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Data Sheet—Tuesday, April 21, 2015

Welcome to Tuesday, Data Sheet readers, otherwise known as “Mobilegeddon,” the day upon which Google’s search algorithms start penalizing websites that aren’t friendly to smartphones and tablets.

Ready for a cornucopia of tech earnings? This morning, it’s time to dissect results from IBM and SAP, both enduring painful transitions to the cloud and the digital business era. (Microsoft, Google, Facebook and Amazon are on deck.) Plus a random lifestyle fact: Twitter’s CFO Anthony Noto is its highest paid executive. His 2014 compensation package was almost $73 million. With that in mind, enjoy your Tuesday!

TOP OF MIND

Ginni Rommetty’s need for speed. IBM just reported its 12th straight quarter of revenue declines. There’s no end in sight, other than her declaration earlier this year that new areas—cloud computing, security and analytics—will account for 40% of revenue four years from now. That’s a very long time, and frankly it’s difficult for investors or analysts to gauge progress.

The company’s cloud computing results offer a great example. IBM says it drove $3.8 billion for this business in Q1, compared with just $2.3 billion one year ago. But no one really knows what that means. Does it include outsourcing contracts that have evolved into “cloud” relations? Does it reflect cloud server hardware? No one has those answers.

The progress of SAP’s cloud transition, on the other, is becoming clearer. The enterprise software company more than doubled subscriptions during the first quarter (reported this morning), reaching about $537 million in revenue for that business. It managed to report an operating profit, but larger because of favorable foreign exchange conditions. Like IBM, though, SAP’s transformation is far from certain and nowhere near complete.

TRENDING

Did you get my Twitter message? The social network has adjusted its policy: you can now send short notes to someone you follow who hasn’t returned the favor. Fear not, this is an opt-in program. You’ll be flooded only if you choose.

Good news, bad news on point-of-sale security. Millions of new cards embedded with special security chips are now in the hands of consumers. The snag is that very few retailers—notable exceptions are Wal-Mart Stores and Target—have actually installed equipment that can read them. Smaller merchants are struggling.

Hey Windows 10 watchers, mark your calendars for July. In remarks related to her company’s earning report last week, AMD CEO president and CEO Lisa Su accidentally revealed the timeframe when Microsoft will start granting free upgrades to millions of PCs. Here’s how the plan will unfold.

Samsung’s high-end chip factory has another customer. Although it usually works with another contract manufacturer, Qualcomm plans to make its next-generation mobile processors at Samsung’s sophisticated fab. Apple has also signed a similar contract. “Samsung’s fabs for mobile processors are the hottest thing going,” one analyst told Re/code, which broke the story. “This is a great example of ‘co-opetion.’ “

Chicago wants to be the go-to city for digital manufacturing. It now has the 94,000-square-foot facility to deliver on that dream, backed with money from both the private sector (GE and Boeing) and public agencies (the city and the Department of Defense). The institute’s first projects include research into manufacturing enabled by smart eyeglasses and modeling software to improve materials choices.

THE DOWNLOAD

These former Microsoft engineers want to manage your big data projects

Pepperdata co-founders Sean Suchter and Chad Carson spent the last decade managing web-scale computing environments for Inktomi, Yahoo and (eventually) Microsoft’s Bing search team.

Suchter’s background also includes another notable credential: the engineering team he headed for Yahoo’s search organization pioneered the first production installation of the Hadoop data management platform.

Their latest venture uses that expertise to help businesses manage big data analytics jobs more efficiently. You can think of Pepperdata’s technology as a traffic cop for Hadoop installations. “It instruments every job on the freeway,” Carson said.

Projects can be prioritized based on variables such as who submitted the request, the processing resources it might require, or expectations about how fast a report should be generated. A daily sales forecast report, for example, might be handled differently than a fraud-detection query. Companies can define their own performance parameters, protecting high-priority jobs without having to invest in additional hardware.

That promise just helped the software company close a $15 million Series B round of funding, led by Wing Ventures. Existing backers Signia Vantures and Yahoo Chairman Maynard Webb also kicked in more money. So did new investors Silicon Valley Data Capital and Citi Ventures.

“Pepperdata’s pioneering optimization software seeks to eliminate the unpredictable nature of Hadoop queries, allowing enterprises to experience new levels of control and visibility into their Big Data infrastructure. Their technology powers some of the largest Hadoop installations across a range of industries, and we are excited to explore its application within Citi’s Big Data environments,”said Ramneek Gupta, managing director at Citi Ventures. In particular, Citi is studying it for customer service applications.

“As more companies rely on Hadoop, our technology has become a crucial part of their production infrastructure,” said Suchter, who is Pepperdata’s CEO. “This funding allows us to execute on this inflection point in the market.”

