Hot Off Wire: Rosetta Stone loses Google suit; Motorola back in black; Associated Press revenues plunge
A roundup of the latest high-tech news “Hot Off the Wire” from The Associated Press:
• Rosetta Stone loses court case against Google
ARLINGTON, Va. - Foreign language education company Rosetta Stone Inc. said Thursday it lost a court case in which it sued Google Inc. for allowing rivals to advertise copycat software when Rosetta trademarks are used in search terms.
The company said it was "deeply disappointed" that its suit was dismissed by the U.S. District Court for the Eastern District of Virginia.
The company said the decision will "permit Google to continue to create consumer confusion" by allowing counterfeit products to be sold using its trademarks.
Rosetta Stone said that Google knows counterfeit software is being advertised using its AdWords system and takes no effective steps to stop the activity.
The company said it will consider an appeal upon reviewing the court's written decision.
A representative of Google did not immediately respond to a request for comment.
• Motorola posts profit, strong sales; stock jumps
NEW YORK - Motorola Inc. (NYSE: MOT) posted an unexpected profit in the first quarter, as sales of its new phones outdid its own forecasts. It also gave an outlook that was brighter than Wall Street was predicting, and its shares jumped Thursday.
However, it has lost its position as the largest U.S. maker of phones to Apple Inc. Motorola sold a total of 8.5 million phones in the quarter, while Apple sold 8.8 million iPhones. Four years ago, when the Razr was still popular, Motorola sold 46.1 million phones in the first quarter.
The Schaumburg, Ill., company has been trying to turn around that long slide in phone sales by focusing on new smart phones, including the Droid. That strategy is bearing fruit, but too slowly to compensate for the drop in overall phone sales. Motorola sold 2.3 million smart phones in the first three months of the year. It had said it expected to sell less than 2 million.
A year ago, Motorola sold 14.7 million phones in the comparable quarter. The drop in phone revenue in the latest quarter was just 9 percent - less steep than the drop in overall unit sales would suggest. Motorola can charge much more for the new smart phones than for run-of-the-mill phones.
Sanjay Jha, the head of the phone business, said on a conference call he expects smart phone sales to be up this quarter, while overall phone sales will continue to decline. Motorola is now the world's seventh-largest maker of phones, down from fifth in the fourth quarter.
As a whole, Motorola earned $69 million, or 3 cents per share in the quarter. In the same quarter a year ago, it lost $231 million, or 13 cents per share.
Motorola had said it expected to lose 1 cent to 3 cents per share for the quarter.
Revenue fell 6.1 percent to $5.04 billion. Analysts polled by Thomson Reuters were expecting $5.1 billion in revenue.
• Associated Press profit and revenue slide in 2009
NEW YORK - The Associated Press said Thursday its net income plunged as revenue fell nearly 10 percent last year. The news cooperative also expects a decline in revenue this year, which would be its first back-to-back drop since the Great Depression.
The AP released its 2009 financial results at the not-for-profit organization's annual meeting in New York. AP executives used the forum to explain some of the ways they hope to boost revenue for the organization and its members, such as with news applications for the iPad.
Net income decreased 65 percent to $8.8 million in 2009 from $25.1 million a year earlier. The AP would have posted a loss had it not booked a $13.2 million gain from the sale of its German-language news service. Revenue totaled $676.1 million, a drop from $747.7 million in 2008.
It was the first annual decline in revenue since a 6 percent drop in 1993. If revenue falls this year as anticipated, it would be the first time that has happened in consecutive years since 1932 and 1933, according to the 164-year-old organization's corporate archives.
The cooperative has been cutting the fees of both U.S. newspapers and broadcasters, which together account for 40 percent of revenue, to help them deal with their own financial woes.
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