit the market just over a year ago.

The current price range suggests the San Francisco company, co-founded in 2007 by Andrew Houston and Arash Ferdowsi, will hit the public market valued at roughly $ 7 billion, a hefty discount to the $ 10 billion implied by its last funding round in 2014.

The company has 500 million users and competes with Alphabet Inc’s (GOOGL.O) Google, Microsoft Corp (MSFT.O), Amazon.com Inc (AMZN.O) and has Box Inc (BOX.N) as its main rival.

Reporting by Sweta Singh, Nikhil Subba and Diptendu Lahiri in Bengaluru, Editing by Dan Burns and Saumyadeb Chakrabarty


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Exclusive: Amazon eyes new warehouse in Brazil e-commerce push – sources
February 9, 2018 6:01 pm|Comments (0)

SAO PAULO (Reuters) – Amazon.com Inc (AMZN.O) is looking to lease a 50,000-square-meter warehouse just outside Sao Paulo, people familiar with the matter told Reuters, as it steps up its push into Latin America’s biggest retail market, Brazil.

The logistics investment, which would be four times the size of its current book-shipping operation in the country, is a sign the online retailer may soon handle distribution of electronics and other goods sold on its Brazilian website.

That would be the first step of its kind for Amazon in Latin America’s largest economy, where it currently relies on third parties to ship their own goods sold on its marketplace, and it underscores the seriousness of the e-commerce giant’s renewed push into Brazil.

Amazon declined to comment to questions about leasing a warehouse.

While an estimated two-thirds of Brazil’s 209 million people have internet access, online retail was slow to take off at first, amid concerns over security and complications with tax and logistics in the continent-sized country.

E-commerce accounts for around 5 percent of Brazil’s roughly $ 300 billion retail market — about half its share in the United States — but it has doubled in the past four years and is forecast to keep growing annually at a double-digit pace.

Now Amazon, which expanded its Brazil business from books to electronics in October, is gearing up to fight rivals such as Latin Ameria’s homegrown e-commerce champion Mercado Libre Inc (MELI.O) and B2w Cia Digital, (BTOW3.SA) which is indirectly controlled by partners of private equity group 3G Capital.

“You obviously can’t underestimate a company like Amazon,” said Pedro Guasti, CEO of Brazilian online consultancy Ebit. “It has huge capacity to invest and it’s obviously taking a bigger bite of the cake than it did last year.”

Mercado Libre Inc, B2w and local retailer Magazine Luiza SA (MGLU3.SA) have stolen a march on Amazon by storing and shipping goods appearing on their websites even when offered by third-party sellers, to ensure speed and customer satisfaction.

Amazon, by contrast, has been slow to tackle the challenges of shipping in a country where tricky logistics and tax issues have long made online retail an unprofitable venture.


In Mexico, Amazon launched its third-party marketplace coupled with its own shipping service, called “Fulfillment by Amazon,” in 2015.

The contrast has been stark. Nearly 20 percent of reviews on Amazon’s Brazilian marketplace are negative, compared with 10 percent in Mexico and just 4 percent in the United States, according to e-commerce analytics firm Marketplace Pulse.

Complaints in Brazil often focus on delayed or canceled orders – a problem dramatically reduced in other countries when Amazon itself packs and posts orders of third-party goods stored at its warehouse facilities.

In an early sign of Amazon’s Brazilian logistics push, the company posted more than a dozen listings for distribution jobs in the country to LinkedIn last year, including “Site leader, Fulfillment Center”.

The new warehouse site outside of Sao Paulo, in the municipality of Cajamar, looks to be a step in that direction.

There San Francisco-based logistics company Prologis Inc (PLD.N) has offered a 50,000-square-meter space to Amazon in a new industrial park that hosts DHL and Samsung, according to sources, who said adaptation of the warehouse had not begun.

Prologis, which also partnered with Amazon on a mega-warehouse north of Mexico city last year, declined to comment.

