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Tuesday, August 9, 2011

Apple briefly passes Exxon as most valuable US co. (AP) : Technet

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Apple briefly passes Exxon as most valuable US co. (AP) : Technet

Apple briefly passes Exxon as most valuable US co. (AP)

Posted: 09 Aug 2011 01:52 PM PDT

By BARBARA ORTUTAY, AP Technology Writer Barbara Ortutay, Ap Technology Writer – Tue Aug 9, 4:52 pm ET

NEW YORK – Apple briefly surpassed Exxon Mobil on Tuesday as the nation's most valuable company.

The iPhone and iPad maker had the lead for much of the afternoon before its stock closed just behind Exxon's. The two companies are so close that Apple is likely to keep the top spot soon.

Apple Inc.'s stock gained 5.9 percent to $374.01 on Tuesday, bringing its market capitalization to about $347 billion.

Exxon Mobil Corp.'s stock, meanwhile, closed up 2.1 percent at $71.64. That gives the oil company a market cap of $348 billion. Its stock was down earlier in the day, allowing Apple to take the lead.

Other big-name corporations, such as Wal-Mart Stores Inc. and General Electric Co., don't even come close. Apple overtook Microsoft Corp., the previous No. 2, just last year.

Does this mean people need iPads more than oil?

"Exxon obviously sells a product that people need. Apple sells a product that people want," said Brian Marshall, an analyst with Gleacher & Co. who follows Apple.

Exxon, which set a record in 2008 for the highest quarterly earnings by any company, has limited growth prospects, which are driven by oil prices and discovering new oil. It's growing, but not as quickly as Apple, which is charging ahead at the pace of a startup, Marshall says, even though the company is 35 years old.

Apple, which is based in Cupertino, Calif., has been on a roll with the soaring popularity of its iPad tablet computer and strong sales of the iPhone. Its growth is limited only by innovation. Investors expect it to grow as long as it keeps making products that people want. So investors are betting on Apple's stock even though it currently makes less money than Exxon.

In its latest quarterly report, Apple said stronger iPhone and iPad sales helped more than double its net income to $7.31 billion and grow revenue by 82 percent to $28.6 billion.

Exxon Mobil, meanwhile, posted a 41 percent increase in its second-quarter earnings to $10.68 billion, the largest since it set a record of $14.8 billion in the third quarter of 2008. Its revenue grew 36 percent to $125.5 billion.

International companies that vie for the most valuable spot in the world include PetroChina Co., the publicly traded unit of China's biggest oil and gas company, and Petrobras, Brazil's state-controlled energy company.

In the U.S., Exxon and General Electric had been trading off the No. 1 and No. 2 spots until Microsoft surpassed them both in early 1999, at the height of the dot-com boom. By 2000, though, GE was No. 1 once again. According to data from FactSet, the three were close over the next five years, though Apple was ascending quickly.

Exxon Mobil, which is based in Irving, Texas, took the top spot in 2005 and, for now, remained there on Tuesday.

Marshall believes Apple may pass yet another milestone next year, when it's likely to surpass Hewlett-Packard Co. as the world's largest technology company by revenue. In the quarter that ended in April, HP reported $31.6 billion in revenue, compared with Apple's $28.6 billion in the just-ended period. HP reports results for the May-July period next week.

AOL posts smaller 2Q net loss, ad revenue grows (AP)

Posted: 09 Aug 2011 09:18 AM PDT

By BARBARA ORTUTAY and RACHEL METZ, AP Technology Writers Barbara Ortutay And Rachel Metz, Ap Technology Writers – Tue Aug 9, 12:18 pm ET

NEW YORK – Internet company AOL Inc. said Tuesday that its net loss narrowed in the second quarter even though revenue fell, largely because the results a year ago were weighed down by a huge accounting charge.

AOL's advertising revenue grew for the first time since 2008 in what CEO Tim Armstrong called "another meaningful step forward in the comeback of the AOL brand."

But investors sent AOL's stock tumbling 20 percent as they focused on a slowdown in June and lowered expectations for an adjusted income figure.

The company has been working on turning its business around as demand for its old dial-up Internet access service fades. It's been trying to boost advertising opportunities by expanding content offerings to lure visitors.

AOL bought The Huffington Post this year for $315 million and the technology blog TechCrunch last year, adding them to a stable that currently includes more than 50 websites.

