Facebook to unveil financials, raises $ 1.5 billion (Reuters)

SEATTLE (Reuters) – Facebook is preparing to open its books this year or early in 2012 to give investors a glimpse into the financial workings of the world's No. 1 social network, after it sealed an oversubscribed $1.5 billion round of financing led by Goldman Sachs.

The financing, $1 billion of which is from Goldman Sachs' overseas clients and $500 million from Goldman itself and Russian investment firm Digital Sky Technologies, gives the company a projected value of $50 billion, setting the stage for what could be one of the largest initial public offerings next year.

Facebook, founded in a Harvard dorm room in 2004, said it would begin to file public financial reports no later than April 30, 2012, in a statement detailing the new investment.

United States securities regulations require companies with more than 499 shareholders to disclose financial information whether they are publicly traded or not. Facebook expects to exceed that number some time this year.

The new funding was organized by investment bank Goldman Sachs, which raised $1 billion from non-U.S. investors in a fund that Facebook said was oversubscribed.

Goldman Sachs originally pitched the investment to U.S. investors, but switched focus to overseas clients as concerns grew that intense media coverage surrounding the offering could run afoul of U.S. securities laws.

Initial projections from Goldman Sachs in documents circulated to potential investors earlier this month indicated it was looking to raise up to $1.5 billion.

Facebook said it made a "business decision" to limit the offering to $1 billion, without explaining further. It said it had no immediate plans for using the money raised.

The company earned $355 million in net income in the first nine months of 2010 on revenue of $1.2 billion, according to a document distributed by Goldman Sachs to potential investors earlier this month, the only source of financial data on the company.

In December, Digital Sky Technologies, Goldman Sachs and some funds managed by Goldman invested $500 million in Facebook.

Facebook has more than 500 million users and is challenging big Web businesses like Google Inc and Yahoo Inc for users' time online and for advertising dollars.

Investors are increasingly eager to buy shares of Facebook and other fast-growing Internet social networking companies on private exchanges.

(Reporting by Bill Rigby; Editing by Bernard Orr)

Google's Page brings change and questions (Reuters)

NEW YORK/SAN FRANCISCO (Reuters) – Larry Page will need a rare combination of vision and solid management skills when he takes over at Google in April.

One day after Google's surprise announcement that Page would replace Eric Schmidt as chief executive officer, investors and industry insiders are grappling with how the change will affect the world's No.1 Internet search company.

"What's going to change under Larry?" said BGC Partners analyst Colin Gillis, asking the question on the minds of executives from Silicon Valley to New York City.

"In our opinion, Larry is likely to increase investments as a priority. It could be a long-term positive, but short term it's a negative."

The company hopes 38-year-old Page will help streamline decision-making as it tries to deal with tougher competition from Facebook and Twitter.

Within technology circles, the move to replace Eric Schmidt left some wondering if Page can make a successful comeback to the company he helped create during the first dot-com boom. For a list of tech executive departures and hires see: http://r.reuters.com/pyh67r

"Founder becoming CEO ... Is this like a Steve Jobs returning or a Jerry Yang returning?" tweeted Chris Dixon, a technology veteran who has invested in Skype and Foursquare.

Steve Jobs returned to Apple Inc in the 1990s to save the company he founded. Yahoo Inc's Jerry Yang made a similar comeback, returning to his Internet company during a troubled stretch, but failed to restore its fortunes.

"It is important to note that, although the titles have changed, the core team remains the same ... this new team structure makes a lot of sense and could result in faster decision making," JP Morgan analysts led by Imran Khan said.

Some analysts believe Google's stock could gain another 20 percent from current levels.

Brokerage UBS said it was bullish on Google's long-term prospects and expects the company's focus on its emerging display network business, YouTube, Android and enterprise customers to deliver healthy returns in 2011.

Fourth-quarter operating margins were slightly weaker than expected at 53 percent on higher sales and marketing expenses.

JP Morgan's Khan, who lowered his 2011 operating margin estimates by less than a percentage point to 52.4 percent, said the expenses are necessary to promote future growth.

Evercore Partners, however, said it was still concerned about Facebook's growth trajectory and deepening integration with third party sites. Investors have speculated Facebook could cut into Google's business if advertisers shift to the social network.