The preparations in Brazil come as Luft, the local logistics operator for Amazon’s book business, readies a move into another Prologis site nearby in Cajamar, sources said, leaving its current 12,000-square-meter facility in the city of Barueri.

Amazon registered in October to conduct operations in Cajamar, according to municipal records seen by Reuters.

The new logistics investment could spell trouble for rivals.

Mercado Libre has been a success story among Latin America tech start ups: its shares have nearly tripled since 2014, bringing its market capitalization to more than $ 15 billion.

Magazine Luiza’s stock has risen sixfold in each of the past two years as it shifted its rolled out an ambitious e-commerce strategy built on its brick and mortar stores.

Reporting by Gabriela Mello; Writing and additional reporting by Brad Haynes; Editing by Daniel Flynn and Alistair Bell


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Exclusive: China's Ant plans equity fundraising at potential $100 billion valuation – sources
February 9, 2018 6:00 am|Comments (0)

HONG KONG (Reuters) – China’s Ant Financial Services Group is planning to raise up to $ 5 billion in fresh equity that could value the online payments giant at more than $ 100 billion, people familiar with the move told Reuters.

A fundraising would bring Ant, in which e-commerce firm Alibaba Group Holding Ltd is taking a one-third stake, a step closer to a hotly anticipated initial public offering by establishing a more current valuation.

Ant’s last fundraising in 2016 valued the owner of Alipay, China’s top online payment platform, at about $ 60 billion. The new round should start with a valuation of between $ 80 billion to $ 100 billion, the people said.

Ant is currently in talks to appoint advisers for the fundraising which is expected to be launched in the next couple of months, they added.

Ant declined to comment on its fundraising plans. All the people spoke to Reuters on the condition they not be identified due to the sensitivity of the issue.

While no timetable for an IPO has been set, nor any location yet chosen, Ant’s plans are being viewed as a pre-IPO fundraising, the people said. A pre-IPO round is an increasingly common move by sought-after Chinese companies to establish valuations and widen their investor base ahead of going public.

It was not immediately clear how the company plans to use the fresh cash.

The exact timing and size of the fundraising still depends on investor feedback but any deal will add to an already hectic pace of domestic and offshore fundraising by Chinese tech firms that are looking to expand both at home and abroad.

Chinese e-commerce firm JD.com is raising funds for its logistics unit with a target of attracting at least $ 2 billion, while live-video streaming start-up Kuaishou is nearing the close of a $ 1 billion funding round, sources have said.

Ant’s own existing investments include stakes in Paytm, the Indian mobile payment and e-commerce website, and Thai financial technology firm Ascend Money.

Last month, however, Ant suffered a setback when a U.S. government panel rejected its $ 1.2 billion offer for money transfer company MoneyGram International over security concerns.

At home, in addition to its core online payments business, which Ant says has 520 million yearly users, the company also offers wealth management, credit scoring, micro lending and insurance services.

Last week, Alibaba announced it would take a 33 percent stake in Ant – replacing the current system where Alibaba receives 37.5 percent of Ant’s pre-tax profit – in what was viewed as an important step ahead of any IPO.

Alibaba set up Alipay in 2004, modeling the business on PayPal, to help Chinese buyers shop online, and later controversially spun it off ahead of its own listing in 2014. Jack Ma, Alibaba’s founder, controls Ant, according to Alibaba filings with the U.S Securities and Exchange Commission.

Ant is considered by some analysts as one of the most valuable Alibaba assets due to its unique position in Chinese e-commerce.

Current shareholders in Ant include large state-owned institutions such as China Life Insurance, China Post Group – parent of Postal Savings Bank of China – and a unit of China Development Bank.

Reporting by Sumeet Chatterjee and Julie Zhu; Additional reporting by Kane Wu; Editing by Muralikumar Anantharaman and Edwina Gibbs


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Tencent-led group to invest $1.6 billion in menswear firm Heilan: sources
February 1, 2018 6:01 am|Comments (0)

HONG KONG (Reuters) – Tencent Holdings Ltd is leading a deal to invest 10 billion yuan ($ 1.59 billion) in Chinese menswear group Heilan Home Co Ltd, upping a retail rivalry with fellow internet giant Alibaba Group Holding Ltd, sources with knowledge of the matter said.

