Tag Archive | "announcement"

Apple Up 3% On Jobs WWDC Visit, ‘iCloud’

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Apple made a pretty steep climb at the open following word CEO Jobs will head the company’s June 6th developer conference.

Apple (AAPL) shares are getting a substantial lift here this morning from the announcement a little while ago that CEO Steve Jobs will help unveil “next generation software” during the company’s Worldwide Developer Conference on June 6th in San Francisco, starting at 10 am, Pacific.

The stock is up $5.94, or 1.8%, at $343.35.

The event will feature discussion of “Lion,” the next version of OS X, which was previewed already; iOS 5, the next version of the iPhone and iPad and iPod Touch operating system; and also “iCloud,” Apple’s “upcoming cloud services offering,” a rather direct and frank admission by the company of what has been speculated upon for some time, namely, that Apple will host more capabilities in data centers rather than having them be simply a desktop affair.

Clearly, though, the notice of Jobs’s in-person appearance is doing the heavy lifting on the shares this morning. It can’t hurt that smartphone competitor Nokia (NOK) is down almost 15% this morning after cutting its Q2 and year view on smartphone weakness.

Update: Apple shares continued to build on the momentum throughout the session, ending the day up $9.93, or 3%, at $347.34.

Helps to see this morning’s rise in the context of the last two weeks:

Apple’s open defies the trend of the last two weeks’ trading.

Article courtesy of Tech Trader Daily

Intel to steer its center of gravity into low-power microprocessors (exclusive)

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Sean Maloney, Intel’s newly appointed president of Intel China, plans to deliver a keynote speech at the Computex trade show in Taiwan next week where he will unveil a heavy-duty effort to steer Intel into the production of low-power microprocessors.

Maloney is expected to say that Intel will accelerate its efforts to make chips that are more appropriate for tablet computers, smartphones, laptops, and low-power desktops. Intel has been doing that for some time. But Maloney, a well-respected executive who recovered from a stroke that kept him sidelined last year, is expected to push that even farther, according to a source familiar with the matter.

This shift within Intel is similar to the shift that occurred when it launched its Centrino laptop processors in 2003 — which Intel referred to as a right-hand turn. This is another right-hand turn, since the current roadmap isn’t as ambitious when it comes to low power consumption.

Most of Intel’s mainstream desktop chips target power consumption of about 40 watts or so. That allows for very fast microprocessor performance, but such a chip generates enough heat that it can’t be so easily used in a laptop and has no chance of making it into a tablet or smartphone. Now, Intel plans to target mainstream chips that consume about 15 watts.

That’s a big difference, but it doesn’t mean Intel will cancel a bunch of chips in development. Rather, the company will modify the roadmap over the next couple of years so that the center of its efforts focuses on 15 watt or lower wattage chips.

The company has already been moving in this direction for a number of years. Intel recently announced a new manufacturing innovation dubbed Tri-Gate transistors that will allow it to use lower power and smaller circuits in its 22 nanometer microprocessors. (Intel’s current Sandy Bridge chips use 32-nanometer manufacturing; the smaller the number, the faster, lower power, and lower cost.)  At its recent annual investor meeting, Intel showed a working 22-nanometer microprocessor code-named Ivy Bridge that is one of the flagship chips for this new low-power strategy. The Tri-Gate transistors take advantage of three dimensions and allow for a 50 percent power reduction at a given level of performance with only a 2 to 3 percent increase in costs. Ivy Bridge will be followed by a chip code-named Haswell that will represent the fruition of Intel’s efforts to reduce the average wattage of its mainstream chips.

Intel is also accelerating development of its lowest-power Atom microprocessors, which are targeted at smartphones, tablets and ultrathin laptops. The Atom chips have been shipping for a number of years, but Intel will turn up the treadmill now. It will shift from 45 nanometer Atom chips this year to 32 nanometer chips and then 22-nanometer chips in 2012. With every manufacturing shift, Intel can make its chips cheaper, faster, smaller and lower power. That pace of innovation is faster than the pace of Moore’s Law (observed in 1965 by Intel chairman emeritus Gordon Moore), which says the number of transistors on a chip doubles every two years.

