November 15, 2024

You are here: Home / Archives for steven p jobs

E-Book Antitrust Trial of Apple to Begin

June 2, 2013 by Leave a Comment

But the evidence in the case will not just determine whether Apple has violated antitrust laws. It will also tell a broader story of how the introduction of e-books created upheaval in the publishing industry — with guest appearances by major players like Amazon and Barnes Noble and e-mails from the late Steven P. Jobs, Apple’s former chief executive.

In the case, brought a year ago, the Justice Department accused Apple and five book publishers of conspiring to raise e-book prices. The idea, the government said, was to allow publishers to set their own prices rather than letting retailers do so.

Their motivation, according to the Justice Department, was to defend themselves against Amazon, which was setting the price of most new e-books at $9.99 and becoming increasingly dominant in the market. Simon Schuster, HarperCollins and the Hachette Book Group settled the day that charges were filed; Penguin and Macmillan settled months later.

Complaints by Amazon, which now controls at least 60 percent of the e-book market, are widely believed to have incited the investigation. Amazon declined to comment.

After the lawsuit was filed, the expectation was that e-book prices would drop sharply; the publishers that settled agreed to allow retailers to discount their e-books for two years. But the price drop has still not happened.

A government victory against Apple, which would not involve monetary damages, might also not affect e-book prices.

“Are consumers going to be better off as a result of any government win here?” said Charles E. Elder, an antitrust lawyer at Irell Manella, which is not involved in the case. “That’s going to have to be seen depending on what happens to book publishing generally. It’s in trouble, and e-books are either the savior or they’re going to hasten the demise of book publishers.”

Apple declined to comment, but has said it has done nothing wrong.

“The e-book case to me is bizarre,” Timothy D. Cook, Apple’s chief executive, said during an onstage interview at a business conference last week in Southern California. “We’ve done nothing wrong there, and so we’re taking a very principled position of this. We were asked to sign something that says we did do something, and we’re not going to sign something that says we did something we didn’t do. And so we’re going to fight.”

Apple certainly has the money to fight, and a brand to protect, at a time when its stock is sagging and its tax practices and manufacturing processes are under scrutiny. Yet it is bigger than ever — with hundreds of millions of its iPhones and iPads in the hands of customers all over the globe.

The trial, before Judge Denise L. Cote of United States District Court, is expected to feature testimony from chief executives from the five publishers, who will offer a window into their world of fierce price negotiations. But the star witness may well be Mr. Jobs, even though he died in October 2011.

In the case, the government cast
Apple as the “ringmaster” of the conspiracy. It said that when the company entered the e-book industry in 2010 with the introduction of the iPad, it wanted to pressure Amazon to raise its prices above its uniform $9.99 for new e-books.

At the time, publishers’ agreements to sell e-books were made under the so-called wholesale model of print books; publishers charged retailers about half the cover price for a book, and the retailers then set their own prices. The government said Mr. Jobs had persuaded publishers to agree to agency pricing, which allowed publishers to set their own prices for e-books, giving Apple a 30 percent commission for books sold in its online store.

The publishers’ contracts with Apple included a “most favored nation” clause, requiring that no other retailer sell e-books for a lower price; if they did, the publisher would have to match the price of the e-book in Apple’s store. That, the Justice Department said, resulted in higher prices that harmed consumers.

Article source: http://www.nytimes.com/2013/06/03/technology/e-book-antitrust-case-against-apple-to-begin.html?partner=rss&emc=rss

Filed Under: Media Business Tagged With: , ,

Bits Blog: Apple Settles Patent Suit With HTC

November 11, 2012 by Leave a Comment

Apple and HTC have brought an end to their lawsuits against each other in the first settlement between Apple and a maker of Android smartphones.

In a statement issued Saturday night, the two companies said the settlement includes the dismissal of all current lawsuits and sets up a 10-year license agreement that includes rights to current and future patents held by both parties. Apple and HTC, which is based in Taiwan, said the terms of the deal were confidential.

“We are glad to have reached a settlement with HTC,” Timothy D. Cook, the chief executive of Apple, said in a statement. “We will continue to stay laser-focused on product innovation.”

“HTC is pleased to have resolved its dispute with Apple, so HTC can focus on innovation instead of litigation,” Peter Chou, HTC’s chief executive, said in a statement.

