Bits Blog: A Lot Changes in Tech Over Four Years

Bits Blog: How Surveillance Changes Behavior: A Restaurant Workers Case Study

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DealBook: Icahn Sues Dell to Halt Changes to Buyout Vote

DealBook: NetApp Adds Directors Amid Push for Changes

NetApp Inc. quietly announced last week that it planned to add two directors to its board. But their qualifications may hint that the decision to appoint them did not just come out of thin air.

In its preliminary proxy filing, NetApp, the computer storage provider, disclosed that it will seat Kathryn M. Hill and Tor R. Braham as its newest directors, with investors voting on them at the company’s annual meeting on Sept. 13.

Both have been involved in the technology sector for a long time. But according to people briefed on the matter, they were also suggested by Elliott Management, the activist hedge fund that has taken a stake of just less than 5 percent in NetApp and is pushing for strategic changes at the company.

Elliott, which has managed to shake up several technology companies in recent years, had discussed adding Ms. Hill and Mr. Braham with the company for a number of weeks, one of these people said. Mr. Braham was the suggestion of Elliott’s point person on technology investments, Jesse Cohn; Ms. Hill arose out of discussions between the two sides.

What makes both nominees interesting are their backgrounds. Ms. Hill was most recently a senior vice president of development strategy and operations at Cisco Systems, which is considered a natural potential buyer of NetApp.

And Mr. Braham is a longtime technology mergers banker who previously worked at Deutsche Bank and at Credit Suisse, where he worked with the deal maker Frank Quattrone.

“We applaud NetApp’s smart, forward-thinking decision to strengthen its board as it plans for success in the future,” Mr. Cohn of Elliott said in a statement. “Both Tor and Kathy will add tremendously to the board’s dialogue as it seeks to ensure continued success and value-creation for NetApp’s stockholders.”

A possible goal of adding the two directors is to help steer the company’s board into considering a sale, an idea that Elliott has supported. It has had success agitating for the sales of Novell and BMC Software. The hedge fund has pushed for several changes at NetApp to lift its stock price.

The company has already taken steps to return money to shareholders. In May, it rolled out a $3 billion stock buyback plan and a new quarterly cash dividend.

It remains to be seen whether NetApp will take that next step. For its part, the company said of its newest directors: “All candidates underwent a comprehensive review process and NetApp is confident in the two new nominees to bring a fresh perspective to our existing board with their relevant experience and deep industry knowledge.”

The company added that its board and management would continue working to improve the company’s long-term shareholder value and “will continue to take actions that we believe will enable us to achieve this objective.”

Gadgetwise Blog: An iPad 5 Case Hints at Design Changes

A Gumdrop Drop Tech Designer series case.

Shortly before the iPhone 5 was announced, the first case for that phone arrived at my desk. It was made by Gumdrop.

Not resting on its laurels, Gumdrop is even further out front this time, releasing covers for the iPad 5, a device that is not expected to be unveiled before this week, although some predict it will be much later than that.

The new case provides some clues about the design of the new iPad. If the size of the case is correct, the new pad will be thinner and narrower. Information tracked by MacRumors places the dimensions at 15 percent thinner and up to 33 percent lighter than the current iPad.

Gumdrop has posted a 360-degree view comparing the new and old iPads inside its cases, which also shows the new iPad to be narrower. The ports for buttons and cameras all appear to be in the same places as current models.

How does Gumdrop know what size the new iPad will be? As I had written previously, the Gumdrop covers, like the Apple products, are made in Shenzhen, China. Manufacturers there swap information, which has been described as a communal strategy to attract companies to employ Shenzhen manufacturers.

So far Gumdrop’s batting average is .500, having bet incorrectly once on the date of the iPhone 5 introduction and design, before getting the launch and design right nearly a year later.

If you are of a mind to take a gamble, Gumdrop is offering three case designs for the iPad 5: the Drop Tech series, the Drop Tech Designer series, and the Bounce cover. They range in price from $35 to $60.

Mobile Apps Drive Rapid Changes in Search Technology

Google has repeatedly made the argument — and the commission agreed — that the speed of change in the technology industry made it impossible for regulators to impose restrictions without stalling future innovations.

Exhibit A is the mobile device. Nowhere has technology changed as rapidly and consumer behavior as broadly. As people abandon desktop computers for mobile ones, existing tech companies’ business models are being upended and new companies are blooming.