Intel is also designing a brand new Atom single-chip computer architecture, code-named Silvermont, from the ground up. Those chips are also going to be designed for low power, and the cadence for introducing new chips will become increasingly faster. The 22-nanometer Silvermont chips are expected to be introduced around 2013.

“Intel will completely focus a huge percentage of consumer microprocessors toward mainstream, low-power, ultra-thin, no-compromise computers,” said the source. “The center point of the roadmap will be all about ultra-mobility.”

By the end of 2012, a large percentage of consumer laptops will be in the ultrathin category — think MacBook Air laptops that cost a lot less than they do today and have a lot more performance and all-day battery life. That’s the kind of machine that will use the chips that Intel is placing at the center of its efforts.

Asia is a good place to make the announcement since China is expected to be the largest PC market in the world starting next year. Maloney’s assignment to that region is significant. Maloney was considered the heir apparent to Intel chief executive Paul Otellini. But a stroke threw him off that path. He returned to work in January and is regaining control of his motor skills.

Intel’s Atom processors are beginning to appear in tablet computers and about 10 of them will be shown off at the Computex show in Taiwan.

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Article courtesy of VentureBeat » deals

Intel to steer its center of gravity into low-power microprocessors (exclusive)

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Sean Maloney, Intel’s newly appointed president of Intel China, plans to deliver a keynote speech at the Computex trade show in Taiwan next week where he will unveil a heavy-duty effort to steer Intel into the production of low-power microprocessors.

Maloney is expected to say that Intel will accelerate its efforts to make chips that are more appropriate for tablet computers, smartphones, laptops, and low-power desktops. Intel has been doing that for some time. But Maloney, a well-respected executive who recovered from a stroke that kept him sidelined last year, is expected to push that even farther, according to a source familiar with the matter.

This shift within Intel is similar to the shift that occurred when it launched its Centrino laptop processors in 2003 — which Intel referred to as a right-hand turn. This is another right-hand turn, since the current roadmap isn’t as ambitious when it comes to low power consumption.

Most of Intel’s mainstream desktop chips target power consumption of about 40 watts or so. That allows for very fast microprocessor performance, but such a chip generates enough heat that it can’t be so easily used in a laptop and has no chance of making it into a tablet or smartphone. Now, Intel plans to target mainstream chips that consume about 15 watts.

That’s a big difference, but it doesn’t mean Intel will cancel a bunch of chips in development. Rather, the company will modify the roadmap over the next couple of years so that the center of its efforts focuses on 15 watt or lower wattage chips.

The company has already been moving in this direction for a number of years. Intel recently announced a new manufacturing innovation dubbed Tri-Gate transistors that will allow it to use lower power and smaller circuits in its 22 nanometer microprocessors. (Intel’s current Sandy Bridge chips use 32-nanometer manufacturing; the smaller the number, the faster, lower power, and lower cost.)  At its recent annual investor meeting, Intel showed a working 22-nanometer microprocessor code-named Ivy Bridge that is one of the flagship chips for this new low-power strategy. The Tri-Gate transistors take advantage of three dimensions and allow for a 50 percent power reduction at a given level of performance with only a 2 to 3 percent increase in costs. Ivy Bridge will be followed by a chip code-named Haswell that will represent the fruition of Intel’s efforts to reduce the average wattage of its mainstream chips.

Intel is also accelerating development of its lowest-power Atom microprocessors, which are targeted at smartphones, tablets and ultrathin laptops. The Atom chips have been shipping for a number of years, but Intel will turn up the treadmill now. It will shift from 45 nanometer Atom chips this year to 32 nanometer chips and then 22-nanometer chips in 2012. With every manufacturing shift, Intel can make its chips cheaper, faster, smaller and lower power. That pace of innovation is faster than the pace of Moore’s Law (observed in 1965 by Intel chairman emeritus Gordon Moore), which says the number of transistors on a chip doubles every two years.

Intel is also designing a brand new Atom single-chip computer architecture, code-named Silvermont, from the ground up. Those chips are also going to be designed for low power, and the cadence for introducing new chips will become increasingly faster. The 22-nanometer Silvermont chips are expected to be introduced around 2013.

