IT center for employees inside Facebook's new Menlo Park headquarters is seen October 27, 2011. (Dai Sugano/San Jose Mercury News/MCT)

By David Sarno and Nathaniel Popper
Los Angeles Times
(MCT)
LOS ANGELES _ Facebook Inc. has opened its books to eager investors, but some don’t like what they see.

Profit margins have been shrinking. Costs have been rising. And the stock structure means that founder Mark Zuckerberg controls 57 percent of the voting shares, giving him near-dictatorial power over the company’s future.

Other potential problems: Facebook does not operate in China, the world’s largest social networking market. The company’s regulatory filing this week also showed that it makes little money from advertising on mobile devices, which may soon be the primary way users access the Internet and visit social networks.

“Mobile advertising simply doesn’t have the legs that online advertising has,” said Nate Elliott, an analyst at Forrester Research. “If all the users moved to mobile, there’s no guarantee they could make anything like what they’re making now.”

Adding it all up, investors eager to get in on Facebook’s initial public offering this spring are worrying the company will not be able to live up to the hype and sky-high prices that shares are expected to reach.

“Emotionally, people will want to own a piece of it,” said Tim Ghriskey, the chief investment officer at Solaris Group. “But this is a very speculative investment at this point in its life cycle.”

That said, appetite for the shares is expected to be strong during the initial public offering this spring. Facebook’s 845 million users make it an Internet superpower. The billions of ads displayed to users every day are a clear indicator that marketers believe Facebook’s unrivaled trove of user data will let them connect with consumers in a way no other company can.

“Their growth trajectory is huge,” said A.C. Moore, chief investment strategist for Dunvegan Associates Inc. “This is the new kid on the block, and it’s probably going to move into the center of the arena.”

Yet certain kinds of growth are already slowing, while costs are going up.
Facebook’s base of daily users shot up 11.6 percent in the last quarter of 2010 _ but that growth rate dropped by nearly half at the end of 2011, to 5.7 percent. Most observers believe that Facebook will not be able to sustain the ballooning expansion it has enjoyed for several years.

At the same time, the cost of running its network of data centers has surged. In 2009, Facebook spent $2.78 per active daily user to power its service; by last year that number had jumped to $4.04. And because companies must constantly upgrade their servers to keep up with user demand, Facebook’s costs may not ebb any time soon.

The head winds facing the company are disconcerting because investors are expecting such enormous growth from it.

While Facebook shares are not yet trading publicly, sophisticated investors have been able to buy them on private exchanges, where the prices this week valued Facebook at $90 billion. Many analysts expect the market value to go above $100 billion after the IPO.

Most companies of that size have profits many times greater than the $1 billion that Facebook said it made last year. Google Inc., which is worth about twice as much as Facebook, had profits almost 10 times higher last year.

“Enormous growth prospects have already been placed into this stock, and it’s difficult to meet those kinds of expectations,” said Tim Loughran, a finance professor at the University of Notre Dame.

Moving forward, there are a number of clear roadblocks facing the company’s effort to grow profits. In its public filings, the social network said it derived 12 percent of its revenue from Zynga, the maker of popular online games such as “FarmVille.”

Zynga users pay to play the game by using Facebook Credits, the social network’s online payment system. But that relationship is scheduled to expire in 2015.

Analysts also said Facebook’s success will hinge on whether it can follow users from traditional personal computers to the tablet computers and smartphones to which they are moving in droves.

Tablet computers will probably outsell PCs in the U.S. this year, and research firm IDC said recently that by 2015, more users will access the Internet on wireless devices than wired ones.

Also looming in Facebook’s future is the specter of when and if it will expand into China, where strict media control has made doing business there difficult for U.S. Internet companies like Google. Facebook and messaging site Twitter are both banned there.

“China is the world’s largest social networking market, and Facebook doesn’t play there _ that’s a big problem,” said Debra Aho Williamson, an analyst at advertising research firm EMarketer.

Then there’s Zuckerberg, the wunderkind who started Facebook in his Harvard dorm room at age 19.

Generally, when companies go public, shareholders gain a voice in determining the future development of the company and helping to iron out the wrinkles. Facebook stock owners will have no such power because of a stock structure that keeps almost all of the power in Zuckerberg’s hands.