China’s second-largest e-commerce company JD.com Inc and online clothing platform Vipshop Holdings Ltd will also be among the group that plans to acquire less than 10 percent of the company for 5 billion yuan, one source said.

Another 5 billion yuan would help set up an industrial investment fund to focus on deals that fit with Heilan’s business, the person said, requesting anonymity because they were not authorized to speak to the media.

Heilan had a market value of about $ 8.13 billion as of Monday, when it halted shares from trading, pending deal announcements.

Tencent, JD.com and Vipshop declined to comment. A Heilan spokesman was not immediately available to comment.

The proposed deal, which could be announced as early as Friday, extends a recent push by Tencent, China’s biggest social network and gaming company, into bricks-and-mortar retail to further compete with Alibaba.

Heilan which has clothing brands such as HLA and SANCANAL, has been a long-time partner of Alibaba’s online marketplace Tmall.

But last month Tencent, which has a market capitalization of $ 563 billion, said it would invest 4.2 billion yuan for a stake in Yonghui Superstores. It is also looking to take a stake in the China business of French supermarket retailer Carrefour.

The recent moves reflect a wider, long-running stand-off between Tencent and Alibaba, which have made competing investments in areas as diverse as bike-sharing apps, food delivery and gaming.

JD.com, in which Tencent is a top-10 investor, traditionally leads against Alibaba in online retail sales of electronics and home appliance products, but lags behind in the fashion business.

Tencent and JD.com last month jointly made an $ 863 million investment in Vipshop, in a bid to tap the country’s young female shoppers and gain access to consumer and transaction data to help them compete with Alibaba’s online payment platform Alipay.

Jiangsu-based Heilan was set up by Zhou Jianping, one of the richest people in China’s fashion industry, in 1997. It runs more than 5,000 stores, mostly in China, and recorded 12.5 billion yuan in operating income in the first three quarters last year, its website showed.

Reporting by Julie Zhu; Editing by Stephen Coates


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Google, Temasek coming in as new investors in Indonesia's Go-Jek: sources
January 18, 2018 6:00 am|Comments (0)

SINGAPORE (Reuters) – Alphabet Inc’s Google (GOOGL.O), Singapore state investor Temasek Holdings Pte Ltd and Chinese online platform Meituan-Dianping are investing in a fundraising round of Indonesian ride-hailing start-up Go-Jek, sources familiar with the matter said.

Go-Jek’s existing investors such as global private equity firms KKR & Co LP (KKR.N) and Warburg Pincus LLC are also participating in the funding round of Go-Jek, which is raising about $ 1.2 billion in total, the sources said.

Google, KKR, Warburg and Temasek [TEM.UL] declined to comment. Meituan-Dianping and Go-Jek did not immediately respond to requests for comment. The people declined to be identified as they were not authorized to speak to the media.

Reporting by Anshuman Daga; Additional reporting by Julie Zhu in HONG KONG; Editing by Muralikumar Anantharaman


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U.S. experts resign from monitoring China’s ZTE Corp: sources
December 22, 2017 12:56 pm|Comments (0)

(Reuters) – Two consulting firms hired to help the United States police ZTE Corp’s compliance with trade sanctions have resigned, according to four people familiar with the matter.

China’s second-largest telecommunications company agreed earlier this year to pay a nearly $ 900 million penalty – the largest in a U.S. export controls case – and open its books to a U.S. monitor as part of a guilty plea for illegally shipping goods to Iran and North Korea. To read the Reuters report that exposed the practice, click goo.gl/rvNwr6

Guidepost Solutions and Larkin Trade International were hired in June by the U.S. monitor in charge of the oversight regime – Texas lawyer James Stanton – to help assess the company’s compliance with U.S. export control and sanctions laws, and reduce its risk of future misconduct, said the people, who wished to remain unnamed because the matter is not public.

