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Intel plans to launch TV services

California (Reuters) - Top chipmaker Intel Corp plans to launch an Internet television service this year with live and on-demand content, entering a hotly competitive race as its core PC business erodes.

Shifting into an unfamiliar and potentially costly market in which Intel lacks experience and relationships, Erik Huggers, vice president and general manager of Intel Media, said he is negotiating with content providers.

He said hundreds of Intel employees and their families are already testing a set-top box the company will sell as part of the service.

Intel's move puts it into competition with heavyweights like Apple, Amazon and Google that believe the $100 billion cable television ecosystem is ripe for change.

The chipmaker plans to offer consumers smaller bundles of content than those currently offered by cable operators, Erik Huggers, vice president and general manager of Intel Media, told the AllThingsDigital "Dive into Media" conference on Tuesday.

Asked if Intel has inked any content deals, Huggers said he is working with providers and is confident Intel will have a compelling product to launch this year.

"We have been working for (the past) year to set up Intel media, a new group focused on developing an Internet platform," Huggers said. "It's not a value play, it's a quality play where we'll create a superior experience for the end user."

Intel has struggled to get its virtual television service off the ground due to unwillingness on the part of major media content providers to let the company unbundle and license specific networks and shows at a discount to what cable and satellite partners pay, according to sources.

Silicon Valley has been taking aim at the U.S. cable television market - dominated by major distributors such as Comcast and DirecTV Group and program makers like Walt Disney Co and Time Warner Inc. Technology companies see opportunities due to reasons ranging from shifting viewer habits to mounting programming costs.

A STEP BEYOND

Intel's plan, if successful, would go further than products currently offered by Apple, Amazon and Netflix by offering live programming as well as on-demand content.

"There is an opportunity to offer a bundle that can be curated by the consumer, an opportunity to create smarter bundles," Huggers said.

Intel's set-top-box will also have a camera that could be used to automatically steer content and ads toward specific users.

"There's a scenario where the TV recognizes that it's you and says 'Hey, I know what you like. I know what you want to watch', versus the environment we're in today where the TV literally is not interested in you at all," Huggers told Reuters In an interview.

Some media executives are skeptical that Intel will be able to convince content providers to agree to terms that are attractive enough to make its service viable. That view was shared by Bernard Gershon, head of digital consultancy GershonMedia and a former Disney senior vice president for strategic planning who helped develop Disney's online strategy.

"The chance that Intel launches is zero," Gershon, who speaks with media and digital executives, told Reuters at the conference. "They haven't cut any deals with any content companies, and they are not offering something that differentiates itself enough on service or price to get the deals done."

Analysts see Intel's leap into Internet television, along with its growing focus on smartphones and tablets, as a way to diversify beyond the slowing PC market.

"The question you have to ask with Intel is, Is anything they do big enough to move the needle?" said Stacy Rasgon, an analyst at Sanford Bernstein. "You're not going to make or break the company on something like this."

Huggers said in the interview that Intel employees are testing the device's user interface, sound and picture quality and other features.

"We're actively testing it in the field with employees. It's not the final product, but it's certainly functional," he said.

Industry insiders have said Apple may unveil a TV-based device that has the potential to shake up the cozy television content and distribution industry the way the iPod and iPhone disrupted music and mobile content.

Sources say Apple, which already sells a $99 set top box called Apple TV that streams Netflix and other content, has opened discussions with providers but it is unclear how much headway it has made, despite its reputation as a tough negotiator.

Huggers previously worked at Microsoft and the BBC, where in 2007 he launched iPlayer, an online service letting viewers catch up with programs they missed on regular television.

"The model we envision is a model where live television and catch-up television live in the same paradigm," Huggers said.

Intel's shares closed up 0.76 percent, at $21.19.

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Yahoo Inc Chief Executive Marissa Mayer said the company's search partnership with Microsoft Corp was not delivering the market share gains or the revenue boost that it should.