“It makes us much more cautious on the stock,” Ghriskey said. “It’s a publicly traded company, but it’s not a publicly managed company.”

Added Ghriskey: “If you look historically at companies that are run this way, it pays to be wary of them.”
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(Popper reported from New York.)
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(c)2012 the Los Angeles Times
Visit the Los Angeles Times at www.latimes.com
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“Today, a selfish and bullying minority is paving the ground for its domination over the nations by means of the media,” Ahmadinejad said, according to Iran’s Fars News Agency.

The initiative comes as Iran is hoping to build stronger ties in Latin America amid mounting sanctions from the United States and the European Union over its nuclear activities. Ahmadinejad insists the nuclear program is peaceful, but some worry about Iran’s military ambitions.

HispanTV’s launch comes less than a month after Ahmadinejad toured Venezuela, Cuba and Ecuador _ some of Iran’s strongest allies in the region. 
The U.S. House Foreign Relations Committee will hold a hearing Thursday about Ahmadinejad’s Latin America trip, which committee Chairman Rep. Ileana Ros-Lehtinen, R-Fla., dubbed the “Tour of Tyrants.”

During the HispanTV launch, Ahmadinejad said the airwaves were an ideological battleground that the West had long dominated.

The station will “reduce the grounds used by the arrogant powers exercising their hegemony,” he said, according to Fars, “and also narrow the distance between free and justice-seeking nations.”

Iran’s foreign minister went a step further, calling the media the equivalent of a “military force” because it determines the winners and losers of a conflict, HispanTV reported. 

The station, which is available on five satellites, the Web and mobile devices, was running programming Tuesday about how U.S. citizens are not in favor of Iran sanctions and what it called Washington’s plots against Syria and Venezuela. Also running was content produced by TeleSur _ the Latin American network launched in 2005 with the backing of Venezuelan President Hugo Chavez.

HispanTV is the latest addition to Iran’s growing international media presence. The country also runs English-language PressTV and the Arabic-language al-Alam.
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(c)2012 The Miami Herald

Gay rights supporters won a huge victory last year when New York state legalized gay marriage with bipartisan support, doubling overnight the number of same-sex couples who could marry. Four states _ Illinois, Hawaii, Delaware and Rhode Island _ enacted civil union laws, giving gay couples many of the same rights and protections afforded by marriage.

Currently, six states and the District of Columbia allow gay marriage, and Maryland, Washington state, New Jersey and Maine could next join the list. However, there are still more than two dozen states with voter-approved constitutional amendments that ban gay marriage, and voters in Minnesota and North Carolina will decide this year whether to enact similar prohibitions.

On Sunday, Maryland Gov. Martin O’Malley, a Democrat, made a full endorsement of same-sex marriage at a conference in Baltimore of the National Gay and Lesbian Task Force, which works to promote grassroots activism.

“Other states have found a way to protect religious liberty, religious freedom and to protect rights equally, and it is time for Maryland to do the same,” O’Malley told the thousands of gay rights activists gathered, “and that’s why this week we proposed a civil marriage law in the General Assembly of Maryland and we seek to get it done this year.”

In Washington state, Gov. Christine Gregoire, a Democrat, said in early January that she supports same-sex marriage after struggling with the issue for several years. The effort appears to have enough support in the legislature after a key lawmaker switched sides.

“I have sorted it out in my head and in my heart,” said Gregoire, who’s Catholic, when she made the announcement.
I
n New Jersey, the legislature has the votes to approve gay marriage, but Gov. Chris Christie, a Republican, told reporters at a news conference last week that he’d veto the bill and issued a public statement saying voters should decide the issue. Legislators may have enough votes to override a veto, but voters still could have the final word.
Gay marriage opponents point out that voters have rejected it every time it’s been brought to the ballot. And assuming that Washington and Maryland pass bills allowing gay marriage, opponents almost certainly will collect enough signatures to put the issue on the ballot.

“Thirty-one states have voted on the definition of marriage and everyone voted to define marriage as the union of one man and one woman,” Brian Brown, the president of the National Organization for Marriage, said in a statement. “Not only will we mount a successful referendum campaign, we will hold every Washington legislator accountable for his or her vote.”

