Sony, Sharp in turnaround battle; Panasonic battered

TOKYO (Reuters) – Sony Corp is likely to say it returned to an operating profit for July-September after it sold a chemicals business, but investors still aren’t sure a consumer electronics revamp will deliver the profit growth the group seeks.

Sony shares, valued at less than $ 12 billion, have dropped 19 percent since end-June and its 5-year credit default swaps – the cost of insuring against debt default – have jumped by almost 60 percent. The benchmark Nikkei average is down by less than 1 percent.

The maker of Bravia TVs, Vaio laptops and PlayStation game consoles, battling weak demand and tough competition, is expected to say it earned operating profit of 33.8 billion yen ($ 424.7 million) in its second quarter, after losing 1.6 billion yen a year ago, according to an average estimate from five analysts on Thomson Reuters I/B/E/S.

“The reality for Sony now is that it’s getting profit through financial accounting; beyond that, things are not good,” said Tetsuro Ii, CEO of Commons Asset Management. “The question is whether Sony can tell a growth story or not.”

Sony has sold a chemicals unit to state-backed Development Bank of Japan for 58 billion yen, and other asset sales may further inflate operating profit this business year. The Japanese group, which blazed a trail in the early 1980s with its Walkman portable music players, is closing the Shinagawa Technology Center, a 31-storey Tokyo office built in 1998 [ID:nL1E8LN16K] and may even sell the 37-storey Sony Tower, the New York headquarters of its U.S. business, according to media reports.

Sony has said it expects to reduce its global workforce by 10,000 people by end-March, around 6 percent of its total, as it seeks to lop 30 billion yen off its costs.

HIGH-RISK

Kazuo Hirai, who took over as CEO in April, has pledged to rebuild Sony around gaming, digital imaging and mobile devices, and nurture new businesses such as medical devices, as the TV business shrinks – Sony has lost close to $ 9 billion in TVs over the past 8 years. In late-September, Sony agreed to pay 50 billion yen to become the biggest shareholder in Olympus Corp, a world leader in medical endoscopes.

“The areas in which Sony is continuing to focus are of course high-risk, high-return markets,” said JP Morgan analyst Yoshiharu Izumi in a recent report. “Although we expect (full-year) margin improvement in the electronics segment, we think it’s too early to appraise a sustained recovery.”

While battling weak demand for its products, fierce competition from Apple Inc and Samsung Electronics and others, Sony is also up against a strong yen and a depressed global economy.

Shares in rival Japanese TV maker Panasonic Corp slumped by nearly a fifth on Thursday, wiping $ 3 billion off its market value, a day after it said it will lose almost $ 10 billion this business year as it cleans its house of risky assets – writing down billions of dollars of goodwill and assets in its mobile and energy units and preparing for more restructuring that is likely to see it shift away from money-losing TVs and other consumer electronics.

“It may not be on the same scale, but for the same reasons I think there’s a strong chance Sony, too, will opt for writedowns,” said Makoto Kikuchi, CEO fo Myojo Asset Management in Tokyo.

OUTLOOK DIMMER

In August, Sony cut its full-year operating profit forecast by more than a quarter to 130 billion yen, still some way above the average forecast by 19 analysts for 107 billion yen. At a net level, Sony sees annual profit of 20 billion yen, while the market prediction is for around a third of that.

“It’s unclear if Sony will cut its full-year operating profit guidance, but we see considerable potential for second-half shortfalls, mainly in smartphones and games,” Goldman Sachs analyst Takashi Watanabe said in a client note.

Sales of Sony’s handsets, including its Xperia smartphones, are expected to have slid by more than a fifth in July-September, to below 8 million devices, a Reuters poll found last month. [ID:nL6E8LAL10] Next year it is forecast to sell 34.4 million mobiles, about the same as Samsung shifts each month.

The South Korean firm and Apple are also encroaching on Sony’s gaming business, and Hirai has cut the forecast for annual sales of the hand-held Vita and PSP consoles to 12 million from 16 million.

After four straight years of net losses, Hirai is also hampered by weakened finances. At end-June, Sony’s shareholder equity ratio fell to below 15 percent – a rate of 20 percent is generally considered a healthy minimum.

