Daily News Digest- 16th Jan'15

Thought of the Day:

Today in History:

Following made the Headlines:

India:

• SpiceJet Flies Back to Ex-Owner Ajay Singh: Budget carrier SpiceJet announced its third change of ownership in a decade, with control circling back to original co-promoter Ajay Singh, who's looking to pull off a rescue act to help the carrier avoid the fate that befell the now-grounded Kingfisher Airlines. This may involve changes in the top management and the phasing out of Bombardier aircraft, which would lead to the carrier having only Boeing 737s, executives said. SpiceJet's board decided “to transfer the ownership, management and control“ to Singh as proposed by principal shareholder and promoter Kalanithi Maran and KAL Airways on Thursday , the airline said in a BSE filing. The proposal will be submitted for the approval of regulators as well as the ministry of civil aviation, the airline said in the filing without elaborating. Former co-promoter Ajay Singh is likely to rope in an unidentified domestic investor and JPMorgan Chase as backers. New promoters will infuse `. 1,500 crore in three installments of ₹500 crore each, the first starting this month and the last in March, said an official in the aviation ministry.

• Driven by Demand, Myntra Plans to Sell In-house Brands on Other Sites: Myntra, the country's largest online fashion retailer, may offer its 10 privately owned brands of garments on other sites to take advantage of demand after sales of clothes and accessories on e-commerce portals grew faster than other categories of goods in the past year. The in-house brands yield higher operating margins and making them more widely available may increase sales and help the sevenyear-old Bengaluru-based company turn profitable. “We are looking at how to sell these brands at other e-commerce sites,“ said one person familiar with the matter who did not want to be identified because the company is in talks with other e-tailers. “It will work just like we sell our goods on Flipkart...like a client...If everything goes as planned, we could see our brands being sold (on other portals) from April.“ Another model that Myntra is considering is setting up standalone stores at high-end malls where buyers can try out dresses before shopping for them online. 

• Fashion-savvy Snapdeal Eyes $2b Sales in '15-16: Ecommerce major Snapdeal is tying up with leading fashion brands, designers and some large format retailers such as Shoppers Stop, and has set a target to facilitate sales of fashion product worth $2 billion, or about ₹12,400 crore, next fiscal.` Already , about 60% of its overall orders, at the unit level, already come from the fashion and lifestyle categories, Amit Maheshwari, vice president for fashion at Snapdeal, said. “The overall contribution (of fashion and lifestyle categories) to the top-line is currently at about 35%, but given the responses we have been seeing from consumers, we are quite confident this will only increase,“ he said. The Delhi-based company , flush with investor money , after it raised a massive $627 million in a new round of funding, led by Japanese investor giant SoftBank in October last year, is making an all-out effort to increase the size and range of its offerings, tying up with big brands as well as niche sellers. “We have tied up with Fashion Design Council of India to launch our Designer Studio that will bring premium designer wear to consumers. Separately, we are also launching brand stores in January , and are looking at more celebrity endorsements,“ Maheshwari said.

• Audi Retains No. 1 Spot in Luxury Car Pecking Order: No changes in the pecking order at India's luxurycar space, which expanded faster than the broader auto market in the past year. Sales of luxury cars and sportutility vehicles made by companies such as Audi, MercedesBenz, BMW and Volvo are estimated to have grown about 9% in 2014, compared with a less than 1% expansion in the overall auto market. Audi led the pack, followed by MercedesBenz and BMW. While the market grew, BMW posted a fall in sales for the second successive year in the country. While it was third on the list in India, BMW leads its German rivals globally. BMW India sold 6,812 cars and SUVs in the past year, a drop of 7% from 2013. Audi, which wrested the crown in the Indian market from BMW in 2013, and a supercharged MercedesBenz posted handsome growth in sales. In 2013, BMW's sales had dropped as much as 22% in India. The BMW Group currently sells three brands in India. Two brands, BMW and MINI, are sold directly by the Indian subsidiary. The third, Rolls-Royce, is sold separately. Automobile analysts blame BMW India's inability to shift gears at the right time and its product portfolio for the dismal performance. BMW launched several new cars in India in the past year, like the new X3 SUV , 3 Series Gran Tu rismo, M6 Gran Coupe, X5, Ac tiveHybrid 7 Series and the new MINI 3-door and 5-door. But ac cording to experts, rivals have come up with more competi tively priced products and bet ter discounts to attract buyers as the overall automobile mar ket remained sluggish.

• Xiaomi Targets to Get B'luru R&D Centre up and Running by May: Chinese smartphone maker Xiaomi is set to sign the lease for its R&D centre in Bengaluru, which is expected to be launched later this year, at a time when the government is pushing for more foreign investments in India. “We have taken a 20,000 sq ft building on lease for the R&D centre in Cessna Business Park, Bengaluru,“ Manu Jain, head of India operations, told ET at the launch of the 5.7inch Mi Note priced at ¥2,299 `23,000) in Beijing on Thurs(.day. “We plan to have it operational by Q2 (second quarter) 2015. So, by April or May, the development center should be up and running.“ Xiaomi, popularly called the `Apple of China,' had talked about setting up a research & development centre in India back in August, a month after it started selling devices in India. “The R&D centre will also house a Xiaomi call centre and will be used to develop the MiUI phone interface for India and other countries,“ said Hugo Barra, head of international operations. It will also test products relevant for the Indian market.

