Stocks Are Higher on More Takeover News

By MADLEN READ

Wall Street advanced Wednesday, driving the Dow Jones industrials above 13,600 for the first time on another wave of takeover activity and an increase in oil and gasoline stockpiles.

Alcan Inc. (AL) rebuffed a $27.6 billion hostile bid by aluminum competitor Alcoa Inc. (AA), and Canadian media reported that Australian mining giant BHP Billiton Ltd. might make its own offer.

The bidding battle rumors came amid a New York Post report that EMI Group Chief Executive Jim Fifield might be in the final stages of planning an offer to buy the music company. And late Tuesday, Payless ShoeSource Inc. (PSS) said it will buy competing shoe store chain Stride Rite for about $800 million, while real estate investment trust Crescent Real Estate Equities Co. (CEI) said it will be bought by another real estate investment firm, Morgan Stanley Real Estate, for about $2.34 billion.

Investors appear to be unperturbed by the slow economy and focused more on corporate America's strength. About $2.3 trillion worth of deals have been announced so far this year, according to financial data provider Dealogic, and the tally is on track to beat last year's record $4 trillion.

Robust earnings reports from companies including Target Corp. (TGT) and Medtronic Inc. (MDT) and a solid rebound in U.S. gasoline inventories also encouraged investors to resume their buying. The Energy Department said gas inventories rose by 1.5 million barrels in the latest week, nearly twice the amount the market expected.

In mid-morning trading, the Dow Jones industrial average rose 60.46, or 0.45 percent, to 13,600.41.

Broader stock indicators were also higher. The Standard & Poor's 500 index advanced 7.72, or 0.51 percent, to 1,531.84, and the Nasdaq composite index gained 11.72, or 0.45 percent, to 2,599.74. [via]

Alltel buyout deal stirs the anger of rival bidders

A decision by Alltel to go private in a $27.5 billion deal, the largest leveraged buyout in the telecommunications industry, has not gone down well with some other private equity firms that were lined up to bid for the company.

The agreement for Alltel, the wireless service provider, to be acquired by a consortium including the Texas Pacific Group and a unit of Goldman Sachs effectively short-circuits an auction process, in which other groups had hoped to participate. Among them were the Blackstone Group, with Providence Equity Partners and the Carlyle Group, with Kohlberg Kravis Roberts.

The lack of a formal auction may also raise questions among some Alltel shareholders about whether they received the highest price possible.

Some potential bidders were infuriated by the announcement Sunday that a deal had been reached because they understood the bid deadline for Alltel to be June 6, people close to the process said. The agreement comes with a standard breakup fee but no "go shop" provision, a typical clause that allows the company being acquired to seek higher offers.

"Of course they are unhappy," Scott Ford, chief executive of Alltel, said when asked about the complaints. He dismissed the idea that bids were not due until June 6.

"We said we were open for business," Ford said. "They knew what the deal was."

Texas Pacific and Goldman Sachs will pay $71.50 a share for Alltel, a premium of about 10 percent over the Friday closing price of Alltel shares and about 25 percent over its price late last year, when speculation about its future began to build.

Ford said the company had canvassed all the potential bidders before accepting the Texas Pacific-Goldman offer, and did not believe it could get a higher one.

One of the private equity consortiums had indicated in a letter to Alltel weeks ago, however, that it expected to pay $70 to $74 a share, and another consortium indicated verbally that it planned to bid higher than $71 a share, people knowledgeable about the negotiations said.

Adding to the confusion are Alltel's written instructions to bidders to model their bids assuming no more than seven times debt to equity - in other words, that they would borrow no more than seven times as much equity as they would put in. The deal that Alltel accepted is close to eight times debt to equity.

[via]

Staples' Profit Rises on Higher International Sales

Staples Inc., the world's largest office-supplies retailer, said first-quarter profit rose 12 percent on deliveries of paper and increased sales in Europe.

Net income climbed to $209.1 million, or 29 cents a share, for the three months ended May 5 from $186.1 million, or 25 cents, a year earlier. The profit matched analysts' estimates, and Staples said second-quarter and full-year earnings per share will be at the ``low end'' of its forecast of 15 percent to 20 percent growth.

Sales at the division that sells paper and cleaning supplies directly to companies climbed 15 percent. International sales increased 16 percent to $632.8 million.

