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Top 10 Days in 2010 for Technology

The start of a fresh year is the perfect time to reflect and ponder on what happened.

After a frightening 2009 that will go down in the books as the year of the biggest economic recession since World War II, 2010 was the year of economic recovery and stabilization.

Emerging and Developing countries (with a powerful and hungry China) have bounced back from the crisis, leading the world economic recovery. Developed countries have not yet enjoyed the same growth rates. Greece and Ireland danced dangerously on the verge of bankruptcy but eventually were saved by the EU and IMF. England elected a new government, and a US Democratic President will have to deal with a Republican Senate for at least the next two years. Undaunted by sanctions, Iran has continued to pursue a nuclear program and neither North Korea nor Middle East countries have trumpeted political goodwill to bring prosperity in their respective regions. Mother earth was hard on countries like Haiti and Pakistan, and reminded us that climate change must be a higher priority in world debate.

On a brighter note, the Winter Olympics in Vancouver and the Soccer World Cup in South Africa distributed their fair amount of medals and managed to unite billions of people around the planet to watch TV.

The technology world was not shy either for major events in 2010. Here are the top 10 game-changing days for 2010 in the technology world.

January 12, 2010: Google leaves China

In response to cyber attacks on Google infrastructure that compromised the Gmail accounts of Chinese human rights activists, Google decided that they would provide unfiltered (or uncensored) Chinese search results, acknowledging the consequences and contemplating "having to shut down Google.cn, and potentially [their] offices in China". Google, by redirecting all search traffic to the Hong Kong office, managed to address the increasing complaint from American human rights activists while preserving their brand mission. But this also sealed their fate to exit a market that became too difficult to compete within, politically speaking. Google executed its long term exit strategy from China. Since then Baidu picked up Google’s search market share, and became a top performer on the Nasdaq. China, despite the economic boom, middle class rise and relative political calm, continues to isolate its 450 million internet users from the rest of the world.

April 3, 2010: Apple launches the iPad

The long-rumored Apple tablet, called the iPad, was introduced by Steve Jobs himself. The company sold over 300,000 iPads just in the first day, and had sold 7.5 million units within two quarters (by Sep 30, 2010). This long-anticipated revolution has changed the way consumers devour their digital content. Once again Apple managed to enter a new market late with a strong marketing buzz and slick design, and signed up enough content providers behind its paid wall to make it a blockbuster success. Neither the "Antennagate" of the iPhone 4, nor the battle with Flash has deteriorated Apple’s market capitalization, which surpassed the US$ 300 billion mark for the first time in the company's history in January 2011. Apple clearly has the first mover advantage to become the ultimate aggregator of all media for consumers… at least for now.

April 12, 2010: Palm goes up for sale

In response to another shortfall on sales expectations, Palm was put up for sale. After a short yet intense bidding war between large technology companies, HP was eventually the last man standing in the room and picked up the prize for US$ 1.2 billion.
HP didn't buy Palm to be in the smartphone business” – HP’s CEO Mark Hurd (June 2, 2010)

With Palm in hand, HP has now a strong brand in the smartphone business, a winning technological piece of equipment and a portable operating system (WebOS) ready to be used on other devices, such as tablets. HP will bring what the company is good at, which is a strong distribution channel, a mass scale operational know-how and deep pockets to market and partner for new products. Despite Mark Hurd's announcement, HP had indeed entered the smartphone business with the Palm acquisition... and kicked off a new tablet business division at the same time.

July 22, 2010: 500 million people use Facebook

This day saw half a billion people on the planet actively using Facebook to stay connected with their friends and family. In mere seven years of existence (thefacebook.com was registered on Jan11, 2004), the site is the second most popular website in the world (first being Google.com) despite being blocked in China. All numbers are growing at an exponential rate still; 2010 saw 580 million users connecting to the site, a 65% increase year-on-year, and a market valuation at US$ 50 billion by Goldman Sachs. Nothing seems to stop Facebook, not ownership lawsuits, not privacy concerns, not breach of the government’s Data Protection Act, no environmentalists' protests and not even a movie can end the ever-growing impact of Facebook on the planet. 2011 could be the year Facebook crosses the one-billion user mark before an historical IPO.

July 25, 2010: WikiLeaks.org reveals classified government documents

On this day WikiLeaks revealed 92,201 internal and classified "Secret" records of action by the US military in Afghanistan between 2004 and 2009, the first of many such leaks, in coordination with The New York Times, The Guardian and Der Spiegel. On Oct 22, 2010, another batch of 391,832 United States Army field reports from the Iraqi War from 2004 to 2009 was released by the controversial website. Then on Nov 28, 2010, WikiLeaks published another 251,287 leaked United States embassy cables, the largest set of confidential documents ever to be released into the public domain.

Since then the spokesperson of WikiLeaks and Man of the Year voted by Times readers, Julian Assange has been arrested in UK facing extradition to Sweden over sexual assault allegations. Without a doubt WikiLeaks' actions have triggered a heated debate over the public access and use of secret information and challenged the governments’ transparency in the modern world. The leaks, by their sheer quantity and by their importance, have shaken up the foundation of journalism industry as well as global politics, and governments and large corporations are anxiously waiting for the next batch to be released, with a secret hope to not be implicated in some way. If only one day should be remembered in the technology world in 2010, WikiLeaks' very first release should be the one.