"We have cleaned up and simplified our operations," Armstrong told analysts in a conference call. "We're witnessing encouraging metrics in key growth areas, and we're seeing the beginning of this manifest in our reported numbers."

Investors weren't as impressed. The company's stock dropped $2.97 to $12.10 in midday trading Tuesday. Earlier, it traded as low as $11.80, marking the stock's cheapest price since it began trading publicly after separating from media conglomerate Time Warner Inc. in late 2009.

Investors may have been focusing on AOL's revenue from display advertising and search, both of which weakened in June. Much of the growth in ad revenue came from its less-profitable third-party ad business. Chief Financial Officer Artie Minson said AOL's search advertising trends "got a little bit weaker as we moved through the quarter."

The company lowered its outlook for a figure called adjusted operating income before depreciation and amortization, or OIBDA. This measures restructuring costs, stock-based compensation and gains and losses on asset disposals, among other items. It expects adjusted OIBDA in the range of $340 million to $370 million for the full year.

Evercore Partners analyst Ken Sena said investors seem concerned about this figure because it suggests, among other things, that some acquisitions the company made this year aren't contributing as much to AOL's profitability as the company would like.

And given that the company reorganized its advertising sales force in July, he said this "just gives the impression that the company is still very much in turnaround phase instead of inflecting and showing some positive signs."

For the second quarter, AOL posted a net loss of $11.8 million, or 11 cents per share. A year ago it lost $1.06 billion, or $9.89 per share. That was largely because of writedowns of $1.41 billion for the declining value of its assets and the sale of social networking site Bebo.

In the latest quarter, AOL booked special items totaling 15 cents per share. Excluding these, the company would have earned 4 cents per share.

Revenue fell 8 percent to $542 million from $592 million. Analysts had expected lower revenue of $535 million, according to a poll by FactSet.

Advertising revenue grew 5 percent to $319 million, helped by AOL's acquisition of Huffington Post.

Subscription revenue fell 23 percent to $201 million as fewer people paid to access AOL's waning dial-up service.

___

Rachel Metz reported from San Francisco.

Just Show Me: How to create a new station in Pandora (Yahoo! News)

Posted: 09 Aug 2011 06:18 PM PDT

Military-inspired camera launcher can give you perspective on your surroundings (Yahoo! News)

Posted: 09 Aug 2011 06:14 PM PDT

The Rise of the Mobile Workforce [INFOGRAPHIC] (Mashable)

Posted: 08 Aug 2011 07:29 PM PDT

Ben Parr Ben Parr – Mon Aug 8, 10:29 pm ET

The era of the nine to five job is over. Even just a few years ago, you were expected to commute to work, put in your hours and drive back home. Once you left work, it was done until you came back into the office the next way. Thanks to laptops, smartphones, tablets and Wi-Fi, that has all changed. As long as you have an Internet connection, you can file reports, hold meetings, edit proposals and complete practically all of your work tasks remotely. As a result, telecommuting is on the rise, and more and more work is completed via our mobile devices.

[More from Mashable: New Balance Offers Free Shoes If You Can Find Virtual Batons [VIDEO]]

Social contact manager Gist, acquired by RIM earlier this year, has analyzed some of the data around the rise of the mobile workforce, detailing where they prefer to work and the devices they use to do it. The infographic below provides a nice overview of this very important business trend.

Check out Gist's infographic, and let us know how much of a mobile worker you are in the comments below.

[More from Mashable: Mobile App Uses Twitter Feeds To Find Nearby Food Trucks]

This story originally published on Mashable here.

Demand Media beats quarterly revenue forecasts (Reuters)

Posted: 09 Aug 2011 04:57 PM PDT

By Jennifer Saba Jennifer Saba – Tue Aug 9, 7:57 pm ET

NEW YORK (Reuters) – Demand Media Inc beat revenue expectations, pointing to a possible sign that search engine changes at Google Inc have not affected the company as much as feared.

Second-quarter revenue excluding traffic acquisition costs was up 34 percent to $76.6 million, above analysts' average expectation of $73.9 million according to Thomson Reuters I/B/E/S, Demand said on Tuesday.

Demand Media is an online company that relies on freelance writers to provide articles and videos designed to appear at the top of Internet searches that in turn generate ad revenue.

The company also said it renewed its global advertising relationship with Google through a three-year agreement and bought online ad company Indie Click, as well as social media company RSS Graffiti.

The agreement with Google includes the inclusion of Demand Media in the search giant's display ad network reserved for quality content.