``They're continuing to take market share and grow the direct sales business,'' said Walter Todd, who helps manage $800 million, including 265,000 Staples shares, at Greenwood Capital Associates LLC in South Carolina. ``Clearly the turnaround in international continues.''

Staples also said today it acquired American Identity from Republic Financial Corp. American Identity sells T-shirts and baseball caps with company logos. Staples didn't disclose the terms of the transaction.

Revenue in the quarter rose 8.3 percent to $4.59 billion, Staples said today in a statement. The average sales estimate of 11 analysts was $4.66 billion, according to a Bloomberg survey.

Shares of Framingham, Massachusetts-based Staples, which operates more than 900 retail stores, declined 59 cents, or 2.3 percent, to $25.08 at 8:07 a.m. before the start of Nasdaq Stock Market composite trading. The stock fell 3.9 percent this year through yesterday.

Tempered Forecast

Staples forecast earnings per share of $1.43 to $1.49 for the year ending in 2008. Analysts estimated $1.48. The company tempered its forecast after first-quarter sales in North American stores fell short of its expectations.

Sales at North American stores open at least a year climbed 1 percent. Mitchell Kaiser, an analyst at Piper Jaffray Cos. in Minneapolis, projected a 3 percent increase. Staples said sales of furniture, fax machines and copiers trailed.

The retailer has spent more on advertising, helping to turn around its U.K. stores and French catalog sales. Staples is also expanding in China, India and other emerging markets.

``The turnaround of the international operations is gaining steam,'' Armando Lopez, a Morgan Stanley analyst based in New York, wrote in a May 14 research note. ``Staples made a number of changes and investments to the international operations, which are beginning to bear fruit.''

Office Depot Inc., the second-largest office-supplies retailer, said last month that sales at North American stores open at least a year fell 3 percent, the first drop in more than three years.

OfficeMax Inc. on May 3 reported profit that trailed analysts' estimates as sales at its stores fell for the fifth straight quarter. [via]

Sell-off holds Dow, S&P short of high

Bill Barnhart

Most stocks closed higher Monday. But a late-session sell-off prevented another record high close for the Dow Jones industrial average and left the broader Standard & Poor's 500 index just shy of its all-time high, set in March 2000.

The Dow Jones industrial average closed down 13.65 points, to 13,542.88, after trading as high as 13,586 earlier in the day. Losses by International Business Machines and Alcoa helped account for the Dow's decline. Hewlett-Packard and Merck paced Dow winners.

The S&P 500 index added 2.35, to 1525.10, just short of its all-time closing high of 1527.46 set March 24, 2000. During Monday's session, the benchmark index reached 1529.

The biggest sector gains since the 2000 S&P 500 peak have been scored by energy and materials companies, while information-technology and telecommunications stocks hold well under water.

The Russell 1000 and 3000 indexes reached all-time highs.

Energy stocks, including Dow component Exxon Mobil, rallied Monday, along with crude oil futures. Crude oil for June delivery jumped $1.33 a barrel, to $66.27. Traders cited unrest in Nigeria, an important source of oil for the world market.

Among stocks in the news, home-improvement retailer Lowe's dropped more than 2 percent, reflecting disappointing quarterly results and a downbeat outlook by company officials.

Merger-and-acquisition news continued to animate trading. Two investment firms agreed to acquire wireless network operator Alltel. Alltel shares rose nearly 7 percent.

The Chicago Board Options Exchange technology stocks index reached a multiyear high, thanks to gains by Apple and Hewlett-Packard. Ama zon.com was the biggest percentage gainer in the S&P 500.

Treasury securities advanced. The weekly auction of 3-month Treasury bills appeared to attract strong bidding from non-U.S. investors.

TREASURY AUCTIONS: Interest rates rose at Monday's Treasury bill auctions. The discount rate on 3-month bills was 4.77 percent, up from 4.73 percent last week. The rate on 6-month bills was 4.10 percent, up from 4.73 percent last week.

The coupon-equivalent investment rates were 4.91 percent for 3-month bills and 5.01 percent for 6-month bills. [via]

Hologic to Buy Cytyc for $6.3 Billion

By CHARLES FORELLE

Hologic Inc. has agreed to buy Cytyc Corp. for $6.3 billion in cash and stock, in a deal that combines two major players in women's health care.

Executives of both companies say the tie-up will increase the opportunity for sales representatives to win over obstetricians and gynecologists, who are critical to recommending that patients use the companies' products.