While selling off non-core assets, Sony has also spent to bolster its business portfolio – laying out $ 1.8 billion in four months on the Olympus stake, a cloud gaming firm and a website for doctors, but this has prompted both Moody’s and Standard & Poor’s to lower their long-term debt rating on the company to the second-lowest investment grade.

SHARP DOWNTURN

At rival Japanese TV maker Sharp Corp, which also announces quarterly earnings on Thursday, the need to return to profit is more urgent.

The maker of Aquos TVs has secured a $ 4.6 billion bank bailout, and has pledged to axe 10,000 jobs, sell assets, and return to profit. At end-June, Sharp’s shareholder equity ratio was 18.7 percent.

After adding restructuring charges, valuation losses on stocks of LCD display panels and other costs, Sharp will almost double its net loss forecast for the year to 450 billion yen, two sources familiar with the matter told Reuters.

But Sharp will keep its forecast for an operating profit in the current second half, a turnaround that will let its banks justify their bailout of Japan’s TV pioneer. For July-September, Sharp is expected to have made a 50.4 billion yen operating loss, according to the average of six analysts on Thomson Reuters I/B/E/S.

The bank loans may prove to be just a sticking plaster rather than a salvation, said Myojo Asset’s Kikuchi. “I don’t think Sharp has a future. Even if it gets by this term, financial problems could emerge again next business year, and I don’t see the banks coming to the rescue.”

Both Sharp and Sony may also have felt the impact of a recent dispute with China over ownership of islands in the East China Sea, which triggered sometimes violent protests against Japanese products. Sharp had almost a fifth of its revenues in China, while Sony has around 8 percent of its business there.

Sharp shares have more than halved since end-June, to record lows below 150 yen. Five years ago, the stock traded at above 2,440 yen. Its market value has slumped to below $ 2.4 billion.

($ 1 = 79.5800 Japanese yen)

(Additional reporting by Reiji Murai; Editing by Ian Geoghegan and Eric Meijer)

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After Sandy’s Pain, There Will Be Gain

In terms of sheer size (1,100 miles from end to end) and the number of people in its path (some 60 million), Hurricane Sandy was the biggest storm ever to hit the East Coast of the U.S. Estimates of its devastation range from $ 30 billion in destroyed property and lost business activity to as much as $ 50 billion. Whatever Sandy’s ultimate price tag, it’s a huge number. But as devastating as it was, Sandy’s impact to the national economy will likely be negligible: The short-term loss to economic output should be made up by long-term spending to rebuild.

Photographs by AP PhotoThe bad news: Your town is damaged. The good news: Construction is up

Whether it’s recovering from a war or cleaning up after a natural disaster, periods of severe destruction are usually followed by sharp bursts of economic activity. Money pours in from government and insurers to repair infrastructure. Homes get rebuilt, debris cleared. As a result, the overall economic growth that follows a natural disaster can often outweigh the wealth it destroyed. Economists call this the broken window effect. “To an economist, breaking a window always boosts GDP,” says Michael Englund, chief economist at Action Economics. Englund thinks that Sandy could end up boosting fourth-quarter gross domestic product by as much as two-tenths of a percentage point. “The backfill activity will probably be bigger,” he says. “By the time the rebuild is over, I think we’ll see this as a net positive [for GDP].”

While the full extent of that rebuilding will take months to show up in the economy, the short-term hit to output could be severe. The 12 states in Sandy’s path, from Virginia to Maine, account for about 23 percent of national GDP. Throwing a giant “Superstorm” at one-quarter of the country’s economic engine will have a major impact on businesses over the next few weeks. In particular, holiday spending on items like clothes and toys could take a hit.

That spending won’t vanish, though; it will merely be delayed and redirected. People may cut back on holiday shopping but end up buying a new car to replace the one that got damaged by a tree. Much of the wealth lost in disasters is assumed by global insurance companies, which make good on policies and pump money into the local economy afterwards. That lost wealth doesn’t get reflected in GDP, while the increase in spending does.

There’s also the question of job creation. While a worker probably won’t lose his job as a result of Hurricane Sandy, there’s a chance he might gain one afterwards, particularly if he’s in the construction industry. “We definitely see stronger job gains in response to natural disasters, particularly when economies are coming out of recession,” says Gus Faucher, senior economist at PNC Financial, who has researched the economic effects of natural disasters. He cites two examples: After Hurricane Andrew hit the southeast coast of Florida in August 1992, job growth in Miami went from just under 1 percent a year to more than 5 percent by mid-1993, as more than 1,700 construction jobs were added. In the year after a 6.7 magnitude earthquake hit Northridge, Calif., outside Los Angeles, in January 1994, 16,000 construction jobs were added.