Many gay marriage opponents say that legalizing same-sex marriages redefines marriage and that it’s best for children to be raised in a two-parent household that includes a mother and a father, even though research has shown that children with same-sex parents are no worse off than children of opposite-sex parents. Many opponents also object to same-sex marriage for religious reasons, and they don’t think that gay marriage laws do enough to protect churches, officials and individuals who oppose gay unions.

But gay marriage supporters say that this year could be a turning point for them.
“The more Americans have been talking about who gay families are, the margin of defeat for freedom to marry has gotten smaller and smaller over the years,” said Evan Wolfson, an attorney and the founder of Freedom to Marry, a gay rights organization in New York, who attended the Baltimore conference. He said that as gay and lesbian couples tell their stories, elected officials and voters come over to their side.

“It used to be not that long ago that anti-gay opponents used to say that gay people getting married is absurd, it will never happen. Then it happened. And support grew,” Wolfson said in an interview. “Arguments are diminishing because hearts and minds have changed.”
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(c)2012 the McClatchy Washington Bureau
Visit the McClatchy Washington Bureau at www.mcclatchydc.com
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By Joan Verdon

A family in Virginia has been using the shoes for the past month, as part of a trial set up by an elder-care expert, to keep track of an 83-year-old husband and father who scared his wife recently when he wandered away while she was grocery shopping. The man’s son now gets alerts on his cellphone showing his father’s location. “So if I lose him, I can call my son and he tells me where he is,” the man’s wife said.

Aetrex Worldwide Inc. began selling the shoes on its website last month. Aetrex President Evan Schwartz said the company has sold “a few hundred pairs” thus far and that the response from customers has been positive. He said the company also is in discussions with the Department of Veterans Affairs and assisted-living companies about the shoes.

Aetrex spent close to two years developing the GPS footwear with GTX Corp. of Los Angeles. GTX had invented a miniature GPS tracking device and was looking for ways to use that technology. Andrew Carle, an administrator at George Mason University in Virginia who specializes in studying the technology needs of the elderly, approached GTX about creating a tracking shoe for Alzheimer’s patients and helped bring GTX and Aetrex together. Carle also recruited the Virginia man’s family to test the shoes.
“GTX was thinking of using the technology for children,” Carle said. “I contacted them and pointed out the need for something like this for Alzheimer’s,” he said. “We know that 60 percent of people with Alzheimer’s wander and get lost. We know they have extremely high rates of injury and even death if they’re not found within 24 hours,” said Carle, who has become a paid consultant for GTX.

And, Carle said, caregivers also know that other kinds of tracking accessories, such as watches or bracelets, don’t work because the Alzheimer’s patient will remove them. Most Alzheimer’s patients aren’t going to wander off without their shoes, he said.
GTX patented the GPS shoe technology some years ago, but hadn’t found a company that could make the shoes until it began talking to Aetrex. Aetrex, founded in 1946 as an orthotics inserts manufacturer, now also sells shoes, sneakers and orthotics for people with special footwear needs such as diabetics, as well as comfort shoes for the elderly. GTX recently branched into fashionable comfort shoes, such as sandals and women’s boots, as well.

The privately held company says it has more than $60 million in annual sales, and has one retail store, in Englewood, N.J.

In discussions with GTX, “we realized this might be a good fit,” said Schwartz. “You have this company that makes this technology and a company that’s really well-known in the foot health space.”

Aetrex installed the GPS tracking mechanism in a sneaker-style shoe it makes called the Ambulator, which is popular with elderly patients. The GPS shoe comes in men’s and women’s models, and in two colors, white and black, and sells for $299.99. Customers who purchase the shoe also need to pay a monthly fee for the GPS monitoring service. There are two levels of service offered location alerts every 30 minutes for $34.99, or every 10 minutes for $39.99. Customers also can go online and create, in effect, a virtual fence, a geographic zone around a person’s residence and get special alerts anytime the shoe wearer leaves that zone.

The battery that powers the shoes needs to be charged periodically, and a charger plugs into the back of the shoe.

Carle said “procedural memory” habits such as putting on your shoes when you wake up is the last to fade for Alzheimer’s patients, and that is why a GPS device in a shoe is effective.

He said wandering is a problem, even when a patient is with a spouse or family member all the time, because “it doesn’t take 15 seconds for them to be gone. You can’t have this person follow you everyplace you go. By definition, there’s going to be moments when they’re alone. And they wander,” he said.

