"Happy Feet Two" flop leads to 600 layoffs: report

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Actor and voice of Mumble, Elijah Wood (L) and actor and voice of Ramon, Robin Williams (R) arrive at the premiere of ''Happy Feet Two'' in the Hollywood area of Los Angeles, California, November 13, 2011.

Credit: Reuters/Gus Ruelas

By Kurt Orzeck

Fri Nov 25, 2011 2:52pm EST

LOS ANGELES (TheWrap.com) - As a result of the poor box-office performance of "Happy Feet Two," 600 of the 700 employees at the digital production studio behind the animated movie reportedly have received their walking papers.

Employees at Dr. D Studios, which is based in Sydney, Australia, have been told they will be laid off in the coming weeks, according to IF.com.au. TheWrap was unable to reach Dr. D for comment.

The film, a sequel to 2006's Academy Award-winning "Happy Feet" -- which grossed $384.3 million off a budget of $100 million -- had amassed only an estimated $30.3 million worldwide as of Thursday.

There may be a silver lining for some of the employees, who reportedly have been offered a job at a new company that Kennedy-Miller Mitchell Films -- which launched Dr. D as a joint partnership with Omnilab Media -- plans to get off the ground in early 2012. KMM was founded in 1973 by "Happy Feet" director George Miller and producer Byron Kennedy.

In addition to the layoffs, KMM and Omnilab are reportedly at odds, and there is the possibility that the partnership between the two companies may be dissolved.

Released on November 18, "Happy Feet Two" has not found much success. It opened in 3,606 theaters and came in second at the box office during its debut weekend, grossing $21.2 million. Its estimated budget was $140 million.

"We obviously came in a little bit under our expectations on 'Happy Feet,' " Warner Bros. President of Distribution Dan Fellman told TheWrap. "The market expands enormously over the holiday. By next Monday, we'll know whether we're in good shape."

With three new family films released this week -- "The Muppets," "Hugo" and "Arthur Christmas" -- "Happy Feet Two" is unlikely to gain further traction.

Dr. D Studios, which specializes in digital feature film production and high-end special effects, reportedly had hoped to compete with Peter Jackson's Weta Digital in neighboring New Zealand. The studio is also attached to the long-delayed fourth "Mad Max" film, "Fury Road"; Miller was the director, producer and writer for the first three installments.

According to DrDStudios.com, "Fury Road" is in pre-production, although the site also includes an out-of-date notice that "Happy Feet Two" is in production. There are no job openings listed on the site.

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How to Value the Stock Market (U.S. News & World Report)

In a headline-driven environment, it's easy to get confused about which way the market is moving. Let's put aside the calamities of the day and focus on the fundamentals of "the market," as defined by the Standard and Poor's 500 Index (S&P 500). The S&P 500, which includes the 500 largest companies in the U.S., represents more than 80 percent of the U.S. stock market and is widely regarded as the best single gauge of the U.S. stock market.

Two powerful measurements for determining stock valuations are price-to-earnings ratio (P/E) and earnings yield (E/P). In fact, earnings and earnings estimates have more to do with the movement of stock prices than any other measure. In 2010, the earnings for the S&P 500 came in at $83.77. According to Standard & Poor's, the earnings estimates for 2011 are at $97.81 and $111.73 for 2012. Both are at historic highs and have been revised upwards in the past six months. Assuming that these estimates hold, we can use this data to compare our current findings against historical results.

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The P/E ratios of the S&P 500 from 1988 to today range from a high of 29.44 in the fourth quarter of 2001 to a low of 11.51 posted in the fourth quarter of 1988. Eliminate the extremes, and you come away with averages that fall between 13x and 16x earnings. As of July 1, 2011, the S&P 500's current P/E is 13.65 (using the S&P 500 July 1 price of 1335 and a 2011 earnings estimate of $97.81). If you use the 2012 earnings estimate, you end up at 11.95x earnings. As you can see, we are much closer to the historical low end than the high end whether we use the 2011 or 2012 estimates--which indicates that the markets are on the undervalued side and have significant room for growth.

Now, let's take a look at earnings yield, which is defined as earnings/price. If we use the same 2011 S&P 500 earnings estimate of $97.81 and an S&P price of 1335 (97.81/1335), you come away with a multiple of .073 or 7.3 percent. Simply put, this means that the expected earnings of the S&P 500 are 7.3 percent of the price of the index. Why is this relevant? Because we are comparing the additional rate of return we expect to receive by investing in equities with the anticipated rate of return offered by other asset classes.

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We can also compare these returns to the rate of inflation. Over the past 50 years, the average earnings yield for the S&P 500 has outpaced inflation by 2.4 percent. When the market is above that mark, equities are generally considered attractive. When below that mark, stocks may be considered expensive. If we subtract the current core inflation rate of 1.5 percent from the 2011 S&P 500 earnings estimate of 7.3 percent, we end up with 5.8 percent--well above the 50-year 2.4 percent level. Even if we use the 3.4 percent consumer price index rate, we come out at 3.9 percent (7.3 percent minus 3.4 percent), which is still a very attractive number when compared to most interest-bearing investments. A look at history shows that the last time the S&P 500 earnings yield approached 7 percent was at the end of 1994. The market enjoyed a nice five-year run from there. While it's not the perfect indicator, when combined with the P/E ratio, earnings yield can provide a useful point of reference.

