Will ‘crazy’ tax leave Berlin unable to compete?

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What makes a city competitive for startups? VCs, angels and cheap desk space, to be sure, but also nuts-and-bolts stuff like transport and taxation.

As Om noted in December, Berlin’s airports are quite small, but the city had a plan. The two currently operational airports — Tegel and Schoenefeld — were supposed to be replaced in June by a new mega-airport, Berlin Brandenburg.

But then disaster struck. In a sore blow to anyone still harbouring stereotypes about German efficiency, officials admitted at the start of May that the airports fire safety systems were not yet ready. And yesterday it emerged that the opening date has been pushed back by an embarrassing nine months to next March.

This is humiliating for the German capital, a city that wants to reposition itself as one of the world’s premier technology hubs, and — as a result — has upset a number of local companies.

“The airport screw up is really sad and not worthy of a capital city in Europe. It looks really unprofessional,” productivity startup 6wunderkinder told me.

However, the company does not think it will have any direct impact on the startup scene – a view shared by others I spoke to. What they’re far more worried about is a new compulsory pension contribution for freelancers aged under 30, that’s set to kick in from mid-2013.

‘Crazy’ taxation

The government is forcing young freelancers to pay into their pension pot, something that has been causing quite a stir recently — infact, a petition against it has racked up almost 60,000 signatures. But what’s the problem here? Pensions are good, right?

People might be a bit more enthusiastic about the move if it weren’t for the fact that the contributions (€250-€300 a month for the pension and €100 for disability insurance) are not going to be linked to income. And the fact that the minimum earnings threshold for the scheme is just €400 a month. You do the math.

As Gidsy CEO Edial Dekker told me, it’s “crazy that freelancers have to pay for the broken pension system,” particularly given the high levels of health insurance and social security that they already have to pay.

“Instead of helping freelancers, they’re being charged with something that is very likely not going to be beneficial for them personally later,” Dekker said. “I think one of the most exciting things about our generation is that a lot of people are doing small jobs and that no one thinks about working for the same employer for the upcoming 30 years. It’s good, and should be supported.”

6wunderkinder also took the stance that being a freelancer is not just a job but “a starting point into self-fulfilment”.

“But starting as a freelancer isn’t always easy and being forced to pay a lot of money might stop a lot of people to start their own business,” the company warned.

That said, not everyone agrees on this point. Prominent local angel and Phonedeck co-founder Christophe Maire called the issue “a false problem.”

“Great companies are not — as a rule — built by freelancers but by full-time core employees dedicated to a product,” Maire argued.

“This freelancer thing is so 90s.”

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Just Married

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Here’s Mark Zuckerberg’s way of telling the world he has tied the knot with longtime girlfriend Priscilla Chan: A photo posted to his Facebook Timeline. (Click on this one to get the full Us Weekly treatment.)

We’re told by a guest of the couple authorized to speak that the ceremony happened in Zuckerberg and Chan’s backyard at their home in Palo Alto, in front of a very small number of family and friends, around 100.

The couple had been planning the wedding in secret for about four or five months, our source says, but told their guests that it was a surprise party for Chan’s graduation from UCSF medical school, where she just got her degree in pediatric medicine. News of the wedding was first reported by the Associated Press.

A close friend of Zuckerberg and Chan played the music for the processional, while another close friend played them off.

While the date of the wedding was timed to Zuckerberg’s birthday and Chan’s graduation, the IPO was a moving target, our source says, and was definitely not part of the whole plan.

The ring, you ask? It was simple, our source says, and Zuck designed it himself.

He went with a ruby.

Mike Isaac contributed reporting.

(Image courtesy of Allyson Magda)

After Amazon, how many clouds do we need?

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With news that Google and Microsoft plan to take on the Amazon Web Services monolith with infrastructure services of their own, you have to ask: How many clouds do we need?