“Mobile is very much a moving target,” said Herbert Hovenkamp, a professor of antitrust law at the University of Iowa who has been a paid adviser to Google. “This is a market in which new competitors come in a week’s time.”

When the commission began its investigation 19 months ago, for instance, the iPhone did not have the Siri voice search, Apple did not have its own mapping service and Yelp’s mobile apps had no ads. By the time the inquiry concluded, all of that had changed. Google had new competitors on all sides trying to chip away at its hold on the mobile search and advertising market.

Still, Google is even more dominant on mobile phones than on desktop computers. It has 96 percent of the world’s mobile search market, according to StatCounter, which tracks Web use. It collects 57 percent of mobile ad revenue in the United States, while Facebook, its nearest competitor, gets just 9 percent, according to eMarketer.

But, analysts say, as people change their search habits on mobile devices — bypassing Google to go straight to apps like Yelp’s, for example — that dominance could wane, or a competitor could swoop in and knock Google off its perch.

“It’s important to recognize that many mobile apps are really vertical search engines,” said Rebecca Lieb, a digital media analyst at the Altimeter Group. “It is impossible to really say anyone dominates a section of mobile in a secure way right now.”

On cellphones or tablets, for instance, people increasingly skip Google altogether in favor of apps like Flixster for movie times or Kayak for flights.

Apple is taking on mobile search with Siri on the iPhone, which can answer questions about the weather or search for nearby restaurants. With its new mapping service, Apple has also entered local search.

On Friday, Blekko, a search start-up, introduced an app called Izik for Apple and Android devices. It tries to make searching more tablet-friendly by showing images instead of just links, and making it easier to swipe through many pages of results with a finger.

On mobile devices, said Rich Skrenta, chief executive of Blekko, “the user experience is so different that we think it opens things up. On your desktop, if it doesn’t look like Google, you think that’s not a search engine. On a tablet, it’s just vastly different.”

Jon Leibowitz, chairman of the F.T.C., said at a news conference Thursday that the speed of change in the tech industry meant that “you want to be careful before you apply sanctions.”

The commission also considered Google’s partnerships with cellphone makers like Samsung and HTC that license Google search on phones, so that a search box shows up on the home screen. In the end it decided not to take action against Google.

Some Google critics said that even though the competitive landscape is different on mobile devices, it should not have influenced the government’s analysis of Google’s behavior on the desktop Web.

“There’s no doubt that mobile applications, including Yelp’s, give consumers the ability to bypass the major search engines and go directly to the best provider of the service they’re looking for,” said Vince Sollitto, vice president for government relations at Yelp. Still, he added, “I don’t see how that impacts how someone is acting anticompetitively on the desktop.”

(One of Google’s concessions to the federal agency, that it would allow other Web companies to ask Google not to show their content in its own vertical search products — a chief complaint of Yelp’s — applies to mobile as well.)

But others said antitrust enforcement in the 21st century needs to be more agile.

Nick Wingfield contributed reporting from Seattle.

The iEconomy: Signs of Changes Taking Hold in Electronics Factories in China

At first, Ms. Pu wondered if someone had made a mistake. But when her bosses walked by, they just nodded curtly. So Ms. Pu gently sat down and leaned back. Her body relaxed.

The rumors were true.

When Ms. Pu was hired at this Foxconn plant a year earlier, she received a short, green plastic stool that left her unsupported back so sore that she could barely sleep at night. Eventually, she was promoted to a wooden chair, but the backrest was much too small to lean against. The managers of this 164,000-employee factory, she surmised, believed that comfort encouraged sloth.

But in March, unbeknown to Ms. Pu, a critical meeting had occurred between Foxconn’s top executives and a high-ranking Apple official. The companies had committed themselves to a series of wide-ranging reforms. Foxconn, China’s largest private employer, pledged to sharply curtail workers’ hours and significantly increase wages — reforms that, if fully carried out next year as planned, could create a ripple effect that benefits tens of millions of workers across the electronics industry, employment experts say.

Other reforms were more personal. Protective foam sprouted on low stairwell ceilings inside factories. Automatic shut-off devices appeared on whirring machines. Ms. Pu got her chair. This autumn, she even heard that some workers had received cushioned seats.

