Key Developments: Amazon.com, Inc. (AMZN.O)
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19 Mar 2010
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Latest Key Developments
Microsoft Corp. And Amazon.com Sign Patent Agreement
Microsoft Corp. announced that it has signed a patent cross-license agreement with Amazon.com. The agreement provides each company with access to the other's patent portfolio and covers a broad range of products and technology, including coverage for Amazon.com's e-reading device, Kindle, which employs both open source and Amazon.com's software components, and Amazon.com's use of Linux-based servers. Although specific terms of the agreement are confidential, Microsoft Corp. indicated that Amazon.com will pay Microsoft an undisclosed amount of money under the agreement.
Microsoft Corp., Amazon.com Others Urge Judge To Reject Google Inc. Pact-DJ
Dow Jones reported that Microsoft Corp., Amazon.com and others urged a federal judge to reject a revised settlement among Google Inc. and publisher and author groups over digital copies of books. At a fairness hearing, lawyers for Microsoft and Amazon were among a group of objectors who spoke against the pact, telling U.S. District Judge Denny Chin in Manhattan that the settlement would give Google an unfair monopoly over a large number of unclaimed published works and violates well-established copyright law in the U.S. The revised settlement was designed to allay concerns raised by the U.S. Department of Justice and others that the original pact granted broad rights and immunities to Google and was anti-competitive. The Justice Department is expected to speak at the hearing later Thursday. Chin, the district judge, said he would not rule Thursday on the settlement and that he wants to write an opinion at a later date outlining his views. The hearing is expected to last several hours. Lawyers for the governments of Germany and France also are expected to speak in opposition to the settlement later Thursday.
Amazon.com To Acquire Touch Screen Company Touchco-DJ
Dow Jones reported that Amazon.com has acquired touch screen technology company Touchco. Amazon, whose Kindle e-reader will compete with Apple Inc.'s upcoming iPad, will integrate Touchco's technology and staff into its Kindle hardware division, according to the person cited by the Times. The technology used by Touchco is said to potentially cost much less than the touch screen technology used in Apple's iPhone and iPad. Also unlike the Apple touch screen devices, Touchco screens can recognize an unlimited number of simultaneous touch points, according to the report.
Amazon.com Authorizes Share Repurchase; Issues Q1 2010 Guidance In Line With Analysts' Estimates
Amazon.com announced that its Board of Directors has authorized the Company to repurchase up to $2 billion of the Company's common stock. The program allows the Company to opportunistically repurchase its shares from time to time when it believes that doing so would enhance long-term shareholder value. The repurchase authorization does not have a fixed expiration. Purchases may be effected through one or more open market transactions, privately negotiated transactions, transactions structured through investment banking institutions or a combination of the foregoing. This stock repurchase authorization replaces the previous $1 billion stock repurchase authorization, approved by the Board of Directors in 2008. For first quarter of 2010, it expects net sales to be between $6.45-$7.00 billion and operating income to be between $275-$365 million. This guidance includes approximately $110 million for stock-based compensation and amortization of intangible assets, and it assumes, among other things, that no additional business acquisitions or investments are concluded and that there are no further revisions to stock-based compensation estimates. According to Reuters Estimates, analysts were expecting the Company to report $6.54 billion and EBIT of $354 million for the same period.
Amazon.com's Amazon Web Services LLC Introduces Media Streaming To Its Content Delivery Service Amazon CloudFront
Amazon Web Services LLC, a subsidiary of Amazon.com announced that streaming media delivery for Amazon CloudFront, the content delivery service from AWS. This new feature enables streaming delivery of audio and video content, providing an alternative to progressive download where end users download a full media file. Amazon CloudFront streams content from a worldwide network of 14 edge locations, ensuring low latencies and providing cost-effective delivery. Like all Amazon Web Services, Amazon CloudFront requires no up-front investment, minimum fees or long-term contracts, and customers only pay for what they use.
Amazon.com Announces Expanded Distribution Options For Members Through Ingram Content Group And Lightning Source
CreateSpace, part of the Amazon.com, Inc. group of companies, announced a new agreement with Lightning Source Inc., the print on demand unit of Ingram Content Group Inc. The collaboration between the two companies will expand CreateSpace`s distribution options for its members beyond Amazon.com and CreateSpace eStores. Under the new agreement, CreateSpace`s Books on Demand platform will allow members to print and then distribute their titles to thousands of bookstores, libraries and online retailers. CreateSpace members will have access to this enhanced print and distribution option as part of the CreateSpace Pro Plan, a program which gives members access to lower print pricing for their own book orders and better royalties for sales on Amazon.com.
Amazon.com Completes Acquisition Of Zappos.com
Amazon.com announced the completion of its acquisition of Zappos.com. Zappos.com, Inc. is a online apparel and footwear sales that strives to provide shoppers with the best possible service and selection.
Amazon.com Issues Q4 2009 Guidance In Line With Analysts' Estimates
Amazon.com announced that for the fourth quarter of 2009, it expects net sales to be in the range of $8.125-$9.125 billion or to grow between 21% and 36% compared with fourth quarter 2008 and expects operating income (EBIT) to be in the range of $300-$425 million. This guidance includes approximately $100 million for stock-based compensation and amortization of intangible assets, and it assumes, among other things, that no additional business acquisitions or investments are concluded and that there are no further revisions to stock-based compensation estimates. According to Reuters Estimates, analysts are expecting the Company to report EBIT of $368 million on revenues of $8.168 billion for the same period.
Publishers Choose Print On Demand Technology From Amazon.com's CreateSpace And Amazon Europe
Amazon.com announced that CreateSpace, part of the Amazon.com group of companies entered into agreements with several international publishers who are using print-on-demand technology to distribute content in the United States market on Amazon.com and other channels. Amazon Europe also announced agreements with publishers - including Germany`s Langenscheidt and Bibliographisches Institut and the United Kingdom`s Cambridge University Press and Faber & Faber to make content more accessible to customers shopping.
Amazon.com Cuts Kindle Price; Offers International Version-WSJ
The Wall Street Journal reported that Amazon.com has trimmed $40 off the price of its Kindle e-reader and introduced a version of the device with international wireless service, in an effort to combat growing competition in the coming holiday shopping season.
UPDATE 4-Barnes & Noble names new CEO in e-books push
* New CEO Lynch says e-books business "key to our future"
Earnings vs. 
Estimates
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