In late August, the two firms parted ways with the monitor after clashing over his approach to the job, the people said. Although Reuters was unable to determine the exact reasons for the departure , Stanton initially restricted the consultants’ access to ZTE documents and officials, hindering their ability to help monitor the company, one of the people said.

Stanton did not respond to multiple phone calls and emails seeking comment. 

Tina Larkin, the chief financial officer of Larkin International, declined to comment, as did a spokeswoman for Guidepost Solutions.

A lawyer for ZTE declined to discuss the departure of the consulting firms, or the company’s relationship with the monitor.

“We’re looking to be cooperative and have a successful monitorship,” said Matthew Bell, the head of compliance for ZTE in the United States.

The problems with efforts to monitor ZTE, unreported to date, are rooted in how a U.S. judge set up the policing program in March, according to interviews with more than half a dozen people familiar with the matter and a review of court documents related to the plea deal between ZTE and the U.S. government. 

U.S. District Judge Ed Kinkeade presided over the ZTE sanctions case because the Justice Department filed the plea agreement between the United States and ZTE in his court in Texas, where the company’s U.S. headquarters are located.

Before signing off on the plea deal, Kinkeade took the unusual step of having the agreement rewritten to put Stanton, a civil and personal injury lawyer, in charge of monitoring ZTE’s compliance with U.S. export controls, several people familiar with the matter said. 

The appointment was made despite the Dallas-based attorney’s lack of experience in U.S. trade controls. The order naming him was sealed, leaving additional details about the judge’s decision unclear.  

Generally, the Department of Justice chooses an independent monitor in a corporate criminal case from candidates proposed by the company, which is how the deal was originally set.

But ZTE and the Justice Department felt compelled to agree to Kinkeade’s choice and the changes to the monitorship agreement, sources said, because the plea had already been negotiated and filed in the judge’s court and a temporary license allowing ZTE to obtain U.S. made goods – crucial for the company’s output – was about to expire.   

While courts have been weighing in more often on monitors, John Hanson, president of the Virginia-based International Association of Independent Corporate Monitors, said it was extremely rare for a judge to modify a major part of a plea agreement between a company and the government to select his own monitor.

Kinkeade and his courtroom deputy did not respond to inquiries about the monitorship and requests for comment.

A spokesman for the U.S. Department of Justice, which negotiated the guilty plea with the company, declined to comment. A spokesman for the Commerce Department referred questions to the U.S. Attorney’s office in Texas, which also declined to comment.

Stanton has to issue three reports, the first of which is due in January, on ZTE’s compliance with U.S. trade rules. The reports will help determine whether the company is liable for an additional fine of $ 300 million or, worse, should lose its access to the U.S. market.

Both Washington and Beijing have a lot riding on the reports and the success of the monitorship, which is set to last three years. The agreement allows the company continued access to the U.S. market, which provides 25 to 30 percent of the components used in its networking gear and smart phones. It is also part of a wider push by the United States to get China’s cooperation in combating nuclear proliferation and marks the first time that a Chinese company has submitted to such scrutiny.

Kevin Wolf, a former Commerce Department official who worked on the ZTE case, said the first few months of a monitorship do not always determine success or failure.  

“With any monitorship involving a complex situation, inevitably there will be start-up problems but in my experience the issues work out in the long run,” said Wolf, who is now a lawyer in Washington D.C.


Kinkeade has known Stanton for over a decade. Both graduates of Baylor law school in Waco, Texas, Stanton dedicated a 2016 book, titled “What Judges Want” to Kinkeade, who he described as his mentor.

“He guided me with grace and judgment as I became a lawyer, a husband, a father and a judge,” Stanton wrote of Kinkeade in his book.  Stanton was appointed as a Texas state civil judge in 2009 and lost the election the following year.

In the modified ZTE plea agreement, references to required qualifications and experience were removed, and a clause about professionals assisting the monitor was added, according to a review of the original and modified documents.   

