At least, according to a Reuters story tonight that suggests that the communications and carrier company wants to buy out its partner Vodafone, which currently owns 45 percent of the joint venture that is known as Verizon Wireless.

These are not new rumors. As long ago as last month we reported that Verizon no longer wanted its destiny tied to the European carrier. The massive entities had discussed various merger possibilities, apparently, but could not come to agreement on details such as headquarters and leadership structure.

In other words: who leads, and where they live.

Verizon Wireless is the most profitable division, and Verizon looks at it as the focus of wireless communications possibilities beyond phones to corporate or government sensors and networks.

According to Reuters, Verizon’s board will discuss the details next week in advance of the company’s annual shareholder meeting, but there is no reason to believe that Vodafone is interested in any deal.

One of the reasons Vodafone might shy away? A potential tax bill as high as $20 billion.

photo credit: shane_curcuru

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Verizon is the king of fast cellular networks in America, or so it says. And it’s hard to argue with the company’s numbers.

Verizon reported its fourth-quarter 2012 earnings today, revealing that 63 percent of its smartphone sales were Apple iPhones. But chief financial officer Fran Shammo made a special point of stressing the carrier’s fast 4G LTE network.

“Customer adoption of 4G LTE is really gaining momentum,” Shammo said on the company’s earnings call. “Our total 4G LTE devices sales reached 7.3 million [units] … up 60 percent from last quarter.”

Almost all of the Android phones Verizon sold were 4G LTE capable, and 65 percent of the entire 9.8 million smartphones sold were 4G LTE. (The non-Android numbers are down slight due to sales of Apple’s older iPhone models, which do not support LTE.)

Source: Verizon

Verizon devices/4G LTE coverage

But it’s not just the devices, of course. It’s the network that matters.

“Almost half of our data traffic is on the 4G LTE network,” Shammo said, adding that Verizon believes its 4G network is five times more efficient than 3G. “We are by far the market leader, with 476 markets covering 89% of the US population.”

The company will no long be adding any capacity to its 3G network; instead it is continuing to expand 4G coverage. Verizon expects to have full coverage of the U.S. by mid-year 2013.

Chief competitor AT&T’s LTE ambitions had a slow start and have generally not compared favorably with Verizon. However, late last year AT&T did manage to acquire some additional spectrum that should help it expand LTE more rapidly.

photo credit: Robert Scoble via photopin cc

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Verizon reported its fourth quarter 2012 results this morning, and while the company lost $1.93 billion, it grew by a record 2.1 million subscribers. And it sold a whack-load of iPhones — over six million, in fact.

“In the fourth quarter, we activated 9.8 million smartphones, which was by far our highest total ever,” Verizon’s chief financial officer Fran Shammo said in today’s earnings call. “About 65 percent of these smartphones were 4G LTE, and in terms of Apple iPhones, we activated about 6.2 million in the quarter.”

Those are big numbers, but the even bigger implication is what this means for Apple’s iPhone market share in the key U.S. market. iPhone 5 pushed Apple to its highest market share ever soon after being launched, and the momentum continued in the final months of the year as Apple claimed more than 50 percent of the smartphone market for the first time ever.

Source: Verizon

Verizon devices/4G LTE coverage

Now Verizon’s iPhone numbers show an even bigger share for Apple, at 63 percent. In just two days, AT&T will reveal its numbers, which will help form a very clear picture of iPhone/Android market share.

Shammo added that Android phones made up a majority of the remaining 3.6 million smartphones Verizon sold, which will surprise no one. Over 95 percent of them were 4G LTE.

With all those iPhone and Android sales, Verizon now has a 58% smartphone penetration rate: Almost six in 10 of its customers are smartphone users. That compares to something in the neighborhood of 40 percent a year ago and is pretty much in lockstep with the U.S. market as a whole, which tipped over 50 percent smartphone penetration early last year.

Image credit: John Koetsier

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Apparently, information does want to be free. And phone calls, and text messages. At least, if you’re a subscriber to FreedomPop, “America’s free wireless Internet company.”

FreedomPop, which already offers free wireless Internet service, is announcing a partnership with TextPlus today that will enable it to also offer free voice calls and free texts.

“We’re allowing consumers to cut the carrier,” CEO Steve Stokols told me. “And basically screw AT&T and Verizon.”

Starting in the first quarter of this year, TextPlus’ free calls and texts will be integrated into FreedomPop’s services, so existing free wireless customers will have the ability to go 100 percent free, Stokols said.