Based in Santa Monica, California, Demand Media works with about 13,000 freelancers who churn out articles, such as "How to plant heirloom sunflowers," that appear on its Websites eHow and LiveStrong, as well as its partners sites such as Gannett Co Inc's USA Today.

Since its founding in 2006, Demand has raised the eyebrows of news editors because of its use of software algorithms to forecast what stories consumers want.

The company has been striking partnerships with celebrities such as Rachael Ray and Tyra Banks for branded content and has been commissioning longer reported pieces to raise the quality of its offerings.

It was one of the first online companies to go public this year, testing the waters with an IPO that surged about 33 percent above its initial price. But since its January IPO, Demand shares have fallen roughly 60 percent.

Investors are concerned that changes Google made to its formula to return search results of higher quality -- known in technology circles as "panda" -- have hurt Demand Media's traffic and therefore its ability to generate revenue based on advertising.

During the second quarter, Google made two changes to how search engine results are delivered. Demand's Chief Financial Officer Charles Hilliard said it affected revenue at eHow, but the site represents about 32 percent of second quarter revenue.

Overall, the company expects the Google changes to impact revenue by 6 percent for 2011.

Demand forecast yearly revenue ex-TAC in the range of $308 million to $316 million.

Analysts's revenue outlook for 2011 is $314.3 million.

Demand reported a net loss of $2.4 million, or 3 cents per share, compared with a loss of $1.9 million, or 75 cents per share, a year earlier.

Adjusted for stock based compensation, Demand reported EPS of 6 cents per share beating analysts' estimate by a penny.

Earlier in the day, AOL shares plummeted more than 25 percent after it reported a second-quarter loss, citing weaker than expected advertising growth.

(Editing by Gunna Dickson and Andre Grenon)

LightSquared will not be allowed to harm GPS: FCC (Reuters)

Posted: 09 Aug 2011 04:41 PM PDT

By Jasmin Melvin Jasmin Melvin – Tue Aug 9, 7:41 pm ET

WASHINGTON (Reuters) – Communications regulators were adamant on Tuesday that hedge fund manager Philip Falcone's satellite broadband start-up would not be allowed to operate if it posed a risk to GPS services.

The Federal Communications Commission and other agencies are evaluating Falcone's LightSquared after months of testing found its original plan for a high-speed wireless network would interfere with GPS services.

Some 500 million GPS receivers are estimated to be in government or commercial use in the United States, serving critical public safety functions like aviation navigation, emergency communications and weather tracking.

"We're not going to do anything that creates problems for GPS safety and service as we explore technical solutions that will both protect GPS and allow a new service to launch," FCC Chairman Julius Genachowski said during a press conference after the agency's monthly open meeting.

LightSquared in June unveiled a new plan for deploying its network that uses a different block of wireless airwaves that is farther away from the GPS band.

The company hopes this will deal with interference issues and satisfy the FCC, which must give its approval before the network can be built.

But an FCC official speaking at a background briefing for the press said creating such a "guard band" between LightSquared's airwaves and those used for GPS left a large swath of spectrum underutilized.

The official said they would like to find a solution that is better for long-term spectrum policy and allows efficient use of the airwaves.

The FCC is currently working with the Obama administration to make 500 megahertz of spectrum available over the next 10 years to meet the growing demand for mobile broadband.

Comments on the new proposal are due to the FCC by August 15. The agency could not give a time table for when a decision might be made on how to proceed but said more testing may be warranted.

LightSquared intends to invest $14 billion over the next eight years to build a wireless network, and aims to sell wholesale wireless services to companies such as Best Buy Co, which would then resell the service under their own brand names.

Genachowski said ultimately "the facts and engineering" would hold LightSquared's fate.

The company would serve around 260 million people with its cellular network and provide satellite coverage over the entire United States, meaning subscribers with dual land-based and satellite service could make a call from anywhere in the country.

Falcone and investors in his Harbinger Capital Partners hedge fund have gambled billions of dollars on the success of LightSquared, making the fund the company's largest single equity investor.

The telecommunications start-up has become one of Falcone's riskiest and most high-profile bets.

The FCC official said that the agency is aware of LightSquared's financial situation but said that would have no impact on the agency's review of its network. (Reporting by Jasmin Melvin; Editing by Steve Orlofsky)

Judge rejects Comcast demand for limits on DirecTV ads (Reuters)

Posted: 09 Aug 2011 06:02 PM PDT

By Tim Molloy Tim Molloy – Tue Aug 9, 9:02 pm ET

NEW YORK (TheWrap.com) – An Illinois federal judge denied Comcast's request for a temporary restraining order barring DirecTV from making various claims about its NFL Sunday Ticket service.