Yahoo Inc Chief Executive Marissa Mayer said the company's search partnership with Microsoft Corp was not delivering the market share gains or the revenue boost that it should.

"One of the points of the alliance is that we collectively want to grow share rather than just trading share with each other," Mayer said at the Goldman Sachs Technology and Internet Conference in San Francisco on Tuesday.

In her first appearance at an investor conference since taking the reins of the struggling Web portal in July, Mayer said she planned to prune a sprawling lineup of mobile apps and she reiterated her focus on enticing consumers to spend more time on Yahoo's online properties, in order to display more money-making ads.

"I'm not confused. Our biggest business problem right now is impressions. Basically can we grow impressions, can we get growth happening here," Mayer said.

Yahoo shares finished Tuesday's regular trading session up 31 cents at $21.21.

Mayer, 37, took over after a tumultuous period at Yahoo in which former CEO Scott Thompson resigned after less than 6 months on the job over a controversy about his academic credentials and in which Yahoo co-founder Jerry Yang resigned from the board and cut his ties with the company.

Yahoo's revenue in 2012 was flat year-over-year, at roughly $5 billion, and down from roughly $6.3 billion in 2010.

"We need to see monetization working better because we know that it can and we've seen other competitors in the space illustrate how well it can work," Mayer said of the search deal with Microsoft.

Yahoo and Microsoft entered into a 10-year search partnership in 2010, hoping their combined efforts could mount a more competitive challenge to Google Inc, the world's No.1 search engine. But the partnership has not lived up to expectations.

Google remains the dominant search engine, with a 66.7 percent share of the U.S. market in December, almost unchanged from its 66.6 percent share two years earlier, according to online analytics firm comScore.

Microsoft had 16.3 percent share and Yahoo had 12.2 percent share in December, a reversal of two years earlier when Yahoo's U.S. search share was 16 percent and Microsoft had 12 percent share.

Yahoo's stock has risen more than 30 percent since Mayer took the helm in July, reaching its highest levels since 2008.

Analysts say that part of the stock's rise has been driven by significant stock buybacks, using proceeds from a $7.6 billion deal to sell half of its 40 percent stake in Chinese Internet company Alibaba Group.

Mayer said that she viewed the company's relationship with Yahoo Japan, which is partly owned by Softbank, as "strategic" to the company. Under previous CEOs, Yahoo had engaged in unsuccessful discussions to "monetize" its roughly 35 percent stake in Yahoo Japan.

Apple Inc has been ordered to appear before Australia's parliament with fellow technology giants Microsoft Inc and Adobe Systems Inc to explain why local consumers pay so much for their products, despite the strong Aussie dollar.

 Apple Inc has been ordered to appear before Australia's parliament with fellow technology giants Microsoft Inc and Adobe Systems Inc to explain why local consumers pay so much for their products, despite the strong Aussie dollar.

Broadening a row between the world's most valuable company and Australian lawmakers over corporate taxes paid on Apple's operations, Apple executives were formally summonsed on Monday to front a parliamentary committee in Canberra on March 22.

"In what's probably the first time anywhere in the world, these IT firms are now being summoned by the Australian parliament to explain why they price their products so much higher in Australia compared to the United States," said ruling Labor government MP Ed Husic, who helped set up the committee.

High local prices and soaring cost-of-living bills for basic services are hurting the popularity of the minority Labor government ahead of a September 14 election it is widely tipped to lose, giving political momentum to the inquiry.

All three companies have so far declined to appear before the special committee set up in May last year to investigate possible price gouging on Australian hardware and software buyers, despite the Australian dollar hovering near record highs above the U.S. currency around A$1.03.

A 16GB WiFi iPad produced by Apple with Retina display sells in Australia for A$539, $40 above the price in the U.S., despite the stronger local currency. Microsoft's latest versions of office 365 home premium cost A$119 in Australia versus $99.99 in the United States.

IT firms and other multinationals have blamed high operating costs in Australia including high local wages and conditions, as well as import costs and the relatively small size of the retail market in the $1.5 trillion economy.