“Intel will completely focus a huge percentage of consumer microprocessors toward mainstream, low-power, ultra-thin, no-compromise computers,” said the source. “The center point of the roadmap will be all about ultra-mobility.”

By the end of 2012, a large percentage of consumer laptops will be in the ultrathin category — think MacBook Air laptops that cost a lot less than they do today and have a lot more performance and all-day battery life. That’s the kind of machine that will use the chips that Intel is placing at the center of its efforts.

Asia is a good place to make the announcement since China is expected to be the largest PC market in the world starting next year. Maloney’s assignment to that region is significant. Maloney was considered the heir apparent to Intel chief executive Paul Otellini. But a stroke threw him off that path. He returned to work in January and is regaining control of his motor skills.

Intel’s Atom processors are beginning to appear in tablet computers and about 10 of them will be shown off at the Computex show in Taiwan.

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Article courtesy of VentureBeat » deals

Symantec Slips Despite FYQ4 Beat; Q1 View Tops Estimates

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Symantec (SYMC) this evening report fiscal Q4 results ahead of expectations and forecast the current quarter slightly ahead as well.

Q4 revenue was up 9.3% at $1.67 billion, yielding EPS of 38 cents, versus the consensus $1.6 billion and 36 cents.

For the current quarter, the company sees revenue of $1.57 billion to $1.59 billion, ahead of the average $1.55 billion, and EPS of 36 cents to 37 cents, versus 36 cents expected.

Symantec shares are down 11 cents, or half a percent, at $19.30.

International revenue, which was 51% of all revenue, was up 10%, including a 4% rise in Europe, the Middle East, and Asia, while Asia revenue rose 22%, or 12% on a currency-neutral basis. Americas revenue, which has some overlap with International in the case of Latin America, rose 9% and was 55% of revenue.

CFO James Beer took some time to talk with me following the announcement.

Beer said the company was particularly pleased with the performance in its consumer products, hosted services, data loss prevention, and backup products, and also the performance of recent acquisitions.

On the consumer side of the house, “We’re doing a very good job of getting new customers but also upsetting and cross-selling them to things like backup,” said Beer.

On the enterprise side, “data loss prevention had a strong quarter as customers increasingly focused on this problem of losing information,” said Beer. The “Wikileaks episode,” as he calls it, has put a particular focus on that issue, he thinks.

Hosted services was, “reflective of how some customers, particularly smaller companies, are getting comfortable taipang into software through a browser.”

The company got $81 million from its recently acquired businesses, including the security business it bought from Verisign (VRSN), and the PGP and GuardianEdge businesses. Beer wouldn’t give a year-over-year growth rate for those businesses, but said the bookings growth for they saw was “very strong” in the quarter.

Beer said Symantec will focus its efforts this fiscal year on three new emerging growth opportunities in particular: mobile, virtualization, and cloud.

Article courtesy of Tech Trader Daily

Nvidia: Icera Deal Brings Them Closer To QCOM; Trouble For TI?

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Response is trickling in to Nvidia’s (NVDA) announcement this morning it will purchase baseband chip maker Icera for $367 million in cash in order to boost its mobile semiconductor offerings.

Linley Gwennap with The Linley Group writes this afternoon that Icera’s programmable baseband, the “DXP,” can be a quarter of the size of chips offered by Qualcomm (QCOM) and others, because programmable firmware can replace the separate modem blocks that those other chips require for each wireless protocol — EDGE, Wideband CDMA, HSPA, and LTE, among others.

“In the near term, both companies should benefit by cross-selling their products to largely non-overlapping customer bases,” writes Gwennap. “For the longer term, the acquisition gives Nvidia an opportunity to expand the market for “Tegra” [Nvidia's application processor] by developing single-chip products that combine the application and baseband processors.”

Gwennap observes that over half the smartphones shipped last year included an integrated app and baseband processor, and, “this percentage will exceed 70% by 2015.” Tablet computers, too, are destined to ship with integrated cellular going forward, he thinks.

It should be “straightforward” for Nvidia to merge the chips on a single semiconductor, as they both are made in Taiwan Semiconductor Manufacturing’s (TSM) 40-nanometer process, he observes. Such an integrated system-on-chip might appear in phones in the first half of 2013.