To compare the plea agreements, click tmsnrt.rs/2BV5Duq

Kinkeade also gave his own court a key role in overseeing the monitorship, including replacing the Justice Department as the arbiter in any dispute, and the monitor’s description was changed in one paragraph from “independent third-party” to ”judicial adjunct.” In an unusual move, the judge used a civil rule to make the monitor a judicial adjunct, despite it being a criminal case.

“Anyone who looked at this scratched his or her head,” said Washington lawyer Jacob Frenkel, who specializes in government investigations at Dickinson Wright and has represented monitors. “How do you appoint someone without requisite qualifications to the monitorship?”

While monitors are not always subject experts, they generally are not appointed in major cases without some relevant experience, Frenkel added.

With the original consultants out, Stanton turned to Ernst & Young in August to advise him, two people familiar with the monitorship, said.

Since Ernst & Young has been ZTE’s auditor since 2004, some ethics experts including University of Virginia law professor Brandon Garrett said the hiring raised conflict of interest concerns about how independent the firm would be in assessing the company’s adherence to U.S. trade rules.

A spokeswoman for Ernst & Young declined to comment, as did a lawyer for ZTE.

Editing by Carmel Crimmins and Edward Tobin


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U.S. to blame North Korea for 'WannaCry' cyber attack: sources
December 19, 2017 12:50 am|Comments (0)

WASHINGTON (Reuters) – The Trump administration is expected on Tuesday to publicly blame North Korea for unleashing a cyber attack that crippled hospitals, banks and other companies across the globe earlier this year, said two sources familiar with the matter.

The accusation that the North Korean government was behind the so-called WannaCry attack comes as worries mount about North Korea’s hacking capabilities and its nuclear weapons program.

The U.S. government has assessed with a “very high level of confidence” that a hacking entity known as Lazarus Group, which works on behalf of the North Korean government, carried out the WannaCry attack, a senior administration official said. The official spoke on condition of anonymity to discuss details not yet public.

The White House did not immediately respond to a request for comment.

The public condemnation will not include any indictments or name specific individuals, the official said. But the shaming is designed to hold North Korea accountable for its actions and “erode and undercut their ability to launch attacks,” the official said.

North Korean government representatives could not be immediately reached for comment. The country has repeatedly denied responsibility for WannaCry and called other allegations about cyber attacks a smear campaign.

Lazarus Group is widely believed by security researchers and U.S. officials to have been responsible for the 2014 hack of Sony Pictures Entertainment, which destroyed files, leaked corporate communications online and led to the departure of several top studio executives.

Sony also suspended release of a comedy film that portrayed North Korea’s ruler, Kim Jong Un, because of threats issued by the hackers.

Then-U.S. President Barack Obama condemned Pyongyang for the Sony hack, vowing at the time to “respond proportionally.” No indictments have been brought in the Sony case.

Reporting by Dustin Volz; Editing by Jonathan Weber and Peter Cooney


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Exclusive: Uber paid 20-year-old Florida man to keep data breach secret – sources
December 7, 2017 12:29 am|Comments (0)

SAN FRANCISCO/WASHINGTON (Reuters) – A 20-year-old Florida man was responsible for the large data breach at Uber Technologies Inc last year and was paid by Uber to destroy the data through a so-called “bug bounty” program normally used to identify small code vulnerabilities, three people familiar with the events have told Reuters.

FILE PHOTO – The logo of Uber is seen on an iPad, during a news conference to announce Uber resumes ride-hailing service, in Taipei, Taiwan April 13, 2017. REUTERS/Tyrone Siu

Uber announced on Nov. 21 that the personal data of 57 million passengers and 600,000 drivers were stolen in a breach that occurred in October 2016, and that it paid the hacker $ 100,000 to destroy the information. But the company did not reveal any information about the hacker or how it paid him the money.

Uber made the payment last year through a program designed to reward security researchers who report flaws in a company’s software, these people said. Uber’s bug bounty service – as such a program is known in the industry – is hosted by a company called HackerOne, which offers its platform to a number of tech companies.