There are exceptions. Hurricane Katrina, the most expensive natural disaster in the U.S. at $ 150 billion in total economic losses, slowed annual growth in the second half of 2005 from 3.3 percent to 2.8 percent, according to an analysis by the Congressional Budget Office. Katrina knocked out about 20 percent of the country’s refining capacity and damaged more than 100 oil and gas rigs along the Gulf Coast. Within a week, national gasoline prices had jumped 13 percent.

While a number of refineries shut down along the East Coast as Sandy approached, their suspension of operations likely won’t have the same impact because the East Coast facilities handle a far smaller share of refined products. There’s another crucial difference between Sandy and Katrina that could dampen the overall economic impact of the recent hurricane. The East Coast economy is more knowledge-based, with a higher-skilled, better-educated workforce, which makes it more resilient than the blue-collar Gulf Coast economy.

The bottom line: Hurricane Sandy could cost the economy as much as $ 50 billion, but the payback from rebuilding could end up larger.

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Clinton calls for overhaul of Syrian opposition

ZAGREB (Reuters) – The United States called on Wednesday for an overhaul of Syria‘s opposition leadership, saying it was time to move beyond the Syrian National Council and bring in those “in the front lines fighting and dying”.

Secretary of State Hillary Clinton, signaling a more active stance by Washington in attempts to form a credible political opposition to Syrian President Bashar al-Assad, said a meeting next week in Qatar would be an opportunity to broaden the coalition against him.

“This cannot be an opposition represented by people who have many good attributes but who, in many instances, have not been inside Syria for 20, 30, 40 years,” she said during a visit to Croatia.

“There has to be a representation of those who are in the front lines fighting and dying today to obtain their freedom.”

Clinton’s comments represented a clear break with the Syrian National Council (SNC), a largely foreign-based group which has been among the most vocal proponents of international intervention in the Syrian conflict.

U.S. officials have privately expressed frustration with the SNC’s inability to come together with a coherent plan and with its lack of traction with the disparate internal groups which have waged the 19-month uprising against Assad’s government.

Senior members of the SNC, Free Syrian Army (FSA) and other rebel groups ended a meeting in Turkey on Wednesday and pledged to unite behind a transitional government in coming months.

“It’s been our divisions that have allowed the Assad forces to reach this point,” Ammar al-Wawi, a rebel commander, told Reuters after the talks outside Istanbul.

“We are united on toppling Assad. Everyone, including all the rebels, will gather under the transitional government.”

Mohammad Al-Haj Ali, a senior Syrian military defector, told a news conference after the meeting: “We are still facing some difficulties between the politicians and different opposition groups and the leaders of the Free Syrian Army on the ground.”

Clinton said it was important that the next rulers of Syria were both inclusive and committed to rejecting extremism.

“There needs to be an opposition that can speak to every segment and every geographic part of Syria. And we also need an opposition that will be on record strongly resisting the efforts by extremists to hijack the Syrian revolution,” she said.

Syria’s revolt has killed an estimated 32,000. A bomb near a Shi’ite shrine in a suburb of Damascus killed at least six more people on Wednesday, state media and opposition activists said.

NEW LEADERSHIP

The meeting next week in Qatar’s capital Doha represents a chance to forge a new leadership, Clinton said, adding the United States had helped to “smuggle out” representatives of internal Syrian opposition groups to a meeting in New York last month to argue their case for inclusion.

“We have recommended names and organizations that we believe should be included in any leadership structure,” she told a news conference.

“We’ve made it clear that the SNC can no longer be viewed as the visible leader of the opposition. They can be part of a larger opposition, but that opposition must include people from inside Syria and others who have a legitimate voice which must be heard.”

The United States and its allies have struggled for months to craft a credible opposition coalition.

U.S. President Barack Obama’s administration has said it is not providing arms to internal opponents of Assad and is limiting its aid to non-lethal humanitarian assistance.

It concedes, however, that some of its allies are providing lethal assistance – a fact that Assad’s chief backer Russia says shows western powers are intent on determining Syria’s future.

