Mithril, doubling down, leads $50 million investment in AppDirect

San Francisco-based AppDirect, which helps developers and businesses create, use and sell apps, said it raised another $50 million in a funding round led by Mithril Capital Management, the same firm in charge of its last round.
The latest funding values AppDirect at $600 million, double the valuation when it raised $35 million in April.
By doubling down, Mithril is making a big bet on the growth of apps, specialized software that users tap into via the Internet rather than through a specific computer. As part of the trend, also called cloud-based software, developers try to make sure the apps work seamlessly with smartphones.
Last year, venture firms invested $2.89 billion in software, up from $2.41 billion the year before, according to the National Venture Capital Association. Software has led venture investing since 2008, the height of a clean-technology boom and a time when venture capitalists preferred industrial energy.
From its founding in 2012, Mithril was seeking investments that benefit from the increasing tendency of companies to move software to the cloud, said partner Ajay Royan. However, he wanted to find new ideas within that well-trodden route.
“You’re looking for something that is slightly hidden,” he said. “The secret that was hidden in plain sight.”
He liked AppDirect in part because it makes it easy to tap into what he says is a quietly emerging trend that allows employees to use their own software at work, much as they now bring in their own computers and phones instead of using workplace hardware.
AppDirect does this by creating an online marketplace of apps that work well in business environments and integrate with each other, Royan said. It also simplifies the app-publishing and selling process for developers and intermediaries, and runs the app marketplaces for customers such as AT&T Inc.
To mitigate risk, venture firms typically lead just one round of a start-up's financing. If they like the company and want to increase their stake, or alternatively, if they cannot find an outside investor willing to pay a higher price, they sometimes lead two or more rounds.
In this case, new investors Henry Kravis, co-founder of buyout firm KKR & Co LP, and Paul Fribourg, chief executive of Continental Grain, joined the round. Existing investors Foundry Group, iNovia Capital and StarVest Partners also participated.
(Reporting by Sarah McBride. Editing by Andre Grenon)

Original post found here: http://www.reuters.com/article/2015/02/11/us-venture-investing-appdirect-idUSKBN0LF1DG20150211

Exclusive-Survey: Trouble for Amazon Prime's two-day deliveries?

Employees arrive for work at an Amazon Fulfillment Center, ahead of the Christmas rush, in Tracy, California, November 30, 2014.