The changes also extend to California, where Apple is based. Apple, the electronics industry’s behemoth, in the last year has tripled its corporate social responsibility staff, has re-evaluated how it works with manufacturers, has asked competitors to help curb excessive overtime in China and has reached out to advocacy groups it once rebuffed.

Executives at companies like Hewlett-Packard and Intel say those shifts have convinced many electronics companies that they must also overhaul how they interact with foreign plants and workers — often at a cost to their bottom lines, though, analysts say, probably not so much as to affect consumer prices. As Apple and Foxconn became fodder for “Saturday Night Live” and questions during presidential debates, device designers and manufacturers concluded the industry’s reputation was at risk.

“The days of easy globalization are done,” said an Apple executive who, like many people interviewed for this article, requested anonymity because of confidentiality agreements. “We know that we have to get into the muck now.”

Even with these reforms, chronic problems remain. Many laborers still work illegal overtime and some employees’ safety remains at risk, according to interviews and reports published by advocacy organizations.

But the shifts under way in China may prove as transformative to global manufacturing as the iPhone was to consumer technology, say officials at over a dozen electronics companies, worker advocates and even longtime factory critics.

“This is on the front burner for everyone now,” said Gary Niekerk, a director of corporate social responsibility at Intel, which manufactures semiconductors in China. No one inside Intel “wants to end up in a factory that treats people badly, that ends up on the front page.”

The durability of many transformations, however, depends on where Apple, Foxconn and overseas workers go from here. Interviews with more than 70 Foxconn employees in multiple cities indicate a shift among the people on iPad and iPhone assembly lines. The once-anonymous millions assembling the world’s devices are drawing lessons from the changes occurring around them.

As summer turned to autumn and then winter, Ms. Pu began to sign up for Foxconn’s newly offered courses in knitting and sketching. At 25 and unmarried, she already felt old. But she decided that she should view her high-backed chair as a sign. China’s migrant workers are, in a sense, the nation’s boldest risk-takers, transforming entire industries by leaving their villages for far-off factories to power a manufacturing engine that spans the globe.

Ms. Pu had always felt brave, and as this year progressed and conditions inside her factory improved, she became convinced that a better life was within reach. Her parents had told her that she was free to choose any husband, as long as he was from Sichuan. Then she found someone who seemed ideal, except that he came from another province.

Reclining in her new seat, she decided to ignore her family’s demands, she said. The couple are seeing each other.

“There was a change this year,” she said. “I’m realizing my value.”

An Inspector’s Push

“This is a disgrace!” shouted Terry Gou, founder and chairman of Foxconn, the world’s largest electronics manufacturer and Apple’s most important industrial partner.

Keith Bradsher reported from Chengdu and Chongqing, and Charles Duhigg from New York. Yadan Ouyang contributed reporting from Chengdu and Chongqing.

Bits Blog: Anger at Changes on Instagram

Karly Domb Sadof/Associated Press

Instagram, the popular photo-sharing service, was met with anger after changing its terms of service on Monday. The changes will let advertisers in Facebook’s ad network use data and information that users have shared on Instagram, and will also give Instagram and Facebook the right to use its users’ photographs and identity in advertisements. The changes are to go into effect Jan. 16.

On Twitter, many users said they were deleting their accounts and urged others to do the same.

Facebook Responds to Anger Over Proposed Instagram Changes

Jeremy Pinnix, a 40-year-old app developer in Spring Hill, Tenn., has been a regular user of the photo-sharing service Instagram since it was introduced in 2010, posting pictures of his family, local scenery and favorite moments.

But when he learned this week about changes to the company’s terms of service that would apparently allow his photos to be used as advertisements, he didn’t hesitate. Mr. Pinnix deleted his account and has not looked back.

“Many of the photos I take are of my wife and kids,” he said. “The idea that those could be used in ads without my consent is disconcerting.”

This has been a common sentiment on social networks this week as Instagram users react to the coming changes, part of a push by Facebook, which now owns Instagram, to make money from the service.

On Tuesday evening, the complaints prompted some action. Kevin Systrom, a co-founder of Instagram, wrote a blog post saying the company would change the new terms of service to make clearer what would happen to users’ pictures.

“We’ve heard loud and clear that many users are confused and upset about what the changes mean,” he wrote. “I’m writing this today to let you know we’re listening and to commit to you that we will be doing more to answer your questions, fix any mistakes, and eliminate the confusion.”