Apple’s battle with HTC had a much lower profile than its legal fight with Samsung, a more significant rival in the smartphone market and the biggest maker of handsets based on Google’s Android operating system. In August, a jury awarded Apple more than $1 billion in damages in its lawsuit with Samsung, though Samsung is challenging the ruling.

The HTC suit, however, was the first one Apple filed against an Android phone maker and a harbinger of future Apple legal challenges aimed at the software. Apple filed patent infringement suits against HTC in March 2010 in federal court in Delaware and before the International Trade Commission.

The suit was the start of what is widely viewed as a proxy war between Apple and Google, the creator of the Android operating system. The week Apple filed the suit against HTC, Steven P. Jobs — then Apple’s chief executive, who died late last year — erupted in fury over Android, in a scene depicted in Walter Isaacson’s biography of him.

“I’m going to destroy Android, because it’s a stolen product,” Mr. Jobs said, according to the book.

Apple sued Samsung in 2011. Another Android maker, Motorola Mobility, sued Apple in late 2010, and Apple subsequently countersued. Google now owns Motorola.

Article source: http://bits.blogs.nytimes.com/2012/11/10/apple-settles-patent-suit-with-htc/?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

Bits Blog: Apple Becomes the Most Valuable Public Company Ever, With an Asterisk

August 21, 2012 by Leave a Comment

Noah Berger/Bloomberg News

8:53 p.m. | Updated

Apple, a company that nearly filed for bankruptcy just 16 years ago, passed a very different sort of milestone on Monday, when a bump in its share price made it the most highly valued public company ever.

Apple already boasted the largest market value of any public company, a title it has held since toppling Exxon Mobil from that spot. But Microsoft still held onto the record for the biggest market capitalization ever, $616.34 billion, which it set at the close of trading on Dec. 27, 1999, according to Howard Silverblatt, an analyst at S. P. Dow Jones Indexes.

Apple blew past that mark when its stock surged 2.6 percent on Monday to close at $665.15, giving it a market value of $623.52 billion.

The short-term explanation for the rise in its stock is the investor euphoria that often accompanies new product announcements from Apple — in this case, the expected introduction of a new iPhone in mid-September that could give a jolt to sales.

But the longer-term story behind the stock price is a corporate turnaround with few, if any, equals. The Apple that Steven P. Jobs arrived at when he rejoined the company in 1997 was, in his own words, in a precarious state, with a bloated inventory, a sprawling line of mediocre products and dwindling cash reserves.

Apple’s situation was so bad that Michael S. Dell, chief executive of the computer maker Dell, told an audience at a conference that, if he was running Apple, he would “shut it down and give the money back to shareholders.”

The Apple that Mr. Jobs left behind when he died of cancer last October had reinvented itself multiple times under his watch, first with the iPod, then the iPhone and then the iPad. At an industry conference in 2010, Mr. Jobs described seeing Apple pass the market value of Microsoft, its longtime rival and long the most highly valued of technology companies, as “surreal.”

If Mr. Jobs were still alive, he could add up the values of Microsoft, Intel and Google and still have more than $13 billion of daylight between that figure and Apple’s market capitalization, which is a company’s stock price times its outstanding share count.

“It has been an absolutely remarkable transformation,” said Charlie Wolf, an analyst at Needham Company.

Another analyst, Horace Dediu of Asymco, noted that Microsoft’s 1999 market value was still far higher than Apple’s when adjusted for inflation. The Microsoft of late 1999 would be worth $850 billion in today’s dollars. The Microsoft of August 2012 is worth $258 billion.

By Mr. Silverblatt’s calculations, Apple needs to close at $910 to beat Microsoft’s inflation-adjusted market value.

It is worth noting that Microsoft achieved its pinnacle back when high-flying technology and Internet stocks had yet to be humbled by the bursting of the Internet bubble. Microsoft never regained the favor of investors after that happened, even as it delivered strong growth in revenue and profits. Investors have become increasingly concerned about the growth prospects of companies dependent on sales in the traditional computer business.

Apple, however, has seen great leaps in its value during the last four years, a period of great economic uncertainty.

In 2006, after Apple passed the market value of Dell, Mr. Jobs couldn’t resist pointing out the flaws in Mr. Dell’s assessment of Apple. “Stocks go up and down, and things may be different tomorrow, but I thought it was worth a moment of reflection today,” Mr. Jobs wrote in a note to Apple employees.