Credit: Reuters/Noah Berger

Amazon.com Inc packages ordered by its Prime members regularly arrived late over the holidays, a Reuters/Ipsos survey shows, reflecting the strain on the logistics network that transformed the company into an e-commerce powerhouse.
Customer satisfaction with Prime is extremely high - 96 percent are happy with its two-day shipping service, the survey revealed. But the results raise questions for Amazon as it expands and takes greater control of its shipping system.
The $99-a-year service was launched a decade ago with the guarantee of standard, reliable two-day shipping on online orders. Prime has since become the cornerstone of Amazon's growth - and a testing ground for new services ranging from TV and video to delivery-by-drone.
Amazon said U.S. Prime memberships increased 50 percent last year. Analysts reckon that the largest U.S. online retailer now promises standard two-day shipping to what amounts to nearly one-third of U.S. households.
In the Reuters/Ipsos poll conducted last month, 10 percent of about 1,700 Amazon shoppers who chose the two-day shipping option said packages ordered between November 1 and December 31 did not arrive on the expected day.
Greg Greeley, head of Prime, said the Reuters figures on delay sounded "very suspect" and that Amazon monitors the issue very closely.
"Our internal data shows significantly better results," an Amazon spokeswoman added, without providing specific figures. "But any miss is an error and we continue to work very hard to ensure fast, reliable and accurate delivery for customers."
The survey figures reflect the complexity and high cost of shipping orders from distribution centers to customer's homes -the so-called "last mile."
"As Amazon keeps raising the bar, it keeps raising the business risk for itself because the last mile is a messy place," said Bhaskar Chakravorti, senior associate dean for international business and finance at Tufts University's The Fletcher School.
Satisfaction rates could erode if the late shipping problems continue, said Hayley Silver, a vice president at e-commerce researcher Bizrate Insights. “Some customers will remain Prime members because they love the other aspects Prime offers them. Some may not because on-time delivery was the most important thing to them,” she said. Others will simply order earlier, Silver added.
SPEED MERCHANTS
Amazon has increasingly tapped local and regional package delivery companies to cut costs and improve speeds. None of the firms Amazon lists as delivery partners on its website would comment for this article.
This is the first time Reuters has conducted this survey so it's unclear how Amazon fared in the past. In addition, Reuters didn't compare delays at Amazon with other retailers. The Reuters/Ipsos survey had a credibility interval of plus or minus 1.4 percentage points.
Amazon's net shipping costs as a percentage of revenue have remained relatively constant over the last several years, at about 4.7 percent.
However, Amazon and other shippers continue to worry about rising costs. Early this month, United Parcel Service Inc said it would begin applying surcharges to deliver packages to homes. UPS, which reported that its earnings were hit by holiday shipping expenses, said its own cost to deliver a package to a residence are three times more than to a business.
Guaranteed two-day shipping on items as low as a few dollars - such as $5.17 for a set of measuring spoons - costs Amazon big. Prime is also the vehicle for Amazon's other pricey ventures, including film and television production, same-day shipping and even one-hour delivery in New York.
The challenge posed by Prime's growing popularity and scope has not gone unnoticed at Amazon, which is trying to speed deliveries and take more control of the process.
One of Amazon's chief concerns is it doesn't have control of the entire delivery from warehouse to consumer, said former employees who spoke on condition of anonymity.
For years, the company has been testing ways to take more control of the last mile, those ex-employees said. Those steps include building its own local delivery fleet and using the trucks designated for its Amazon Fresh grocery service to deliver orders.
This mirrors what Amazon has already done in the United Kingdom. The online retailer previously outsourced delivery to local firms, but customers complained in large numbers during the 2012 holiday peak season when packages went astray.
So Amazon began creating its own "fast, last-mile delivery networks in the U.K. where commercial carriers couldn't support our peak volumes," CEO Jeff Bezos said in his annual shareholders letter last year. "And there is more invention to come."
(Reporting by Deepa Seetharaman, Nick Carey and Peter Henderson. Editors: Peter Henderson and Hank Gilman)

Original post found here: http://www.reuters.com/article/2015/02/11/us-amazon-delivery-idUSKBN0LF1Z720150211

Experts warn 2015 could be 'Year of the Healthcare Hack'

Man poses in front of on a display showing the word 'cyber' in binary code, in this picture illustration taken in Zenica December 27, 2014.

Credit: Reuters/Dado Ruvic

Security experts are warning healthcare and insurance companies that 2015 will be the "Year of the Healthcare Hack," as cybercriminals are increasingly attracted to troves of personal information held by U.S. insurers and hospitals that command high prices on the underground market.     Anthem Inc, the No. 2 U.S. health insurer, last week disclosed a massive breach of its database containing nearly 80 million records, prompting investigations by state and federal authorities. That hack followed a breach last year at hospital operator Community Health Systems, which compromised some 4.5 million records.
    "People feel that this will be the year of medical industry breaches," said Dave Kennedy, chief executive of TrustedSEC LLC.

    In the past decade, cybercriminals focused their efforts on attacking banks and retailers to steal financial data including online banking credentials and payment card numbers. But as those companies boost security, using stolen credit card numbers has become more difficult.
Their prices on criminal exchanges have also dropped, prompting hackers to turn to the less-secure medical sector, just as the amount of digital healthcare data is growing dramatically, Kennedy said.
Stolen healthcare data can be used to fraudulently obtain medical services and prescriptions as well as to commit identity theft and other financial crimes, according to security experts. Criminals can also use stolen data to build more convincing profiles of users, boosting the success of scams.
"All of these factors are making healthcare information more attractive to criminals," said Rob Sadowski, marketing director at RSA, the security division of EMC Corp.
MONETIZING STOLEN DATA
RSA Executive Chairman Art Coviello recently wrote in a letter to customers that he expected well-organized cybercriminals to turn their attention to stealing personal information from healthcare providers.
"A name, address, social and a medical identity ... That's incredibly easy to monetize fairly quickly," said Bob Gregg, CEO of ID Experts, which sells identity protection software and services. Identities can sell for $20 apiece, or more, he said.
    Insurers, medical equipment makers and other companies say they have been preparing for breaches after seeing the waves of attacks on other industries.
    Cigna Corp has looked to financial and defense companies for best practices, including hiring hackers to break into its systems, said Chief Executive David Cordani. Attempts to break into corporate systems to probe for information are a constant, he said in an interview.
St Jude Medical Inc CEO Daniel Starks said the company increased investment in cybersecurity significantly over the last few years, to protect both patient data and the medical devices it manufactures.
"You may see from time to time law enforcement briefings on nation-based (intellectual property) issues, espionage," he said. "Those are things that we take very seriously and have been briefed on and that we work to guard against."
    The FBI is investigating the Anthem breach alongside security experts from FireEye Inc.
The insurers UnitedHealth Group Inc and Aetna Inc have warned investors about the risks of cyber crime in their annual reports since 2011.
UnitedHealth has said the costs to eliminate or address the threats could be significant and that remediation may not be successful, resulting in lost customers.
    In response to the Anthem attack, UnitedHealth spokesman Tyler Mason said in an emailed statement: "We are in close contact with our peers in ... the industry cybersecurity organization, and are monitoring our systems and the situation closely."
Aetna has cited the automated attempts to gain access to public-facing networks, denial of service attacks that seek to disrupt websites, attempted virus infections, phishing and efforts to infect websites with malicious content.
Aetna spokeswoman Cynthia Michener said in a statement: "We closely follow the technical details of every breach that's reported to look for opportunities to continually improve our own IT security program and the health sector's information protection practices broadly."
(Additional reporting by Bill Berkrot in New York; editing by Michele Gershberg and G Crosse)

