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Facebook, banks sued over pre-IPO analyst calls

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Facebook - Reversal of the Fortune

(Reuters) – Facebook Inc and banks including Morgan Stanley were sued by the social networking leader’s shareholders, who claimed the defendants hid Facebook’s weakened growth forecasts ahead of its $16 billion initial public offering.

The defendants, who also include Facebook Chief Executive Officer Mark Zuckerberg, were accused of concealing from investors during the IPO marketing process “a severe and pronounced reduction” in revenue growth forecasts, resulting from increased use of its app or website through mobile devices. Facebook went public last week.

The lawsuit was filed in U.S. District Court in Manhattan on Wednesday, according to a law firm for the plaintiffs. A day earlier, a similar lawsuit by a different investor was filed in a California state court, according to a law firm involved in that case.

In the New York case, shareholders said research analysts at several underwriters had lowered their business forecasts for Facebook during the IPO process, but that these changes were “selectively disclosed by defendants to certain preferred investors” rather than to the public generally.

“The value of Facebook common stock has declined substantially and plaintiffs and the class have sustained damages as a result,” the complaint said.

Representatives of Facebook and Morgan Stanley did not immediately respond to requests for comment.

Facebook shares fell 18.4 percent from their $38 IPO price in the first three days of trading, reducing the value of stock sold in the IPO by more than $2.9 billion.

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5 best features of your new iPhone 6

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iphone6

 

Optical image stabilization

If you’re lucky enough to have snagged an iPhone 6 Plus, you’ll probably notice that your photos are a lot less blurry. Why? Apple is using a combination of the A8 SoC, the M8 motion coprocessor, and the lens of the camera itself to offer optical image stabilization. Your phone is sensing the shaking of your hand, and it’s compensating for that with image processing as well as movements of the camera lens. The result is clearer pictures — even in low light situations. The best part? It’s completely automatic, so you don’t have to change a thing.

1080p 60fps video recording

You’ve been able to record 1080p video on smartphones for a while now, but Apple wants to push the limits with this release. With both models of the new iPhone, you can record all of your videos in full 1080p HD at either 30 fps or 60 fps. Crisp, clear, and virtually no motion blur to speak of. If you’re recording your kid’s soccer game, or shooting from a moving vehicle, this will make all the difference in the world. Even better, the slo-mo mode now supports upwards of 240 fps, so you can capture an insane amount of detail in your home movies.

Apple Pay

Other companies have been trying to get NFC payments to stick in the US for years. It hasn’t taken off as of yet, but hopefully Apple Pay will change all of that. Apple has slapped an NFC chip its new phones, and partnered with companies like McDonald’s, Walgreens, and Staples to help make NFC payments a reality across the United States. It’s still too early to tell whether or not Apple Pay will catch on, but just the idea of using your phone to pay for your sandwich is incredibly novel and exciting to most of us.

 

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Facebook Will Ring The NASDAQ Bell Today at $38

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Mark Will Ring The Nasdaq Bell on 18 May , 2012

NEW YORK — Wall Street has one simple task as Facebook Inc. shares begin trading: Don’t mess it up.

Major stock exchanges, brokerage firms and mutual fund companies have been gearing up for one of the biggest initial public offerings on record. And, with all the hype surrounding the social-media giant, any snafus would be a major embarrassment.

“It has to go off without a hitch. There’s going to be a lot of visibility on this,” said Larry Tabb, chief executive of the TABB Group consulting and research firm. “If this goes poorly, it will not just be a poor reflection on Nasdaq — it will be a poor reflection on the U.S. market structure.”

In pricing its stock at $38 on Thursday, Facebook raised $16 billion in the third-biggest IPO in U.S. history and the largest ever by a tech company. The stock trades as FB.

The company is expected to sell an additional $2.4 billion in stock later this month, raising the total value to $18.4 billion. That would make it the second-largest U.S. IPO, trailing only the $19.65 billion raised by Visa Inc. in 2008.

The IPO values Facebook at $104 billion, by far the largest ever for a newly public company.

Facebook shares are scheduled to begin trading at 11 a.m. Eastern time, 90 minutes after the Nasdaq Stock Market opens. The late start is designed to give the stock exchange and Wall Street brokerage firms sufficient time to process what is expected to be a crush of opening-day orders.

At center stage is the Nasdaq, considered to be the world’s premier home for technology companies. The exchange has been testing various scenarios for how the stock will open, checking its systems through a dummy ticker — ZWZZT — to allow clients to practice processing their orders.

Glitches do happen. In April, when software developer Splunk Inc. went public on the Nasdaq, the price soared so high the exchange halted trading. However, trading reportedly continued elsewhere, leading to canceled trades.

The biggest blunder happened in March when BATS Global Markets, an electronic trading platform, suffered a trading debacle. A software glitch sabotaged the company’s own IPO, which sent the stock plummeting and forced it to cancel the offering altogether.

BATS has been in talks with Nasdaq about the Facebook IPO, but hasn’t participated in any of the tests. However, clients have been routing test orders of Facebook through the exchange, spokeswoman Stacie Fleming said.

Meanwhile, the New York Stock Exchange is making sure it is ready for the crush of new shares that will be dumped into the market Friday. The Big Board has dedicated a server just for Facebook trading that will be done on the NYSE Euronext Inc.’s all-electronic Arca exchange.

“We’re fully prepared,” NYSE spokesman Rich Adamonis said.

Tabb said myriad problems could arise, though he predicted high volume wouldn’t be one.

Buyers and sellers may not get access to the stock, he said, because market data feeds connecting all the exchanges could hit a snag, trading algorithms may not be properly tuned, or a server could crash.

“If there’s a problem it’ll be a technology glitch,” Tabb said.

Brokerages are getting ready to field phone calls from customers who want Facebook shares — and potentially upset clients who didn’t get as large of an IPO allotment as they wanted.

Fidelity Investments in Boston, one of the country’s largest retail brokerages, has employees on standby to deal with high customer demand, spokesman Steve Austin said.

Wall Street might spend the remaining few hours before Facebook’s public debut worrying about what might go wrong. But there’s a decidedly different atmosphere on the West Coast at Facebook’s Menlo Park headquarters.

Hundreds of employees spent Thursday in a “hackathon” — an all-night work session for programmers and engineers.

Even founder Mark Zuckerberg was expected to attend the event — until he rings the Nasdaq’s opening bell.

By Andrew Tangel and Walter Hamilton, Los Angeles Times

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Microsoft Bids $8.5 Billion To Buy Skype [Report]

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Microsot Near to Buy Skype

NEW YORK (Reuters) – Microsoft Corp is close to buying web video conferencing service Skype Technologies for $8.5 billion including debt, a source familiar with the situation said, in a deal which would rank as the biggest for the software company.

A deal is expected to be announced as early as Tuesday morning, the source said. The source declined to be named because the talks are not public.

Both Microsoft and Skype declined comment.

Skype, which had delayed plans for an initial public offering, had recently been looking at other options.

Four days ago, we heard that Facebook was reportedly offering between $3 and $4 billion to acquire Skype or (perhaps more plausible for a startup with $2 billion in annual revenue) that Facebook might simply construct some sort of joint venture with Skype.

 

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