While Carson won’t disclose how many businesses are using Pepperdata’s software, he said the company has scored customers from the consumer electronics, media, financial services, telecommunications, and energy sectors.

The latest financing brings the company’s total backing to more than $20 million. It will be used for sales and marketing investment, and to extend Pepperdata’s reach beyond Hadoop onto other big data platforms.

ALSO WORTH SHARING

Does BlackBerry have an acquisition up its sleeve? Several Israeli news organizations report it’s close to acquiring digital rights management software company WatchDox. The pricetag could be $200 million.

Verizon cancellations slow. The wireless carrier added 565,000 new subscribers during the first quarter, despite aggressive promotional deals from Sprint and T-Mobile.

Another thing to know about the updated search agreement between Microsoft and Yahoo: either company can opt out of it after Oct. 1, 2015.

Groupon unloads Ticket Monster stake. The daily deals company, which has been expanding its retail point-of-sale business, will retain a 41% interest in the South Korean mobile commerce operation. It will make about $200 million on the deal, which it will put toward a stock buyback program.

The flaw in software bug bounty programs. They’re good at catching the most obvious vulnerabilities, but not-as-great at uncovering deeper weaknesses in design. A better investment might be buying time from this “white hat” hacker, who gets paid trying to trick employees at Fortune 500 companies.

Apple didn’t make the top-five cut on IDC’s Q1 ranking of top personal computer makers. It was just shy of the list. That said, its sales grew an estimated 8% during the period, which was way better than Hewlett-Packard, Lenovo, Asus, Dell or Acer.

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MY FORTUNE BOOKMARKS

Will Apple’s new complex really be the ‘greenest building on the planet’? by Colleen Kane

The pervasive bias against female computer science majors by Pooja Sankar

Watching other people play video games could soon be a billion-dollar industry by John Gaudiosi

Why Target’s web snafus with Lilly Pulitzer are good news by Phil Wahba

ONE MORE THING

Want to test your data privacy knowledge? See if you can pass this quiz from The Wall Street Journal. For good measure, make your friends and family take it, too.

MARK YOUR CALENDAR

Forrester’s Forum for Technology Leaders: Win in the age of the customer. (April 27 – 28; Orlando, Fla.)

MicrosoftIgnite: Business tech extravaganza. (May 4 – 8; Chicago)

NetSuite SuiteWorld: Cloud ERP strategy. (May 4 – 7; San Jose, California)

EMC World: Data strategy. (May 4 – 7; Las Vegas)

SAPPHIRE NOW: The SAP universe. (May 5 – 7; Orlando, Florida)

Gartner Digital Marketing Conference: Reach your destination faster. (May 5 – 7; San Diego)

Cornerstone Convergence: Connect, collaborate. (May 11 – 13; Los Angeles)

Cloud Foundry Summit: Open source development. (May 11 – 12; Santa Clara, California)

Annual Global Technology, Media and Telecom Conference: JP Morgan’s 43rd invite-only event. (May 18 – 20; Boston)

Signal: The modern communications conference. (May 19 – 20; San Francisco)

MuleSoft Connect: Tie together apps, data and devices. (May 27 – 29; San Francisco)

MongoDB World: Scale the universe. (June 1 – 2; New York)

HP Discover: Trends and technologies. (June 2 – 4; Las Vegas)

Apple Worldwide Developers Conference: Future of iOS and OS X. (June 8 – 12; San Francisco)

Hadoop Summit San Jose: Mainstreaming adoption. (June 9 – 11; San Jose, California)

Red Hat Summit: Energize your enterprise. (June 23 – 26; Boston)

Brainstorm Tech: Fortune’s invite-only gathering of thinkers, influencers and entrepreneurs. (July 13 – 15; Aspen, Colorado)

LinuxCon North America: All about open source. (Aug. 17 – 19; Seattle)

VMworld: The virtualization ecosystem. (Aug. 30 – Sept. 3, 2015; San Francisco)

Dreamforce: The Salesforce community. (Sept. 15 – 18; San Francisco)

BoxWorks 2015: Cloud collaboration solutions. (Sept. 28 – 30; San Francisco)

Workday Rising: Meet and share. (Sept. 28 – Oct. 1; Las Vegas)

HP Engage: Big data, big engagement. (Oct. 4 – 6; San Diego)

Gartner Symposium ITxpo: CIOs and senior IT executives. (Oct. 4 – 8; Orlando, Florida)

Grace Hopper Celebration of Women in Computing: World’s largest gather of women technologists. (Oct. 14 – 16; Houston)

Oracle OpenWorld: Customer and partner conference. (Oct. 25 – 29; San Francisco)