• Datsun Launches Compact MPV Starting at Rs 3.79 lakh: Having got off to a modest start with its Go hatchback, Datsun has launched a compact MPV at an aggressive price of Rs3.79 lakh to Rs 4.61 lakh, seeking to catch the eye of those looking to buy a bigger car for the first time.Datsun is the entry level car brand of Nissan Motor India. The company has sold about 12,000 Go hatchbacks in the last 10 months, which is almost half the monthly number of the Alto that No. 1 Maruti Suzuki sells. The new Go+ is aimed at offering yet another alter native to price-conscious Indian buyers, thereby creating a new segment in the Indian passenger vehicle market. “Indian people are very demanding, they always want more without an increase in price and Go+ is just that,“ Guillaume Sicard, president, Nissan India Operations, told ET. “It is an innovative product, which fulfils the Indian car buyer's need of maximum comfort, space, fuel efficiency and active safety.“

• Startups can expect more money, higher valuations and major exits in 2015: Venture capital firms that maade 2014 the biggest year for technology investing in India expect to pay more for good companies this year, as competition separates the winners from laggards. Some of the world's most sophisticated investors put money into Indian startups last year, with most of the capital going to consumer internet startups. Those who came in include hedge funds like Tybourne Capital and FalconEdge to Japan's SoftBank which invested nearly $1 billion making the Asian firm one of the largest investors in Indian startups. "2014 will be looked at as an inflection point, the year the world discovered the true potential of the Indian startup," said Mohit Bhatnagar of Sequoia Capital which closed over 40 deals in the yeVenture capitalar including in mobile gaming firm Octro, ride sharing Zoomcar and customer feedback platform Akosha.

International:

• Google and Apple in $415m 'non-poaching' settlement offer: Four of the world's biggest tech giants - Apple, Google, Intel and Adobe - have agreed to a new settlement of $415m (£273.5m) in an attempt to resolve a lawsuit. The US lawsuit alleged the firms agreed not to poach staff from each other. It claimed the alleged agreement prevented workers from getting better job offers elsewhere. The 2011 US case had claimed $3bn in damages on behalf of more than 64,000 workers at the four firms. The latest attempt to settle the case for $415m, which was filed in court on Thursday, comes after a US judge rejected a $324.5m settlement offer last year.

• Target: 17,600 jobs at risk as retailer leaves Canada: The US discount store Target is to shut all of its 133 stores in Canada two years after launching there. On current trading performance, Target Canada, which employs 17,600 people, would not be profitable before 2021, its US parent said in a statement. Target Canada, which has filed for bankruptcy protection, faced tough competition from Walmart and Costco, which opened in the country years ago. Target said the closure was in the "best interest of the business". Chairman and chief executive Brian Cornell said in a statement: "After a thorough review of our Canadian performance and careful consideration of the implications of all options, we were unable to find a realistic scenario that would get Target Canada to profitability until at least 2021," He said the focus now would be on "driving growth" in the US, where it has 1,801 stores.

• Bloomingdale's Promotes Michelle Israel to Oversee Outlets: Bloomingdale's has promoted Michelle Israel to senior vice president of outlets, succeeding Arnie Orlick, who will retire Jan. 31. Orlick was instrumental in the launch and development of the Bloomingdale’s outlet division in 2010. Macy’s, which like Bloomingdale’s is a division of Macy’s Inc., revealed last week it is considering opening outlets for the first time. Bloomingdale’s is continuing to open outlets. Israel, vice president and divisional merchandise manager for housewares, tabletop, food and trim, will report to Francine Klein, vice chair for outlets, omnichannel technology, center core, fine jewelry and cosmetics.

• Tom Ford Planning More Stores: Tom Ford’s business is in growth mode, and the designer plans to have a total of 104 stores, including 46 freestanding locations and 58 shops-in-shop, by the end of the year, in addition to a roster of wholesale accounts. The designer will open stores in Dubai and Jeddah in March, Houston in September, and Miami and Atlanta later this year. Following his fall men’s wear presentation in London earlier this week, Ford said the company planned to close some stores in China, but would be opening others in better locations. “We are currently re-negotiating the contracts. A few of the stores were not as great as they should be. When we first entered Asia, we didn’t have the power that we do now,” said the designer. Asked whether he was looking to raise additional money or to bring new investors into the privately funded business, Ford said, “No, we’re fine.”

