Welcome to “The Week in Tech,” where we recap some of the most interesting technology and mobile stories from the past week.
This week we highlight Apple’s patent lawsuit, Jack Dorsey’s busy week, and Netflix’s missed earnings.
Wisconsin Alumni Research Foundation wins patent lawsuit against Apple
Reuters reported on Tuesday that a Wisconsin jury found Apple in violation of a patent owned by the Wisconsin Alumni Research Foundation (WARF). Patent “752” improves chip efficiency and was granted in 1998. The lawsuit targets the A7, A8, and A8X processor chips found in iPhone 5s and 6/+ devices.
WARF has a proven track record of pursuing their patent rights. In 2008, they settled with Intel on patent 752 for $110 million. Back in 2003, they also settled with Sony for the chip used in the PlayStation 2. Apple allegedly ignored WARF’s offer to license the patent.
Apple could pay up to $864 million in damages, depending on subsequent phases of the trial. To top it off, WARF also has another lawsuit in the pipeline against the A9 and A9X chips used in the latest iPhone 6s/+ and iPad Pro devices. Afraid of becoming the next target, major tech firms are taking a stand against patent trolls.
Jack Dorsey’s busy week
Returning CEO Jack Dorsey announced layoffs on Tuesday as Twitter focuses on a more “streamlined roadmap”. This impacts 336 employees, which represents 8% of the company. Twitter stock rose 5%.
The announcement promised severance packages and job search assistance for effected employees. Other companies are scrambling to scoop up this engineering talent using the #TwitterLayoffs hashtag.
Jack Dorsey is still the CEO of Square, which filed to go public on Wednesday. Square is known for making credit card readers that work with tablet and mobile devices, but also provides other financial services. The SEC filing revealed that Square has a lot of sales but hasn’t turned profitable yet. Jack Dorsey also owns 24.4% of Square.
Folks are worried that the CEO may not have the bandwidth to corral investors for the Square IPO while turning Twitter around.
Netflix misses earnings and stock dives 8%
Netflix missed earnings Wednesday by one cent per share. Netflix blames involuntary churn caused by the recent EMV credit card deadline. As credit card companies raced to issue updated cards, this supposedly gave users pause on whether to re-up their Netflix subscription. Not everyone is buying this excuse though.
Netflix is considered a high growth stock, so missing an earnings estimate is a big deal. But the main concern is a slowdown in domestic growth. Netflix added 880,000 domestic subscribers, missing its estimate of 1.15 million. Maybe the market is saturated or there’s too much competition. Or maybe Netflix is just feeling the consequences of rolling off Epix this past summer. As Ellen DeGenres puts it, “Netflix basically has every movie, except for the ones I actually want to watch.”
What do you think of these stories? Have you read other interesting mobile and technology stories this week that are worth mentioning? Feel free to add your thoughts to the comments.
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