Failure to appear before the committee as ordered could leave all three firms open to contempt of parliament charges, fines or even jail terms.

"For some time consumers and businesses have been trying to work out why they are paying so much more, particularly for software, where if it's downloaded there is no shipping or handling, or much of a labor cost," Husic told Reuters.

Adobe and Microsoft have previously provided separate written statements and submissions to the inquiry. But executives have been reluctant to explain their pricing before a public inquiry.

Apple executives in Australia declined to comment when contacted by Reuters.

"The companies have blamed each other for not appearing. One will say 'we're not going to appear if the other is not going to appear'. So we've cut straight to the chase and said we'll just summons you," Husic said.

Price gouging in IT for hardware and software, Husic said, could be costing Australia's more than 2 million small and medium businesses as much as $10 billion extra.

Husic took aim at Apple last week over local taxes paid by the company, telling parliament that Apple generated A$6 billion in revenue in Australia in 2011, but paid only A$40 million in tax - less than one percent of turnover.

"While they generated A$6 billion in revenue, they apparently racked up from what I understand A$5.5 billion in costs. How?" Husic said. "They do not manufacture here. They have no factories here."

He accused Apple executives of maintaining a "cloak of invisibility", while dodging scrutiny of operations. Apple has been criticized elsewhere for its zealous secrecy.

"Ask anyone who has sought answers from them about their Australian operations and you will hear a common theme. They will not talk," he said.

Fashion Design Go Digital

NEW YORK (Reuters) - Hundreds of fashion designers are showing their fall and winter 2013 collections at New York Fashion Week, but not all of them are on the runway.

The semi-annual event, which is followed by fashion weeks in London, Paris and Milan, includes up to 500 fashion shows around New York and attracts about 232,000 people, from buyers to foreign press and wealthy customers.

Top name designers at Mercedes Benz Fashion Week, which runs at Manhattan's Lincoln Center through February 14, have been streaming their runway shows online for the past three or four years.

Now, many lesser-known names, up-and coming-fashion stars and established designers who want to reach a wider, younger audience are going digital.

"This season it is really prevalent," said Stacy Roman of the New York fashion and publicity firm Factory PR. "There has definitely been an increase in this type of platform."

In addition to reaching a wider audience, going digital lets designers give fashionistas a behind-the-scenes look at the show and presentations, taking them backstage and through make-up and even fittings.

It is also far less expensive than staging a runway show, which can run upwards of $100,000 depending on the venue, models, makeup artists, stylists and disc jockeys for the show.

THINKING OUTSIDE THE BOX

Rachel Roy, who launched her first collection in 2005 and has done presentations at Fashion Week, will feature her designs in a digital runway show to stream live on February 14.

"It just really seemed like the right thing to do," said Roy, whose collection juxtaposes modern and antique looks with deep jewel tones and bright metallics, textured and smooth fabrics and light with dark colors.

"I always want to think outside the box, to do something that is new and fresh, and I think part of my job is to bring newness to fashion," she said. "Part of doing that is showing to as many people that love fashion, that want it, making it accessible to them."

Roy is building a full set for her digital show and will include backstage shots to let viewers experience all elements of the production.

Los Angeles-based Kelly Wearstler is also taking the digital route and will feature plenty of denim in a collection that will be displayed in her New York showroom and in a digital show with behind-the-scenes videos shot in her California studio.

"I am in the infancy stage of my fashion world, and I have a ton to learn, so I am baby-stepping it," said Wearstler, who launched her fashion line 18 months ago but has been in interior design for more than 17 years and has a flagship store in Los Angeles.

The content will go out on several digital platforms including her blog , Twitter, the content sharing service Pinterest, the photo sharing and social networking services Instagram and Facebook, as well as fashion-focused websites such as Refinery29.com, racked.com, Style.com and Vine, Twitter's new video sharing app for recording and sharing six-second clips.

"Right now I am happy where I am, learning and growing," she added.