"We're pleased the judge recognized Comcast's veiled attempt to limit our ability to compete in the marketplace and denied the," said Jon Gieselman, senior vice president of marketing and direct sales for DirecTV. "We're happy to go head-to-head with Comcast any day on whose service is superior, so we look forward to competing in the marketplace rather than the courtroom."

In a suit filed last week, Comcast objected to DirecTV offering customers Sunday Ticket for "free" or at "no extra charge." Comcast argues that the service is not free because it "requires a two-year contract with hefty termination fees for early cancellation, with the NFL Sunday Ticket service automatically renewing in the second year at full price."

It further accuses DirecTV of going to "great lengths to conceal this fact from customers."

Comcast's suit will still continue, but it would have been a good sign for Comcast's future success if the judge has sided with the company early on.

Pamela Chelin contributed to this report.

Face it! These free Android video calling apps rock (Appolicious)

Posted: 09 Aug 2011 02:30 PM PDT

Twitter photo sharing goes live for all users (Digital Trends)

Posted: 09 Aug 2011 08:25 PM PDT

Mike Flacy Mike Flacy – 1 hr 17 mins ago

twitter

Announced during June of this year, Twitter rolled out the ability to upload photos to all users today. When users log into the Web version of Twitter, they will be greeted with a prompt that directs users to click the new camera icon underneath the messaging box to choose a photo to upload. Twitter has put a 3MB limit on the size of photos and photos immediately appear in thumbnail mode before a user completes the message. The user also has the ability to delete the picture before sending the tweet. All images are being hosted by Photobucket and will show up as "pics.twitter.com" links within the Twitter feed.

twitter-photo-promptUsers also have the ability to add the pictures to Twitter's search function by adding hashtags to the tweet. Users can also comment on photos by simply replying to the tweet containing the photo link. At the moment, only Web users can take advantage of photo uploading. Twitter had yet to add support for the mobile version of Twitter, although iPhone users will be able to send photos to Twitter through the photo application after the next, major iOS update. Also in the works, Twitter is going to provide support for photo galleries designed to gather and syndicate all photos that a user has uploaded on Twitter and third party services like TwitPic. 

Photographers will be interested to learn that all EXIF data, information that identifies what equipment was used to take a picture as well as the settings used, is stripped from the photos after uploading. If a Twitter user is concerned about photo privacy, switching to a protected account keeps the public from viewing the images. In addition, deleting photos from a public stream removes the photos from Twitter search. Photos can also be flagged if deemed illegal or of a sensitive nature.

Simple, Short-Term Actions Can Help Congress Learn to Work Together (ContributorNetwork)

Posted: 09 Aug 2011 03:54 PM PDT

Michael Thompson Michael Thompson – Tue Aug 9, 6:54 pm ET
Contribute content like this. Start here.

COMMENTARY | Amid the federal debt ceiling debacle, a common question on cable talk news was, what can be done to resolve the intractable division within Congress? Then an infomercial for a supposed miracle gadget came on the TV screen, and I found an answer that would not have occurred to any of the sophisticated pundits.

Please don't laugh. My "solution" is that Congress should pursue legislation to combat misleading infomercials.

Or at least that's just one example of my solution. Congress could explore actions in regards to an array of perceived "little" issues.

This idea is not meant to dodge the really important stuff like jobs and government spending. But maybe Congress needs to revisit how to do some basic things in the short term, sort of like the old "crawl before you can walk" theorem. And regulating infomercial fraud would seem fairly simple, sort of similar to requiring those content labels we see on our cereal boxes.

I picked infomercials as my example because most everyone would agree that many of them are deplorable, so much so that there are entire websites that tackle the problem.

David Lampson, CEO of the California-based From Patent to Profit, told an interviewer from Consumer Reports magazine, "Sometimes sellers make more money off shipping and handling than they do off the product itself. That's just part of the game."

And then we are told outright lies that we need to be among the first 100 callers for a special offer.

I'm thinking back to my years as a neighborhood organizer. From time to time, the neighbors would review a list of concerns. I would draw a line down the middle of the chalkboard, one side listed as "takes time" and the other "immediate." When a neighbor would predictably state that people needed jobs, I would write "employment" under the "takes time" heading.