Russia and China have blocked three U.N. Security Council resolutions aimed at increasing pressure on the Assad government, leading the United States and its allies to say they could move beyond U.N. structures for their next steps.

Clinton said she regretted but was not surprised by the failure of the latest attempted ceasefire, called by international mediator Lakhdar Brahimi last Friday. Each side blamed the other for breaking the truce.

“The Assad regime did not suspend its use of advanced weaponry against the Syrian people for even one day,” she said.

“While we urge Special Envoy Brahimi to do whatever he can in Moscow and Beijing to convince them to change course and support a stronger U.N. action we cannot and will not wait for that.”

Clinton said the United States would continue to work with partners to increase sanctions on the Assad government and provide humanitarian assistance to those hit by the conflict.

(Additional reporting by Ayla Jean Yackley; editing by Andrew Roche)

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Storm knocks down some web sites, but most stay online

SAN FRANCISCO (Reuters) – Despite outages at a few well-known web sites and ripple effects that occasionally slowed communications around the country, the Internet came through the massive storm that swamped New York and New Jersey with relatively minor problems.

Built for resiliency and buttressed by the adoption of cloud computing, the Internet functioned largely as it was supposed to, industry experts said, routing around major disruptions in one of its central network locations, New York City.

“You don’t hear about big content providers going offline anymore,” said Jeffrey Young, a spokesman for major delivery network Akamai Technologies Inc, which has servers spread among some 1,100 communications set-ups. “We can route around issues that are occurring.”

New York has two major exchange centers where U.S. backbone telecommunication providers meet data from undersea cables, said Doug Madory, senior analyst at Renesys Corp, which monitors Internet response times. A number of network addresses were inaccessible on Tuesday afternoon, including many in the New York area, and connection times for others were slower than normal, he said, but the disruptions were limited.

Still, a handful of popular web sites, including Google‘s YouTube, AOL Inc’s Huffington Post, and the network of sites owned by Gawker Media, did experience outages.

Social news site BuzzFeed and News Corp’s financial site MarketWatch were also reduced to bare-bones versions as they regrouped on Tuesday.

At least some of the problems were the direct result of data centers losing power and being unable to fuel their own generators because of flooding.

Most web sites use commercial data centers rather than running their own computer servers, in part to ensure security and stability in emergencies. Many of those data centers offer back-up services elsewhere.

But New York data centers, including Internap and Datagram, went down due to the power and flooding problems. BuzzFeed, Huffington Post and Gawker all crashed because of Datagram.

“How dumb to locate datacenter in a flood zone. And how dumb to host Gawker servers there,” Gawker founder Nick Denton wrote on Twitter. The company moved to blog platform Tumblr for a while, one of a number of creative workarounds made easier by more advanced web offerings. BuzzFeed moved everything onto Akamai and Amazon’s web services arm.

An AOL spokeswoman said after Huffington Post’s main data center went under that it had shifted to a backup data system in Newark. That worked until all three telecom firms serving that location went down.

“At approximately 3:30 a.m., network connectivity failed at the backup datacenter when all three of its providers each separately failed,” said AOL’s Erin Kurtz.

Huffington Post switched to a skeletal blog platform until it recovered at eight hours later.

Dow Jones and Datagram could not be reached immediately for comment. YouTube refused to say why it became unavailable, but Google’s New York headquarters was closed by the storm. The company said the video site was available, if slow, for most users by Tuesday evening.

Many large and mid-sized companies adopted disaster planning for data after the September 11, 2001, attacks, making sure to have duplicates of core data in different locations. Smaller firms have taken the same route by moving to cloud computing, which generally spreads data across multiple facilities.

“The whole point of the cloud is that companies are insulated from outages really of any sort, absent a giant nuclear disaster,” said Bernard Golden, vice president at enStratus Networks, a cloud software company. “You want your provider to have facilities in disparate-enough locations so that even if you have problems in a particular region, your service is still available.”

(Additional reporting by Alexei Oreskovic and Alistair Barr in SAN FRANCISCO and Jennifer Saba in NEW YORK; Editing by Jonathan Weber and Paul Tait)

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‘Homeland’ hits series high, Showtime sets record

LOS ANGELES, Oct 30 (TheWrap.com) – Showtime‘s “Homeland” hit a series high with its Sunday episode — and it helped to deliver a first-time honor for the network, Showtime said Tuesday.