On Monday, the market value of Dell was just under $22 billion.

Article source: http://bits.blogs.nytimes.com/2012/08/20/apple-becomes-the-most-valuable-public-company-ever-with-an-asterisk/?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

Bits Blog: Apple Posts Video From Steve Jobs Tribute

October 24, 2011 by Leave a Comment

Apple has posted a video of a tribute to Steven P. Jobs, the company’s co-founder, that took place last week at the Apple campus in Cupertino, Calif. (The video must be viewed in the Safari Web browser.)

The event, which lasted about 90 minutes, was held to commemorate Mr. Jobs, who died this month after battling pancreatic cancer.

The video begins with Timothy D. Cook, Apple’s chief executive, introducing Laurene Powell Jobs, Mr. Jobs’s wife, who attended the event. Mr. Cook shared thoughts of Mr. Jobs’s work at Apple over the years and noted that no one in attendance would be working at Apple if it wasn’t for Mr. Jobs.

“There is one more thing he leaves us; he leaves us with each other,” Mr. Cook said. “Other than his family, Apple would be his finest creation.” Mr. Cook also said the last piece of advice Mr. Jobs gave him was “to never ask what he would do; just do what’s right.”

After Mr. Cook’s speech, Al Gore, the former vice president and an Apple board member, spoke. Some of Mr. Jobs’s favorite musicians played the event. The British band Coldplay performed “Fix You” and “Yellow” while thousands of Apple employees, mostly wearing black sweaters, listened and helped celebrate the co-founder’s life. Other performers included Norah Jones, who sang the Bob Dylan song “Forever Young.”

Article source: http://feeds.nytimes.com/click.phdo?i=6b19df2438cb14ea200f914165bc257b

Filed Under: Business News Tagged With: , ,

Apple’s Lower Prices Are All Part of The Plan

October 23, 2011 by Leave a Comment

Something unexpected has happened at Apple, once known as the tech industry’s high-price leader. Over the last several years it began beating rivals on price.

People who wanted the latest Apple smartphone, the iPhone 4S, were able to get one the day it went on sale if they were willing to wait in a line, spend at least $199 and commit to a two-year wireless service contract with a carrier.

Or they could have skipped the lines and bought one of the latest iPhone rivals from an Apple competitor, as long as they were willing to dig deeper into their wallets. For $300 and a two-year contract, gadget lovers could have picked up Motorola’s Droid Bionic from Verizon Wireless, or they could bought the $230 Samsung Galaxy S II and $260 HTC Amaze 4G, both from T-Mobile, under the same terms.

Apple’s new pricing strategy is a big change from the 1990s, when consumers regarded Apple as a producer of overpriced tech baubles, unable to compete effectively with its Macintosh family of computers against the far cheaper Windows PCs. But more recently, it began using its growing manufacturing scale and logistics prowess to deliver Apple products at far more aggressive prices, which in turn gave it more power to influence pricing industrywide.

Apple’s innovations — including products like the iPhone, iPad and the ultrathin MacBook Air notebook — are justifiably credited for their role in the company’s resurgence under its chief executive and co-founder, Steven P. Jobs, who died on Oct. 5.

But analysts and industry executives say Apple’s pricing is an overlooked part of its ability to find a large audience for those products beyond hard-core Apple fans. Indeed, Apple sold more than four million iPhone 4S smartphone over its debut weekend.

People can still easily find less expensive alternatives, with less distinctive and refined designs, to most Apple products. Within the premium product categories where Apple is most at home though, comparable devices often do no better than match or slightly undercut Apple’s prices. “They’re not cheap, but I don’t think they’re viewed as high-priced anymore,” said Stewart Alsop, a longtime venture capitalist in San Francisco.

Apple declined to comment for this article.

Prices in the ultrathin notebook category are an illustration of Apple’s strategy. While there are much cheaper laptops for sale, ranging all the way down to bargain-basement netbooks that cost a few hundred dollars, Apple’s MacBook Air has become a hit among computer users seeking the thinnest and lightest notebooks available. The product starts at $999 for a model with an 11-inch screen.

On Oct. 11, the Taiwanese computer maker Asus introduced its answer to the MacBook Air, a sleek device with a brushed aluminum body that uses Windows. But it was unable to undercut Apple; the Asus computer also starts at $999. Samsung’s wafer-thin Series 9 notebook, with a comparable set of features, costs $1,049.

