Daily News Digest- 5th Jan'15

Thought of the Day:

Today in History:

Following made the Headlines:

India:

• In 6 Mths, Flipkart may Deliver in 3 Hrs: Indian online shoppers would ideally like to push the button on their purchase and hear the doorbell chime immediately after, announcing delivery . That's not going to happen anytime soon but e-tailers, led by Flipkart, are trying to get as close as they can. The country's largest online retailer is figuring out how it can get goods to the customer's doorstep in as little as three hours. Bengaluru-based Flipkart is evaluating which products and cities it can start with even as it considers pricing for the service, which ET learns could be rolled out in the coming six months. “We have to figure out the technology , pricing for these services,“ said Sujeet Kumar, head of WS Retail and ekart Logistics. “Such deliveries are necessity driven -say a thing a customer wants to gift or something he needs immediately .“ Kumar, who joined Flipkart in 2008, declined to put a date on when the logistics arm, ekart, could start with this service. WS Retail, which used to be part of Flipkart, has since been spun off and is now the largest vendor on the Flipkart marketplace. “Flipkart has to offer a viable business model because it (3-4hour delivery) will be expensive for the customer,“ Kumar told ET in an interview last week. However, ET learns it could start with some products in 3-4 cities as early as July.

• A CEO Hooked to the Taste of India Readies for Takeoff: Here's the thing about Phee Teik Yeoh -he doesn't give up easily. “The gem cannot be polished without friction, nor man perfected without trials,“ he likes to say , citing Confucius. Lots of patience -that's the one virtue anyone needs to have when dealing with Indian bureaucracy, for there are many trials and much polishing is required. That is what he has been doing over the past many months, trying to get Vistara off the ground. Phee Teik Yeoh, 46, is chief executive officer of the airline, jointly owned by the Tata Group and Singapore Airlines. Vistara will start flights on January 9 to Mumbai and Ahmedabad from its Delhi hub. “He used to come and sit with us with the thick sheaf of application documents and ask politely but firmly to point out the mistake that was holding up a particular approval,“ says an aviation ministry official. Yeoh did this over and over again, whenever the paperwork got stuck, ministry officials recall. Yeoh says his first connect with India was when he was four. Growing up in Malaysia, his father would take the family for a Sunday treat to Petaling Jaya beyond Kuala Lumpur. He loved the dosas at a Tamil food stall there -he could polish off three at one go. His parents would quip that they would get him married to the dosa maker's daughter so that he could have a steady supply of the snack.

• SpiceJet Debts Hold Back Fund Infusion Plan from Taking Off: Talks on rescuing SpiceJet, said to involve fund infusions of about ₹1,200 crore from new investors, have got stuck over the servicing of liabilities to the tune of ₹700 crore, people familiar ` with the development said. Negotiations to bail out the financially struggling carrier are taking place between representatives of current controlling stakeholder Kalanithi Maran on the one side and former promoter Ajay Singh and a unit of JPMorgan Chase on the other. The two sides will hold a crucial discussion on the debt-servicing issue on Monday.

• Tech Startups Queue up for Foreign Citizenships: A mass exodus of tech startups is expected this year as an increasing number of young ventures shifts overseas in search of investors and a better regulatory environment and facilities unless the government takes steps to reverse the trend. A software product industry think tank estimates that as many as 75% of new technology startup firms, ranging from data analytics, mobility and security to cloud that intend to raise seed or venture capital will be domiciled outside the country. “If we also raise next round of funding, we would also be pushed to move base to Singapore,“ Shivakumar Ganesan, co-founder of cloud telephony startup Exotel, said at an event in Bengaluru. Competitor Knowlarity has already moved to Singapore. “Considering we are in India, selling and building in India, I don't see why I should be breaking my head to move to Singapore, Hong Kong or other such places,“ said Ganesan.