With “Dexter,” in its seventh season, inching up 5 percent from last week to score 2.28 million total viewers, Sunday marked the first time that Showtime has aired two back-to-back episodes of original series that have drawn more than 2 million viewers each in a single night.

“Homeland” drew 2.07 million viewers with its 10 p.m. airing Sunday, jumping 19 percent from the previous week and delivering the highest viewership to date for the series, which cleaned up at the Emmy Awards earlier this year.

Between its 10 p.m. airing and an encore showing, “Homeland” brought in a total of 2.29 million viewers, making for the highest-rated night of the series, now in its second season.

Meanwhile, “Dexter” delivered its highest viewership since the seventh-season premiere with its 9 p.m. airing. Along with an encore airing, it drew a total of 2.81 million viewers.

(Editing By Zorianna Kit)

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Top medical innovations address headache, diabetes, cancer

(Reuters) – The best medical innovations for next year include an almond-size device that’s implanted in the mouth to relieve severe headaches and a hand-held scanner resembling a blow dryer that detects skin cancer, the Cleveland Clinic said on Wednesday.

The clinic’s annual list of the best medical innovations for 2013 also includes new drugs to treat advanced prostate cancer and better mammography technology.

But leading the 2013 list for innovations is an old procedure that has a new use due to findings in a recent study. Physicians and researchers at the clinic voted weight-loss surgery as the top medical innovation, not for its effectiveness in reducing obesity, but for its ability to control Type 2 diabetes, the most common form of the disease.

Over the years, bariatric surgeons noticed that the procedure would often rid obese patients of Type 2 diabetes, before they even left the hospital.

A study, led by Cleveland Clinic head of Bariatric and Metabolic Institute Dr. Philip Schauer, examining this phenomenon was published in the prestigious New England Journal of Medicine earlier this year.

“Bariatric surgery has been around for a while. The reason it was chosen as the top innovation is because Medicare has broadened its indication for payment, and Medicaid in many states follows Medicare. A lot of the other (private) insurance companies started covering it, so it’s much more accessible,” Dr. Michael Roizen, the Cleveland Clinic’s Chief Wellness Officer, said in an interview.

The criteria that insurers use to cover the surgery has been broadened because of its effectiveness in controlling Type 2 diabetes, he said.

The number of people affected by diabetes has tripled over the past 30 years to more than 20 million Americans, according to the Centers for Disease Control and Prevention, and more than 90 percent of those cases are Type 2.

Doctors and researchers at the Cleveland Clinic voted for what they thought were the biggest, most significant innovations from the 250 ideas submitted from their colleagues at the clinic. Roizen said one of the main contributing factors to getting on the list is the number of people that the product or procedure can potentially help.

For that reason, a device that helps relieve headaches, the second most common ailment after the cold, was second on the clinic’s list.

The miniaturized device — invented at the Cleveland Clinic and spun off into a separate, private company called Autonomic Technologies Inc — is implanted in the upper gum above the second molar to treat cluster headaches and migraine headaches. A lead tip of the implant is placed near specific nerves behind the bridge of the nose.

When the patient feels the headache coming on, a remote control device is placed on the outside of the cheek and the device delivers stimulation to those nerves, blocking headache pain.

The implant is available in Europe, but not in the United States. The company needs to do more studies to get FDA approval, said Dr. Frank Papay, Department Chair of Dermatology and Plastic Surgery Institute at the Cleveland Clinic, and consultant to Autonomic Technologies.

A hand-held device used to detect melanoma, the most deadly form of skin cancer, was also on the list.

“Up until now, we’ve counted on our eyes,” Dr. Allison Vidimos, Department Chair of Dermatology at the Cleveland Clinic, told Reuters. “This device offers an objective look underneath the skin using a special spectrum of light.”

It compares moles and other things it finds on the patient’s skin with a large database containing information on all types of melanoma. It also rates the risk.

“All dermatologists fear missing melanomas. The cure rate can be close to 100 percent if caught early,” she said.

Vidimos said using the device, approved by FDA last year for use by trained dermatologists, helps prevent unnecessary biopsies.

Mela Sciences Inc make the scanning device.

Also on the list is a new type of mammography, called breast tomosynthesis. This technology provides greater detail of the image than the standard mammography, which renders a 2-dimensional image.