The computer maker Acer, however, began undercutting the cheapest MacBook Air this month with an $899 ultrathin notebook, the Aspire S series, that has a bigger screen.

The original MacBook Air catered to a more rarefied audience when it came out in early 2008, priced at a whopping $1,799 for a model with a 13-inch screen. A year ago Apple revamped the notebook to make it thinner and smaller and reduced its entry-level prices to $999 and $1,299 for models with 11-inch and 13-inch screens. Jean-Louis Gassée, a venture capitalist and former Apple executive, said there was a “collective gasp” at how low Apple priced the new MacBook Air.

The aggressive pricing, analysts say, reflects Apple’s ability to use its growing manufacturing scale to push down costs for the crucial parts that make up its devices. Apple has also shown a willingness to tap into its huge war chest — $82 billion in cash and marketable securities last quarter — to take big gambles by locking up supplies of parts for years, as it did in 2005 when it struck a five-year, $1.25 billion deal with manufacturers to secure flash memory chips for its iPods and other devices.

Article source: http://feeds.nytimes.com/click.phdo?i=04ecb4fda6f8369b88951780e840b6a7

Filed Under: Business News Tagged With: , ,

Dispute Over Apple Image Shows Internet’s Reach

October 13, 2011 by Leave a Comment

Mr. Mak, a university student in Hong Kong, went from being an unknown, aspiring graphic designer to an Internet sensation after an image he produced spread rapidly across digital platforms following the death of Steven P. Jobs, the co-founder of Apple.

Mr. Mak’s design of a silhouetted profile of Mr. Jobs in the Apple company logo was shared across the Web and reported by news media. The actor Ashton Kutcher posted the design on his Twitter account.

And then, nearly as fast, Mr. Mak found himself being vilified.

With a speed fitting for the technological age that Mr. Jobs helped usher in, Mr. Mak became the subject of derisive Internet postings and negative news media reports. His design, it turned out, closely matched one produced earlier this year by Chris Thornley,
a British graphic artist.

“It’s been a very overwhelming experience,” Mr. Mak, 19, said by telephone between classes at the Hong Kong Polytechnic University School of Design. “I still attend classes and lessons as usual. But as far as following my assignments, it’s been difficult.”

Mr. Mak said he had developed his design in late August — a white Apple logo on a black background, with a black silhouette of Mr. Jobs indented in the apple — as a tribute to Mr. Jobs after he stepped down as chief executive of Apple.

Mr. Mak said he had searched across the Internet both for inspiration and to ensure he was not copying another design. He said his searches had not uncovered Mr. Thornley’s design.

He then posted the tweaked Apple logo on his blog
. Mr. Mak also asked the public to alert him if they spotted similarities between his work and others.

The design lay quietly on his blog for weeks until Mr. Jobs’s death on Oct. 5.

“Overnight, my Web site went from getting 80 responses to tens of thousands,” he said. “At first I was very happy.”

But by the weekend, Mr. Mak said, people began informing him how similar his design was to Mr. Thornley’s, which featured a black Apple logo on a white background, with a white silhouette of Mr. Jobs at a slightly different angle.

Mr. Mak said he had received notification Sunday night from Mr. Thornley’s wife, Julia, about the similarities of the two designs.

In the world of graphic design, similarities between images are quite common, said Juliette Cezzar, director of the communication design program at Parsons The New School for Design in New York City. But Mr. Mak’s case shows how easy it has become to unearth similar images or outright copies.

“If we were living in a different age, it would take weeks, maybe months to discover copies,” Ms. Cezzar said. “Now it can take 24 hours. That is a good thing.”

In a statement released to the news media, Mr. Thornley said he had followed the controversy while receiving treatment for a rare form of non-Hodgkin’s lymphoma. He said he had first developed his design in May “because I wanted to celebrate the fact that someone who had cancer was still working, still driving forward and still thinking positively about the future.”

Mr. Thornley, a 40-year-old living in Darwen, England, acknowledged the dangers the digital age presented to creativity.

“The Internet can be a double-edged sword,” he said. “You need to use the Internet in order to promote yourself, but in order to do this you are making yourself vulnerable to these situations.”

Mr. Thornley said he hoped to speak with Mr. Mak soon about the two designs.