This Google-Microsoft news broken this week by Derrick Harris,  proves to anyone who didn’t already realize it, that Amazon is the biggest cloud computing force (by far) and as such, wears a big fat target on its back. With the success of Amazon cloud services, which keep started out as plain vanilla infrastructure but have evolved to include workflow and storage gateways to enterprise data centers, Amazon’s got everyone — including big enterprise players like Microsoft, IBM and HP worried. Very worried.

These vendors are betting big that they can give Amazon a run for its money and that their cloud services will help them retain existing customers and (knock wood) win some newbies. Microsoft built Azure as a full-fledged platform as a service, but in the face of Amazon’s success had to tack to offer IaaS-type services, including VM Roles, which has been in beta for more than a year.

Amazon as enterprise apps platform? Don’t laugh

Take the news late this week that IBM is working with Ogilvy and Mather to move the advertising giant’s SAP implementation from its current hosted environment to  ”SmartCloud for SAP Applications hosted in IBM’s state-of-the-art, green Smarter Data Center.” (Note to IBM: brevity is beauty when it comes to branding.)

Don’t think that little tidbit is unrelated to last week’s announcement that SAP and Amazon together certified yet another SAP application — All-in-One — to run on Amazon’s EC2.  This sort of news validates Amazon as an enterprise-class cloud platform and that’s the last thing IBM or HP or Microsoft wants to see happen.  So every one of these players — plus Google — are taking aim at Amazon.

For some hardware players, including HP, which is reportedly about to cut 30,000 jobs see the cloud as a way to stay relevant, and oh by the way, keep customers workloads running on their hardware and software.  HP’s OpenStack-based public cloud went to public beta earlier this month.

Case in point: Along with the SAP migration news,  IBM also said its SmartCloud Enterprise+, IBM’s managed enterprise cloud infrastructure offers:

“unprecedented support for both x86 and P-Series [servers] running … Windows, Linux and AIX on top of either VMware or PowerVM hypervisors….

and

SCE+ is designed to support different workloads and associated technology platforms including a new System z shared environment that will be available in the U.S. and U.K. later this year.

Hmmm. P-Series and System Z —  not exactly the sort of commodity hardware that modern webscale cloud companies run, but they are integral to IBM’s well-being.

Vendor clouds to lock customers in

This illustrates what prospective buyers should know: Despite all the talk about openness and interoperability, a vendor’s cloud will be that vendor’s cloud. It represents a way to keep customers running that company’s hardware and software as long as possible. But legacy IT vendors are not alone in trying to keep customers on the farm.

Amazon is making its own offerings stickier so that the more higher-value services a customer uses, the harder it will be to move to another cloud.  As Amazon continues what one competitor calls its “Sherman’s march on Atlanta,” legacy IT vendors are building cloud services as fast as they can in hopes that they can keep their customers in-house. For them, there had better be demand for at least one more cloud.

Photo courtesy of Shutterstock user Ohmega1982,

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China Clears Google’s Motorola Mobility Deal

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Google said Saturday that Chinese antitrust authorities have cleared the Internet giant’s proposed purchase of Motorola Mobility Holdings Inc., pushing the $12.5 billion deal over its last regulatory hurdle.

Google, a Silicon Valley giant that built its business on Web services, startled the tech industry last August by saying it would buy the company, a much older, Illinois-based maker of mobile devices and other hardware.

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Here’s What Zuckerberg Said to Employees Before Ringing the Opening Bell (Video)

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Haven’t gotten enough coverage of Facebook’s initial public offering yet? Here’s a video of CEO Mark Zuckerberg giving a speech to employees before ringing the opening bell on Friday.

“Our mission isn’t to be a public company,” he said. “Our mission is to make the world more open and connected.”

The speech, which was shot by Bloomberg, took place at the company’s headquarters in Menlo Park, Calif., the day after it raised $16 billion in one of the biggest IPOs in recent history.

Zuckerberg added that it took eight years to turn Facebook into the largest community in the history of the world, and said, “I can’t wait to see what you’ll do, going forward.”

As a bonus, here’s Zuck accepting a hoodie from the Nasdaq.