For the patient, it may seem like there’s no difference. “You still have the squish,” said Dr. Alice Rim, Section Head of Diagnostic Radiology. But the images produced by the new technology show the breast in slices, so far more detail can be seen.

“With 2-demensional mammography, there are shadows, so it can be like a polar bear running around in a snow storm. This eliminates the shadows, allowing increased detection and fewer call backs (for a second mammography),” Rim said.

Other devices that made the list include mass spectrometry for bacterial infections, which allow microbiology laboratories to identify the type of bacteria sooner and with more specificity, a new modular stent graft to treat complex aortic aneurysm and a laser used for cataract surgery.

Novel drugs to treat advanced prostate cancer were on the clinic’s list because of their ability to halt the progress of the disease by blocking testosterone receptors.

A new technique to repair and regenerate damaged lungs, called ex vivo lung perfusion, is on the list. Experts say as many as 40 percent of previously rejected donor lungs may now be suitable for transplantation after undergoing this novel “lung washing”.

The procedure involves placing donor lungs into a bubble-like chamber connected to a cardiopulmonary pump and ventilator. Over four to six hours, the lungs are repaired as special fluids are forced through the blood vessels. Nutrients are used to recondition the lungs as they inflate and deflate.

The final item on the list is neither a procedure, a drug nor a device, but healthcare programs that use incentives to encourage people to take better care of themselves.

The Medicare Better Health Rewards Program Act of 2012 provides incentive payments to Medicare participants who voluntarily establish and maintain better health.

“We are seeing efforts to avoid rationing of healthcare and seeing programs with incentives built in if people maintain their health. This can radically change the cost of care,” said Roizen. “We’re seeing this more in big companies, the GE’s and J&J’s of the world. All companies are looking at how much they are spending on healthcare and they are looking at ways they can reduce spending without rationing.”

(Reporting By Debra Sherman; Editing by David Gregorio)

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NYC Rats: Stronger Than Sandy

Unprecedented flooding throughout low-lying portions of New York City over the past two days undoubtedly left hundreds—if not thousands—of rats scrambling for their dear lives. According to experts, most of them likely survived. “They’re a jack of all trades when it comes to locomotion,” says Rick Ostfeld of the Cary Institute of Ecosystem Studies in Millbrook, N.Y. “They can’t sprint, but they run well; they’re not Michael Phelps, but they’re strong swimmers; and even though they don’t have prehensile tails, they climb well. They do it all.”

Ostfeld notes that rats can easily swim a couple hundred yards. In fact, he says, “one of the ways that rats have dispersed around the world is by jumping off of ships and swimming to shore—the proverbial ‘rats leaving a sinking ship’ is actually based on reality.”

No one knows exactly how many rats live in New York City, but Ostfeld suspects that there are at least as many rats as humans. The city’s population is dominated by the Norway rat (Rattus norvegicus), an invader from Europe, and the Black rat (Rattus rattus), which originated in Asia. These highly resilient rats can be found throughout New York City, but they usually don’t travel far within those limits.

The displacement of rats caused by Hurricane Sandy—a dispersal of rats that is likely unprecedented for the city in terms of numbers—has Ostfeld concerned about a possible increased spread of rat-borne diseases. “You get infected individuals mixing with uninfected individuals and that’s a recipe for an outbreak,” says Ostfeld. “It spreads like the flu, from rat to rat.”

Urban rats are known to carry infectious diseases including leptospirosis, typhus, salmonella, hantavirus, and even the plague. The incubation period for these diseases in humans is usually a couple of weeks or months, and symptoms are often similar to those of a common flu. According to Ostfeld, “In the coming weeks and months, health-care providers should have rat-borne diseases on their radars and potentially test for them.”

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Hurricane’s death toll rises to 65 in Caribbean

PORT-AU-PRINCE, Haiti (AP) — As Americans braced Sunday for Hurricane Sandy, Haiti was still suffering.

Officials raised the storm-related death toll across the Caribbean to 65, with 51 of those coming in Haiti, which was pelted by three days of constant rains that ended only on Friday.

As the rains stopped and rivers began to recede, authorities were getting a fuller idea of how much damage Sandy brought on Haiti. Bridges collapsed. Banana crops were ruined. Homes were underwater. Officials said the death toll might still rise.