(I would note that, as I mentioned earlier, Icera’s baseband is oriented toward data, not voice applications, though Nvidia clearly intends to extend the Icera parts to voice.)

Jim McGregor of In-Stat writes that Texas Instruments (TXN) could have problems: it’s winding down its baseband operation and has dependend on Icera for some chips. Like Gwennap, McGregor believes an integrated baseband offering will be important for design wins in future tablet devices.

Romit Shah, with Nomura, who has a Neutral rating on Nvidia, thinks the deal is a positive for the company in that it expands the addressable market. He notes Qualcomm currently has almost 50% of the integrated baseband chip market.

He also, however, thinks Nvidia now needs to buy WiFi, Bluetooth, and GPS chip expertise in order to “compete effectively with Qualcomm.”

“Furthermore, we believe that this announcement highlights a hole in TI’s argument that there is a sizable opportunity for standalone app processors,” writes Shah.

Nvidia shares are up 31 cents, or 1.6%, at $19.62.

Article courtesy of Tech Trader Daily

Sprint: Deal With Clearwire Could Lift Profit, But Swell Investment As Well

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Shares of Sprint-Nextel (S) are up 7 cents, or 1.4%, at $4.77 after the company this morning filed a form 8-K with the SEC stating it amended its relationship with Clearwire (CLWR), the broadband wireless provider in which Sprint owns a majority stake.

The agreement, following negotiations for months that had been closely watched, provides for Sprint to pay Clearwire a minimum of $1 billion in 2011 and 2012 combined to utilize Clearwire’s network.

Analysts are taking a relatively positive view of the fact that the two reached a deal, though bears are concerned it doesn’t matter much for Sprint in the context of the company’s overall business.

Jennifer Fritszche with Wells Fargo reiterated an Outperform rating on both Sprint and Clearwire shares. “While most investors knew this announcement was close, we believe the contract shows Sprint’s near term commitment to CLWR,” she writes.

“We continued to field questions from investors if S would abandon CLWR and turn to Lightsquared for its 4G strategy,” writes Fritszche. Privately held Lightsquared of Reston, Virginia is developing its own wholesale broadband wireless network.

“Today’s announcement – with Sprint’s commitment through YE 2012 – should quell some of those near term fears,” she concludes.

Citigroup’s Michael Rollins sees additional profit coming out of any deal to host traffic for Clearwire and Lightsquared.

We continue to believe each hosting scenario for Sprint can capture an incremental NPV of $2.8-$4.4 billion using a 10-year DCF based on a national network of 40k sites, while generating an upfront profit of $25k/site deployed and a cost recovery for combined monthly backhaul, maintenance, and power for at least at $600/site. Under a hosting scenario, we believe S can improve liquidity perception and accrete value of at least $0.60-$1.10/share per hosting partner on top of the NPV in savings that it has already outlined for Network Vision.

Rollins reiterated a Buy rating on Sprint shares and a $6 price target.

Sanford Bernstein’s Craig Moffett opines that reaching a deal of any kind is good news for both companies. However, “higher wholesale rates mean that Sprint’s margins will decline (even further),” he writes.

At the same time, with Sprint as the principle tenant, he expects Sprint will end up being the primary backer for the continued buildout of Clearwire’s network. “There’s no such thing as a free lunch,” writes Moffett. He reiterates an Underperform rating on Sprint shares and a $3 price target.

Mike McCormack of Nomura Equity Research reiterated a Neutral rating on Sprint shares. “We view the agreement as a small positive, in that it allows the company some breathing room to continue discussions with LightSquared, while maintaining a 4G presence through Clearwire,” writes McCormack. “This deal could also lessen the fears of a near-term acquisition of Clearwire by Sprint.”

But he also thinks it will be tough for Sprint and Clearwire to get much out of network sharing, given that they still must sign up customers in a market, “that is unlikely to yield meaningful share.”

As Dave Novosel with Gimme Credit observes today, the response of Clearwire’s shares — they are down 22 cents, almost 4%, at $5.56 — suggests investors expected Clearwire would get a higher payment from Sprint. It’s possible Sprint will provide both Clearwire and Lightsquared with access to its own network, which might help Clearwire to avoid some buildout costs.