Voice calls will run over data channels, Stokols said, using the FreedomPop app for Android and iOS, as will text messages. Users simply set up a new number — any number that is available in any area code — or port their existing number over. No new SIM card is needed.

And coverage?

“Today we’re in the top 80 markets,” Stokol said. “That’s 120 million people. By the third quarter, we’ll have coverage for 240 million people.”

FreedomPop makes money when users add premium services on top of its basic, free services. Currently 30 percent of its users purchase some form of upgrade. The company uses Clearwire’s WiMAX network to provide 4G service. And according to Stokol, it’s growing fast through viral marketing.

“We’re averaging about 10-11 invites per user,” Stokol told me today. “So some of the key metrics that were speculative at our launch are now proving themselves.”

Ten to 11 invites per user is pretty spectacular, and should result in a very sweet viral coefficient. In other words, watch your backs, AT&T and Verizon.

photo credit: TheAlieness GiselaGiardino²³ via photopin cc

Sandy’s timing couldn’t have been worse, as the Weather Company is in the early stages of a massive transformation, transitioning from 13 global data centers to managed hosting in Amazon’s cloud.

Perhaps it was lucky number 13, however, because in spite of a Boston data center being caught in the storm, the company’s 100-strong technical team maintained the site, apps, and services at a 99% uptime rating throughout the storm.

I talked to the Weather Company’s chief information officer, Bryson Koehler, about how they did it.

“We saw double the traffic that we’ve ever seen before on our digital platforms,” Koehler told me. “We had to handle 10X the traffic we’ve ever had before.”

The Weather Company delivers news on basically any medium you can imagine: the original TV show, smartphone apps, tablet apps, live streaming video online, print, radio, and APIs for partners all over the globe. On a typical day, the company serves the equivalent of about 40 million pageviews on its digital platforms, and it has previously seen service interruptions when the number approached only 120-140 million.

But on Monday, the company was serving 110 gigabytes of data per second, almost without a hiccup, not counting the livestreams — 170 thousand simultaneous streams of live video, pushed out over the Internet.

The question is: how?

While the Amazon Web Services integration is still mainly in the future, The Weather Company did have several hundred instances running at 100% capacity, Koehler said, telling me that the scalability was “exactly what you would expect,” as was the cost efficiency.

But the company had significant help from three additional critical partners.

“We relied very heavily on three partners that helped us deal with the sudden surge: Verizon, Akamai, Google were great throughout the storm.”

Akamai, of course, accelerates and distributes site load. Verizon manages some of the company’s data centers and much of its networking infrastructure, adding gigabytes of capacity literally in real time during the course of the hurricane. Google manages the livestreams, as The Weather Company delivers live video via a partnership with YouTube.

But the 13 data centers were key to the service’s resilience. Like any large organization that has been built over time and acquired other companies, Koehler said, there’s a mix of technologies.

“You end up with a good bunch of technologies that come together, but for the most part, we run Linux servers, Apache for web serving, Tomcat for our app server, and VMware for virtualization. MySQL is our core weather database.”

More than the technology, though, Koehler said it’s about the team. The Weather Company put together a 100-person hurricane team: technicians, system administrators, and networking specialists. “We were very prepared,” he said.

photo credit: cab234 via photopin cc

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July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Next week, Verizon Wireless’ 4G LTE service takes the unprecedented step of landing in its 400th market, showing the company’s dominance in next-generation wireless service.

By comparison, Verizon’s closest competitor, AT&T, has 4G LTE service in just 75 markets. And don’t even get us started on Sprint, which is floundering to get LTE in a handful of markets this year.

Verizon’s 400-plus milestone achievement, announced Tuesday at MobileCON by Verizon Wireless chief technical officer Nicola Palmer, comes two months ahead of schedule. The winning city is Marquette, Mich., which was specifically chosen to symbolize Verizon’s commitment to extending 4G LTE coverage beyond the obvious big markets.

Verizon first launched its 4G LTE network in December 2010, offering consumers speeds nearly 10 times faster than 3G service. Since then, the company has been focused on expanding the network coast to coast, and it has ramped up the number of 4G LTE-ready devices for sale. The company has introduced 37 4G LTE devices, Palmer said.

Beyond Marquette, 4G LTE coverage will arrive in 20 additional middle-sized towns next Thursday. On October 18, the carrier will offer the faster service in 417 total U.S. markers, which gives it reach to an estimated 245 million people, the company said. Verizon will also roll out the speedier network to 30 more cities in November and December.