China finally gives blessing to Google’s Motorola buy

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Google has finally received approval from China to complete its purchase of Motorola Mobility, Google said Saturday. That paves the way for Google to integrate Motorola, though it remains to be seen exactly how it wants to use the phone maker. The deal is expected to close in the next week.

Google made huge waves when it announced it was buying Motorola for $12.5 billion last August. After getting the U.S. Justice Department and EU approval in February, the process ground to a crawl as China took its time weighing in on the acquisition. Now, all eyes will be on how Google proceeds with its biggest purchase ever.

Android manufacturers have been nervous about Google giving Motorola an advantage. But Google may be taking some steps to try and allay those fears. The Wall Street Journal reported that Google was preparing to work with multiple manufacturers to launch the next version of Android, instead of picking one device maker. The report also said that Google would sell the devices directly through its Web site and through some unnamed retail partners. That would allow Google to take more control of the Android experience, something my colleague Kevin Tofel has urged Google to do.

While Google has been a leader with its Android smartphones, its operating system has not had as much success on tablets. The Motorola pick-up could be critical in helping improve that situation for Google, which is losing out on revenue on tablets because of the popularity of the iPad and Kindle Fire, which don’t provide as much direct revenue to Google.

Google still faces a big challenge in incorporating Motorola, while still keeping its other Android partners happy. And it has also got to show that the acquisition makes sense from a financial stand point. Motorola has struggled like many other Android makers in the face of Samsung, the leading Android manufacturer. At the very least, Google gets more than 17,000 patents, which should provide some more protection in the smartphone patent wars.

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The cost of losing a customer’s trust

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MoneyPreserving consumer trust gets a lot of lip service. But a new report from the World Economic Forum actually attempts to translate its value into dollars and cents.

In a study on personal data released this week with the Boston Consulting Group, the report said that while online retail in the Group of 20 countries could reach $2 trillion by 2016, consumers’ perception of trust plays a significant role in enhancing or eroding that value. With more trust, online retail could grow to $2.5 trillion by 2016; with less, it could reach just $1.5 trillion by the same time, they said.

“Given that this $1 trillion range is from just one small part of the broader personal data ecosystem, it provides an indication of the magnitude of the potential economic impact when other sectors (health, financial services, etc.) are considered – potentially in the tens of trillions of dollars,” the report says. That ecosystem includes individuals, as well as data collectors, marketers, data brokers, publishers and other organizations with an interest in using personal information.

As our volume of digital “exhaust” grows (currently, 10 billion text messages and 1 billion blog and social network posts, according to the report), so does consumer concern around privacy. Just this week, (now public) Facebook was hit with a lawsuit over privacy and, over the past few years, regulatory investigations over privacy violations have climbed.

In this report – and a highly cited report on the topic last year – the World Economic Forum calls personal data “an emerging asset class.” But to really extract its value, the organization argues, public and private institutions need to rethink how they do business so that consumers get more protection, rights and opportunities to hold organizations accountable when it comes to their data.

For a data industry making billions of dollars from personal information ($2 billion from third-party consumer data alone, according to Forrester Research) that’s a tall order. But a handful of companies, from startups like Personal and Azigo to industry giants like Experian, are testing new business models that give consumers more ways to control – and, in some cases, receive compensation for – their data.

As Personal’s Shane Green told my colleague Ryan Kim  earlier this month, “A new model is emerging for personal data. You’ll want a simple, clear answer about what data companies are capturing about you, how they’re using it and what’s in it for me.”

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Tencent to Restructure Business

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Tencent Holdings said Friday it will restructure its business operations into six groups and named a new chief operating officer as the Chinese Internet company moves to improve efficiency and grow beyond its core gaming business.

The move is aimed at helping its smaller operations, such as its mobile, search and e-commerce businesses, gain more independence, analysts said. Over the past year Tencent’s profit growth has slowed as it has sought to spend on a wide array of initiatives to solidify its holdings in areas such as mobile chat and online shopping.