• Videocon Merges Backend Ops of Retail Arms for Efficiency: Videocon Group is consolidating its retail operation across its three formats — Next Retail, Planet M and Digiworld — by merging their backend operations to form a common sourcing platform with the aim of bringing scale, improving profitability and fighting online sales by ensuring better bargaining power with the brands for margins. The group has floated a new company, Techno Kart India, which will manage the backend operations of all the three retail formats such as sourcing, marketing, human resources, IT, warehousing and supply chain. “This structure will also free up a lot of working capital, make the operations efficient and offer an united front to the brands for better margins,” said a senior official of the group, requesting anonymity. “While the frontend of the three formats will be run separately by three companies at present, the plan is to eventually merge them into Techno Kart for leaner operations,” he added.

• Ecommerce Finds Its Feet, to Handhold Tech Cos: Last year, e-commerce took a lion's share of venture funding, leaving little for young technology companies. But this year, the same sector will be the one giving a big push to small firms developing software products. These firms are relying on tech products that range from the fantastic -photo shoot animation, drone delivery -to core enterprise products. “We are always scouting for startups and we will not shy away when an opportunity presents itself,“ said Sameer Nigam, vicepresident of engineering at Flipkart. Last month, the seven-yearold company raised $700 million at a $7 billion valuation towards making long-term strategic investments in India and bulking up its technology capabilities. Over $3.1 billion was pumped into 46 deals in the ecommerce space last year. Software product companies received just about one-tenth of that, across 48 deals, according to research firm Venture Intelligence. Both Flipkart and Snapdeal have acquired five technology companies since 2010. But that number is likely to rise this year, as new rounds of capital infusion gives them enough ammunition to remain ahead of the curve. Flipkart said its core focus in 2015 will be about bringing more sellers online. At the heart of it, Flipkart and Snapdeal own little inventory of items and have a technology platform that allows third-parties to sell online. Greater the number of sellers, greater is a customer's choice on the website.Innovations including intuitive tools that help third-party sellers to rapidly adopt technology is something Flipkart said it was keen to look at.

• Travellers in India Now Check in More at Small Hotels, Inns: Travellers in India increasingly prefer small, unbranded hotels and villas to pricy star hotels, encouraged by their high ratings in popular hotel review and booking sites that have made word of mouth accessible to the whole world. Take, for example, Jaipur Friendly Villa or Kaiya House at Varkala in Kerala -they may not sound as exquisite as any 5-star hotel you can recall, but they are rated far ahead of most top hotels in the country on travel review websites. And such small hotels and homestays are much more affordable that the star hotels. “We've noticed that a majority of bookings fall in the up to ₹3,000 category of spenders,“ said Sharat Dhall, president at travel site Yatra.com, where the unbranded hotels make up nearly half of the total inventory. This segment of accommodation is growing about 20% a year. Industry experts attribute it to the changing format of hotel booking. Tarun Gulati, founder of Djubo.com that helps hotels and booking sites coordinate sales, said the entire growth stories for the hotel business online is in the unbranded segment. 

• Premji again tops India philanthropy list: Azim Premji, 69, chief of the Bengaluru- based multinational Wipro, donated as much as ₹ 12,316 crore of his personal wealth in the period between April 2013 to October 2014. There are 50 people who donated aminimum of ₹ 10 crore in this period but Premji gave away six times as much as the person who comes second on the list, Anil Agarwal of London- based Vedanta Resources, who gave away ₹ 1,796 crore. The list has been compiled by the Shanghai- based The Hurun Research Institute, the second year it has done this ranking, of an ‘ India philanthropy list’. Premji had topped the list a year before, too. In the institute’s measure, issued three months earlier, of the ‘ India rich list’, he was ranked at number four in personal wealth, with an own fortune of ₹ 86,100 crore. His donation in the 2013- 14 list was to the Azim Premji Foundation, which mainly gives to bodies engaged in education.

• Flipkart, Snapdeal to give big push to small firms developing software products: Last year, e-commerce took a lion's share of venture funding, leaving little for young technology companies. But this year, the same sector will be the one giving a big push to small firms developing software products. These firms are relying on tech products that range from the fantastic photo shoot animation, drone delivery to core enterprise products. "We are always scouting for startups and we will not shy away when an opportunity presents itself," said Sameer Nigam, vicepresident of engineering at Flipkart. Last month, the seven-yearold company raised $700 million at a $7 billion valuation towards making long-term strategic investments in India and bulking up its technology capabilities. Over $3.1 billion was pumped into 46 deals in the ecommerce space last year. Software product companies received just about one-tenth of that, across 48 deals, according to research firm Venture Intelligence.