“J. Mak has been as honest as he can about the situation, I think,” he said. “It is important to have the debate about this, and J. Mak has to be credited for opening up the debate and not hiding from it.”

Such an environment “is really stressful for designers,” said Ms. Cezzar. “You don’t want to be called out in front of the world and called a copier.”

For his part, Mr. Mak said the past week had provided a lesson he could apply as a graphic designer.

“It really taught me to be very careful about what I say and do,” Mr. Mak said. “With all the negative publicity I received in Hong Kong, it taught me to be very careful. At the same time, I need to stay true to my sense of aesthetics.”

Article source: http://feeds.nytimes.com/click.phdo?i=e0cf8f6d96fe6b4931be903fa1baf19d

Filed Under: Business News Tagged With: , ,

Media Decoder Blog: Video: Jobs’s Media Legacy

October 7, 2011 by Leave a Comment

Steven P. Jobs transformed not just the technology industry, but also music, publishing and even parts of Hollywood. Bruce Headlam, the media editor of The Times, talks about his impact.

Article source: http://feeds.nytimes.com/click.phdo?i=c6da67e6c3c46f73e14db8c8799b121f

Filed Under: Business News Tagged With: , ,

Digital Domain: The Auteur vs. the Committee

July 23, 2011 by Leave a Comment

AT Apple, one is the magic number.

One person is the Decider for final design choices. Not focus groups. Not data crunchers. Not committee consensus-builders. The decisions reflect the sensibility of just one person: Steven P. Jobs, the C.E.O.

By contrast, Google has followed the conventional approach, with lots of people playing a role. That group prefers to rely on experimental data, not designers, to guide its decisions.

The contest is not even close. The company that has a single arbiter of taste has been producing superior products, showing that you don’t need multiple teams and dozens or hundreds or thousands of voices.

Two years ago, the technology blogger John Gruber presented a talk, “The Auteur Theory of Design,” at the Macworld Expo. Mr. Gruber suggested how filmmaking could be a helpful model in guiding creative collaboration in other realms, like software.

The auteur, a film director who both has a distinctive vision for a work and exercises creative control, works with many other creative people. “What the director is doing, nonstop, from the beginning of signing on until the movie is done, is making decisions,” Mr. Gruber said. “And just simply making decisions, one after another, can be a form of art.”

“The quality of any collaborative creative endeavor tends to approach the level of taste of whoever is in charge,” Mr. Gruber pointed out.

Two years after he outlined his theory, it is still a touchstone in design circles for discussing Apple and its rivals.

Garry Tan, designer in residence and a venture partner at Y Combinator, an investor in start-ups, says: “Steve Jobs is not always right—MobileMe would be an example. But we do know that all major design decisions have to pass his muster. That is what an auteur does.”

Mr. Jobs has acquired a reputation as a great designer, Mr. Tan says, not because he personally makes the designs but because “he’s got the eye.” He has also hired classically trained designers like Jonathan Ive. “Design excellence also attracts design talent,” Mr. Tan explains.

Google has what it calls a “creative lab,” a group that had originally worked on advertising to promote its brand. More recently, the lab has been asked to supply a design vision to the engineering and user-experience groups that work on all of Google’s products. Chris L. Wiggins, the lab’s creative director, whose own background is in advertising, describes design as a collaborative process among groups “with really fruitful back-and-forth.”

“There’s only one Steve Jobs, and he’s a genius,” says Mr. Wiggins. “But it’s important to distinguish that we’re discussing the design of Web applications, not hardware or desktop software. And for that we take a different approach to design than Apple,” he says. Google, he says, utilizes the Web to pull feedback from users and make constant improvements.

Mr. Wiggins’s argument that Apple’s apples should not be compared to Google’s oranges does not explain, however, why Apple’s smartphone software gets much higher marks than Google’s.

GOOGLE’S ability to attract and retain design talent has not been helped by the departure of designers who felt their expertise was not fully appreciated. “Google is an engineering company, and as a researcher or designer, it’s very difficult to have your voice heard at a strategic level,” writes Paul Adams on his blog, “Think Outside In.” Mr. Adams was a senior user-experience researcher at Google until last year; he is now at Facebook.