The pending network updates are part of a bigger push to persuade consumers to think of Verizon as the fastest network out there.

The speed message, particularly as to why consumers should care about 4G LTE, is harder to convey to people than the general coverage message, a company spokesperson told me yesterday. A variety of “Can You Hear Me Now?” ads were effectively used to drive home the idea that Verizon’s network is more reliable than competitors. The company aims to convey its 4G LTE prowess with equally simple, we’re-better-than-the-other-guys messaging.

It’s easy for consumers to understand “more than,” the spokesperson said.

Photo credit: shane_curcuru/Flickr

In his new book The Fine Print, Pulitzer Prize-winning journalist David Cay Johnston tell us, among other things, what’s wrong with the Internet in America. The answer is fairly depressing: It’s too slow, too expensive, and … too controlled by a duopoly of AT&T and Verizon.

Japan has fiberoptic Internet available to many homes with speeds of 100 or 200 megabits per second, and, believe it or not, an available 1 gigabit per second service. (At least one place in the U.S, Chattanooga, Tenn., can get an equivalent speed.) South Korea is still the king of Internet speeds, however, with an average 17.5 megabits per second to all homes.

Average speed in the U.S., meanwhile is a measly 5.8 megabits per second — actually a decrease from U.S speeds of 2011, according to Royal Pingdom. It’s the barely visible blue line in the chart below:

Source: Royal Pingdom

Average global internet connection speeds.

That slower speed comes, unfortunately, at a higher cost than many other countries.

Hong Kong gets 500 megabits per second for $37 a month. Other major international cities, such as Paris and Berlin, get 100 megabits per second for $40. But the same speed in Washington, DC, comes at $105, courtesy of Comcast, and Verizon’s 150 megabits per second service sets New Yorkers back $159.95.

Typically, service providers point to the vast distances of North America as the reason why speeds are slower here. VentureBeat contacted both Verizon and AT&T for comment, but neither have responded (yet).

The question remains for cities as densely packed as New York: Why such high cost for such comparably slow service?

Johnston’s answer is that Americans were better off with Ma Bell’s monopoly. Adjusting for inflation, he says, phone service is 230 percent more expensive than in 1984.

That’s a future even Orwell didn’t anticipate.

photo credit: Maryam (one bored chica) via photopin cc

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Verizon Wireless posted encouraging second quarter numbers, bolstered by increased revenue from smartphone sales and the shift from copper to fiber optics’ FiOS for wireline and Internet customers. The No. 1 U.S. mobile carrier announced Thursday a $1.83 billion quarterly profit on $28.552 billion in revenue.

The company, a joint effort with Vodafone Group, announced wireless revenue rose 7.3 percent to $15.8 billion, compared to a year ago. Meanwhile, wireline second-quarter revenue fell 3.1 percent to $9.9 billion. Smartphones now comprise 50 percent of Verizon’s wireless sales, up from 47 percent in the first quarter of 2012. Revenue from data plans now represents 43.6 percent of the carrier’s income. Data now brings in $6.9 billion, an 18.5 percent jump compared to the same period last year.

During the second quarter, Verizon Wireless added 888,000 net post-paid mobile subscribers, helping the company reach 94.2 million wireless customers, a 4.9 percent increase over the 88.8 million postpaid mobile customers reported during the same time in 2011. Under 1 percent of Verizon Wireless customers are jumping ship to other carriers, witnessed by the 0.84 percent “churn” rate.

The picture wasn’t so bright on the wireline side of Verizon’s business. While wireline subscriptions fell 3.1 percent in the second quarter, the more profitable FiOS service, which includes phone, internet and television, grew. FiOS sales now comprise 65 percent of the $9.9 billion in second-quarter revenue reported today. Verizon’s margin on wireline sales is slowly increasing from the 1.6 percent announced earlier this year. FiOS can be thanked there, too. While overall, a wireline customer brings in $100, an average FiOS subscriber provides more than $149, Verizon said. The company reports 5.1 million FiOS Internet customers and 4.5 million FiOS Video subscribers. Around 70 percent of FiOS customers opt for the phone, internet and video bundle, Verizon announced.

After rising more than 14 percent Wednesday, Verizon stock fell 1.5 percent to $45.22 before the markets opened in New York.

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

New Verizon customers will no longer have the option of choosing an unlimited data plan for their smart devices. The wireless carrier is rolling out new tiered data plans July 7, reports DroidLife.