August 6, 2010: HP CEO Mark Hurd steps down

Chairman, President and CEO Mark Hurd decided with the Board of Directors to resign his positions. Hurd’s decision was made following an investigation by outside legal counsel and the General Counsel’s Office, overseen by the Board, of the facts and circumstances surrounding a claim of sexual harassment against Hurd and HP by a former contractor to HP. The investigation determined there was no violation of HP’s sexual harassment policy, but did find violations of HP’s Standards of Business Conduct. A month later Oracle announced that Hurd had joined them as President and a Board member.

HP shortly named Léo Apotheker, a former executive at SAP (Oracle's chief rival), as its new President and CEO, to replace Hurd. Perhaps angered, Oracle then tried to link Apotheker (now at HP) to a software theft by a unit of SAP within an ongoing lawsuit against SAP. SAP admitted wrongdoing, but denied that Apotheker played a role. In the end, a jury awarded Oracle US$ 1.3 billion in damages. Since the abrupt departure of Hurd, Oracle and HP have continued to fight, eroding one of the closest partnerships in Silicon Valley.

September 10, 2010: Stephen Elop becomes the new CEO of Nokia

Nokia Board of Directors appointed Stephen Elop as the President and CEO of Nokia. As the first non-Finnish CEO in Nokia’s 139-year history, the Canadian Elop was previously the head of Microsoft's Business Division and had held several senior executive tenures in various US-based public companies, such as Juniper Networks, Adobe Systems Inc. and Macromedia Inc. Nobody internal seemed more appropriate than Elop, a seasoned executive of established US tech companies, with a strong background in both networks and software, deep experience in building alliances with large corporations (such as Intel), all while nurturing a vast business partner network (such as Microsoft’s).

This was an excellent appointment for Nokia, which has the global reach but hasn't come close to gaining Apple and Android on market share, especially in the US. And although US represents just 8% of the global mobile phone market in terms of revenue and 6% in terms of users, it is still the market maker when it comes to financial markets and Nokia is not loved by investors there. If Wall Street sneezes, the world catches a cold. OPK, Nokia's previous CEO, was fired to have forgotten it. Elop, whose career was made with American companies, may fare better.

October 4, 2010: New CEOs appointed at Twitter and Skype

On Oct 4, Twitter gave its reins to its COO Dick Costolo, who replaced co-founder Evan Williams as the new CEO. The same day former Cisco Systems executive Tony Bates was hired by Skype as their new CEO. Skype and Twitter have never been more alike than that particular day when both replaced their CEO for similar reasons. Both companies have been the market leader in their respective markets, one in the VoIP space and the other in real time communication stream. Both have been victims of a similar disease: lack of revenue growth. In bringing in highly seasoned industry executives to lead the last mile before the IPO, their Boards have decided to give a final push for a likely billion-dollar cash out.

October 11, 2010: Microsoft launches Windows Phone 7

A quick history lesson: In 2006, Nokia’s Symbian was the market leader in the mobile OS industry, a 60 million-units-a-year business, in which Palm, RIM and Microsoft were only distant competitors. Then in 2007, Apple introduced the iPhone and changed the paradigm forever. Today though Symbian is still a declining market leader, Apple and Google are the only references in the smartphone business. Palm has been bought out by HP and RIM is still defending its corporate clientele. Windows disappeared from the radar screen and had to reinvent itself or die, if it wanted to compete in the smartphone business.

So on Oct 11, 2010, the Windows Phone 7 launch marked the new era of Microsoft-powered smartphones. With a solid design and a strong touch-driven interface different from its competitors, Microsoft managed to get it right in the first place. Certainly with its tremendous capital and large partner network, Microsoft is back in the smartphone business with the ambition for a 20% market share, a share that the PC version of Windows 7 OS attained within one year of launch.

December 3, 2010: Groupon says no to Google's US$ 6 billion offer

It could have been a fantastic Christmas for Brad Keywell and Eric Lefkofsky, the Groupon co-founders, but instead of accepting a historical US$ 6 billion buyout bid from Google that might have made them as much as US$ 600 million and US$ 1.8 billion respectively, they instead raised a new series of funding: at least US$ 500 million.

The hottest web phenomenon is based on a very simple idea. The site collects deals from local businesses and offers its subscribers one deal a day in their city. But before the deal can kick in, a certain minimal number of people need to buy into it. Once the deal is reached, or "tips", the local business and Groupon split the revenue in half. Since its introduction in December 2008 with just 400 subscribers, Groupon has captured over 35 millions subscribers by November 2010 and sold over 22 million coupons generating almost US$ 2 billion a year in revenue. They are generating US$ 1 million or more every week in pure profit.

Groupon, which serves mainly young, urban, educated and single women as its target segment, is now in more than 150 markets in North America and 100 markets in Europe, Asia and South America (October 2010). The Chicago-based company, with 80% global market share for group discounts, is not afraid of the 500-plus copycat competitors (100 just in China) because it addresses the perennial concern of the local small businesses with limited marketing budgets. Only Living Social, which recently received a US$ 175 million investment from Amazon, has emerged as a genuine competitor. With a unique tone (most of the staff is from the Chicago's legendary improv-comedy scene) Groupon spotlights one local business to avid shoppers once a day.

No company has managed to grow so big, so fast, ever in history. Groupon is on track to do what Google did in three years but in less than one year. Groupon has found the magic formula, and is not ready to give it away, not even to the busiest buyer of 2010, Google, and its US$ 6 billion.

In the year of economic recovery, 2010, the few winners in the technology space have been the large multinational companies with their multi-billion dollars, similar to 2009. The big corporations became bigger, acquiring more products and services, venturing into new businesses, while leaving behind their competitors. A handful of internet companies have managed their way up and cleaning the books in preparation for IPOs. NQ Logic is looking forward to seeing you in 2011.

Happy holidays to everyone.

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