"The OB/GYN is the one person a woman listens to and takes advice from," says Jack Cumming, Hologic's chief executive. Mr. Cumming says the combined company will have 425 sales representatives in the U.S. dedicated to calling on OB/GYNs.

Cytyc, which is the leader in the market for Pap smears, also makes devices to treat uterine bleeding and to deliver radiation therapy in breast-cancer patients. Hologic's major product is a digital mammography tool.

Hologic is based in Bedford, Mass., about 15 miles from Cytyc in Marlborough, Mass. Mr. Cumming and Patrick Sullivan, the Cytyc CEO, live in the same town.

Mr. Cumming says the two companies have long crossed paths, given their similar markets and physical proximity. "In many regards, this combination has been a long time coming," said Mr. Sullivan, who will become Hologic's chairman. Mr. Cumming will continue as CEO.

Cytyc's traditional Pap smears makes up the bulk of its business--about 40% of the company's sales. But that segment is slower-growing than Cytyc's medical devices. Hologic, which once relied heavily on osteoporosis screening, has seen considerable success with digital mammography, which arrived by way of an acquisition about five years ago.

Hologic shares have risen some seven-fold in five years. By market-capitalization, Hologic is the smaller company, but thanks to the magic of leverage, it is the acquirer. Hologic will pay 0.52 Hologic shares, valued at about $29.96 as of Friday's closing price, plus $16.50 in cash for each share of Cytyc.

Hologic will borrow the $2.2 billion necessary to pay the cash portion of the acquisition. Overall, Hologic is paying $46.46 per share of Cytyc, a premium of 33% to Cytyc's closing price Friday. [via]

Aerospace Companies Seek Young Recruits

By ALICIA CHANG

Justin Wong, an aerospace engineering student from the Massachusetts Institute of Technology, was schmoozing on Facebook.com last fall when he came across a sleek Boeing job ad.

Wong, who had just interned at the aerospace company, saw the banner on the popular social networking site as a "two-way street" - a defense behemoth reaching out to today's youth in their virtual playground.

"My first impression was that Boeing is getting with the times," said the 21-year-old senior, who will work at Boeing's satellite division after graduation. "It shows the company is making an effort to talk to us on our level."

It's no secret the U.S. aerospace industry is rapidly graying: The average age of an aerospace worker was 45 in 2005. By next year, roughly one out of four will be eligible to retire.

Faced with a looming brain drain, companies are cooking up creative ways to lure and keep talent from chatting with students online to fast-tracking young workers to be future leaders.

Industry analysts say there's still time to stave off a shortage - if the effort begins now.

"The work force isn't going to suddenly disappear," said Jeremiah Gertler, assistant vice president of the Aerospace Industries Association, a trade group. "We actually have enough time to start building up the folks for the future."

For years, recruiters flooded college campuses, promoting internships, setting up luncheons and handing out leaflets at job fairs. While many aerospace and defense companies still consider face-to-face contact their best weapon, more are experimenting with virtual connections.

For example, Boeing Co. (BA) last year advertised a contest on Facebook to win an iPod Nano or iTunes gift card. Facebook users who entered the sweepstakes listened to a short video promoting the company and answered a multiple-choice quiz. The company then followed up with job openings.

Boeing also uses Facebook to keep in touch with workers hired through traditional channels. Interns who will work at the company's Southern California plants this summer were invited to join a Facebook group created by Rob Papandrea, a 28-year-old former Boeing engineer turned college recruiter.

Interns are valuable because many land full-time jobs after their gigs. Recruiters are increasingly going out of their way to make interns feel welcome in a corporate environment, and that sometimes means speaking their language - on the Internet.

"We've got to go to their turf," Papandrea said.

It works both ways. Papandrea said he often gets random messages on Facebook and other networking sites from young engineers interested in Boeing.

The Boeing intern group, with 127 members, has been messaging one another with a simple "hi" or questions about housing and other topics. The page even lists an invitation to a mixer later this month before summer internships start.

"It'll be a lot easier to break the ice and socialize," said intern Senad Basic, a 22-year-old computer science student at the University of Illinois at Chicago.

The aerospace sector - loosely made up of people who design and develop aircraft, spacecraft, missiles and engine systems - was flush with engineers during the Cold War. Workers from that era still make up the heart of today's work force.