Monthly plans for new customers start at $30 for 2GB, $50 for 5GB and a whopping $80 for 10GB, which doesn’t even include voice calling. Tethering costs an additional $20 for a measly 2GB extra added to the total data cap and additional $10 for every 1GB thereafter.

Data plans for tablets are also increasing to $30 for 2GB per month, which is $10 more than the current plan that offers half as much data.

Another big thing to note about the change in Verizon’s data pricing is that it doesn’t make any distinction between use of its 3G and 4G wireless networks. So, if you’re new to Verizon it makes sense to opt for a 4G device for a faster internet experience since you’re paying for it either way.

Current customers with a pre-existing unlimited data plan won’t be affected by Verizon’s new pricing structure, according to the report. Thus far, there’s no word on whether current customers can renew unlimited data plans if they choose to upgrade their device after July 7.

Since Verizon is the largest provider of wireless service in the country, many have long since speculated that it would join competitor AT&T in ending “all-you-can-eat” unlimited data plans after adding the iPhone to the list of devices available on the network.

By comparison, AT&T’s monthly data plans start at $15 for 200MB, $25 for 2GB and $45 for 4GB — much cheaper but not much of a deal for people unhappy with the lack of reliable service in larger areas like San Francisco.

Verizon is definitely more confident about its network’s ability to satisfy customers, which is probably why it didn’t bother offering a data plan below 2GB. Yet, it isn’t confident enough to let iPhone owners use the Facetime video chat application over its network.

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Our VentureBeat Mobile Summit kicks off next week, and we’ve got a tremendous program lined up. We’ve invited the 180 Who’s Who in mobile. Here are the latest two execs to join the roster:

Michael Abbott (left), VP of Engineering at Twitter, will be joining us for an opening fireside chat on Monday. Michael helps lead Twitter’s mobile efforts, working closely with co-founder Jack Dorsey. As such, he can speak to mobile product development. Yes, he was referenced in that recent article by Fortune about the leadership shuffles and strategy discussions happening at Twitter. He’ll talk with us about Twitter’s investments in HTML5 versus native mobile app development, how he is making sure Twitter’s offering stays consistent across platforms, and also provide insights around Twitter’s roadmap.

Previously, Abbott led Palm’s webOS platform efforts, and before that was general manager of .NET Online Services at Microsoft. Prior to Microsoft, he co-founded Passenger Inc. and led the development of the company’s consumer marketing SAAS platform. He also founded Composite Software, creator of industry-leading enterprise information integration software, where he served as CEO/CTO. Abbott’s talk segues nicely to the chat we’ll have with Keith Rabois of Square, who will talk about how to design for mobile. (Later in the event, we’ve got other presentations from some of the most dynamic private, disruptive companies too, from Dynamics, to Evernote, who will reveal insights about their efforts and mobile user stats.)

To round out Monday evening, we’ll also be joined by Nicola Palmer, VP of Network for Verizon Wireless, the largest wireless carrier in the country. In December 2010, Verizon launched its 4G LTE network, arguably the fastest 4G network in the country. And because she’s in charge of that network, she’ll be giving our audience fresh insight into what Verizon is doing on the LTE front, how it’s ensuring quality and speed (it basically boasts half the latency of 3G), how the explosion of Android devices has affected the network, how things like voice (VoIP) and IMS will be supported soon, and how developers can interface with these technologies. She’ll be providing specific tips about how to design for this new world.

Palmer is responsible for Verizon Wireless’ network support, including overall systems performance and quality assurance. She’s also responsible for implementation of new products and services within the network, along with transport interconnect, supplier management and ensuring regulatory compliance.

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

AT&T is budgeting up to $19 billion this year to improve its nationwide phone network, a 5 percent to 10 percent increase over its $17.3 billion investment last year, the company said today.

Although AT&T didn’t break out how much of the budget it plans to spend in California, it said it will add 200 new cell sites and upgrade 500 existing sites to 3G capability in the Golden State this year on top of 200 new sites and 320 site upgrades in 2009. The carrier has spent $7.3 billion on wireline and wireless networks in California from 2007 to 2009, $1.5 billion of that on wireless in particular, according to a release from AT&T’s office in Sacramento.

The company said its 2010 budget includes a $2 billion increase in capital spending for “wireless and backhaul related to AT&T’s wireless network.” Backhaul refers to the portion of its wireline network that moves wireless voice and data traffic when it’s not flying through the air.