Douglas Bowman is another example. He was hired as Google’s first visual designer in 2006, when the company was already seven years old. “Seven years is a long time to run a company without a classically trained designer,” he wrote in his blog Stopdesign in 2009. He complained that there was no one at or near the helm of Google who “thoroughly understands the principles and elements of design” “I had a recent debate over whether a border should be 3, 4 or 5 pixels wide,” Mr. Bowman wrote, adding, “I can’t operate in an environment like that.” His post was titled, “Goodbye, Google.”

Mr. Bowman’s departure spurred other designers with experience at either Google or Apple to comment on differences between the two companies. Mr. Gruber, at his Daring Fireball blog, concisely summarized one account under the headline “Apple Is a Design Company With Engineers; Google Is an Engineering Company With Designers.”

In May, Google, ever the engineering company, showed an unwillingness to notice design expertise when it tried to recruit Pablo Villalba Villar, the chief executive of Teambox, an online project management company. Mr. Villalba later wrote that he had no intention of leaving Teambox and cooperated to experience Google’s hiring process for himself. He tried to call attention to his main expertise in user interaction and product design. But he said that what the recruiter wanted to know was his mastery of 14 programming languages.

Mr. Villalba was dismayed that Google did not appear to have changed since Mr. Bowman left. “Design can’t be done by committee,” he said.

Recently, as Larry Page, the company co-founder, began his tenure as C.E.O., , Google rolled out Google+ and a new look for the Google home page, Gmail and its calendar. More redesigns have been promised. But they will be produced, as before, within a very crowded and noisy editing booth. Google does not have a true auteur who unilaterally decides on the final cut.

Randall Stross is an author based in Silicon Valley and a professor of business at San Jose State University. E-mail: stross@nytimes.com.

Article source: http://feeds.nytimes.com/click.phdo?i=a3acaa8c4287ceda683871e6ca51bafb

Filed Under: Business News Tagged With: , ,

DealBook: A Force Behind the Gaga Effect

June 6, 2011 by Leave a Comment

Soon after Apple started its music-centric social network Ping last year, Steven P. Jobs reached out to Lady Gaga and her business manager, Troy Carter, for feedback.

At the company’s headquarters in Cupertino, Calif., Lady Gaga peppered Mr. Jobs, Apple’s chief executive, with questions about Ping’s design and how it would work with other social networks. The pop star and Mr. Carter voiced concerns over the lack of integration with Facebook, but they left respecting Mr. Jobs’s overall vision.

The meeting also gave Mr. Carter, a new technophile, an idea. He called his friend Matthew Michelsen, a well-connected technology investor and entrepreneur, to find a platform for entertainers that could help them manage their fan base across all major social networks.

“I said why try to find a platform, let’s try to build one,” said Mr. Michelsen.

Despite Lady Gaga’s demanding world tour schedule that fall, Mr. Carter and Mr. Michelsen quietly founded a start-up, the Backplane, with a team of seven. The company, which has not yet been unveiled, is a platform meant to power online communities around specific interests, like musicians and sports teams, and to integrate feeds from Facebook, Twitter and other sites.

“Backplane will provide a platform and tools for communities to socialize and communicate on a more focused level,” said Mr. Carter, sounding less like a pop star’s manager and more like an entrepreneur delivering the typical elevator pitch. “We needed a more concentrated base.”

While Lady Gaga herself — née Stefani Joanne Germanotta — is the artist and creative mind behind Lady Gaga Inc., her lesser-known manager, Mr. Carter, is leading the enterprise’s digital strategy. Unlike other managers who focus on a handful of big platforms like YouTube, Mr. Carter is trying to tap into a broad range of online tools to keep the Gaga machine in overdrive.

Backplane — a blend of music, celebrity and technology — was a natural evolution, says Mr. Carter, who has worked with Lady Gaga for more than four years. As traditional sales have dwindled, the Internet has become increasingly important in music management.

“There was a time when radio stations wouldn’t play Gaga’s music, because it was considered dance,” said Mr. Carter. “Outside of live performances, the Internet became our primary tool to help people discover her music.”

Mr. Carter represents an emerging group of Hollywood managers, actors, musicians and other industry players who are spending more time in Silicon Valley, as technology upends the way people consume content.

The worlds of technology and entertainment have often clashed, tested by products like the music-sharing service Napster, through which some users shared files illegally. Some critics in Silicon Valley are still skeptical of Hollywood people, whom they view as carpetbaggers overestimating their worth.