Reuters was unable to establish the identity of the hacker or another person who sources said helped him. Uber spokesman Matt Kallman declined to comment on the matter.

Newly appointed Uber Chief Executive Dara Khosrowshahi fired two of Uber’s top security officials when he announced the breach last month, saying the incident should have been disclosed to regulators at the time it was discovered, about a year before.

It remains unclear who made the final decision to authorize the payment to the hacker and to keep the breach secret, though the sources said then-CEO Travis Kalanick was aware of the breach and bug bounty payment in November of last year.

Kalanick, who stepped down as Uber CEO in June, declined to comment on the matter, according to his spokesman.

A payment of $ 100,000 through a bug bounty program would be extremely unusual, with one former HackerOne executive saying it would represent an “all-time record.” Security professionals said rewarding a hacker who had stolen data also would be well outside the normal rules of a bounty program, where payments are typically in the $ 5,000 to $ 10,000 range.

HackerOne hosts Uber’s bug bounty program but does not manage it, and plays no role in deciding whether payouts are appropriate or how large they should be.

HackerOne CEO Marten Mickos said he could not discuss an individual customer’s programs. “In all cases when a bug bounty award is processed through HackerOne, we receive identifying information of the recipient in the form of an IRS W-9 or W-8BEN form before payment of the award can be made,” he said, referring to U.S. Internal Revenue Service forms.

According to two of the sources, Uber made the payment to confirm the hacker’s identity and have him sign a nondisclosure agreement to deter further wrongdoing. Uber also conducted a forensic analysis of the hacker’s machine to make sure the data had been purged, the sources said.

One source described the hacker as “living with his mom in a small home trying to help pay the bills,” adding that members of Uber’s security team did not want to pursue prosecution of an individual who did not appear to pose a further threat.

The Florida hacker paid a second person for services that involved accessing GitHub, a site widely used by programmers to store their code, to obtain credentials for access to Uber data stored elsewhere, one of the sources said.

GitHub said the attack did not involve a failure of its security systems. “Our recommendation is to never store access tokens, passwords, or other authentication or encryption keys in the code,” that company said in a statement.


Uber received an email last year from an anonymous person demanding money in exchange for user data, and the message was forwarded to the company’s bug bounty team in what was described as Uber’s routine practice for such solicitations, according to three sources familiar with the matter.

Bug bounty programs are designed mainly to give security researchers an incentive to report weaknesses they uncover in a company’s software. But complicated scenarios can emerge when dealing with hackers who obtain information illegally or seek a ransom.

Some companies choose not to report more aggressive intrusions to authorities on the grounds that it can be easier and more effective to negotiate directly with hackers in order to limit any harm to customers.

Uber’s $ 100,000 payout and silence on the matter at the time was extraordinary under such a program, according to Luta Security founder Katie Moussouris, a former HackerOne executive.

“If it had been a legitimate bug bounty, it would have been ideal for everyone involved to shout it from the rooftops,” Moussouris said.

Uber’s failure to report the breach to regulators, even though it may have felt it had dealt with the problem, was an error, according to people inside and outside the company who spoke to Reuters.

“The creation of a bug bounty program doesn’t allow Uber, their bounty service provider, or any other company the ability to decide that breach notification laws don’t apply to them,” Moussouris said.

Uber fired its chief security officer, Joe Sullivan, and a deputy, attorney Craig Clark, over their roles in the incident.

“None of this should have happened, and I will not make excuses for it,” Khosrowshahi, said in a blog post announcing the hack last month.

Clark worked directly for Sullivan but also reported to Uber’s legal and privacy team, according to three people familiar with the arrangement. It is unclear whether Clark informed Uber’s legal department, which typically handled disclosure issues.

Sullivan and Clark did not respond to requests for comment.

In an August interview with Reuters, Sullivan, a former prosecutor and Facebook Inc (FB.O) security chief, said he integrated security engineers and developers at Uber “with our lawyers and our public policy team who know what regulators care about.”