AT&T’s spending seems to be on par with that of rival carrier Verizon Communications, whose capital budget is projected to be $16.8 billion to $17.2 billion, compared to $17 billion in 2009, the company stated in a Jan. 26 earnings release.

The breadth and strength of AT&T’s 3G network has been called into question by a series of ads Verizon has been running on TV and in other media for several months, depicting AT&T’s coverage as sparse compared to Verizon’s. This led to an air war of commercials from each carrier dissing the other’s network and providing actor Luke Wilson with a steady job.

Pressure on AT&T’s wireless network has been building ever since it was picked as the exclusive carrier for Apple’s wildly popular iPhone in 2007. It can expect more pressure once Apple starts selling its new iPad tablet computers, whose 3G version would also run exclusively on AT&T.

Wireless data traffic on the AT&T network has grown more than 5,000 percent over the past three years, the company said, largely attributed to growth in the sale of smartphones, which now account for 40 percent of its postpaid customer base.

Despite the negative publicity about a weak network and dropped calls, AT&T appears to be actively pursuing a build out program.

The deployment of High-Speed Packet Access (HSPA) 7.2 technology is continuing along with a second AT&T initiative to increase the number of high-speed backhaul connections to cell sites, primarily with fiber-optic connections. In addition, improvements to its 3G network will bring the network closer to offering 4G/LTE broadband technology, offering data speeds 10 times faster than on existing 3G networks. AT&T currently trails Verizon in this race; Verizon anticipates having faster 3G networks up this year, while AT&T said it won’t be ready until 2011.

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Not too long after Apple dropped its VoIP restrictions on the iPhone, we reported that Skype was eagerly working on a 3G-enabled version of its iPhone application. Now we’ve learned that Verizon and Skype have teamed up for a 3G-enabled version of Skype mobile on several of its smartphones as well.

Verizon smartphone customers will now be able to make unlimited Skype-to-Skype calls, as well as SkypeOut calls to any phone number using Skype’s reduced rates. And of course, Skype mobile will allow users to instant message their Skype friends and view their online status.

The move is clearly a response to Apple’s announcement — but whatever the reason, consumers are winning out. Just a year ago, it would have seemed impossible for mobile carriers to allow VoIP over 3G on smartphones. Now, it’s to be expected. I won’t be surprised if Sprint and T-Mobile make similar announcements soon.

Unlike Apple and AT&T’s announcements allowing VoIP over 3G, Skype is the only VoIP app that’s approved to work on Verizon’s 3G network. This leaves other VoIP applications like Fring out in the cold for now. The move is still a big step for Verizon — a carrier that has traditionally been very restrictive with its network. It’s an important change in the company’s attitude, and it shows that it may further relax 3G restrictions down the line.

The new Skype mobile will be available for Verizon smartphones in March. Initial smartphones that will support the app include the BlackBerry Storm 9530, Storm2 9550, Curve 8330, Curve 8530, 8830 World Edition and Tour 9630 smartphones, as well as Droid by Motorola, Droid Eris by HTC and Motorola Devour, according to Verizon.

This slowdown is forcing carriers to consider doing the inevitable: Keep pricing low for basic users, but increase pricing substantially for customers who use too much data — or simply cut off users who abuse the data plans. In other words, get ready to say goodbye to wireless net neutrality. The chart below (sorry, you’ll have to squint) is from a presentation by Shen Donglin, VP, Mobility ZTE Corporation, at this year’s Mobile World Congress in Barcelona. It illustrates how the industry could look like over the next few years: While mobile traffic explodes, carrier revenue barely grows. Consequently, carriers just can’t cover the costs of all these customers using all these great applications on their smart phones. So they’ve got to either offload the traffic to someone else, or they’ve got to cut costs. Really, it boils down to the simple business equation: Profit = Sales – Costs.

Already, you’ve seen AT&T revise its terms of service on some of its new netbooks, prohibiting things like “downloading movies using P2P file-sharing services, customer-initiated redirection of television or other video or audio signals via any technology from a fixed location to a mobile device, Web broadcasting, and/or for the operation of servers, telemetry devices and/or Supervisory Control and Data Acquisition devices.” It means you may no longer be allowed to stream content from third-party Web sites, such as You Tube, or via applications like Slingbox.

Subscriber growth for AT&T and Verizon has fallen below 10 percent for the first time in five years, to 8.8 percent and 8.7 percent.