Original post found here: http://www.reuters.com/article/2015/02/11/us-usa-healthcare-cybersecurity-analysis-idUSKBN0LF22H20150211

Smartphone theft drops in London, two U.S. cities as anti-theft 'kill switches' installed

(Reuters) - Thefts involving smartphones have declined dramatically in three major cities since manufacturers began implementing "kill switches" that allow the phones to be turned off remotely if they are stolen, authorities said on Tuesday.
The number of stolen iPhones dropped by 40 percent in San Francisco and 25 percent in New York in the 12 months after Apple Inc added a kill switch to its devices in September 2013. In London, smartphone theft dropped by half, according to an announcement by officials in the three cities.
"We have made real progress in tackling the smartphone theft epidemic that was affecting many major cities just two years ago," said London Mayor Boris Johnson.
Johnson, San Francisco District Attorney George Gascon and New York state Attorney General Eric Schneiderman were among numerous officials arguing for new laws mandating the kill switches.
In California, where a law mandating kill switches has yet to go into effect, smartphone theft is dropping because some manufacturers have already started installing the software-based switches on the devices they sell, Gascon said.
“The wireless industry continues to roll out sophisticated new features, but preventing their own customers from being the target of a violent crime is the coolest technology they can bring to market,” Gascon said.
California's law, one of the nation's strongest, received wide support from California prosecutors and law enforcement agencies that hoped it could help reduce smartphone thefts.
According to the National Consumers League, handheld devices were stolen from 1.6 million Americans in 2012. In California, smartphone theft accounts for more than half of all crimes in San Francisco, Oakland and other cities.
Other states experiencing a rash of smartphone thefts have considered similar measures, and Minnesota passed a theft-prevention law last year.
So far, Apple, Samsung and Google have implemented kill switches on their smartphones, and Microsoft is expected to release an operating system for its Windows phones that has one this year, the three officials said in their news release.
But some of the smartphone systems require consumers to opt in, meaning not all will be protected when their phones are operating in the default mode.
Gascon, Johnson and Schneiderman called on all manufacturers to make the technology active as a default position, as Apple has done with its iPhones.
(Reporting by Sharon Bernstein; Editing by Peter Cooney)

Original news found here: http://www.reuters.com/article/2015/02/11/us-usa-smartphone-killswitch-idUSKBN0LF09520150211

Apple in big solar power deal, market cap closes over $700 billion

Apple CEO Tim Cook speaks at the WSJD Live conference in Laguna Beach, California October 27, 2014.

Credit: Reuters/Lucy Nicholson

(Reuters) - Apple Inc (AAPL.O) will buy about $850 million of power from a new California solar farm to cut its energy bill, the iPhone maker said on Tuesday as its stock market value closed above $700 billion for the first time.