Eric Goldman, an associate professor at the Santa Clara University School of Law, said the latest skirmish between Facebook and its users was part of the sometimes uncomfortable dynamic between companies that offer free online services and their eventual need to turn a profit from them.

“The interest of the site is never 100 percent aligned with the users, and the divergence inevitably leads to friction,” said Mr. Goldman. “It’s unavoidable.”

When it announced the changes on Monday, Facebook provided few details on how it would integrate ads and photos, other than to say that when the changes went into effect on Jan. 16, they would not affect any photographs uploaded to the service before then.

That did not prevent unhappy users from threatening to take their portfolios of photographs over to rival services. Many, including Mr. Pinnix, eyed a return to Flickr, the former king of photo-sharing services, which is owned by Yahoo. In a stroke of lucky timing, Flickr recently released a shiny new application for the iPhone that has drawn praise from users.

The operators of services like Instaport.Me and Instabackup, which let people create copies of their Instagram photos, said they were seeing higher than average volume.

Linus Ekenstam, who helped found a service called Copygram that lets people back-up their Instagram accounts and order physical prints of their favorite snaps, said demand for the company’s free exporting tool had skyrocketed.

“It’s a thousand percent more activity than we’re used to,” he said. “Today is crazy.”

He estimated that roughly 15 people per minute were using the exporting tool, and around half a million photographs had been backed up.

Billboard’s Changes to Charts Draw Fire

The magazine started counting digital sales and online streams along with radio airplay in its tallies for most major formats. It also created two new charts using the same criteria, breaking out rap songs in one and R&B songs in a second.

The results have given stars with a pop-oriented sound and broad crossover appeal an advantage over other artists, upsetting and puzzling some music fans. Take Psy, the pudgy South Korean pop star with the infectious dance moves whose video “Gangnam Style” went viral on the Internet. Since the new rules took effect, “Gangnam Style” has been the No. 1 song on the new Rap Songs chart for the last three weeks, even though Psy does not rap on the track and most American hip-hop radio stations have yet to embrace him as a bona fide rapper.

On the Hot Country Songs chart, Taylor Swift’s pop single “We Are Never Ever Getting Back Together” has held the No. 1 position for three weeks, even as many country stations have rejected it, and Rihanna’s pop hit “Diamonds“ has remained atop the Hot R&B-Hip Hop Songs chart, causing dismay among R&B purists.

Bill Werde, Billboard’s editorial director, said the shake-up was necessary to reflect changes in the way people consume music these days. There was a time when radio programmers — and the record labels who lobbied them — largely defined the charts, using surveys of their listeners and their gut instincts to select hits. Now the Internet gives fans a greater say, as people buy music from online stores, stream it through services like Spotify or listen to it on video sites like YouTube and Vevo.

“Three weeks ago, the main genre charts only reflected FM radio play,” Mr. Werde said. “Every fan out there in the world knows and everyone in the music business knows that is not the business we are in anymore, that a stream on Rhapsody or Spotify, or a download at iTunes or Amazon — all these different things — are a meaningful part of the fan experience. And to have genre charts that don’t reflect that? I can’t believe anyone would be arguing for that.”

Still, some people did. The changes caused a backlash on Twitter and other online forums from some purists among hip-hop, country and R&B fans. A headline on one commentator’s blog was “Billboard Chart Changes — R.I.P. R&B Music.” The Web site Saving Country Music lamented that “these new rules could cause the largest wholesale power shift to superstars that music has ever seen.”

Psy’s climb up the rap chart was also criticized. “Trust me when I tell you hip-hop does not consider Psy rap,” said Ebro Darden, the program director at Hot 97 (WQHT, 97.1 FM) the leading hip-hop station in New York. “Billboard has pull, but they cannot make people who live hip-hop believe Psy is rap.”

Most of the criticism, however, has come from fan groups with narrow interests. Carrie Underwood fans were furious that her song “Blown Away” was blocked from No. 1 by Ms. Swift’s pop tune, even though Ms. Underwood’s track is being played far more on country radio stations.

Some R&B and hip-hop fans were dismayed that Rihanna’s song jumped abruptly to No. 1 from No. 66, and that it has remained at the top of the chart ever since. Fans of R&B singer Brandy were particularly incensed, because her song “Put It Down,” featuring Chris Brown, which had been in the Top 10, dropped like a stone after the rule change, even though it remains a favorite on urban radio stations.