The industry took a nosedive in the 1990s. Military spending cuts forced businesses to downsize or merge to stay afloat. Many young engineers fled to dot-coms and other tech startups.

There were 630,000 aerospace workers last year compared with 1.1 million in 1990. The ranks of workers 25 to 34 years old plunged from 27 percent in 1992 to 15 percent in 2005, according to the aerospace association.

With fewer students interested in engineering, many wonder whether defense contractors can attract enough skilled workers to replace retiring baby boomers.

Other industries facing a talent shortage can easily outsource jobs overseas where labor is cheaper. But defense contractors have a harder time hiring non-citizens because of national security clearances and government restrictions on technology transfer.

Lockheed Martin Corp. (LMT), the nation's No. 1 military contractor, started a chat room earlier this year on its Web site where recruiters host daily one-on-one instant messaging fests with job seekers.

The virtual chat was not specifically created to attract younger workers, but many college and high school students log on to seek advice and learn about internships, said Pete Bugnatto, a recruiter based in Silicon Valley.

Every Wednesday, Bugnatto's computer lights up with a torrent of IMs from job candidates. He greets every user who signs on during the two-hour chat window and divvies up the questions among eight other recruiters.

The chat room for recent college grads is among the most popular, with recruiters answering hundreds of questions during each session.

"It's one way for them to get immediate attention. They can chat with someone in real time," Bugnatto said.

Raytheon Co. (RTN) is trying to take the guesswork out of recruiting by targeting specific regions. In the past, the defense contractor took a "shotgun approach" by flooding college campuses and job fairs with recruiters and trying to appeal to the largest number of people.

Last year, the company developed a proprietary computer software program that analyzes federal labor and demographic data. Recruiters use the software to zero in on engineering hotspots and areas with a diverse population.

Once Raytheon targets a region, it holds job fairs and sends mass e-mails to engineers and scientists.

"We're getting more scientific and more deliberate" in our recruiting, said John Malanowski, vice president of talent acquisition.

Along with using technology, aerospace companies are bolstering their ranks by training young workers.

Rolls-Royce PLC, the world's second-largest aircraft engine maker, started a training program in 2004 that grooms 20-somethings to become future leaders. Normally, it takes about 10 years to get promoted. Under the accelerated program, a worker can become a middle manager in five to six years.

Workers are graded on their productivity, business judgment and influencing skills.

Not everyone makes it. Some voluntarily drop out because of work schedule conflicts. Others who aren't up to par go back to their day jobs.

"We try to make it so that it's a soft landing. It doesn't mean your career is over," said Hugh Harvey, a Rolls-Royce executive.

Nikki McMullen is among 50 employees chosen for the fast track. Her duties included overseeing a five-member team, giving PowerPoint updates to executives and helping design a new factory in England.

McMullen said she never had a problem with the age difference.

"I try not to come across like I know it all because I know that I don't," she said.
[via]

With big buy, Microsoft joins online-ad flurry

Robert A. Guth, Kevin J. Delaney, Suzanne Vranica And Emily Steel, Wall Street Journal

Microsoft Corp.'s $6 billion deal to buy an online-ad specialist called aQuantive Inc. puts into high gear a race between Madison Avenue and a new guard of technology businesses that are trying to dominate the unbridled market in brokering Internet advertisements.

The deal -- the largest in Microsoft's history -- follows recent acquisitions of Web-ad companies by Google Inc., Yahoo Inc. and traditional advertising agencies. The emerging consensus: The online-ad market is maturing around an oligopoly of huge companies that sell and place the ads users see online. Placing those ads is increasingly seen as the business model that will fund almost everything on the Internet -- from search portals, news sites and video downloads to Web-based software services such as word processing.

The deals also highlight the deepening conviction that the automated-advertising approach championed by Google will draw more ad dollars from traditional media and play a larger role in how TV, radio and print ads are sold. Hundreds of thousands of advertisers buy online ads using the Web sites of Google and its competitors, providing some details about what they're willing to pay and where they want their ads shown. The automated systems act as brokers by finding places for the ads on Web sites.

The catalyst for the recent wave of deals was Google's agreement last month to buy ad-services company DoubleClick Inc. for $3.1 billion. The company inserts ads on Web pages as users call them up on their computers. It also provides tools and services to agencies to help them manage online advertising.

