Daily News Digest- 2nd Feb'15

Thought of the Day:

Today in History:

Following made the Headlines:

India:

• Prasanth Kumar Named CEO, MindShare S Asia: MindShare, one of the biggest media agencies of WPP's media arm GroupM, has named Prasanth Kumar as its new CEO for South Asia, replacing Ravi Rao who will shift to an international market. Popularly known as PK, Kumar currently heads GroupM's Central Trading Group and is a member of GroupM's South Asia executive committee. He will relocate to Mumbai from Bangalore to take up his new role with affect from March 1. “Prasanth (Kumar) was a unanimous choice for this role. He is a very dynamic leader always full of ideas and a true organisation man. In the past ten years he has played a stellar role in ensuring GroupM's scale is leveraged to maximise value for our clients,“ said CVL Srinivas, CEO at GroupM South Asia. Srinivas declined to specify Rao's new role. “Ravi Rao wanted to move to a new region within the MindShare network. So we have been working on this change for last three to six months,“ he said.

• Fiat, Toyota, Honda to Recall 2 m Cars over Airbag Flaw: The auto industry's airbag troubles deepened on Saturday as US federal safety regulators said three big automakers will recall about 2.1 million older vehicles to fix defects that could cause airbags to deploy when they are not supposed to. The vehicles involved in the recall announced by the US National Highway Traffic Safety Administration (NHTSA) are made by Toyota Motor, Fiat Chrysler and Honda Motor. There have been about 400 reported cases of inadvertent airbag deployments in the recalled vehicles, NHTSA administrator Mark Rosekind said. The incidents have caused some minor injuries, but no known deaths, he said. The recall concerned a defective chip in airbag systems and the fix involved replacing the entire airbag module, including circuits manufactured by parts maker TRW Automotive Holdings, Rosekind said. The automakers involved had issued three earlier recalls to fix the chip problems. But the NHTSA said it had reports that 39 vehicles fixed under those actions had experienced inadvertent airbag deployments, hence the new recall. 

• Soon, Hits Won't be Misses at the Indian Box Office: Why is it so difficult to know the exact amount any Indian film has earned? How much has PK really made at the box office ­ apart from estimates? According to filmmaker Vidhu Vinod Chopra, it seems to be a cultural problem. “The trade always knows exactly how much each film has done, so who are they fooling? We have to get rid of this notion of projecting numbers which are wrong. The way forward has to be Rentrak, to allow tracking in real time, to ensure complete truthfulness and transparency,“ said Chopra as he prepares to launch PK, the first Indian film in China with 3,500 prints. Rentrak is a US research company that tracks 100,000 screens across 36 countries and made its India entry last October. Chopra, co-producer Raju Hirani and actor Aamir Khan signed on Rentrak to track PK prior to its release on December 19.

• Rolls-Royce Bets Big on India, to Unveil New Models: Super luxury car maker Rolls-Royce is gearing up to tap the country's billionaires with new models, including new convertible and a potential SUV. The carmaker said that it is confident that India, which is projected to be “home to the fourth-highest number of billionaires in the world by 2023“, will be one of its key markets.

• Orios Digs Into Food Tech with YuMist Funding: Food technology and delivery start-up YuMist has raised about Rs 6.2 crore ($1 million) from venture capital firm Orios Venture Partners, as investors look to participate in the nascent space increasingly been seen as the next disruptive segment. Three-month-old Gurgaonbased YuMist has been founded by Alok Jain, former chief marketing officer of online restaurant search platform Zomato, will use proceeds to further build its technology platform, expand services and towards marketing. “There are no national players in this space, and that too, in a country which has one of the largest food and beverages mar kets globally ,“ said Jain. The start-up plans to cover all of Gurgaon and the National Capital Region by the end-2015 and to enter the Metros by early 2016.