• Italy's OVS Files for IPO: Italian mass-market retailer OVS SpA said Thursday that it had filed paperwork to be listed on the Milan Stock Exchange to regulatory body Consob. The initial public offering of OVS was expected to take place by the end of 2014, but in November, citing market volatility, the group postponed the listing to the first half of 2015. This would be the first fashion IPO in Italy since Moncler’s listing in December 2013. In October, Italian beauty firm Intercos shelved plans to go public citing deteriorated market conditions. OVS, which is controlled by BC Partners, has been positioning itself as a trendier fast-fashion destination, focusing on a more stylish and higher-quality lineup. The firm has been cutting costs, bringing back to Italy a part of its manufacturing and closely controlling its production abroad.

• Parigi Files Suit Against Puma: Parigi Group Ltd. filed a lawsuit Wednesday against Puma North America Inc., United Legwear Co., United Legwear & Apparel Co., and Puma Kids Apparel North America in the U.S. District Court for the Southern District of New York. According to the suit, Parigi seeks damages for Puma’s breach of its contractual obligations, fraudulent conduct and misrepresentation regarding its intentions to renew its children’s license agreement, and the defendants’ misappropriation of Parigi’s trade secrets and proprietary information, among other things. The suit alleges that the dispute arose from “a calculated scheme” by Puma to misappropriate Parigi’s trade secrets and proprietary business information “to further their own nefarious agenda of covertly forming a secret joint venture for the purpose of unfairly competing, and tortiously interfering, with Parigi and its business relationships.”

Tech:

• Google Glass sales halted but firm says kit is not dead: Google is ending sales of its Google Glass eyewear. The company insists it is still committed to launching the smart glasses as a consumer product, but will stop producing Glass in its present form. Instead it will focus on "future versions of Glass" with work carried out by a different division to before. The Explorer programme, which gave software developers the chance to buy Glass for $1,500 (£990) will close. The programme was launched in the United States in 2013. It was then opened up to anyone and was launched in the UK last summer. It had been expected that it would be followed reasonably quickly by a full consumer launch. From next week, the search firm will stop taking orders for the product but it says it will continue to support companies that are using Glass.

• BB Hopes to Challenge Samsung with Classic: Canadian smartphone maker BlackBerry launched the Classic in India, priced at Rs 31,990, featuring the original Qwerty keyboard, track pad and touch screen in a back-to-roots attempt to return as a contender in a space dominated by Samsung. Classic, the second phone from BlackBerry after the differently designed Passport introduced in late 2014, is aimed at corporate and business users. Like the Passport, which sold out quickly at launch on Amazon, the BlackBerry Classic will be offered on Snapdeal. The first 1,000 buyers who already own BlackBerry Bold will get ₹4,500 off when they upgrade to the Classic.New buyers will get benefits from Yatra.com of up to Rs 10,000. “BlackBerry will push the Classic more for the die-hard enterprise users,“ said Tarun Pathak, senior analyst at Counterpoint Technologies. “Penetration will be higher than the consumer segment. Classic won't be able to do much for a turnaround but will do a lot for BB loyalists.“

• yuMobile Customers Join Airtel: Sunil Mittalfounded Bharti Airtel has integrated yuMobile customers into its mobile network, consolidating its position as the second largest mobile carrier in Kenya with a combined customer base of over 8 million and a 26.6 % customer market share. The process, which started last August, has seen the 2.55 million yuMobile customers get integrated into the Airtel network. Joining “the Airtel network brings a whole new world of exciting customer experience and unmatched value for money,“ Bharti Airtel said in a media statement Thursday.

• Vodafone Unveils iPhone Plans: Apple has stepped up its India play, tying up with Vodafone to offer its range of devices, including the iPhone 6 and 6 Plus, on monthly installments over two years, while the country's No. 2 telco looks to tie in subscribers for premium data services. Vodafone has introduced tariff plans based on installments starting at Rs 2,099 a month, for which a consumer can buy Apple's iPhone 4s along with bundled talk time, SMSes and 3G data. An iPhone 5c can be bought for Rs 2,499 a month and the iPhone 5s at Rs 2,999 per month, while those wanting to buy the iPhone 6 and iPhone 6 Plus will have to pay Rs 3,599 a month for two years. “Our all-inclusive and fully-loaded data plans will allow customers to have a hassle-free experience with no upfront costs and additional savings on monthly plans,“ Marten Pieters, MD & CEO of Vodafone India, said in a statement Thursday. “We see data as a strong growth driver in the years to come and believe these kind of innovative offers add to our efforts in the growth of this segment.“

• Google Search Now Links You to Brands' Social Profiles: Google is always trying to make information quicker to access on its search engine. Now, when you look up a brand, you’ll see links to its social profiles provided right through its information card. Google’s been adding social profiles to its Knowledge Graph cards for celebrities and other famous persons since November, but it’s nice to see brands and companies added to the mix. Interestingly, Google doesn’t list Google+ first, although it will directly showcase recent posts on its own social network. You should see the links appear for major brands on both desktop and mobile. It’s a welcome addition; it could save you some time and at least makes use of otherwise empty whitespace.