“This is a disaster of major proportions,” Prime Minister Laurent Lamothe told The Associated Press, adding with a touch of hyperbole, “The whole south is under water.”

The country’s ramshackle housing and denuded hillsides are especially vulnerable to flooding. The bulk of the deaths were in the southern part of the country and the area around Port-au-Prince, the capital, which holds most of the 370,000 Haitians who are still living in flimsy shelters as a result of the devastating 2010 earthquake.

Santos Alexis, mayor of the southern city of Leogane, said Sunday that the rivers were receding and that people were beginning to dry their belongings in the sun.

“Things are back to being a little quiet,” Alexis said by telephone. “We have seen the end.”

Sandy also killed 11 in Cuba, where officials said it destroyed or damaged tens of thousands of houses. Deaths were also reported in Jamaica, the Bahamas and Puerto Rico. Authorities in the Dominican Republic said the storm destroyed several bridges and isolated at least 130 communities while damaging an estimated 3,500 homes.

Jamaica’s emergency management office on Sunday was airlifting supplies to marooned communities in remote areas of four badly impacted parishes.

In the Bahamas, Wolf Seyfert, operations director at local airline Western Air, said the domestic terminal of Grand Bahamas‘ airport received “substantial damage” from Sandy’s battering storm surge and would need to be rebuilt.

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PayPal cutting jobs as part of major reorganization

SAN FRANCISCO (Reuters) – PayPal is cutting about 325 jobs as part of a major reorganization by its new president, David Marcus, designed to regain an innovative edge and head off rising competition.

PayPal, the online payment pioneer owned by eBay Inc, said on Monday the full-time jobs would be eliminated as it combines nine product-development groups into one. The company is also cutting about 120 contractors.

EBay will take a $ 15 million pretax restructuring charge in the fourth quarter related to the job reductions.

PayPal, which started in the late 1990s as a scrappy Silicon Valley start-up, had almost 13,000 employees earlier this year.

“In a large company, at some point you reach the law of diminishing returns when more people means slower,” said Marcus, who used to run mobile payments start-up Zong, which PayPal acquired last year.

“You have a lot of duplication of roles with nine product groups merging into one,” he said.

Wall Street considers PayPal the crown jewel of eBay because it is growing fast and profit margins are expanding. But in Silicon Valley, PayPal is considered a slow, bureaucratic behemoth – a reputation that has made it difficult for the company to attract and retain smart software engineers and designers.

PayPal needs such talent more than ever because a slew of payments start-ups, including Square, Stripe and Dwolla, are developing rival services and products that are beginning to catch on with merchants and consumers.

“PayPal has been on a very strong growth trajectory, but it’s facing a period of disruption ahead,” said Kevin Hartz, chief executive of ticketing start-up Eventbrite.

“We just haven’t seen a lot of innovation that’s needed for them to continue their leadership,” added Hartz, who was an early investor in PayPal and owns a small stake in Square now.

Still, Hartz said PayPal’s new executive team is the right one to overhaul the company’s culture and approach.

Marcus said he is reorganizing PayPal to help engineers and designers develop new products and services more quickly – to keep up with new rivals.

Marcus has organized demonstrations of rival services at PayPal headquarters in San Jose, California, and screen shots of competing products line the walls of some corridors.

“It’s important to face the reality of the situation,” Marcus said. “In some cases, we don’t have better products and we have to do something about it.”

In the past, it took PayPal six to nine months to develop and launch a product, partly because there was a long application process to assemble the required teams of employees.

After products were released, engineers and developers moved on to other projects. That meant any problems with new products took a long time to update and fix, Marcus said.

Marcus’ new approach involves giving smaller groups of engineers and designers the freedom to coalesce quickly and release early versions of products that will be tested with a small sub-set of PayPal users and updated quickly, he said.

‘JOLTED’

Hill Ferguson, PayPal’s new head of global product, and Chief Technology Officer James Barrese oversee the new, single-product development group.

“We had multiple different product teams coming to me with their ideas and requests, which was crazy,” Barrese said. “We brought that all together and can make much swifter decisions. Hill and I sit in a room and decide to do something and it’s done.”

The company launched PayPal Here, a credit card processing service for small merchants that competes with Square, earlier this year. The product was initially developed by a group that consisted of one product developer, two engineers and two designers.