“Sure these guys can be helpful, but can Lady Gaga make a company? No,” said Jeff Clavier, a venture capitalist.

To Mr. Carter, the two industries are symbiotic. As he pushes to extend the Lady Gaga brand and his own influence in Silicon Valley, he has had many meetings with executives from Zynga and Larry Page, the chief of Google, whom Lady Gaga affectionately calls Larry Google. He is also an investor in several promising start-ups, including Bre.ad, Tiny Chat and Lumier, a company backed by Facebook’s first outside investor, Peter Thiel.

Mr. Carter’s own venture, Backplane, is attracting capital from prominent backers. The company has raised more than $1 million from a group of investors led by Tomorrow Ventures, the investment firm of Google’s chairman, Eric E. Schmidt. Lady Gaga, who has acted as an informal consultant, is also a major shareholder, with a 20 percent stake.

“I’ll never forget when I first met Troy” in 2009, said Mr. Michelsen, who at the time was helping the rapper 50 Cent with his online initiatives. After talking for nearly three hours about the intersection of music and technology, Mr. Carter ended the conversation by saying, “I’m going to get you out of music and you’re going to get me into the tech business.”

Casually dressed in dark jeans, a loose-fitting cream-colored cardigan and thick-framed glasses, Mr. Carter, 38, stands in stark contrast to his client, a paparazzi magnet in her pyrotechnic bras and towering Alexander McQueen heels. Mr. Carter is more comfortable out of the limelight, quietly brokering deals for his larger-than-life clients.

He has worked for Sean Combs, the late Notorious B.I.G. and Will Smith, whom he met in his hometown, West Philadelphia, in the late 1980s. Mr. Carter had come through a scrappy childhood, often subsisting, he said, on government-issued cheese. As a teenager, he lugged crates of records for D.J. Jazzy Jeff and Mr. Smith, then known as the Fresh Prince.

Today, as the chief executive of his own management company, the Coalition Media Group, he represents the firm’s talent, including the YouTube sensation Greyson Chance and the Bollywood actress Priyanka Chopra. But a great deal of his time is spent with his biggest client, Lady Gaga.

Her star power, combined with Mr. Carter’s aggressive deal-making, have made Lady Gaga a force on the Web. In May, she became the first Twitter user to reach 10 million followers, edging out the teenage phenomenon Justin Bieber and President Obama. Her Facebook page has 36 million fans. And in the last few weeks she has begun promotional deals with Google, Zynga and Gilt.

“Troy and Gaga are doing things with communications and fan relationships that we haven’t really seen before,” said Gary Briggs, a vice president at Google, who worked with Lady Gaga’s team on her recent TV commercial for Chrome, Google’s web browser.

Amazon sold digital copies of Lady Gaga’s latest album, “Born This Way,” for 99 cents on May 23 in a heavily publicized move to promote its music service. Her fan base of so-called little monsters crashed Amazon’s servers on the first day of sales. The promotion, paid for by the retailer, helped her sell 1.1 million albums in the United States in its debut week, according to figures released by Nielsen SoundScan, the most for any artist since 2005.

Unlike most venture capitalists, Mr. Carter tends to invest in platforms that are complementary to entertainers. Backplane, along with Bre.ad, a personalized ad start-up, and Lumier, a design-oriented company, will prominently feature Lady Gaga for their public introductions.

Because of Lady Gaga’s reach, she is a valuable incubator to promote new concepts or products. Zynga recently began GagaVille, a special promotion that allowed FarmVille users to unlock her new songs and special virtual items like unicorns and crystals. Bing Gordon, a director at Zynga, called it a logical combination, saying “it’s all about entertainment.” He recently added Gaga crystals to his virtual farm.

The deal developed like many in Lady Gaga’s empire. Mr. Carter and his team negotiated the structure of the arrangement, hammering out a partnership in 90 days. Lady Gaga worked on the creative end, pulling visual components from her music videos and tours to bring a sense of “authenticity” to the design.

“Technology has long been the driver of growth in the music business from the invention of lacquers, eight-track players, vinyl, cassettes and CDs,” Mr. Carter said. “In order to continue the growth we have to go back to embracing technology and the way that people choose to consume music.”

Article source: http://feeds.nytimes.com/click.phdo?i=7a2c23c161da8f287f7a82dc15e139a6

Filed Under: Business News Tagged With: , ,