International:

• Xiaomi Revenue Doubled to $12b in 2014: CEO: Fast-growing Chinese tech firm Xiaomi Technology Ltd Co booked 74.3 billion yuan ($11.97 billion) in pretax sales last year, up 135% from 2013, the firm's chief executive Lei Jun said on his official microblog account on Sunday. The figures helps shine light on the rapid growth of the privately-held tech firm which has risen to become the world's No.3 smartphone maker and is challenging Apple Inc and Samsung Electronics Co Ltd as well as domestic rivals such as Huawei Technology Co Ltd. Xiaomi sold a total of just over 61 million phones in 2014, up 227% from a year earlier, Lei added in a post on his Sina Weibo microblog account. The post did not give a related profit figure, although a filing last month showed that the firm was grappling with razor thin margins as it rapidly expands. A part of the business made around 347.5 million yuan net profit last year on revenue of 26.6 billion yuan and an operating margin of just 1.8%.Lei added that growth in China's smartphone market would ease in 2015 and that the firm would look to focus on innovating new products and pushing into more overseas markets.

• John Lewis Christmas sales driven by online growth: Total like-for-like sales rose 4.8% to £777m in the five weeks to 27 December, with shop sales flat, but online purchases up 19%. Click-and-collect represented 56% of online sales, overtaking home delivery, the firm said in a trading update. The figures come at the start of a big week for retailers, with updates also due from Marks & Spencer and Tesco. Andy Street, John Lewis managing director, said: "This year confirmed the new shape of trade for Christmas, with an early peak at the end of November driven by Black Friday and last minute gift buying." Black Friday, which took place on 28 November, brought the company its biggest sales week in 150 years, and was up 22% on last year. Sales of electrical and home technology products led the way on Black Friday, and finished with a 6.8% year-on-year rise for the five week period. Homeware growth was 2.3% up on last year for the five week period. Fashion and beauty increased by 7.8% on last year, helped by "very strong" online trading, John Lewis said.

• Daniel Hurwitz Steps Down as CEO and Director at DDR: DDR Corp. said Daniel Hurwitz stepped down as chief executive officer and a director of the U.S. shopping- center owner, effective Dec. 31. David Oakes, DDR’s president and chief financial officer, became the company’s principal executive officer, according to a regulatory filing today. Hurwitz will remain an employee until Feb. 14, the Beachwood, Ohio-based real estate investment trust said. Hurwitz will receive cash and stock compensation of $9.8 million, which will result in a charge of about $4.5 million in the fourth quarter, according to the filing. DDR is an owner and manager of 456 shopping centers in 42 U.S. states and Puerto Rico. The company said in September that Hurwitz and the board agreed not to extend his contract past its Dec. 31 expiration.

• Ronald Perelman Backs Revlon CEO Despite Lawsuit: Ronald Perelman is standing by Revlon president and chief executive officer Lorenzo Delpani. Perelman’s support comes after a lawsuit was filed by a former Revlon employee alleging that he was fired in December after raising safety concerns and also discriminated against for being Jewish. Perelman, Revlon’s chairman and owner, stated to WWD, “I know Lorenzo as an executive and as a person. The allegations made are both absurd and offensive to me and those around me. I personally know his mind and his character.” Perelman, who is Jewish and known to take his faith seriously, added, “He is among the least bigoted or biased humans I have ever known. He has my full support.” In the suit, filed on Tuesday in Manhattan federal court, Alan Meyers, who served as chief science officer at Revlon, said, in addition to disregarding safety concerns raised by Meyers, the Italian-born Delpani made disparaging remarks against Jews, blacks and Americans.