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Earnings and earnings estimates play an important role in market dynamics. We just finished the second quarter and will soon find out how just how solid those estimates are. If the companies hit their earnings targets that's good news, but more important is the guidance they give for the future. The markets will put more emphasis on future earnings expectations than how well they did last quarter. That's history.

Timothy S. MicKey, CFP®, is a managing director and cofounder of Monument Wealth Management in Alexandria, Va., a full-service investment and wealth management firm. Monument Wealth Management is backed by LPL Financial, an independent broker-dealer and Registered Investment Advisor, member FINRA/SIPC. Monument Wealth Management has been featured in several national media sources over the past several years. Follow Tim and Monument Wealth Management on their blog Off The Wall , on Twitter at @MonumentWealth and @TimothySMickey, and on their Facebook page. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendation for individual. To determine which investment is appropriate please consult your financial advisor prior to investing. All performance references are historical and are not a guarantee of future results. Strategies involving asset allocation and diversification do not ensure a profit or protect against a loss.

Strauss-Kahn won't plead guilty in any deal: report (AFP)

NEW YORK (AFP) – Dominique Strauss-Kahn will not plead guilty to even a minor charge to reach a plea deal in the sexual assault case against him, the former IMF chief's defense team said in Thursday's New York Times.

"Mr. Strauss-Kahn will not be pleading guilty to anything," William Taylor, one of his lead lawyers, told the newspaper.

Taylor spoke after he and defense attorney Benjamin Brafman met Wednesday with Manhattan prosecutors in a session they described as "constructive."

Taylor also said they did not discuss a plea bargain in the case at the meeting.

Wednesday's meeting came amid growing speculation that prosecutors may have to abandon the case against Strauss-Kahn, a prominent French politician once seen as in line for the presidency.

The case suffered a potentially fatal blow last week when prosecutors cast doubt on the credibility of the Guinean-born maid at the luxury Manhattan hotel who accused Strauss-Kahn of sexually assaulting and attempting to rape her on May 14.

Prosecutors have said the maid lied in sworn testimony in the case, and has given false information on tax and asylum application forms, including about an alleged gang rape in Guinea.

Strauss-Kahn's defense team indicated last week that they would be unwilling to agree to a plea deal over a lesser felony or misdemeanor charge unless the prosecution could find some damning evidence of wrongdoing.

Prosecutors have insisted the matter is not closed and that the charges still stand. Strauss-Kahn, who has been released from house arrest and allowed to travel freely within the United States, is due back in court for another hearing on July 18.

Microsoft wants Samsung to pay smartphone license: report (Reuters)

SEOUL (Reuters) – Microsoft Corp has demanded that Samsung Electronics Co Ltd pay $15 for each smartphone handset it makes based on Google Inc's Android operating system as the software giant has a wide range of patents used in the mobile platform, local media reported on Wednesday.

Samsung would likely seek to lower the payment to about $10 in exchange for a deeper alliance with Microsoft for the U.S. company's Windows platform, the Maeil Business Newspaper quoted unnamed industry officials as saying.

Samsung had no immediate comment.

In April last year, Microsoft said it had reached a licensing deal with Taiwan's HTC Corp, under which it would receive royalty payments on its handsets running Android.

The move comes as Android phones gain in popularity. Microsoft charges handset makers such as HTC and Samsung to use its Windows mobile software and has tied up with Nokia to challenge Google and Apple Inc in the smartphone market.

Analysts forecast Samsung, the world's No.2 handset maker, to have sold about 19 million smartphones in the April-June quarter, with the dominant position running on Android. It is widely expected to emerge as the No.1 smartphone maker, replacing Nokia's more than 10-year reign.

Samsung's Galaxy S II, successor to its flagship Galaxy S smartphone, which runs on the Android platform, has sold more than 3 million units since its debut in late April.

(Reporting by Miyoung Kim; Editing by Chris Lewis)

New report backs up September iPhone 5 release date (Yahoo! News)

The Wall Street Journal confirms reports of a fall release date for the next iPhone

Today, The Wall Street Journal independently confirmed reports that the next generation iPhone will be on the way in the third quarter of this year. According to sources close to the supply line, Apple's next iPhone is expected to trim down the famously svelte iPhone 4, making it both lighter and thinner than the current model. While plenty of other technology outlets had published similar details previously, the credible new report solidifies what we can expect from Apple's next generation smartphone.

While we still don't know if the device will be named the iPhone 5 or the iPhone 4S, such significant improvements point to the former, which would make it an entirely new model, unlike the upgrade from iPhone 3G to the iPhone 3GS.