The First Solar Inc (FSLR.O) plant, with the capacity to power the equivalent of 60,000 homes, will be used to supply electricity for Apple's new campus in Silicon Valley, and its other offices and 52 stores in the state, Chief Executive Tim Cook said at a Goldman Sachs technology conference in San Francisco.
Cook addressed investors as Apple's stock market value closed at $710.74 billion for the first time, buoyed by record sales of big-screen iPhones and a December-quarter profit that was the largest in corporate history.
Apple was already the world's largest publicly traded company by stock value.
The plant in Monterey County, California will also power an Apple data center in Newark, California that already relies on solar power.
"We expect to have a very significant savings because we have a fixed price for the renewable energy, and there's quite a difference between that price and the price of brown energy," Cook said.
"We know in Apple that climate change is real. The time for talk is passed," he added. "The time for action is now."
First Solar, based in Tempe, Arizona, manufactures solar panels and builds solar power plants, many of which it sells to power producers.
Construction of the 2,900-acre California Flats Solar Project is expected to start in mid-2015 and finish by the end of next year, First Solar said in a statement.
Apple will receive electricity from 130 megawatts of capacity under a 25-year purchase agreement, the largest in the industry to provide clean energy to a commercial end user, First Solar said. Output of the project's remaining 150 megawatts will go to Pacific Gas and Electric Co (PCG_pa.A).
Apple will not receive an equity stake in the project and will make the payments over the lifetime of the deal rather than all at once, First Solar spokesman Steve Krum said.
"The reason that they made this choice is because they saw a way to save economically," Krum said. "You won't have price volatility from other fuel sources. The fuel is free. It's competitively priced from other options they would have."
The project could not have gone forward without Apple’s participation, Krum said.
Apple already uses renewable energy to power its data centers. Last week, it said it would invest $2 billion over 10 years to convert a failed sapphire glass plant in Arizona into a data center that would be powered mostly by solar energy.
"Apple still has work to do to reduce its environmental footprint, but other Fortune 500 CEOs would be well served to make a study of Tim Cook," Greenpeace said in a statement following Tuesday's announcement.
Shares of Apple ended up 1.92 percent at $122.02. First Solar rose 3 percent in extended trade after closing up 4.77 percent at $48.54.
(Aditional reporting and writing by Noel Randewich; Editing by Richard Chang)

Original post found here: http://www.reuters.com/article/2015/02/11/us-apple-cook-idUSKBN0LE2RN20150211

Obama and Xi discuss cyber issues, prepare for U.S. visit

U.S. President Barack Obama speaks about his plan for free community college education and middle class economics during a visit Ivy Tech Community College in Indianapolis, Indiana, February 6, 2015.

Credit: Reuters/Kevin Lamarque

(Reuters) - U.S. President Barack Obama called for "swift work" by Beijing to narrow differences on cyber issues, the White House said, as the two sides started planning for Chinese President Xi Jinping's visit to Washington in September.
The world's two biggest economies have been trying to ease tensions amid mutual accusations of hacking and Internet theft.
In a phone call with Xi, Obama said he looked forward to welcoming him to Washington for a state visit later this year, the White House said in a statement on Tuesday.
Chinese state news agency Xinhua said on Wednesday that Xi would visit in September.
"During the conversation, both sides agreed to make full preparations to ensure the success of the trip," the report said.
The White House added: "The two leaders reaffirmed their commitment to coordinate closely on security challenges, including by jointly encouraging Iran to seize the historic opportunity presented by P5+1 negotiations."
The nuclear talks with the United States, Russia, China, Britain and France are aimed at clinching an accord that would ease Western concerns that Tehran could pursue a convert nuclear weapons program, in return for the lifting of sanctions that have ravaged the Iranian economy.
Negotiators have set a June 30 final deadline for an accord, and Western officials have said they aim to agree on the substance of that deal by March.
Xinhua also cited Xi as saying he "hopes the U.S. side can pay attention to China's concerns on the Taiwan and Tibet issues, and prevent China-U.S. relations from suffering unnecessary interference".
China has been angered in the past by U.S. weapons sales to Taiwan, which has been ruled separately since defeated Nationalist forces fled to the island at the end of a civil war in 1949.
Beijing also regularly warns against foreign support of exiled Tibetan spiritual leader, the Dalai Lama, who it sees as a "splittist" seeking to establish an independent Tibet.
(Reporting by Peter Cooney in Washington, and Ben Blanchard and Michael Martina in BEIJING; Editing by Jeremy Laurence)

Original news found here: http://www.reuters.com/article/2015/02/11/us-usa-china-idUSKBN0LF05X20150211