For 32-year-old Radhika Perera-Hernandez, who designs for her New York based-Lois London label, there was no question that online is the place to be.

"It is the smartest way for a start-up line to get their name out there. A lot of designers that are at the same level as myself are doing the same kind of thing," she said.

Perera-Hernandez, who was born and raised in London, features kaftans, jumpsuits and swimwear in her collection.

"Anything that I am doing for the brand I will be pushing through my website and (the microblogging website) Tumblr and any of the other viral things that I have going on."

Pope Benedict XVI announced Monday that he would resign Feb. 28 - the first pontiff to do so in nearly 600 years. The decision sets the stage for a conclave to elect a new pope before the end of March.

VATICAN CITY (Reuters) - Pope Benedict stunned the Roman Catholic Church, including his closest advisers on Monday when he announced he would stand down in the first papal abdication in 700 years, saying he no longer had the mental and physical strength to run the Church through a period of major crisis.

Church officials tried to relay a climate of calm confidence in the running of a 2,000-year-old institution but the decision could lead to one of the most uncertain and unstable periods in centuries for a Church besieged by scandal and defections.

Several popes in the past, including Benedict's predecessor John Paul, refrained from stepping down even when severely ill, precisely because of the confusion and division that could be caused by having an "ex-pope" and a reigning pope living at the same time.

This could create a particularly difficult problem if the next pope is a progressive who influences such teachings as the ban on women priests and artificial birth control and its insistence on a celibate priesthood.

The Church has been rocked during Benedict's nearly eight-year papacy by child sexual abuse crises and Muslim anger after the pope compared Islam to violence. Jews were upset over rehabilitation of a Holocaust denier and there was scandal over the leaking of the pope's private papers by his personal butler.

In an announcement read to cardinals in Latin, the universal language of the Church, the 85-year-old said: "Well aware of the seriousness of this act, with full freedom I declare that I renounce the ministry of Bishop of Rome, Successor of St Peter ...

"As from 28 February 2013, at 20:00 hours (1900 GMT) the See of Rome, the See of St. Peter will be vacant and a conclave to elect the new Supreme Pontiff will have to be convoked by those whose competence it is."

POPE DOESN'T FEAR SCHISM

At a news conference, chief Vatican spokesman Father Federico Lombardi said the pope did not fear a possible "schism" in the Church, with Catholics owing allegiances to a past and present pope in case of differences on Church teachings.

The pope, known for his conservative doctrine, stepped up the Church's opposition to gay marriage, underscored the Church's resistance to a female priesthood and to embryonic stem cell research.

But Lombardi said Benedict, who is expected to go into isolation for at least a while after his resignation, did not intend to influence the decision of the cardinals who will enter a secret conclave to elect a successor.

A new leader of the world's 1.2 billion Roman Catholics could be elected as soon as Palm Sunday, on March 24, and be ready to take over by Easter a week later, Lombardi said.

He indicated the complex machinery of the process to elect a new pope would move quickly because the Vatican would not have to wait until after the elaborate funeral services for a pope.

The decision shocked many throughout the world, from ordinary believers, to politicians to world religious leaders.

"This is disconcerting, he is leaving his flock," said Alessandra Mussolini, a parliamentarian who is granddaughter of Italy's wartime dictator.

"The pope is not any man. He is the vicar of Christ. He should stay on to the end, go ahead and bear his cross to the end. This is a huge sign of world destabilization that will weaken the Church."

OWN BROTHER SURPRISED

The announcement even caught the pope's elder brother Georg Ratzinger, off guard, indicating just how well-kept a secret it was. Ratzinger told reporters in Germany that he had been "very surprised" and added: "He alone can evaluate his physical and emotional strength."

Lombardi said Benedict would first go to the papal summer residence south of Rome and then move into a cloistered convent inside the Vatican walls. It was not clear if Benedict would have a public life after he resigns.