But if a neighbor would state that we needed stop signs along Sixth Street, near the downtown highway exit ramps, then I would mark that as "immediate." We would pick one of the more simple issues and one of the deeper, "takes time" concerns, so that we could at least show that we were getting some short-term things done.

By cooperating on some simpler issues, Congress might learn how to better work together on the tougher challenges.

IntoNow Android app makes TV social (Appolicious)

Posted: 09 Aug 2011 01:00 PM PDT

Apple briefly passes Exxon as largest U.S. company (Reuters)

Posted: 09 Aug 2011 04:31 PM PDT

By Poornima Gupta and Rodrigo Campos Poornima Gupta And Rodrigo Campos – Tue Aug 9, 7:31 pm ET

SAN FRANCISCO/NEW YORK (Reuters) – Apple Inc briefly edged past Exxon Mobil Corp to become the most valuable U.S. company on Tuesday, displacing an old economy stalwart and heralding an era where technology holds sway.

Although Apple slipped back to the No. 2 spot after the close, market watchers said it is simply a matter of time before the company that defined the smartphone and tablet markets with the iPhone and iPad ascends the top.

The technology giant's market value rose on Tuesday to $341.5 billion in severely choppy afternoon trading, just above Exxon's $341.4 billion, even though the oil major's annual revenue is four times that of Apple's.

Exxon quickly regained the No. 1 spot as its shares rose and Apple's shed some of their gains, with stocks globally remaining volatile because of soft economic data and the downgrading of the United States' sovereign credit on Friday.

Exxon ended on Tuesday with a market cap of $348.3 billion followed by Apple at $346.7 billion.

The potential changing of the guard, which is largely symbolic, reflects the influence and power of certain industries over the U.S. economy in different points in time.

"Technology is what people understand now," said Robert Pavlik, chief market strategist at Banyan Partners. "At some point it used to be the radio, before that it was trains. So I think it's sort of indicative of our society."

Tuesday's move by Apple, which for a short time ended Exxon Mobil's run of more than five years at the top, capped a remarkable turnaround for a company that once teetered on the brink before Apple CEO Steve Jobs returned to resuscitate the enterprise he co-founded.

Thirteen years ago, some analysts said Apple's value consisted of real estate holdings and cash on hand.

Apple joined, albeit briefly, a group of nine companies that have held the top spot in the S&P 500, including General Electric Co, General Motors, IBM Corp, Microsoft Corp and AT&T Inc, DuPont, Philip Morris Cos and Wal-Mart Stores Inc, according to Standard & Poor's Index Analytics.

Apple will officially become the 10th member of that group only if its market cap at the close of trading is higher than Exxon's, said Howard Silverblatt, senior index analyst at S&P Indices.

The Silicon Valley icon, which was included in the S&P 500 index in 1982, has clawed its way to the top of the chart from the 287th position it held 10 years ago, he added.

RIDING THE MOBILE WAVE

Exxon became the most valuable U.S. company in 2006 on the back of higher oil and gas prices, while GE got top valuation when heavy equipment, energy, military contracts and finance represented a large portion of the U.S. economy.

GM, which went bankrupt in 2009 and is now back in the market through a new initial public offering, topped the list when automobile manufacturing was biggest symbol of American industrial power.

Apple is riding the mobile wave that has swept up consumers worldwide. Since Jobs' return, the company has cranked out a string of now-iconic, category-defining products, from the Mac and the iPod music player to the iPhone and now the iPad, which almost single handedly created the tablet computer market.

Apple now demands a position in virtually every long-term investor's portfolio on the strength of its deft handling of overseas production and supply, as well as perceptions of an unerring antenna for consumer tastes.

Since July 1, Apple's market capitalization has risen by more than $20 billion, fueled by optimism a new version of its best-selling iPhone will lead to a monstrous second half of 2011.

Exxon's market cap, on the other hand, has slipped about $50 billion in the same period due to volatile crude oil prices.

But many on Wall Street are concerned about Jobs' ailing health and fear the company will not be the same without its hard-driving, visionary leader. Others are worried about the rising popularity of Google-powered smartphones.

The two companies, however, have little in common for investors. Exxon pays a regular quarterly dividend, while the last dividend paid by Apple was in November 1995. Also, Exxon spends billions to buy back its own shares each quarter.