While smartphone demand was still growing in the very challenging first quarter, McCormack said carriers will have to subsidize their plans to keep smartphone growth sales humming. Indeed, AT&T is considering cutting the iPhone’s monthly service plan by $10 when Apple introduces the newest version of the smartphone next month, according to Cote Collaborative analyst Michael Cote. He said there’s a “strong possibility” AT&T will cut the iPhone’s entry-level data service plan from $69 per month to $59, reducing the total cost of a two-year contract by $240.

Verizon, which has been shut out from selling the iPhone is also prowling for cool smartphones to sell. We reported earlier that it was courting Android, and indeed we’re seeing new reports that Verizon will launch an Android phone with Motorola. It’s true, this is a growing market, but no one knows how big it will get. In this market, as McCormack also noted, households are looking for cheaper options, including pre-paid (or pay-as-you-go) plans. Increasingly, what once looked like an open prairie of opportunity — endless versions of smartphones leading to endless growth — is now looking more unrealistic.

We’ll be writing more on the net neutrality issue in the coming days.

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Jajah gets shut out of eBay — This was pretty predictable. As reported earlier, Jajah released a button aimed to give small businesses the equivalent of a free 1-800 number. eBay vendors could use it to let customers call them for free from their eBay page. However, eBay owns Skype, a competing service to Jajah, and quickly stripped Jajah’s buttons from the site within 24 hours.

German cell-phone software vendor buys iPhone game maker — The German company, Shape Services, has bought New York-based iPhone Applications List, showing how the iPhone has generated a platform of its own that’s creating quite a bit of excitement, and could eventually rival the iPod ecosystem. There’s an estimated $1 billion in sales annually of iPod add-ons, according to Dow Jones.

Verizon secretly pressuring FCC Chairman to renege on wireless opening? — News reports suggest Verizon is lobbying behind the scenes, perhaps even in violation of FCC rules, to have the FCC water down provisions that would open up the 700 MHz spectrum to competition. The FCC has opened the spectrum to bidders in an auction, where the highest bidder gets to offer services over the spectrum, but must also let other service providers access the spectrum too. Verizon, a carrier worried that regulation would let Google or others encroach on its wireless turf, apparently is seeking to make the FCC ease up on a key requirement: that the winner of the bid (Verizon presumably thinks it can win the bid) must open up devices and applications if they use the spectrum. Now Google is crying foul.

Quote of the day: Facebook advertisers are “selling shovels to other miners” – You’ve got to like the analogy by the New York Times’ Brad Stone in his piece about Facebook. He likens Facebook application hype to the 1849 gold rush: “Some [Facebook] developers report earning tens of thousands of dollars in advertising with the applications they have created. Yet their applications are mostly running ads promoting other Facebook applications — a situation that recalls the earliest Gold Rush miners, who earned a living selling shovels to other miners.” Overall, very few people found significant amounts of gold.

Microsoft’s chief executive Steve Ballmer says advertising will make up a quarter the company’s business within a few years — Details here. “Over time, all ad money will go through a digital ad platform,” Mr. Ballmer told a gathering of European ad agencies and clients. “All media goes digital; all advertising goes digital.”

Google remove all ads from its social-networking service, Orkut – This is just the latest sign that social networks are having a much harder time being monetized than people appreciate. Users post pornographic images, and advertisers don’t want anything to do with this. Google said advertising appeared on only 1 percent of Orkut pages. The site is popular in Brazil, but has been accused of containing child pornography among other illicit material. According to research firm comScore Inc., Orkut attracted visits from about 25 million people in August. Perhaps never before has there been such a disjunct between a site’s popularity and such a depressing amount of money that can be made from it.

Research firm Gartner predicts continuing chip-industry slowdown — Already down 4.3 percent from predicted levels, chip equipment orders will stay at their current low levels until late next year, according to Gartner. The research revised capital spending forecasts for the semiconductor industry, trimming off $4.7 billion for a predicted total of $54.6 billion next year. Slowdowns in the chip industry have, in the past, foreboded a slowing of the entire tech industry.

Google’s DoubleClick acquisition may face more hurdles — Not just one, but two committees in the House of Representatives are considering holding hearings over Google’s proposed buyout of DoubleClick. The House Energy and Commerce and House Judiciary committees are reviewing the case, following a hearing last week by the Senate Judiciary’s Antitrust, Competition Policy and Consumer Rights Subcommittee. The hearings may have been sparked by rivals including Microsoft and Yahoo, who are actively making arguments against the acquisition to Washington’s lawmakers. It’s a good thing for Google that the company has already been busy hiring lawyers and lobbyists in Washington; it’s got some catching up to do.