The last pope to resign willingly was Celestine V in 1294 after reigning for only five months, his resignation was known as "the great refusal" and was condemned by the poet Dante in the "Divine Comedy". Gregory XII reluctantly abdicated in 1415 to end a dispute with a rival claimant to the papacy.

Lombardi said Benedict's stepping aside showed "great courage". He ruled out any specific illness or depression and said the decision was made in the last few months "without outside pressure".

Joseph Curran, professor of religious studies at Misericordia University in Dallas, Pennsylvania, said the modern medicine prolonging the life of people had posed difficulties for institutions whose leaders usually rule for life.

"His resignation is a tremendous act of humility and generosity," he said. "A man who lives up a position of authority because he can no longer adequately exercise that authority, and does so for the good of the Church, is setting a wonderful example," he said.

But Cardinal Stanislaw Dziwisz, secretary to the late Pope John Paul, who suffered through bad health for the last decade of his life, had a thinly veiled criticism of Benedict. John Paul stayed to the end of his life as he believed "you cannot come down from the cross," Dziwisz told reporters in Poland.

NO HINT OF RESIGNATION

While the pope had slowed down recently - he started using a cane and a wheeled platform to take him up the long aisle in St Peter's Square - he had given no hint recently that he was mulling such a dramatic decision.

Elected in 2005 to succeed the enormously popular John Paul, Benedict never appeared to feel comfortable in a job he said he never wanted. He had wished to retire to his native Germany to pursue his theological writings, something which he will now do from a convent inside the Vatican.

The resignation means that cardinals from around the world will begin arriving in Rome in March and after preliminary meetings, lock themselves in a secret conclave and elect the new pope from among themselves in votes in the Sistine Chapel.

There has been growing pressure on the Church for the cardinals to shun European contenders and choose a pope from the developing world in order to better reflect parts of the globe where most Catholics live and where the Church is growing.

John Paul was only 58 when he was elected in 1978 - 20 years younger than Benedict when he was elected - and some commentators said the resignation would likely convince the cardinals to elect a younger man.

"MIND AND BODY"

In his announcement, the pope told the cardinals that in order to govern "... both strength of mind and body are necessary, strength which in the last few months, has deteriorated in me to the extent that I have had to recognize my incapacity to adequately fulfill the ministry entrusted to me."

Before he was elected pope, the former Cardinal Joseph Ratzinger, was known by such critical epithets as "God's rottweiler" because of his stern stand on theological issues.

After a few months, he showed his mild side but he never drew the kind of adulation that had marked the 27-year papacy of his predecessor John Paul.

The Archbishop of Canterbury, leader of the worldwide Anglican communion at odds with the Vatican over women priests, said he had learned of the pope's decision with a heavy heart but complete understanding.

German Chancellor Angela Merkel said the pope's decision must be respected if he feels he is too weak to carry out his duties. British Prime Minister David Cameron said: "He will be missed as a spiritual leader to millions."

Elected to the papacy on April 19, 2005, Benedict ruled over a slower-paced, more cerebral and less impulsive Vatican.

CHEERS AND SCANDAL

But while conservatives cheered him for trying to reaffirm traditional Catholic identity, his critics accused him of turning back the clock on reforms by nearly half a century and hurting dialogue with Muslims, Jews and other Christians.

After appearing uncomfortable in the limelight at the start, he began feeling at home with his new job and showed that he intended to be pope in his way.

Despite great reverence for his charismatic, globe-trotting predecessor -- whom he put on the fast track to sainthood and whom he beatified in 2011 -- aides said he was determined not to change his quiet manner to imitate John Paul's style.

A quiet, professorial type who relaxed by playing the piano, he showed the gentle side of a man who was the Vatican's chief doctrinal enforcer for nearly a quarter of a century.

The first German pope for some 1,000 years and the second non-Italian in a row, he traveled regularly, making about four foreign trips a year, but never managed to draw the oceanic crowds of his predecessor.

The child abuse scandals hounded most of his papacy. He ordered an official inquiry into abuse in Ireland, which led to the resignation of several bishops.