• Sol Primero Rs 1.5 Cr in Smart Pocket for Clearing Up Loyalty Cards Issues: SmartPocket, a mobile tech start-up that connects offline businesses to loyal customers, has raised seed funding of about Rs 1.5 crore from early-stage investment firm Sol Primero. Rajiv Mehta, an angel investor and a top executive at retail firm Arvind Group, also participated in the round. SmartPocket will use the funds on product development, acquire users and form partnerships with offline businesses. It aims to reach a user base of over half a million by the year end. “We are a marketplace for repeat business,” said Kiran Shastri, 37, chief executive of SmartPocket. An engineer, Shastri co-founded the firm last April along with Mayank Shah, 29, also an engineer and former colleague at investment banking firm Goldman Sachs. It now counts retail brands like Puma, People, Turtle and Peter England among its customers.

• Valiant Capital leads $26m Funding in Babycare Etailer FirstCry: Baby care products e-tailer FirstCry has raised about $26 million (Rs 156 crore) in a fourth round of funding led by San Francisco-based hedge fund Valiant Capital Partners. The company’s existing investors—IDG Ventures India, Ventex Venture Holdings and SAIF Partners—also participated in the round. The deal comes amid a wave of consolidation in the baby care e-tailing segment, which currently accounts for less than 5% of the estimated $10 billion baby care products market in India. The latest round takes total venture capital raised by BrainBees Solutions, the Pune-based company that owns FirstCry, to $59 million. It last raised $15 million in January 2014 in a round led by Vertex, the early-stage investment arm of Singaporeheadquartered Temasek Holdings. “The funds raised will be used to scale across channels, online, mobile and offline, and invest in growing the private label business,” FirstCry co-founder and CEO Supam Maheshwari told ET, while declining details on the company's valuation in this round of funding.

• AAI to Take on Private Cos to Build Goa's New Airport: State-owned Airports Authority of India (AAI), with a new boss at its helm, has decided to reorient itself as an enterprise by bidding for the new facility that's planned for Goa. This is the first time that the organisation will be pitting itself against competition from the private sector, which includes several global companies, in building new airports in India. “We have got the board's approval to bid for the new greenfield airport in Goa,“ said a senior AAI official who did not want to be named. “We will soon be registering our interest for the project.“ The deadline for this is February 12. AAI will likely form a special purpose vehicle (SPV) to bid . 3,000 crore project, the for the ` person said. “However, other details will be worked out post the bidding parameters for the airport project are declared.“ The state-owned agency will have an edge over other bidders for the Mopa airport project, he said. It will also seek to ensure that service levels can be comparable with those airports run by private operators, such as those in Mumbai, Delhi and Hyderabad, the official said.

• Ericsson Sees India as Its No. 2 Market: Ericsson expects India to become one of its top two markets by sales in the next two to three years, as the telecom equipment maker awaits more contracts for managed services, including operations and business support systems, IP network and cloud to come in over 2015. The projection is based on increasing demand for mobile data, which is set to move from second generation to third and LTE, a fourth-generation technology , Chris Houghton, head of India region at the Swedish company , told ET. For the company, India as a market climbed up a rank to No. 3 in the past year, and was tied with Japan by contributing 4% to its global revenue in 2014. The US is its top market, followed by China. Ericsson's outlook comes at a time when the International Monetary Fund is predicting India's economic growth to likely outpace that of China by 2016. “I already see the potential in the country and I will place my bets on India,“ Houghton added. Its India revenue rose 20% from a year earlier to $289 million in the quarter ended December. India was the fastest growing market in the past quarter and revenue was the highest ever for the company in a quarter from this country.

• Royal Enfield races past Harley in global sales: It’s like David taking on Goliath, on the highway. Till now, Milwaukee-born Harley-Davidson (HD), which makes motorcycles with engine displacements over 700cc, has been chugging along unchallenged. But finally, an Indian ‘heavy’ bike maker seems to have caught up, albeit with its nifty range of smaller capacity models. Chennai-based Royal Enfield (RE), originally a British marque from Redditch, sold a shade over 3 lakh bikes in 2014, overtaking Harley’s global sales of 2.67 lakh units. Although HD motorcycles sell at a huge premium over their RE kin (HD's most affordable model in India sells for around Rs 5 lakh while RE's most expensive model comes for Rs 2 lakh), what's remarkable is the stunning turnaround by one of the world’s oldest motorcycle brands. Ten years ago, RE had been reduced to a fringe player in the domestic motorcycle market, plagued by its 50year-old unreliable iron cast engine, while newer and more reliable models from its Japanese rivals swamped the biking scene.