• Stocks Slip on Final Trades of '14: A strong year for stocks closed on a slightly sour note as the WWD Global Stock Tracker fell 0.2 percent to end 2014 at 108.06. The tracker fared better than Wall Street’s main indices for the day. The Dow Jones Industrial Average fell 0.9 percent to 17,823.07, failing to return to the 18,000 level for the start of 2015, while the S&P 500 dropped 1 percent to 2,058.90. Retailers in the S&P eked out a 0.1 percent gain to rise to 1,032.73. The sell-off, reflecting ongoing concern about Greek political turmoil and perhaps anxiety about an increase in applications for unemployment assistance in the U.S., scarcely made a dent in the robust gains most stocks made for the year. WWD’s group of 100 international fashion, retail and beauty equities ended the year ahead 8.8 percent, above the Dow’s 7.5 percent increase but shy of the S&P’s 11.4 percent gain as well as the S&P 500 Retailing Industry Group’s 9.9 percent improvement.

Tech:

• `Make in India' Facebook Page Adds One Member Every 3 Sec: Prime Minister Narendra Modi's 'Make in India' campaign adds a new member every three seconds on its Facebook page and has become the most sought after government initiative ever on any digital media platform. Make in India has seen an overwhelming response on its digital platforms like Facebook and Twitter since its launch just 3 months ago. “The initiative has already touched over 2.1 billion global impressions on social media and re ached an overall fan base of over 3 million on its Facebook page,” an official statment said today. “The Make in India Facebook page adds a new member every 3 seconds, a feat that has not been achieved by any other department of the government and a very few in the private sector, the statement added. Make in India initiative has become the largest and fastest growing government initiative ever on digital media, leaving behind every other government departments like the external affairs ministry, the home ministry or the I&B ministry, the statement added.

• Apple sued over 'shrinking' gadget storage: The legal complaint revolves around iOS 8 and the amount of memory it reserves for itself on iPods, iPhones and iPads. The complaint alleges that it takes up so much space that far less than advertised is left for people to store their own data. The complaint has been filed in California by Miami residents Paul Orshan and Christopher Endara who say that iOS 8 can occupy up to 23.1% of the memory available on some Apple devices. In addition, upgrading devices from the earlier iOS 7 to 8 can cause people to lose up to 1.3 gigabytes of memory, said papers filed in support of the legal action. The amount of memory taken up by iOS 8 can mean users run out of storage and, the pair allege, this is helping Apple force people to sign up for its fee-based iCloud storage system. The lawsuit is seeking millions of dollars in damages for those using Apple devices facing the storage squeeze.

• Roku teams up with Insignia and Haier for Roku TV and announces future 4K support: Roku’s foray into partnering up with TV manufacturers is expanding while it’s committing to the future of 4K. Today the company announced two new Roku TV partners; Haier and Best Buy’s Insignia brand. The Insignia Roku TVs will launch in the spring while the Haier line of TVs will be available sometime in Q3 of 2015. Haier plans on dropping models with screens ranging from 32 to 65 inches, with the 40 and 65-inch models sporting “Full HD resolution and a Sound Chamber that produces enhanced sound quality, with superior dampening, improved mid-range response, cleaner and deeper bass, as well as overall richer sound texture.”

• Xiaomi Announces the $112 Redmi 2 Smartphone: As had been recently anticipated, Xiaomi has today released details of a new version of its popular low-cost Redmi smartphone – appropriately named the Redmi 2. The new model is very similar to the previous 1S variety, except that it features a Qualcomm Snapdragon 410 Quadcore 64-bit 1.2 GHz processor and support for LTE, the front-facing camera has been boosted from 1.4 MP to 2 MP, and the battery has seen a slight boost from 2,000 mAh to 2,200 mAh. It will run Xiaomi’s MIUI 6 version of Android.

• OnePlus Reveals Its Forked Android Build: Chinese smartphone maker OnePlus promised its own forked version of Android after Cyanogen did an exclusive deal with Micromax in India. Now it’s delivered on that promise with the alpha version of its new ROM. The new Android Lollipop-based fork is currently nameless – OnePlus is running a contest among its forum members to find a suitable monicker – but the alpha build is available to grab now, at your own risk. While OnePlus needs to develop its own fork of Android primarily because of the clash with Micromax in India – which led to a sales ban for a time – it says it intends to make the final build available for customers worldwide. In its announcement post, OnePlus says: “…we will keep our promise and deliver an experience that is customizable yet bloat-free with stock-Android-like simplicity by default…” OnePlus is far from the first manufacturer to develop its own custom take on Android but it’ll be interesting to see what route it takes.