Scandal from a source much closer to home hit in 2012 when the pontiff's butler, responsible for dressing him and bringing him meals, was found to be the source of leaked documents alleging corruption in the Vatican's business dealings, causing an international furor.

Benedict confronted his own country's past when he visited the Nazi death camp at Auschwitz.

Calling himself "a son of Germany", he prayed and asked why God was silent when 1.5 million victims, most of them Jews, died there during World War Two.

Ratzinger served in the Hitler Youth during World War Two when membership was compulsory. He was never a member of the Nazi party and his family opposed Adolf Hitler's regime.

(Additional reporting by James Mackenzie, Barry Moody, Cristiano Corvino, Alexandra Hudson in Berlin, and Dagamara Leszkowixa in Poland; editing by Peter Millership, Ralph Boulton, Janet McBride)

LinkedIn Price up

LinkedIn Corp extended its hot streak on Thursday, announcing both blow-out quarterly profits and a bullish forecast for the new year that exceeded Wall Street's already lofty expectations.

The results reaffirmed the "professional" social network's reputation as a fast-growing but sure-footed business -- and the star exception in a mostly disappointing social media sector.

Excluding certain items, net income was $40.2 million, or 35 cents a share, well above the 19 cents expected by analysts polled by Thomson Reuters I/B/E/S.

The results meant LinkedIn beat analyst estimates for the seventh quarter in a row and sent shares of the company, which have doubled in the past 12 months, soaring 9 percent higher to $135 after hours.

Revenue rose a better-than-expected 81 percent from a year ago to $303.6 million, as millions of new job seekers and corporate recruiters around the world signed up with LinkedIn to post resumes or poach competitors' employees.

The company offered bullish forecasts for the first quarter as well, projecting revenue between $305 million and $310 million, above analyst estimates of $301 million.

"You can pick out a lot of things that were great, from customer adds to accelerating revenue to growth in international," said Kerry Rice, an analyst at Needham & Co. "On top of that, guidance is pretty outstanding. And from a historical perspective, they'll likely beat those numbers too."

TURBOCHARGED GROWTH

Founded by former PayPal employees in 2002, LinkedIn remains one of the most profitable Web companies, with gross margins approaching 90 percent.

At a time when Facebook Inc stock trades 25 percent below its initial public offering price and basic questions loom over the business models of online gaming group Zynga Inc and daily deals company Groupon Inc, LinkedIn has proved it can consistently make money by selling access to its 200 million users' resumes since it went public in May 2011 at $45 a share.

The size of LinkedIn's user base has reinforced its position against competitors, few of whom pose a serious challenge. Facebook only recently announced a "Jobs Board" tool in November. And on Thursday, shares of Monster Worldwide Inc fell 7 percent after the human resources company reported a quarterly loss and said it would pull out of several countries.

Analysts in recent months, however, have begun to question how long LinkedIn can sustain its turbocharged growth as it becomes saturated in some U.S. markets.

On Thursday's earnings call, company executives said the majority of LinkedIn's users are now based outside of the United States, and the company is aggressively targeting job markets in Hong Kong and Brazil.

Sales from international markets more than doubled over the past year to $114.6 million, or 38 percent of total revenue in the quarter, the company said.

In response to a slowdown in user growth and the slide in page views, LinkedIn has introduced some social media features to encourage visitors to click more on its site, as opposed to uploading their resumes and never coming back.

LinkedIn has introduced personal blogs by successful businesspeople like Sir Richard Branson, whom users can "follow" for updates.

Chief Executive Jeff Weiner told analysts on Thursday's earnings call that the blog series, called "Influencers," has exceeded expectations and now features contributions from business luminaries like GE Chairman Jeffrey Immelt and investor Mark Cuban.

Other social mechanics, such as a recent addition that encouraged users to endorse their colleagues for their professional skills, also helped keep users coming back to the site more frequently, Weiner said.

The endorsements feature had the effect of "creating the right kind of viral loops," he said.

(Editing by Matthew Lewis and Rich