Aetrex only makes the shoes in adult sizes, but said there is much interest in similar shoes for children. Right now, Schwartz said, the GPS devices aren’t small enough to fit into a children’s shoe. “Between the antennas, the battery, the chip … it ends up being too bulky to get in there,” he said.
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(c)2012 The Record (Hackensack, N.J.)
Visit The Record (Hackensack, N.J.) at www.NorthJersey.com
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A little more than a year ago, Microsoft launched a new mobile operating system called Windows Phone 7 to replace its aging Windows Mobile software. Then last February, the world’s largest phone manufacturer announced that it would abandon Symbian, its longtime smartphone operating system, and adopt Windows Phone 7 in its place.

Windows Phone 7 devices have drawn little interest from consumers to date, but Microsoft hopes Nokia can help change that. The first Nokia Windows Phone 7 devices started hitting store shelves around the globe last fall and hit American shores earlier this month when T-Mobile began selling the Lumia 710.

I got an early glimpse at the Lumia 710 in October and wasn’t impressed. But after getting to play with it over the past several weeks, I’ve warmed up to it. It’s an easy-to-use, quick and light smartphone.

The first thing you’ll notice about the Lumia 710 is that, in an age of jumbo-sized screens and elegant designs, it’s a modest device. It’s about the same size and shape as Apple’s 2-year-old iPhone 3GS, with a similarly curved back and a plastic case.

I’m a big fan of phones of this size. They’re easy to fit in a pocket or hold in your hand. While the Lumia 710′s plastic case feels a bit cheap, it makes the device lighter.
At first glance, the Lumia’s 710 technical specs don’t match up well with the latest and greatest phones from Apple or Google’s Android partners. It only has a single-core processor, only 512 megabytes of memory, just 8 gigabytes of storage and no memory card slot that would allow users to supplement its storage. By comparison, the latest Android smartphones have dual and even quad-core processors and the iPhone 4S has as much as 64-gigabytes of storage.

But this nominal difference means much less in practice. The Lumia 710 is fast and responsive. In my informal tests, it seemed to launch and switch between apps more quickly than many of the dual-core Android devices I’ve used. It also has stamina _ I typically could use it a full day without it needing an extra charge.

The storage capacity limits the amount of music, movies, documents and apps you can keep on the device. But this limitation is mitigated by the additional 25 gigabytes of storage Microsoft offers Windows Phone 7 users on its servers in the cloud. Users can automatically store Office documents on the so-called SkyDrive and have their pictures and videos automatically uploaded to it.

One of the stronger points of the Lumia 710 is the Windows Phone 7 software. Compared with Android, Windows Phone 7 is generally a much more visually appealing and intuitive operating system. While I hesitate to recommend Android devices to those new to smartphones because of the operating system’s complexity, I don’t have the same reservations about Windows Phone 7. One exceptional feature of the software is its built-in Bing search application, which allows users to scan bar codes, identify music, find local events and search the Web and local business at the same time.

Unfortunately, other than Windows Phone 7, there’s nothing terribly exciting about the Lumia 710. It doesn’t have a front-facing camera or a speech-recognition system as sophisticated as the iPhone’s Siri. It does have a rear-facing camera, but it’s slow, does a poor job in low light and has a 5-megapixel resolution that is pedestrian and grainy by today’s standards.

While I generally liked the Lumia’s 710 physical design, I didn’t like its buttons. I often had to press its power button several times to wake it up. Conversely, its camera button seemed overly sensitive; I frequently found myself in the camera app without wanting to be there.

But the biggest shortcoming of the Lumia 710 is, ironically enough, the same thing that is best about it _ Windows Phone 7. While the software is easier and more fun to use than Android, it’s lacking in apps and some capabilities.

Microsoft says there are now 50,000 apps available for Windows Phone 7, and you can find many of the most popular mobile programs for it. But you’ll find 10 times as many apps for the iPhone and eight times as many for Android devices. Among the applications you can’t get for Windows Phone 7 are Pandora, Instagram, the game “Infinity Blade” and, amazingly enough, Skype, which is also owned by Microsoft.
Beyond the app gap, Windows Phone 7 also comes up short on Web browsing. A growing number of websites now use HTML5, the latest version of the code used to design Web pages and applications. Unfortunately, Windows Phone 7′s Internet Explorer browser does a poor job of supporting HTML5 compared to the browsers in the iPhone and Android devices.