The report also suggests that the next iPhone will have a camera upgraded to 8 megapixels, a resolution boost up from the iPhone 4's 5-megapixel sensor and a confirmation of an earlier rumor from Bloomberg. Bloomberg's sources also suggested that the smartphone will sport the same powerful A5 processor as the iPad, which would yield a significant a speed boost for the device.

Yesterday serial Apple secret-leaker DigiTimes suggested that Pegatron, a Taiwanese component manufacturer, will ready 15 million of Apple's elusive next-generation phones for a September launch. According to The Wall Street Journal's new information, Apple intends to move 25 million units of its new iPhone by the year's end.

Since Apple remained mum on the next iPhone during its big June event, evidence continues to pile up indicating that the company's next hot gadget will be hitting stores this fall.

(Source)

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Alibaba Group to launch mobile OS in Q3: report (Reuters)

SHANGHAI (Reuters) – China's top e-commerce group Alibaba Group is preparing to launch a mobile operating system in the third quarter, the Wall Street Journal reported on Tuesday.

The mobile operating system, to be developed by Alibaba's cloud computing unit, will also provide mobile applications, the paper said quoting an unnamed source close to the matter.

An Alibaba Group spokesman declined to comment.

Chinese Internet firms have expanded their mobile presence by developing operating systems, games and applications to tap the high growth of the segment.

China's top search engine Baidu is also developing its own mobile operating system based on Google's Android platform, local media reported recently.

(Reporting by Melanie Lee; Editing by Jonathan Hopfner)

Report: Nokia CEO Will Kill MeeGo Even if N9 Succeeds (PC Magazine)

Not long after "leaking" Nokia's first Windows smartphone, codenamed "Sea Ray," CEO Stephen Elop told a Finnish newspaper that even if the new MeeGo-based N9, launched the day before, succeeds, it will be Nokia's last device on the Meego operating system.

"In Elop's words, there is no returning to MeeGo, even if the N9 turns out to be a hit," wrote the Finnish daily, the Helsingin Sanomat.

On Thursday, Elop stirred the blogosphere when he teased what he called the first Nokia Windows device, which is rumored to be launching this fall.

Unfortunately it left a sour taste in the mouths of MeeGo fans, most of whom are passionate, long-time Nokia users and developers. In February Elop, who joined Nokia from Microsoft in 2008, announced a billion-dollar agreement with Microsoft that puts the Windows Phone 7 operating system in Nokia handsets; Nokia's own Symbian and MeeGo operating systems would be relegated to "science projects."

"I have taken part in the conversations with the teleoperators and I have been part of the consumer test groups. The feedback has been extremely positive and I am sure that the Windows Phone system will be a great success", Elop says of the strategic partnership announced with microsoft in February of this year.

Elop desperately needs Nokia's recent partnership with Microsoft, which fills Nokia handsets with Microsoft's Windows Phone 7 operating system, to succeed. He faces lowered sales targets for the rest of the year, rumors of a Nokia selloff, layoffs in the thousands, and alienation by Nokia's most loyal followers.

In the same interview Elop said he was "sure" upcoming Nokia Windows phones would be a "great success."

"I understand completely that the investors want to see the results of our new strategy in their full glory. This will take some time, but once we are in a position to introduce the results of our strategy, I am sure the doubts will disperse," he said.

Nook Color surpasses Kindle for the first time in Consumer Report rankings (Appolicious)

Even without all the bells and whistles of the Nook Color, Barnes & Noble (BKS) managed to scrape by Amazon (AMZN) in Consumer Reports’ rankings of e-readers for the first time with its all new Nook Simple Touch Reader. The bookstore’s latest black-and-white e-reader, which is the first e-ink-based reader to feature the Google (GOOG) Android 2.1 operating system, scored just one point higher than the most recent edition of the Kindle and a few points higher than other models.

Updating from previous versions that operated on Android 1.5, the new reader features additional flexibility in “rooting” or adding alternative apps and games for advanced users. The newest version of the Android operating system for the Book offers the support required to run modern day games and applications, even Angry Birds, although it has frame-rate issues, according to the blog Good E-Reader.

The newest B&N device also offers a web browser, which is only available through the search button. This feature was quietly introduced, and is accessible if you type the proper website address in the search field. The device also offers a touchscreen that the Kindle does not, as well as smoother page turns and minimized flashing, according to B&N.

Consumer Reports said the Nook Simple, which is also being called “The All-New Nook,” matches or is modestly better than the Kindle in nearly every aspect of performance, including battery life. Instead of attempting to be a tablet as it did with the original Nook and the Nook Color, B&N brought the new Nook Simple back to the roots of the e-reader, with a focus on reading with fewer extra features. The publication noted that Kindle has the potential to reclaim its top spot with upcoming firmware updates.

Although the Nook Color has given B&N a chance to compete in the tablet space, it took going back to the black-and-white basics of e-reader technology, with a few additional features thanks to an updated Android operating system, for the bookstore to edge out Amazon’s pioneer product.