I just returned to the office after taking a little time off these past couple of weeks to play in a couple of golf tournaments with my father.
If you had access to the U.S. government’s secret and exhaustive PRISM Internet and social media screening system, you’d know by now that my father and I finished second in the Texarkana Country Club Four States Competition, and fourth in the Denton Country Club Member/Guest Tournament (Fourth flight).
We really should have come in first, but I had a horrible 11th hole on Sunday, and dad missed an easy par putt on the 18th.
But again, if you had access to PRISM, you’d already know all this.
Of course, you’d also know it if you were my Facebook friend.
If you’ve fallen a little behind, as I have, you might want to read this overview of the PRISM scheme here from Gizmodo.
Basically, this system allows the U.S. government to monitor communications that pass through U.S. servers from the likes of Microsoft, Google, Yahoo!, Facebook, YouTube, Skype, AOL, Apple, and others, and includes all ranges of data: Email, chat (video and voice), photos, stored data, VoiP, file transfers, video conferencing, social networking details…the list goes on.
Methinks George Orwell would probably not approve.
And apparently neither did the whistleblower, ex-CIA employee Edward Snowden who has also worked at the National Security Agency as a contract employee with consultancy Booz Allen and who leaked the program to U.K. newspaper The Guardian before fleeing to…Hong Kong.
Yes, to Hong Kong, to China, that bastion of freedom of speech, thought and expression.
Apparently Mr. Snowden thought that Hong Kong’s “spirited commitment to free speech and the right of political dissent” would be enough to protect him from the prying hands of U.S. authorities.
But perhaps he should have double checked the lawbooks, because Hong Kong signed an extradition treaty with the U.S. just prior to the territory’s being returned to Chinese sovereignty in 1997.
According to reporting from the BBC, the “Fugitive Offenders Order” has both Hong Kong and the U.S. agreeing to extradite someone who has committed “an offence which us punishable under the laws of both Parties…”
Sounds to me like the U.S. government has a round-trip ticket for Mr. Snowden firmly in mind.
In the meantime, a long-needed public debate about the state of the surveillance state, big data, privacy, national security and all those other relevant issues seems to have begun to kick into high gear.
To which I suggest, if Apple can keep all those secrets until their unveiling at the WWDC, perhaps the U.S. government should be studying Apple’s communications plans to find out how to keep a better secret?
Everybody THINKS they know what will be announced at the WWDC, but it’s usually only so much uninformed guesswork.
That’s why I’ll be watching live and in real-time come high noon Central Standard Time via my Apple TV, to hear it straight from the source.
But enough of all this technology talk. Did anybody remember this is the week of the annual U.S. Open Golf Championship, to be held this year for the first time at Merion in Ardmore, PA since 1981???
I wasn’t in Boston over the weekend, so I wasn’t there to see Neil Diamond sing “Sweet Caroline” live and in person at Fenway Park.
But I was introduced to the tradition during my own first visit to Fenway a year ago this May, and I can’t think of a more fitting way to kick away the dust of fear and horror last week than something as American as having Neil Diamond show up at the ball park to sing “Sweet Caroline”!
If you’ve never experienced it firsthand, basically here’s how it goes: In the middle of the eighth inning, since 2002, “Sweet Caroline” is played over the loudspeakers at Fenway, and the great citizens of Bostons (and Red Sox fans everywhere) do a little audience participation. It’s not quite a “Rocky Horror Picture Show” level of audience participation, but then again, this is baseball and we’re between innings people!
Go find some of the video recaps to see for yourself, but if you did see Diamond out there on the diamond doing it live this weekend, amd if that didn’t send a couple of tears to your eyes, you’d better check to make sure the drones from Tom Cruise’s new movie “Oblivion” (and which I saw this weekeend…two thumbs up!) haven’t taken over.
Of course, I guess if you didn’t want anyone to see you cry you could invest in some of these new techno glasses, Google’s or otherwise.
According to The New York Times, Oakley’s also getting into the act, working to introduce goggles that can display incoming text messages, have embedded GPS, Bluetooth, and video cameras.
Skiers, please, keep your eyes on the slopes at all times!
That goes for you cyclists looking to check your heartbeat in your newfangled high tech cycling glasses every five seconds.
Don’t get me wrong, I’m all for having performance biometrics, even in real-time, but I think we have to think very carefully about how that information is presented back to athletes, especially those mid-mountain or mid-peloton.
If you’ve ever nearly been run over by someone who was texting while driving, you know exactly what I’m talking about.
I texted while driving for a time. But about the fourth time I nearly rear-ended someone, it dawned on me that texting while driving was a bad idea. Very bad. And this was well before any of those anti-texting public ad campaigns had emerged.
These days, I find myself constantly scanning my rear-view mirror in fear of some other idiot not having come around to a similar conclusion, which is its own kind of dangerous distraction.
So what’s going to happen on the ski mountains across the globe when folks are too busy checking their optimum heart rate to see those trees racing up towards their performance glasses?
There will be an inordinate demand for well trained ski patrol professionals, that’s what!