Just 24 hours before the Microsoft announcement, advertising giant WPP Group PLC said it agreed to acquire online ad firm 24/7 Real Media Inc. for $649 million. Among other things the company helps advertisers place ads alongside computer users' Web-search results. WPP forged that deal as a counter to Google's DoubleClick acquisition, say people familiar with the matter. Meanwhile Yahoo Inc. recently announced it was buying the remaining 80% of closely held Right Media Inc., which operates an online ad exchange, for $680 million.

"A lot of people are trying to out-Google Google," says Steven Kaufman, senior vice president at Digitas Inc., a Boston digital-marketing company. Digitas was bought by the French ad giant Publicis Groupe SA in January for $1.3 billion.

Advertisers long relied on traditional agencies to link them with newspapers, television and radio, a business model that the Internet is exploding. Google helped change the rules by linking ads to Internet searches -- in many cases eliminating the intermediary role of ad agencies.

Those search-related ads now make up roughly 40% of the roughly $20 billion U.S. Internet ad pie. Internet-ad sales overall have nearly tripled in the past five years. They represent 7% of overall U.S. ads, up from 3% five years ago, according to eMarketer Inc.

Automatic systems that Google helped pioneer to place search-related ads are now brokering display advertisements and other digital ads on a host of Internet-connected devices, including PCs, mobile phones and videogame machines.

Based in Seattle, Wash., and founded in 1997, aQuantive is a holding company for several online advertising businesses, including Avenue A/Razorfish, one of the largest online agencies. Central to the Microsoft deal, say people familiar with the transaction, are aQuantive's systems for helping advertisers, ad agencies and Web publishers. AQuantive's Atlas division helps them manage and serve up online ads. And its Internet ad network DRIVE Performance Media buys blocks of online ad space and resells them to advertisers. AQuantive expects revenues of up to $615 million in 2007, according to guidance given in its latest quarterly earnings.

"This takes our advertising business to a new level," said Kevin Johnson, president, of Microsoft's Platforms & Services Division "It is a big bet in advertising monetization for the long-term growth of the company."

AQuantive's co-founder and chairman, Nicolas Hanauer, will reap at least $290 million from the 5.6% of the company's common stock he owns, not counting unvested options and restricted stock that he holds, according to the company's latest proxy statement. Mr. Hanauer is a long-time executive of a bedding company, founder of a chain of framing stores and early investor in Amazon.com.

The deal marks a new willingness by Microsoft to use its huge cash reserves to buy growth. The company's core PC software business isn't enjoying the same breakneck growth it had for decades and the stock has been trading in the same narrow range for roughly five years. Meanwhile, after years of antitrust battles that constrained it from doing big deals, Microsoft is no longer considered invincible -- especially as Google grows more powerful.

People familiar with the company say Microsoft Chief Executive Steve Ballmer is much more open to bigger deals. In a call yesterday with analysts, Microsoft Chief Financial Officer Chris Liddell said that Microsoft is "willing to use the strength of our balance sheet" to "aggressively accelerate our growth and support our strategic initiatives."

Still, the deal will test Microsoft's ability to integrate a major acquisition. Microsoft traditionally held little regard for the advertising business, and its techie culture was resistant to some of the early moves by the company into online advertising. That has largely changed over the past two years as it has built out its online ad sales staff and made online advertising a much more central, albeit still small, part of its business. AQuantive's 2,600 employees have more of a freewheeling start-up and advertising-world culture than exists at Microsoft.

The move comes amid growing angst within the top ranks of Microsoft that the company is falling behind market leaders in online advertising. Despite recent heavy investments into online advertising and Internet-search businesses the company has lost market share to its key rivals, including Google and Yahoo. Mr. Ballmer in recent months has grown more agitated that Microsoft isn't making a more significant mark, according to people familiar with the matter. Microsoft's loss of DoubleClick to Google was a failure that irked Mr. Ballmer, those people say.

Under the all-cash deal Microsoft will pay $66.50 a share, or roughly $6 billion for aQuantive. It's a surprising 85% premium over aQuantive's closing price on Thursday, a sign of the heady competition for top-tier online-advertising assets. Faced with rival bidders, Microsoft bid high to assure it wouldn't lose aQuantive after missing out on DoubleClick, say people familiar with the matter. AQuantive handles a broader set of advertising services than DoubleClick, which may partly justify the higher price tag.