• Shoppers Stop eyeing bigger play in online space: Retail chain Shoppers Stop is gearing up for a bigger play in the online space with plans to tie up with virtual market places such as Snapdeal and Amazon to counter offline sales "disruptions" caused by e-commerce boom in India. Besides, the company will also be ramping up its own website to increase its online sales, which currently is less than one per cent of its total turnover. As part of a three-pronged strategy, the company will start selling private brands through market place like Snapdeal, Shoppers Stop Ltd Customer Care Associate and Managing Director Govind Shrikhande told . "We are gearing up to counter the disruptions caused by online players. We will also build and invest in technology for our own website. We will also connect our stores with online customer," he added.

International:

• Amazon posts modest profits despite healthy sales: The online retail giant Amazon has reported weaker profits for the busy Christmas period, but a 15% rise in sales has cheered investors. The company made a net profit of $214m (£142m) for the last three months of 2014, which is a drop of $25m on the same period in 2013. However, it was an improvement on the previous quarter, in which Amazon made a net loss of $437m. The company's shares rose by nearly 8% in after-hours trading. But despite net sales of $89bn, Amazon made a loss of $241m for 2014 as a whole. The firm also warned that its finances were "inherently unpredictable". It sounded a note of caution for the next few months, saying it could make an operating loss of up to $450m.

• Honda cuts annual profit forecast after recall: The Japanese carmaker Honda has cut its profit forecast and seen third quarter earnings drop sharply following a vehicle recall linked to airbags. Honda, whose products include Civics and Accords, is forecasting full year net profits of 545bn yen ($4.6bn, £3bn) 3.5% less than it previously hoped. Third quarter net income was down 15% at 136.5bn yen. Honda has had to recall millions of vehicles amid an exploding airbag crisis in which five people died. Honda has already been fined $70m by the US authorities, a record civil penalty for a carmaker, for not telling regulators about 1,700 complaints about deaths and injuries caused by its vehicles, and for not reporting warranty claims. The airbags are supplied by fellow Japanese company, Takata. Aside from that crisis, sales in its home market were dented by a recently introduced sales tax.

• Alibaba Sued for Securities Law Violations: Alibaba plans to defend itself against a lawsuit claiming that the e-commerce giant made misleading statements and hid the fact it met with Chinese regulators months ago before the company’s blockbuster IPO in September. The law firm Robbins Geller Rudman & Dowd LLP said it filed the lawsuit on Friday in Manhattan federal court against the company and some officers based on alleged violations of securities laws, according to a Bloomberg report. Alibaba believes that the claims asserted in the recently filed litigation are without merit and intends to defend itself vigorously,” an Alibaba company spokeswoman said.

• Hong Kong Sees Steady Christmas Sales: Christmas sales in Hong Kong held up but some market watchers voiced concern about sluggish sales in gift-giving categories such as jewelry and the challenge of attracting mainland tourists. Hong Kong has long been the go-to destination for mainland Chinese shoppers, but luxury retailers are, in some cases, feeling the pinch as well-heeled Chinese customers start to favor other shopping meccas. “Brands that are China-centric have suffered quite a bit in 2014,” said Ashley Micklewright, chief executive of Bluebell Group, which markets and distributes luxury brands in Asia. On top of the crackdown on expenditure in mainland China, lots of Chinese are now starting to travel to Europe as well as to South Korea and Tokyo. The Hong Kong Retail Management Association said that compared with 2013, most retailers registered mid- to high-single digit increases during Christmas.