Last week, three more top managers in Uber’s security unit resigned. One of them, physical security chief Jeff Jones, later told others he would have left anyway, sources told Reuters. Another of the three, senior security engineer Prithvi Rai, later agreed to stay in a new role.

Reporting by Joseph Menn in San Francisco and Dustin Volz in Washington; Additional reporting by Heather Somerville and Stephen Nellis in San Francisco; Editing by Jonathan Weber and Bill Rigby

Our Standards:The Thomson Reuters Trust Principles.


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Exclusive: Amazon scraps bundled video service – sources
November 15, 2017 12:00 pm|Comments (0)

NEW YORK/LOS ANGELES (Reuters) – Amazon.com Inc (AMZN.O) has scrapped plans to launch an online streaming service bundling popular U.S. broadcast and cable networks because it believes it cannot make enough money on such a service, people familiar with the matter told Reuters.

The logo of the web service Amazon is pictured in this June 8, 2017 illustration photo. REUTERS/Carlos Jasso/Illustration

The world’s largest online retailer has also been unable to convince key broadcast and basic cable networks to break with decades-old business models and join its a la carte Amazon Channels service, the sources said and has backed away from talks with them.

The reversals come a month after the abrupt departure of Roy Price from his job as head of Amazon Studios, the company’s high-profile television production division, following an allegation of sexual harassment, which he has contested.

They show how difficult it is for Amazon to change entrenched habits in the U.S. entertainment business in the same way that it has done in retail, cloud computing and other areas.

An Amazon spokeswoman declined to comment.

Video has become an important tool for Amazon in generating subscriptions for its U.S. $ 99-a-year Prime membership service. It is on track to spend some $ 4.5 billion or more on video programming this year, analysts estimate.

On Monday it made waves in the entertainment world with the purchase of global television rights to “The Lord of the Rings,” planning a multi-season series to draw more viewers to Prime.

At the same time, Amazon is looking to offer a wide variety of television channels through Prime. It originally aimed to offer a limited bundle of key broadcast and cable networks for a set fee, similar to offerings from Alphabet Inc’s (GOOGL.O) YouTube and Hulu.

Such an offering, known in the industry as a “skinny bundle,” is a way of capturing younger viewers who are dropping traditional, expensive cable or satellite TV packages in favor of channels watchable on smartphones and tablets.

But in recent weeks, Amazon decided not to move ahead with a service on the grounds that it would yield too low a profit margin and did not necessarily indicate the direction the TV business will eventually go, the sources told Reuters.

Amazon could still decide to change course and introduce a skinny bundle, but the talks are over, the sources said.


Instead, Amazon has decided to focus on building out its Amazon Channels service, where Prime customers can subscribe to HBO, Showtime, Starz and other networks on an a la carte basis, according to the sources.

Those networks have standalone subscription services, but the advantage of Amazon Channels is that it groups together separate subscriptions and makes them available through the Amazon Video app.

Amazon has built up Amazon Channels to include more than 140 television and digital-only networks in the United States, but its efforts to get the most-watched TV channels have stalled, the sources told Reuters.

Sources familiar with the talks said Amazon has run up against the same obstacle that has stymied firms such as Apple Inc (AAPL.O) and Verizon Communications Inc (VZ.N) in their efforts to launch TV services: the traditional cable bundle.

Twenty-First Century Fox Inc (FOXA.O), Viacom Inc (VIAB.O) and other media firms typically require cable companies or other partners to take their weaker channels along with their stronger ones, to prevent the weaker ones withering on the vine.

Amazon did not want to do that. It also asked networks for provisions that are foreign to the entertainment business, including discounts based on the volume of subscribers it brings in. “That might be standard in selling, but it is not how it works with content,” said one industry source.

The Seattle-based company, known for taking a long-term view of businesses, is willing to wait, sources told Reuters. It is working on the assumption that as pay-TV subscriptions decline over time, more TV networks will be tempted to go direct to consumers online and therefore be available for Amazon Channels, they said.

TV executives say Amazon is a top-notch marketer of video programming and could eventually help their bottom lines.