(Additional reporting by Anna Driver in Houston; editing by Steve Orlofsky and Andre Grenon)

Wal-Mart Stores ending MP3 sales (AP)

Posted: 09 Aug 2011 08:52 PM PDT

By The Associated Press The Associated Press – 50 mins ago

Wal-Mart Stores Inc. is ending its digital music sales this month after seeing increased competition.

The world's largest retailer confirmed Tuesday that it will stop selling MP3s as of Aug. 29. Customers who already bought digital music through its site may continue to use and manage their music there.

Wal-Mart began selling digital music in 2003 to compete with Apple's iTunes, which has become the largest seller of digital music. The company also faces tough competition from Amazon.com.

The company said it will now concentrate its digital efforts on its Vudu.com video-streaming service, which it acquired last year.

NPD industry analyst Marshall Cohen said the dynamic of retail is changing, and sometimes companies are better off focusing on what they do best rather than offering something that doesn't deliver an above-average experience for consumers.

"It is very easy to become antiquated very quickly in the entertainment industry," he said. "If you are losing ground, and they probably were losing ground more rapidly year after year, it's probably better to regroup and retool."

Wal-Mart's Vudu launches on iPad without an app (Reuters)

Posted: 09 Aug 2011 09:12 PM PDT

By Alistair Barr Alistair Barr – 30 mins ago

SAN FRANCISCO (Reuters) – Wal-Mart Stores Inc's Vudu video-streaming service launches on Apple Inc's iPad on Wednesday, but it doesn't come with the type of app that's common on the best-selling tablet computer.

Wal-Mart said iPad users can now go to vudu.com to buy or rent 20,000 movies and TV episodes to watch instantly.

Once bought or rented, the videos can be viewed online or through more than 300 devices including Internet-capable HDTVs, Blu-ray Disc players and the Sony's PlayStation 3, Wal-Mart said.

Such services often come with an app that lets iPad users access content directly from the tablet's home screen. Wal-Mart said a Vudu icon can be put on the iPad home screen, but when users touch it, they will be taken to Vudu's website to buy content.

"It's not an app," said Edward Lichty, general manager of Vudu. "It's an all-browser experience. But you access it in a similar way."

Apple introduced new terms and conditions recently that required publishers to give the company 30 percent of the price of any content they sell through apps. Since then, some providers, including Amazon.com Inc, have changed the way their apps work to avoid sharing revenue.

Vudu's Lichty said Apple's new terms and conditions were partly behind the way Vudu was launched on the iPad.

"The economic advantage of not having to pay Apple 30 percent was a factor," Lichty told Reuters.

(Editing by Steve Orlofsky)

Lots of photo options showing up in iOS 5 beta (Appolicious)

Posted: 09 Aug 2011 05:22 AM PDT

IBM breaks up with the NCSA and Blue Water supercomputer project (Digital Trends)

Posted: 09 Aug 2011 12:26 PM PDT

Derek Mead Derek Mead – Tue Aug 9, 3:26 pm ET

supercomputer-center-servers-ibm

IBM was with the University of Illinois for three whole years, but apparently it just wasn't working out.

Yesterday IBM suddenly announced it would axe a multimillion dollar contract with the university's National Center for Supercomputing Applications to help build a petascale computer by 2012 as part of the Blue Waters project. With funding from the National Science Foundation and U of I, the Blue Waters project is tasked with building a supercomputer capable of sustainable petaflop speeds, or a quadrillion floating point operations per second, using IBM's Power7 processor cores.

IBM has cited unforeseen complexities and higher costs than initially expected as its reasons for quitting the venture that was worth an estimated $208 million. After having worked on the project for three years, people in the industry expected IBM was a year or less away from delivering its first iteration of the system.

IBM and the NCSA released a statement together that at least gave the appearance of the split being amicable. According to the release:

The innovative technology that IBM ultimately developed was more complex and required significantly increased financial and technical support by IBM beyond its original expectations. NCSA and IBM worked closely on various proposals to retain IBM's participation in the project but could not come to a mutually agreed-on plan concerning the path forward. IBM will return money received to date and NCSA will return equipment delivered by IBM per terms of the contract.

Despite IBM deciding that it wasn't really worth it anymore (and really, it probably wasn't a profitable effort for the company), the NCSA still thinks its can succeed at its goal by the end of next year.  If it succeeds, the computer will likely be listed near the top of the Top 500 world supercomputer rankings. 

at 9:52 PM

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