Clearwire has next year’s funding gap covered, writes Novosel, although, “it appears that it will still need an equity injection to complete the rollout of its network.” Clearwire should be able to meet a target to cover 120 million people, he writes.

Article courtesy of Tech Trader Daily

Seagate: Samsung Deal Improves Drive Economics, Boosts Solid-States

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Shares of Seagate (STX) are down 61 cents, or 3.4%, at $17.23 following this morning’s announcement the company will take over the disk-drive operations of Samsung (SSNLF) and that Samsung will take 10% ownership in Seagate, in a $1.38 billion deal split 50-50 cash and stock.

The deal confirmed speculation by The Wall Street Journal on Sunday.

In conjunction with the announcement, Seagate said that its fiscal Q3 ended in March delivered earnings per share of 25 cents, 2 cents below Street estimates, while revenue of $2.69 billion, up 12%, year over year, was in line with consensus. The forecast for fiscal Q4 was for revenue of $2.7 billion and EPS of 19 cents to 23 cents. The Street has been looking for $2.6 billion in revenue and 28 cents EPS.

During a conference call with analysts this morning, Seagate management said that the situation in Japan following the earthquake last month continues to be “volatile,” and that as a result, Seagate is planning for the drive industry to see sales fall in the June quarter. Seagate’s operating expenses, however, will come in at the same level as the March quarter, weighing on profits.

Aaron Rakers with Stifel Nicolaus thinks the deal is positive, he tells me in a phone call this morning, as it continues the consolidation of the drive market to three competitors who own the vast majority of industry, with Seagate, Western Digital (WDC) and Japan’s Toshiba (6502.jp).

“It’ll lead to more rational behavior from a gross margin standpoint,” notes Rakers. “Plus, there’s a whole 3.5-inch drive category Toshiba doesn’t even play in,” notes Rakers.

Rakers sees the deal as also validating the importance of solid-state drive technology. The agreement calls for Samsung to supply flash memory chips to Seagate for the latter’s flash-based drives, and for Seagate to ship solid-state drives to Samsung for use in its computers.

I would note that flash-memory drive supplier Stec (STEC) is up on the news today, rising 24 cents, or 1.3%, to $18.45.

Article courtesy of Tech Trader Daily

Solar: Big Vote Of Confidence As GE Gets Religion, Says Kaufman

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I had a chat with Kaufman Brothers analyst Jeffrey Bencik this morning about what seems a meaningful endorsement of solar energy with General Electric’s (GE) announcement yesterday it had achieved record efficiency in a type of solar panel component, made of “thin films” based on cadmium telluride materials, and that GE plans to build what it bills as the U.S.’s biggest solar-panel manufacturing facility, capable of 400-megawatts of production, employing 400 people and resulting in enough power generation to power 80,000 homes a year.

Bencik, who used to cover GE formally, and now covers First Solar (FSLR), among others, tells me that the initiative, “marks a significant shift” for GE in its attitude toward solar. GE was sour on the business not so long ago, but has now understood that solar, as Bencik puts it, is the only energy source not rising in cost, including wind energy.

“Five years ago, six years ago when I asked [GE CEO Jeffrey Immelt] about solar, he poo-poo’ed it at the time, said it was way too far away from cost competitiveness,” Bencik recalls.

Bencik muses that Immelt has seen the writing on the wall as far as cost: “The cost of solar has been cut in half in the last two years, while the cost of every other means of electricity generation has continued to increase because they are all steel turbine-based, and steel costs have been going up.”

“They can see the finish line,” he says of GE with regard to cost, “They can see this is a real business.”

For the solar business, it’s a big vote of confidence, says Bencik, even though it will take several years for the GE initiative to bear fruit. No site has been picked for the plant, and it will take a year or more for construction, then more time to ramp the facility, put out product, etc.

But, this will be the first solar energy company “with the ear of the president,” notes Bencik, referring to President Obama’s having appointed Immelt to his “Competitiveness Council” on industry. “With GE going into solar in a big way, it’s in their interest to have increased incentives for solar,” he observes, alluding to the possible impact on U.S. policy.

And the announcement may make solar real for some investors, he argues, though it will probably help to have GE announce a second facility at some point, to prove that the company is not going to just dabble and then walk away.