Google Inc shares -- which gained 2 percent following Thursday's better-than-expected quarterly results and the announcement of the CEO change -- finished Friday's regular trading session 2.4 percent down at $611.83. The shares of Mountain View, California-based Google have risen 16 percent since Google reported third-quarter results mid-October and are up almost 45 percent from its 52-week low of $433.63 touched in July 2010.

(Reporting by Paul Thomasch in New York, Alexei Oreskovic in San Francisco and Sayantani Ghosh and Mary Meyase in Bangalore; editing by Joyjeet Das, Phil Berlowitz and Andre Grenon)

Apple's App Store hits 10 billion downloads (Reuters)

HELSINKI (Reuters) – Apple's App Store reached landmark 10 billion downloads on Saturday, further underlining the lead of the iPhone-maker in mobile online software battle, a counter on front page of the store showed.

Apple launched the iPhone store in mid-2008 and it proved to be an instant hit, driving sales of the smartphone and helping reshape the way mobile content is delivered.

The iPhone app store offers more than 300,000 programs, and there are also more than 40,000 apps available for the iPad.

Its closest rival is privately-held GetJar, which sells software for all platforms, and reached 1 billion downloads in June 2010.

Google's Android Market and Nokia's Ovi Store are among other larger mobile online stores.

(Reporting by Tarmo Virki)

Orange seen eying stake in Dailymotion: report (Reuters)

PARIS (Reuters) – France Telecom's Orange is in talks to buy a stake of between 30 percent and 50 percent in video-sharing web site Dailymotion, a blog on the website of French weekly L'Express said on Friday.

Orange declined to comment on the report, which did not cite a specific source.

Dailymotion was not immediately available for comment.

In an e-mailed invitation on Friday, France Telecom said its chief executive Stephane Richard will hold a news conference on January 25 to unveil "a new development in Orange's content strategy." It did not provide further details.

France Telecom, also known by its brand name Orange, is changing its content strategy as part of a plan by Richard to spur growth and restore worker morale after more than 30 staff committed suicide.

Earlier this week, Orange and French pay-TV group Canal Plus unveiled a strategic partnership, merging their cinema channels.

The blog put the value of Dailymotion at around 200 to 250 million euros ($270.7 million to $338.3 million), a far cry from the $1.65 billion Google paid to buy YouTube in 2006.

France's sovereign fund FSI, owner of close to 14 percent of France Telecom, invested 7.5 million euros in Dailymotion in October 2009.

($1=.7389 Euro)

(Reporting by Julien Ponthus and Dominique Vidalon; Editing by Jon Loades-Carter)

Music industry working on global copyright database (Reuters)

LONDON (Reuters) – The music industry is working to create a global repertoire database to make it easier and faster for new online music services to come to market.

The industry estimates that 100 million euros each year could be saved in copyright administration fees and returned to song writers and the industry by simplifying the current system.

In recent years, music labels and publishers have worked hard to license their music on an array of platforms including mobile networks, mobile handsets, websites, Internet service providers and pay-TV groups.

The long, complex process makes it difficult for many new services to get off the ground, as a new offering has to sign licensing agreements with the many groups that hold the recording rights and the music publishing rights.

Within publishing -- the part of the business that makes money every time a song is played on the radio, in adverts, films or online -- payments have to go to all the song writers on each track. One song can have many writers and they are often all signed to different publishers.

A service that operates in different countries would also need to agree terms with the royalty collection societies of each country it operates in, making for a very tangled affair.

However there is currently no database or central point showing which publisher or song writer unequivocally owns which rights, meaning it is hard to know where to start.

Now, consultancy Deloitte is working to develop a global repertoire database (GRD) for the publishing industry following input from Universal Music Publishing and EMI Publishing, some of the major royalty collection societies and retailers such as Amazon and iTunes.

The groups were asked by the European Commission to look into the issue.

"As an industry there have been many false dawns over the years but at last we seem to have woken up to the fact that we have to change," Neil Gaffney, Executive Vice President at EMI Music Publishing UK told Reuters.

"This GRD is a game changer because for the first time we will have an assured, common, trusted view of what we represent, own and manage.

"One of the complexities for a new services is people say they didn't know who to pay. It gets rid of one of the fundamental issues and means we can turn our attention to those people who use music illegally."

Deloitte partner Neil Allcock said they hoped elements of the database would be up and running very quickly, and aim to be fully functional within 18 months to 2 years. A similar project is also being looked at for the recorded music business.

(Editing by David Cowell)