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SpaceX launch scrubbed

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The anticipated launch of the SpaceX rocket, slated for 4:55 a.m eastern time Saturday, was aborted at the last possible second.

The snafu almost immediately prompted questions as to whether the private sector is ready to take on the momentous challenges of a space program, although given the big NASA Space Shuttle disasters, that criticism seems a bit premature. SpaceX was co-founded and backed by tech entrepreneur Elon Musk who also co-founded PayPal and Tesla Motors.

But, proponents said this is a setback, not a disaster. Computer systems detected a combustion issue in one of the rocket’s nine engines and shut down the mission as the countdown hit zero.

“We aborted with purpose,” said SpaceX president Gwynne Shotwell according to AP reports. “It would be a failure if we were to have lifted off with an engine trending in this direction … The software did what it was supposed to do.”

As the U.S. dismantled the space shuttle program, eyes turned to the private sector for funding and know-how to continue space missions. SpaceX’s goal is to ferry cargo and eventually people to the International Space Station. To date such missions have only been accomplished by the U.S., Russia, Europe and Japan.

In the U.S. other companies pursuing some aspect of space travel include Blue Origin and Sierra Nevada. And then there’s Richard Branson’s Virgin Galactic, which plans to offer suborbital spaceflights as early as next year. The company is already booking reservations either directly or through its Accredited Space Agents at a mere $200,000 a pop.

Image courtesy of NASA TV

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Android this week: Hot home screens; more Nexus partners; Galaxy S III pre-orders

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Even with manufacturer “skins”, Android tablet home screens haven’t been much more useful than those on Android smartphones, even though the slates have larger displays. One third-party software developer wants to change that and it’s using Kickstarter to fund the effort. A $5 pledge will get you a copy of Chameleon; an intelligent, customizable home screen app for Android tablets.

What makes Chameleon unique — aside from what’s essentially a “pre-sale” to guarantee money for the developer up front — is the superb customization it offers for Android tablet home screens. Think of Android widgets, which are of course, great by themselves; but on steroids. The entire screen can be used to show information from social networks, weather apps, your music player of choice and more. You customize what you want to see.

Even better: Chameleon can change the home screen contents based on where you are or what time of day it is. So you could create a morning profile for home, for example, with your personal preferences. When the tablet senses you’re in the office later in the day then, it could show home screen data that’s relevant to your job. The idea is smartly based on the observation that tablet users typically open up the same groups of apps at certain places and times. I love the concept and backed the project with my own $5 pledge, just in case Chameleon later appears in Google Play at a higher price. Here’s a demo video to illustrate what the app will do.

I was so impressed by the app demo that I tweeted “Google should buy this company, immediately!” Maybe that’s too much enthusiasm though and besides; Google seems to be busy at the moment: This week a report surfaced that Google will alter its Nexus device program with more hardware partners.

This is a major change from the prior three years as Google has chosen one hardware maker per Nexus device to showcase Android. HTC built the Nexus One while Samsung delivered both the Nexus S and the Galaxy Nexus. With Android 5.0, also known as “Jelly Bean”, Google could offer a range of Nexus devices from HTC, Samsung, LG, Acer, Asus and others. Part of this strategy is to offset any partner concerns with Google’s proposed purchase of Motorola. But I suspect this also about doing exactly what I asked Google to do earlier this month: Take more control over Android. And like the $399 Galaxy Nexus available through Google Play, Google is expected to sell these new devices directly to customers.

Although Samsung is one of those Android partners that could help Google sell its own devices,  the company continues to dominate the Android scene with solid smartphones of its own.

The highly anticipated Galaxy S III already has 9 million pre-orders from network operators around the world and Samsung can only produce 5 million per month. With 290 carriers in 140 countries vying for Samsung’s latest, it’s possible that some regions will be waiting for months to get the device. I wouldn’t expect Apple-like lines around stores to get a Galaxy S III, but I do anticipate a long, slow global rollout similar to the prior model.

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