“If they follow this up with an additional one, then I think a lot of people will get off the fence,” says Bencik. “A second facility would remove all doubt” among investors.

For First Solar and others, there are more immediate benefits. Their customer base may increase as some prospects see GE coming in and decide the technology’s been blessed. First Solar, in particular, benefits forma the fact that GE has chosen thin-film. GE’s years away from threatening First Solar, and first solar has capacity of 2.5 gigawatts already, dwarfing what GE has planned.

But with a vocal lobby having warned against the health risks of cadmium telluride, First Solar may have gained a big ally in the public health debate.

Bencik maintains a Hold rating on First Solar shares, having downgraded it when it hit $165. He now thinks that, “there’s actually starting to be meaningful upside” for the shares at a recent price of $147.75.

Article courtesy of Tech Trader Daily

Write-Offs: 03.31.11

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$$$ Libya-Owned Bank Drew at Least $5 Billion From Fed‎ [Bloomberg]

$$$ In testimony on Thursday, former Galleon portfolio manager Adam Smith acknowledged that the hedge fund had been awash with speculation about a possible merger of chipmakers Advanced Micro Devices and ATI Technologies months before the announcement of a $5.4 billion deal on July 24, 2006. But Smith said: “The speculation was public. The fact that it was happening was not public.” [Reuters]

$$$ Falcone-backed telecom hires Ed “We’re a nation of wusses” Rendell to lobby for LightSquared [Reuters]

$$$ “We need to get the owners of banks to behave like they own them. Institutions are turning over their bank shares every six months or so. They don’t consider themselves owners. I think we should get capital requirements up in the future but allow them to grow at the moment, and in the meantime make sure shareholders own shares for longer and engage with management. The job of policing management shouldn’t be left to the government. It should be the owners that do that. But we lost that. Again, maybe we need another tax to make shareholders hang on longer. I would call it the Warren Buffett Tax.” [Fortune]

$$$ Moody’s Cuts Tepco’s Credit Rating [WSJ]

$$$ Fed’s Tarullo: Banks Need Tough Capital Standards [CNBC]

$$$ Will Goldman’s Special Situations Group Survive Dodd-Frank? [BW]

$$$ $5 Fees May Be Coming to an ATM Near You [CNBC]



Article courtesy of Dealbreaker

Publishers back Inkling’s iPad textbooks

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inklingiPad textbook startup Inkling just announced that it has won financial backing from the two biggest names in the textbook business — McGraw-Hill and Pearson.

Founder and chief executive Matt MacInnis said Inkling’s goal involves using the content of an existing textbook as a skeleton, then “casting off the shackles of the book” and adding interactive and multimedia content that could only work on the iPad. We first covered Inkling right after the announcement of the iPad in January of last year. The San Francisco startup has now released 14 textbooks, MacInnis said, and it should be up to more than 100 titles by this fall.

There are other companies building iPad textbooks, MacInnis acknowledged. Competitors include ScrollMotion, and educational tablet-maker Kno is reportedly shifting its efforts from hardware to software. But he argued that everyone else is basically adding limited features to a PDF of the textbook, and that these e-books are basically developed by the publishers’ business divisions without much input from the original textbook creators. Inkling, on the other hand, wants to publish apps that feel like they were truly built for the iPad, which usually means working with the books’ authors to create new content.

“It only gets interesting when the content itself changes and begins to respond to your fingertips,” MacInnis said.

You can see an example of an Inkling app in-action in the video below. Thanks to the backing of McGraw-Hill and Pearson, as well as partnerships with John Wiley & Sons, W.W. Norton, and Wolters Kluwer, Inkling now has access to “95 percent of the content universe,” MacInnis said — though the company’s actual production is far behind that amount, since it doesn’t have the resources to convert every title from every publisher. For now, he said Inkling remains very involved in the digital textbook-creation process, because it wants to ensure that the early apps are high-quality, but as time goes on it will move to a more self-service model.

The size of the round was not disclosed, except that it was a “multi-million dollar” financing. Previous investors Sequoia Capital, Felicis Ventures (which also invested in VentureBeat), Kapor Capital, and Sherpalo Ventures also participated in the new funding.

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Article courtesy of VentureBeat » deals