Benner on Tech: Uber Bids on Map Tech
People are Talking About ...
Uber put in a bid for Nokia’s mapping technology, Here, and could pay as much as $3 billion. The proposed deal pits the ride-hailing company against the trio of German carmakers that are working with the Chinese search company Baidu on their own bid for Here.
Both parties want the same thing -- freedom from Google Maps, which is currently positioned as the key software platform for the auto manufacturing and transportation industries.
No matter who wins, Google has such a huge lead in maps that it will still be extremely expensive for anyone to make a truly competitive product. I guess that’s one way for Uber to spend some of its billions in equity and debt.
Yelp Wants Out
Lots of publications are reporting that Yelp hired Goldman Sachs to find a buyer for the local reviews site. Bloomberg’s Alex Sherman says Priceline, Yahoo, Amazon and Rakuten are all possible acquirers. It could help boost an online shopping site like Priceline or Amazon, or a Web company that wants to get into local advertising like Yahoo.
Conspicuously missing from that list is Google, which tried to buy Yelp once before. It’s probably safe to say that bridge burned when Yelp encouraged the U.S. and Europe to file anti-trust charges against Google.
Yelp isn’t growing as fast as it once did, and the stock has been cut in half since it hit its high last year. Looking around for a buyer now, while it’s still valued at $3.5 billion, may not signal a market top for tech, but it probably signals a market top for Yelp.
FitBit to Go Public
FitBit, the largest fitness tracker company by marketshare, has filed for an initial public offering.
Right now FitBit seems to be in pretty good shape. It’s profitable. It made $131.8 million on $745.4 million in revenue. It has sold about 20.5 million devices since 2007. And it currently has a private valuation of about $1.2 billion. It will be interesting to see what the public markets say it’s worth. If there’s huge demand for the IPO, it could be a sign that investors don’t think that smartwatches will crush the whole industry.
The Wall Street Journal highlighted some tidbits that are interesting to keep in mind when thinking about the fitness tracker category as a whole.
Recalls are expensive: Remember when FitBit recalled the Force in 2014 because it gave some customers rashes? Recalls cost the company $84.6 million in pretax income in 2013 and another $22.8 million last year.
Sales don’t equal use: 9.5 million devices were in active use at the beginning of this year, even though 20.5 million devices have been sold. The discrepancy takes into account broken trackers, model upgrades and devices that just sit in a drawer.
Unicorns Say They’re Worth Every Penny
A panel of highly-valued startups at the National Venture Capital Association conference in San Francisco this week said we’re not in a valuation bubble and that their valuations will continue to climb, even if the Nasdaq falls.
Reporting today: AOL, JD.com and Weibo.
Lyft announced a partnership with Verizon to pre-install the ride-hailing app on some Android devices. (Fast Company)
Snapchat will offer advertisers 10-second ads that cost 2 cents per view. (Adweek)
SoundCloud’s licensing talks with Sony Music broke down. Pages for artists such as Adele, Hozier and Kelly Clarkson were removed from the platform. (Billboard)
Spotify is figuring out ways to enter the online-video business. (Wall Street Journal)
Tinder is really popular with people who are already in relationships. (Guardian)
Yard Club, a platform for heavy construction equipment rentals, just got an investment from Caterpillar. (Wall Street Journal)
Accel and the drone maker DJI created a fund to invest in the drone ecosystem. (Re/code)
A primer on late-stage valuation math, from Fenwick & West’s Barry Kramer. (Strictly VC)
People and Personnel Moves
John Chen, the CEO of BlackBerry, is wrestling with the ghosts of the company’s successful past. (Bloomberg)
Alibaba is in talks to buy a 20 percent stake in India's smartphone maker Micromax for $1.2 billion. (Reuters)
Facebook gave the press a look at its new glass and steel, ultra-transparent headquarters. (Wall Street Journal)
Nintendo is delaying a new game console so it can beef up its smartphone games business. (Bloomberg)
Tesla burned through $558 million last quarter, and analysts say the company may have to raise more capital. (Bloomberg)
Zappos has lost 14 percent of its workforce as it transitions to a radical new management structure called Holacracy. (Wall Street Journal)
Cable companies are partnering with streaming services to survive the Internet age. (Bloomberg)
An NSA program to collect the phone records of millions of Americans has been ruled illegal by the Second U.S. Circuit Court of Appeals in New York. (Wall Street Journal)
A WordPress vulnerability is being used to hijack websites. (Ars Technica)
News and Notes
Ericsson is expanding its patent lawsuit against Apple to include Germany, Britain and the Netherlands. (Cult of Mac)
Quote of the Day
“I’ve always tried to make sure I never pay too much attention to the 'CEO of the year' stuff, because the 'worst CEO of the year' stuff is right around the corner.” – Dick Costolo
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Maria Lamagna at email@example.com