“They market our theatrical library better than we have because they have the data,” said an executive at one premium channel, who declined to be named.

Some programmers, including Discovery Communications Inc (DISCA.O), are already using Amazon to test their own streaming services before selling them to the public.

“They are an excellent petri dish,” said Paul Guyardo, chief commercial officer of Discovery.

Reporting By Jessica Toonkel in New York, Lisa Richwine in Los Angeles and Jeffrey Dastin in San Francisco; Editing by Jonathan Weber and Bill Rigby

Our Standards:The Thomson Reuters Trust Principles.


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Get the most out of your marketing stack by unifying data sources
November 19, 2015 2:30 pm|Comments (0)

puzzle pieces


When it comes to getting the most value out of data, successful companies take a practical approach, first defining their own data strategy and then determining the tools needed to get it done. A good example of this is Airbnb, which set their own data strategy and tools to help users more accurately price their home listings. Too often, however, companies fail to lay out a clear strategy, instead relying on the available tools to show them where they need to go. Unfortunately, these tools usually serve up packaged metrics with data that is too detailed and lacks cohesion.

The mobile marketing data landscape

marketing data landscape mobile

In VentureBeat’s The State of Marketing Analytics: Insights in the age of the customer, author Jon Cifuentes writes:

“Enterprises are stuck between fragmented data silos…There’s customer data, inventory data, log data, search data, reporting, analytics, CRM, session data, et. al – with different vendors supporting each. While “real-time” customer data sounds nice in theory, the actual process of broadcasting this information through the organization is time-consuming, expensive, fragmented, and frustrating.”

These cobbled-together sources and tools provide directional insight but don’t align with initial expectations, particularly as companies start requiring custom insights and metrics.  In fact, most companies quickly find themselves in exactly the situation they had hoped to avoid – working in increasingly complex systems with considerably higher non-value added workloads.

data silo

The challenge for companies is: how do you align your data vision with your unique acquisition, engagement and monetization strategies?

Purpose-built tools like app analytics, A/B testing, marketing automation, etc. have done a great job in recent years of allowing non-technical people to analyze data, run tests and engage users. However, since these tools were built for single-use cases and by separate companies with proprietary data stores, they have failed to address a core issue: the need to access the same user data in order to truly provide a personalized experience to each user.

Data-capture tools and user engagement tools also need to be integrated in order to provide a full picture of how changes impact the product downstream.  For instance, teams need to be able to apply user actions from app analytics to run A/B tests, which will in turn impact the user experience.

The path forward

The solution exists at the platform level: unifying data sources before applications are built on top of them, with a flexible 2-way structure that enables real-time integration between event and user data, at all levels in the stack, and not just based on basic pre-determined rules with segmentations on top.

data silo2

This type of structure makes it possible for events to be enriched by boundless user attributes (user state) and enables contextual analytics.  This, in turn, produces a robust targeting framework, because now the user state can be updated in any manner, in real-time.  For example, Glassdoor utilizes this methodology to deliver real-time dynamic notifications of job alerts to users based on their prior behavior when browsing the Glassdoor website.

While many marketing vendors are fighting to define themselves as integrated or unified marketing platforms, most still need to reach deeper down the stack and unify product and marketing tools with data tools at a platform level.   Because they refer to the same data source, there will be no discrepancies between insights and actions.  For example, segments defined for analytics will maintain the same properties in A/B testing or content delivery.  Applications developed on top of unified data platforms will be inherently more flexible and manageable.

From VentureBeat

Omniata is coming out of beta on September 24th!  You can reach us at contact@omniata.com to learn more. Though just coming out of beta, we’re already tracking 300 million monthly active users, 2 billion events per day, and handling over 17,000 requests per second!

Alex Arias is the CEO and cofounder of Omniata, a unified data, analytics and user engagement platform.  For more than 10 years, Alex has been an entrepreneur and driver of innovation in digital services, working previously at Digital Chocolate and EA.  He’s been helping companies define their own Data Value Journey since cofounding Omniata two and a half years ago.


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