“We are using that model for how we work going forward,” Ferguson said.

PayPal is now assembling a small team of engineers and designers to change the company’s core online checkout service, Ferguson and Marcus said.

Hartz said customers who pay for tickets through Eventbrite using PayPal are “jolted” over to PayPal’s website to complete the transaction. That can reduce “conversion,” or the percentage of customers who complete purchases, he said.

Marcus said PayPal will be working to fix such issues.

“We want to do what’s right for merchants and customers. Neither wants to be re-directed when they pay,” he said.

TALENT MAGNET?

Marcus, Ferguson and Barrese hope their changes will attract software engineers and designers to the company again. That may be tough.

Soon after eBay acquired PayPal in 2002, some of the founders and early executives, including Peter Thiel, Reid Hoffman, Jeremy Stoppelman, David Sacks and Max Levchin, left to start other businesses such as LinkedIn Corp, Yelp Inc and Yammer. Thiel and Levchin are among investors in Stripe now.

That talent drain at the top of PayPal, combined with a lack of incentive to innovate further, meant top engineers often went elsewhere.

“They aren’t a very strong magnet for talent right now,” said Elad Gil, a Silicon Valley investor who owns stakes in Stripe and Square. “It’s possible that may change.”

Douglas Crockford, an expert in JavaScript, came to PayPal from Yahoo! Inc recently, joining Bill Scott, former director of User Interface Engineering at Netflix Inc.

Ed Sexton came to PayPal in September as a lead engineer after working at Apple Inc and Jive Software Inc. Sexton had previously worked at eBay for about five years.

“I heard from my colleagues that there was an insurgence of new management at PayPal, some of whom I worked within the past when I was at eBay,” he said.

One attraction was PayPal’s recent embrace of Hadoop, an open-source technology for crunching lots of data quickly.

“They are looking to staff engineers for this technology. That brought a lot of comfort to me,” Sexton said.

Sexton’s LinkedIn page now says, “NO JOB OFFERS PLEASE. Currently having the time of my life at PayPal.”

(Reporting by Alistair Barr; Editing by John Wallace, Bernard Orr and Lisa Shumaker)

Linux/Open Source News Headlines – Yahoo! News

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Rolling Stones memorabilia auctioned after divorce

NEW YORK (Reuters) – An assortment of Rolling Stones memorabilia and artwork provided by Rolling Stones guitarist Ronnie Wood and his ex-wife was sold in a two-day auction, Julien’s Auctions said on Sunday.

The collection featured memorabilia spanning four decades from the guitarist’s work with the band, and included several worn leather and velvet jackets, real and cardboard guitars, tour ephemera and a signed lithograph of Eric Clapton.

Among the items were a white leather coat worn by Wood that sold for $ 8,960, and a lithograph of Eric Clapton drawn by Wood that features his signature as well as Clapton’s that fetched $ 5,120.

Despite being made of cardboard, a guitar cutout gifted to Wood by Keith Richards sold for $ 6,875. The real thing commanded almost nine times that price, with a 1955 Fender Stratocaster guitar often played on stage by Wood bringing in $ 60,800.

Bidding took place live online as well as in person and by phone at Julien’s Beverly Hills gallery on Friday and Saturday.

The auction comes ahead of the release next February of the memoirs of Wood’s ex-wife Jo, which promise to reveal her tales of life as the wife of a Rolling Stone.

Ronnie and Jo Wood were married for 23 years before separating in 2008 when Ronnie left her for a young cocktail waitress named Ekaterina Ivanova. The couple’s divorce was finalized in 2011.

After the auction was announced in September, the former couple issued opposing statements feuding about the ownership of the auction items, but seemed to have worked out their disagreements. Julien described the items for sale as jointly owned and said that they were part of the couple’s divorce settlement.

Part of the proceeds from the auction will go to MusiCares, the Grammy Awards charity that offers help to people in the music industry with finance and addiction.

Wood has recently been focused on his visual art career, but is best known as a musician with the Rolling Stones and The Faces. He has been inducted into the Rock and Roll Hall of Fame twice.

In addition to her upcoming memoirs, Jo Wood – a former model – has also founded a skincare line.

(Reporting by Andrea Burzynski, editing by Gary Crosse)

Music News Headlines – Yahoo! News

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