• German Retail Sales Climb for Fifth Year Running in 2014: German retail sales increased for a fifth consecutive year in 2014, rising by 1.4 percent in real terms, data showed on Friday, reflecting the buoyant mood among consumers in Europe's largest economy. German consumer morale held up well last year as shoppers benefited from a robust labour market, rising wages and low inflation. Private consumption helped drive a 1.5 percent increase in gross domestic product. In December, retail sales rose by 0.2 percent on the month in real terms after climbing strongly in October and November. "Average monthly retail sales in Q4 rose by a whopping 1.6 percent over the Q3 average, suggesting that consumption made a major contribution to GDP growth in Q4," said Christian Schulz, senior economist at Berenberg Bank.

Tech:

• The Pirate Bay returns from the dead, comes back online: Following a raid on a Swedish data center late last year, The Pirate Bay was taken offline for just shy of two months before returning online fully today. The site appears to be fully working on its original domain, with the last uploaded torrent appearing on December 9, the day the site was taken down. The first new torrent contains an image of a phoenix and was uploaded today titled “like a phoenix, it rises from the ashes” said “The Pirate Bay is back.” Torrentfreak reported earlier this week that the previous moderators and admins may be locked out of the revived site, but it’s not clear if that is the case just yet. Even though the site is operational, some functions like the RSS feed don’t work just yet. We also don’t know anything about who’s behind it or if they’re part of the original team. Peter Sunde, co-founder of the site said previously that “it feels good that it might have closed down forever, just a real shame the way it did that.” Perhaps The Pirate Bay is a site that truly never goes offline forever.

• Google Ventures Introduces Design Sprint Site for Startups: Are you putting together a startup based on a weird idea you had while drinking with friends? Well if you are, you should check out Google Venture’s site about a five-day process for answering “critical business questions through design, prototyping, and testing ideas with customers.” Called the Design Sprint, the site and upcoming book are meant to help new companies really focus on what it is they’re building. The process was used by startups like Next, Blue Bottle Coffee and Foundation Medicine so you know it works. Well at least it worked for those companies. Regardless, it looks like a good exercise for any new company trying to build something that’ll change the world or more likely get bought by Google, Apple, Facebook or Yahoo.

• Facebook Is Improving the News Feed by Asking Real People: The News Feed is probably Facebook’s most important asset, and there’s no doubt the company spends a ton of money researching algorithms to feed you optimal content. But it turns out algorithms may not be enough – sometimes asking real people direct questions yields better results. According to Backchannel, since News Feed’s inception in 2006, Facebook has realized that simply observing reactions to a user’s feed and counting likes and shares does not fully correlate with whether people are enjoying the content they’re fed. A News Feed Project Manager made the analogy of feeding people donuts. If you bring me donuts, I’ll almost always certainly eat them. Donuts are tasty. But that doesn’t mean I wouldn’t rather eat something else instead. To improve News Feed, Facebook has a random selection of testers around the United States. Using a special version of the social network, the raters are asked to interact with the content normally, then answer questions about their experience and write a paragraph describing their feelings regarding specific stories.

• Free Windows 10 Upgrade Offer Won't Extend to Enterprise: Everyone got excited when it was announced at the Windows 10 event that users of Windows 7 and 8 would be able to upgrade to Windows 10 for free for one year. Unfortunately, Windows 10 for Enterprise customers won’t be able to partake in all the freeness. Bummer. But if you’re using Windows 10 for Enterprise, you probably shouldn’t be too surprised. Microsoft is in the business of making money off businesses. The good news is that companies will be able to control how updates are deployed. This is something that’s great when you’re managing a huge staff and a feature update could bring the current workflow to a screeching halt. Businesses will still receive critical security updates, but IT departments will be able to control over internal distribution of updates.

• Google Now Introduces Support for 40 Third-Party Apps: Google Now is great, automatically feeding you useful content based on context like time and location. Problem is, it’s been limited to mostly Google-only products. As of today, however, the virtual assistant supports 40 new third-party apps. Now you can wake up to suggestions from Pandora, see suggested Airbnb rentals during a trip, or catch up on your language lessons with Duolingo (there are some sample cards here). Other supported apps include Lyft, Shazam and Runtastic; to view the full selection, check out Google’s list. The new integration certainly make Google Now much more powerful; the additional apps expand the domain of content the assistant can feed you.. The cards are rolling out to everyone over the next few weeks, and Google intends to add new app partners over time.