I was sitting here at JFK waitin’ on a plane and IBM’s 1Q 2013 earnings came across the wire, so here goes:
- Diluted EPS: GAAP: $2.70, up 3 percent; Operating (non-GAAP): $3.00, up 8 percent
- Net income: GAAP: $3.0 billion, down 1 percent; Operating (non-GAAP): $3.4 billion, up 3 percent
- Gross profit margin: GAAP: 45.6 percent, up 0.6 points; Operating (non-GAAP): 46.7 percent, up 1.0 points
- Revenue: $23.4 billion, down 5 percent, down 3 percent adjusting for currency
- Free cash flow of $1.7 billion, down $0.2 billion
- Software revenue flat, up 1 percent adjusting for currency; Pre-tax: income up 4 percent; margin up 1.2 points
- Services revenue down 4 percent, down 1 percent adjusting for currency; Pre-tax: income up 10 percent; margin up 2.0 points
- Services backlog of $141 billion, up 1 percent, up 5 percent adjusting for currency; Closed 22 deals of more than $100 million in the quarter
- Systems and Technology revenue down 17 percent, down 16 percent adjusting for currency
- Growth markets revenue down 1 percent, up 1 percent adjusting for currency
- Business analytics revenue up 7 percent; Smarter Planet revenue up more than 25 percent; Cloud revenue up more than 70 percent
- Reiterating full-year 2013 operating (non-GAAP) EPS expectation of at least $16.70.
IBM announced first-quarter 2013 diluted earnings of $2.70 per share, a year-to-year increase of 3 percent. Operating (non-GAAP) diluted earnings were $3.00 per share, compared with operating diluted earnings of $2.78 per share in the first quarter of 2012, an increase of 8 percent.
First-quarter net income was $3.0 billion, down 1 percent year-to-year. Operating (non-GAAP) net income was $3.4 billion compared with $3.3 billion in the first quarter of 2012, an increase of 3 percent. Total revenues for the first quarter of 2013 of $23.4 billion were down 5 percent (down 3 percent, adjusting for currency) from the first quarter of 2012.
“In the first quarter, we grew operating net income, earnings per share and expanded operating margins but we did not achieve all of our goals in the period. Despite a solid start and good client demand we did not close a number of software and mainframe transactions that have moved into the second quarter. The services business performed as expected with strong profit growth and significant new business in the quarter,” said Ginni Rometty, IBM chairman, president and chief executive officer.
“Looking ahead, in addition to closing those transactions, we expect to benefit from investments we are making in our growth initiatives and from the actions we are taking to improve under-performing parts of the business. We remain confident in this model of continuous transformation and in our ability to deliver our full-year 2013 operating earnings per share expectation of at least $16.70.”
Pre-tax income decreased 6 percent to $3.6 billion. Pre-tax margin decreased 0.1 points to 15.4 percent. Operating (non-GAAP) pre-tax income decreased 1 percent to $4.1 billion and pre-tax margin was 17.4 percent, up 0.8 points.
IBM’s tax rate was 15.9 percent, down 4.1 points year over year; operating (non-GAAP) tax rate was 17.3 percent, down 3.2 points compared to the year-ago period. The lower tax rate is primarily due to benefits recorded to reflect changes in tax laws enacted during the quarter, including the reinstatement of the U.S. Research and Development Tax Credit.
Net income margin increased 0.5 points to 13.0 percent. Total operating (non-GAAP) net income margin increased 1.2 points to 14.4 percent.
The weighted-average number of diluted common shares outstanding in the first-quarter 2013 was 1.12 billion compared with 1.17 billion shares in the same period of 2012. As of March 31, 2013, there were 1.11 billion basic common shares outstanding.
Debt, including Global Financing, totaled $33.4 billion, compared with $33.3 billion at year-end 2012. From a management segment view, Global Financing debt totaled $25.2 billion versus $24.5 billion at year-end 2012, resulting in a debt-to-equity ratio of 7.2 to 1. Non-global financing debt totaled $8.2 billion, a decrease of $0.6 billion since year-end 2012, resulting in a debt-to-capitalization ratio of 34.3 percent from 36.1 percent.
IBM ended the first-quarter 2013 with $12.0 billion of cash on hand and generated free cash flow of $1.7 billion, excluding Global Financing receivables, down approximately $0.2 billion year over year. The company returned $3.5 billion to shareholders through $0.9 billion in dividends and $2.6 billion of gross share repurchases. The balance sheet remains strong, and the company is well positioned to support the business over the long term.
Greetings from lovely White Plains, New York.
I’ve been up here a few days, having flown up to New York City on Monday for a series of meetings.
No sooner had I accompanied my colleague down to baggage claim at JFK than I saw the first reports emerging about the bombings in Boston.
Not long after we heard about the ricin letters.
And then this morning I woke up to the news about the fertilizer plant explosion in West, Texas.
It made me sick to my stomach, and my heart goes out to the folks in West.
I drove through there just last weekend on my to Lake Whitney just west of West to play some golf with my father.
Many of the people who live there are of Czech descent, and are known for both their hospitality to travelers and for their scrumptious kolaches.
So I wanted to pass along this “Things You Need to Know About West” list, for I and my colleagues are feeling a little homesick at the moment being up here in the Northeast while all this is going on back on our doorstep in central Texas.
Thankfully, I’ll be heading back home later this afternoon, which means I’ll likely be in a JFK queue instead of reporting on IBM earnings, as I’m normally wont to do on earnings day.
I’ll be sure to do an earnings post when I get back to Texas.