BB In Motion?

It has a new name now. And a new platform. “It is one brand, it is one promise,” says chief executive Thorsten Heins. So, can Research In Motion, which has renamed itself after its most popular brand, regain its lost glory with the launch of the BlackBerry 10 operating system and the two new phones that feature it? It’s a billion-dollar question, literally. In the December quarter, BlackBerry saw its profits plunge to $9 million from $265 million a year ago. In the same period, its subscriber base fell to 79 million from 80 million. BlackBerry expects that the new measures will give it more muscle to fight rival smartphone makers Apple, Samsung and Nokia, and shore up its falling customer base and shareholder morale. In fact, the Canadian company lost about $70 billion in market value and about 5,000 jobs on account of the delays in launching BB10, which was initially scheduled for early 2012. 
 

The Union Cabinet has cleared a revised Lokpal Bill. According to the provisions in the new anti-graft Bill, it is up to state governments to set up Lokayuktas; state-supported religious and charitable bodies will stay out of its ambit. Besides, it will require states to pass the Lokayukta Bill within a year of the passage of the Lokpal Bill by Parliament, said V. Narayanasamy, minister of state in the PMO.

It’s official. Abu Dhabi-based Etihad Airways is in talks with Jet Airways to buy a stake in the Indian carrier. Its chief executive, James Hogan, and a few top executives of the carrier, along with Jet Airways founder Naresh Goyal,

met aviation minister Ajit Singh seeking regulatory approval. According to Singh, the airlines are “discussing details” of the deal. Etihad reportedly plans to buy up to 24 per cent in Jet Airways for about $300 million.

 

Toyota Motor seems to have had a bumpy ride of late. The Japanese auto major says it will recall some 1.3 million cars globally to fix two glitches. The models recalled include 752,000 Corolla and Corolla Matrix vehicles in the US. This is Toyota’s third recall since October, involving over a million cars, and comes even as it battles a reputation hit, courtesy a series of recalls in 2009 and 2011. 

In its first contraction in three years, the US economy shrank 0.1 per cent in Q4 2012 and shocked markets. The news comes just weeks after the US government managed to avert a ‘fiscal cliff’ that called for automatic drastic spending cuts to fix a fiscal crisis. Now analysts expect the economy to shrink even further given that more spending cuts and higher taxes will follow.

 

In an effort to cut costs and rev up profits, Citigroup reportedly plans to exit consumer banking in more countries. In December, the US banking major said it was pulling out of consumer banking in five countries —Pakistan, Paraguay, Romania, Turkey and Uruguay — aiming to save $1.1 billion a year and cut 11,000 jobs. 

Banks in the UK are staring at another series of claims for compensation that could add up to billions of pounds. The Financial Services Authority has found they had mis-sold complex interest-rate hedging products to small firms. In the 173 test cases it examined, over 90 per cent did not go by regulatory requirements.

Social media giant Facebook seems to be looking at a knotty future. In the last three months of 2012, its profits fell 80 per cent to $64 million, against $302 million last year. Revenues were up 40 per cent at $1.6 billion, thanks to a leap in advertising revenues. 

A survey by web services firm Akamai Technologies shows that the global average Internet speed fell 7 per cent between the second and third quarters of 2012 to 2.8 mbps. But this was up 11 per cent year on year. South Korea continues to have an average of 14.7 mbps, followed by Japan at 10.7 mbps and Hong Kong at 8.9 mbps.

(This story was published in Businessworld Issue Dated 11-02-2013)