As a result, some buttons and pages won’t work right, some videos won’t play and some mobile-oriented sites won’t load at all. The problems don’t affect all sites but are frustrating when you encounter them.

Despite such issues, the Lumia 710 is well worth considering. It’s not a standout device, but it’s not a bad one_and its price is just right.
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NOKIA LUMIA 710 SMARTPHONE:
_Likes: Fast and responsive; operating system is intuitive and easy to use; ideal size and weight; inexpensive
_Dislikes: Relatively few apps available; browser doesn’t support some Web apps, videos or pages; no standout features; mediocre camera does a poor job in low light
_Web: www.nokia.com, www.t-mobile.com
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ABOUT THE WRITER:
Troy Wolverton is a technology columnist for the San Jose Mercury News. Reach him at twolverton@mercurynews.com or follow him on Twitter @troywolv.

Prime Minister Nouri al Maliki, a Shiite Muslim, is driving to consolidate control and sideline more secular politicians in a battle that increasingly appears to be a fight to the finish in which there can be no compromise.
Barham Salih, the widely admired prime minister of the autonomous Kurdish region in the north, said the infighting is “tearing the country apart.” Preemption is the name of the game.

“The motto is: ‘I’ll have him for lunch before they have me for dinner’,” he said during an interview in his office in Irbil.

The downhill spiral takes a new turn every week, sometimes daily. Responding to a boycott by his Sunni partners in the power-sharing government, Maliki last week locked them out of their jobs, ordering ministries to bar their doors to Cabinet officers, even though they still have a mandate from the Iraqi parliament.

A day later, the Iraqiya bloc headed by secular Shiite Ayad Allawi, which has 94 seats in the 325-seat parliament, said that if Maliki did not agree to curbs on his power, he should be replaced, either in new elections or by a vote of Maliki’s Shiite backers in parliament.

Iraqi politics today is a constellation of clashes, many in plain view, but others below the surface. “It’s just one-fifth of the iceberg that we are seeing,” said Tahseen Shekhli, an adviser to the prime minister. “The more dangerous disputes are still hidden.”
What’s visible is disturbing enough.

The country’s vice-president, a Sunni, fled last month to Kurdistan, where he’s safe from Iraqi justice authorities seeking his arrest on allegations that he directed hit squads against prominent Shiites. Maliki has attempted to oust the deputy prime minister, also a Sunni, but Sunni and Kurdish legislators refuse to hold a vote, paralyzing the Parliament.

Maliki has sent troops and tanks into the streets of the Green Zone, where most prominent politicians live, and warned top leaders that he is keeping “files” on them.
Allawi, who has been a no-show at Parliament and seems to be abroad more often than in Iraq, says that Maliki has arrested more than 1,000 political opponents on the pretext of preventing a coup by members and supporters of the Baath party of ousted dictator Saddam Hussein.

All is not well within Maliki’s bloc, either, which is able to control the Parliament with 159 votes.

Supporters of radical Shiite cleric Muqtada al Sadr, who hold 40 of those seats, abstained in protest when they were asked to remove Sunni ministers from their jobs, and they’re outraged by Maliki’s courting of Shiite extremists who are rivals to the Sadrists.

In the midst of the political squabbling, insurgents, possibly al-Qaida, have carried out attacks , killing at least 250 civilians in Baghdad and other cities in the time since U.S. forces left, giving the country a security scare.

The Obama administration, which trumpeted the U.S. troop withdrawal as the fulfillment of a campaign promise, views the internal conflict as a real crisis and a big problem for future relations.

The United States has “repeatedly” told Maliki and other political leaders that “our relationship, all the things we want to do” depend on “a resolution through constitutional means,” a State Department official said. The official spoke on the condition of anonymity because of the sensitivity of the subject.

Less clear is whether the U.S. can help restore stability. With no military forces on the ground, Washington’s leverage is meager.

President Barack Obama may have made things worse last month when he hosted Maliki in Washington and hailed him as the leader of “Iraq’s most inclusive government yet.”

“Iraqis are working to build institutions that are efficient and independent and transparent,” Obama said.