Microsoft's deal shows how the lines between media companies, technology firms and advertising agencies are blurring. Some marketers said that Microsoft's ownership of an ad agency like Avenue A/Razorfish would put it in competition with some of the ad agencies it has been courting for ad spending.

Attempting to assuage such concerns, the software giant said it would allow Avenue A/Razorfish to continue to operate independently. Microsoft sees the agencies -- at least for now -- as allies in a greater fight against Google. Microsoft executives yesterday morning outlined the deal to top management at leading ad agencies including WPP and Publicis.

Alexandra Aleskovsky, general manager of Weight Watchers International Inc.'s WeightWatchers.com division, said Avenue A/Razorfish President Clark Kokich called her yesterday to say that the agency's relationship with clients wouldn't change following the acquisition.

The issue of Silicon Valley's encroachment on the ad world remains a sensitive one. Over the past 18 months, Madison Avenue has embarked on an Internet dealmaking binge fueled by big marketers' shifting of dollars online and away from traditional media. Take, for example, General Motors: The car maker's spending on television declined 15% in 2006 to $1.38 billion, while spending on newspaper ads plunged 60% to $232.1 million, according to ad-tracking service TNS Media Intelligence. Meanwhile, the company's spending on the Web rose 16% to almost $130 million, according to TNS.

The advertising industry is determined to prevent Internet giants such as Google and Yahoo from snatching up this Internet-ad spending and leaving Madison Avenue in the dust. There's also an element of envy: The big ad holding companies who own the agencies have seen their own valuations pale in comparison with the digital behemoths on the West Coast, and are hoping that by changing the mix they can capture some of this luster.

Google's moves onto the traditional turf of agencies, with its efforts to broker TV, radio and print advertising, are helping spur them into action. "That is a real threat to our business" over the long term, says Eric Bader, senior vice president, director of digital connection at MediaVest, the media-buying firm owned by Publicis Groupe. Madison Avenue "is in defensive mode," he adds.

Publicis' January purchase of Digitas was followed last month by Interpublic Group of Cos. snapping up Reprise Media, a search-engine marketing firm.

WPP Group PLC's agreement to purchase 24/7 Real Media Inc. for $649 million on Thursday marked the most aggressive step yet by the advertising industry to take a piece of the technology part of the online-ad business. With the 24/7 purchase WPP, which works on behalf of marketers such as Ford Motor, IBM and Unilever, now has the ability to sell ad space on publishers' Web sites.

"About 10 to 15 years ago we were clearly a creative business, then about five to 10 years ago, the media buying and planning business became more important," Martin Sorrell, WPP's chief executive, said yesterday in an interview. In the last five years, "the technology piece has become more important. ...creative media and technology have all come together."

The consolidation rush is also being driven by advertisers' desire to reach broad swaths of Internet users through a single ad buy. Despite the Web's promise to give advertisers a seamless way to place ads and measure the effectiveness of ads, buying online advertising can often be a bewilderingly complex task for marketers accustomed to buying time on a handful of TV channels. Different Web publishers use different systems to run online ads, requiring Web marketers sometimes to manually track each piece of their ad buy independently. Marketers are looking for one dashboard that delivers information about their ad buy, automatically.

"As you start spending more money online you have to go to a lot of places to execute your online marketing," says Joe Tripodi, chief marketing officer for AllState. "A lot of what we do right now is spend a little here and spend a little there, that can be difficult."

AQuantive, which had to survive cutbacks after the dot-com bubble burst, soon built a track record of making smart investments, analysts say. For example, before the digital marketing industry was focused on search marketing in December 2003, aQuantive acquired Go Toast, a Denver-based company that helps online advertisers manage search-related marketing campaigns and now operates under the name Atlas Search. In 2004, the company took a gamble in acquiring for $160 million the largest independent interactive agency at the time, Razorfish, a battered survivor of the dot-com bust. It seemed like a risky move. But when the Internet ad boom kicked up again, the combined Avenue A/Razorfish became one of the largest Web agencies.

More recently, aQuantive has expanded internationally, snapping up shops in Europe and Asia. It put resources behind emerging technology such as online video. "They've shown an ability to become leaders in where the market is going next even though at different times their moves have been considered unpopular," says Stewart Barry, a media and Internet analyst at San Francisco-based ThinkEquity Partners LLC. [via]