The speech enraged Saleh Mutlak, a Sunni who is a deputy prime minister.
“What I heard from Obama was deceiving both for Americans and Iraqis,” Mutlak said. “Obama is telling Americans that they were victorious in Iraq, they liberated the country and Iraqis are now very well situated, and the hero of Iraq, the prime minister, has made an inclusive government in Iraq. But it is the opposite.”
So he gave an interview to CNN in which he denounced Maliki as a “dictator.”

“I wanted to let Mr. Obama know that what he’s telling his own people is not correct. And I wanted to tell my people that I have waited enough, and it’s time to tell the truth of what’s going on inside the government. If Maliki stays in power, dictatorship will be more concentrated.”

A week later, in an interview with the BBC, Mutlak compared Maliki unfavorably with Saddam Hussein. “Saddam brought a lot of things to Iraq, like construction and roads and other sorts of things, whereas Maliki doesn’t seem to be able to bring about such reforms to the country.”

Mutlak’s comments angered Maliki, who announced that he would depose Mutlak and sent a request to Parliament to oust him from his position. But Kurds refused to take part in the vote and together with Sunni delegates deprived the Parliament of a quorum.

Mutlak defends his comparison of Maliki and Saddam. “Show me a single building which is being built by Maliki. His office, his home, the Parliament, everything was built by Saddam,” he said in Irbil.

Mutlak said Maliki showed his sectarian colors a month before the Washington trip by refusing to address the issue of ethnic and sectarian imbalance in the general staff of the Iraqi military. Mutlak said an all-party study commission had concluded that under Maliki, 86 percent of the military’s top command posts were filled by Shiites and 14 percent by members of all other sects and nationalities, well more than the 60 to 65 per cent that Shiites represent in the population.

Mutlak said Maliki’s response was “I don’t believe in that,” meaning striving for ethnic and sectarian balance. And then Maliki issued a veiled threat. “We are coming after you, sooner or later,” Mutlak quoted him as saying.
“Just imagine when a prime minister talks to me and says ‘we are coming after you.’”

Mutlak also blasted Maliki for not consulting with his Cabinet before departing for the meeting with Obama and for not bringing any member of the Iraqiya bloc and only one non-Shiite to Washington.

“It means this was a personal meeting, between the Dawa party (of Maliki) and the Americans,” Mutlak said.

Shekhli, the government adviser, said, “If you make all the people a part of a decision, it will be weak. At the end, they chose him as prime minister, and they must accept his decisions.”

As for labeling Maliki a dictator, he said: “There is no dictatorship here that will last here forever, as Saddam Hussein, or in other Arab countries,” he said. “At the end, there will be voting every four years. The people can change the government through the ballot box.”

Maliki also has come under criticism for the way he made his terrorism charges against the country’s vice president, Tarek el Hashemi, a Sunni. Maliki made the charge via the country’s television stations, which aired edited confessions by three former members of Hashemi’s security guard charging that he directed them to kill prominent Shiite officials. Maliki has since threatened to air a fourth video.
Hashemi, who is ensconced in a lakeside villa in Dukan, in the Kurdish north, said the charges against him were “nonsense.”

“Why is Mr. Hashemi killing a traffic policeman? What is the motive for that?” he said, referring to himself in the third person.

Opponents say televising the video instead of sharing the evidence privately with other political leaders was a Maliki effort to rally Shiites in the face of high unemployment and poor public services.

Western observers here hope that the last month of controversy is merely teething problems of a fledgling democracy and that Iraqis, having survived a sectarian war from 2005 to 2008 that killed thousands, have no appetite for another round.
But the prospect for violence is real, Iraqis agree _ perhaps as soon as February, said one government official who spoke on the condition of anonymity because he was giving his personal assessment. By early summer, the official added, there could be a major question of whether Iraq will survive as a single country.
Salih, the Kurdish prime minister of the autonomous Kurdish zone, agreed that the situation is alarming. “This is a serious crisis, a real crisis,” he said. “We had the Americans around moderating our problems over the last eight years. Now, essentially the major parties think they’re on their own. The power struggle is intensifying. … This polarization in Iraq cannot be sustained for much longer. This could get out of control into an all-out civil, a proxy war. This is a real danger.”
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(McClatchy special correspondent Sahar Issa contributed to this report.)
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(c)2012 the McClatchy Washington Bureau
Visit the McClatchy Washington Bureau at www.mcclatchydc.com
Distributed by MCT Information Services