An online petition was started to persuade Billboard to undo the changes and has gathered 625 signatures, a small number for an Internet-based campaign.

Mr. Werde characterizes the detractors as a “vocal minority” and has stood firm in the face of the criticism, arguing in columns and online discussions that the definition of a hit has changed and Billboard must keep up with the times.

Similar changes were made a few months ago to the Hot 100 song chart, the main chart that measures popularity across genres, and they have been widely accepted by the industry. Some critics have said there is a subtle price to pay for the new rules. For starters, it becomes harder for artists of a traditional bent, or whose work lacks crossover appeal, to attain a No. 1 hit in their genre.

Billboard made one other change to its methodology that rewards crossover hits. Previously, the magazine only counted airplay on country stations for the country chart, and spins on R&B stations for the R&B chart, and so on. Now it is counting all the plays a song receives on 1,200 stations across genres.

Bits Blog: Twitter Changes Lead to Online Protests

Twitter’s new rules for third-party developers have spurred an online uproar.

After the company imposed stricter rules for its application programming interface, or A.P.I., on Thursday, engineers and developers picked up their virtual pitchforks and took to Twitter and blogs to decry what some described as a “bait and switch.”

“Twitter looks a lot like the big star who forgot about all the little guys that helped it get to the top,” Rafe Colburn, an engineer at Etsy, wrote in a blog post.

The influential Instapaper creator Marco Arment was more direct in his criticism: “Twitter has proven to be unstable and unpredictable and any assurances they give about whether something will be permitted in the future have zero credibility. I sure as hell wouldn’t build a business on Twitter.”

Mr. Colburn, Mr. Arment and others took issue with the company’s new user cap, which limits Twitter’s third-party apps from accommodating more than 100,000 users, or growing beyond 200 percent of their current user base. Another point of contention was a rule that forbids third-party apps from weaving chronological tweets with content from other networks — a big headache for apps like Flipboard, which mix tweets with content from Facebook, blogs and publications and other sources.

Those conditions were greeted with a contempt typically reserved for investment bankers around bonus season: “Wall Street has a saying that applies to Twitter’s new A.P.I. policy: “Bears make money, bulls make money, but pigs get eaten,” tweeted Joel Spolsky, a co-founder of Fog Creek Software.

“This morning Twitter feels like your favourite band that has sold out to a major record label,” wrote Ewan Spence, a contributor to Forbes.com.

“Twitter, what kind of bird are you becoming? Are you still that cute little bird that everyone loved, or are you becoming a scary bird of prey?” wrote Nova Spivack, the chief executive of the start-up Bottlenose.com, who compelled people to sign his petition, #OccupyTwitter.

Some developers tried to quell outrage pointed toward Twitter. Tapbots, the maker of Tweetbot, a popular Twitter app, said in a company blog post that the response to the A.P.I. changes seemed overblown. “There’s been a lot of fear, uncertainty and doubt generated by Twitter’s latest announcement,” the company wrote. “I wanted to let everyone know that the world isn’t ending.”

Others said such changes were par for the course when working with the data that large social networks provide. Bradford Cross, the co-founder of Prismatic, a social news aggregation Web site, said that while Twitter and other social networks could be hard to work with, “You’re getting the lowest distribution cost in history, lots of great data that you can create value from and you’re getting a more intimate connection to people.”

“It is going to be a Wild West for a while — social network wars, platform dodginess, media business turmoil and back-channel deals,” Mr. Cross added.

Many described Twitter’s changes as inevitable, particularly as the company struggles to find a viable business model. Twitter has experimented with various revenue streams like sponsored tweets and advertising. But its revenue — eMarketer estimates Twitter will make $260 million this year — pales in comparison to that of Facebook, which generated a substantial chunk of its $3.7 billion in revenue last year from its profit-sharing arrangement with third-party apps like Zynga.

But that explanation did not square with Twitter’s most vocal critics, like Mr. Spivack, who outlined alternative ways Twitter could generate revenue by keeping its A.P.I.’s open.

“Various apologists for Twitter attempt to justify it because ‘Twitter needs to be a multibillion-dollar business,’” Mr. Spivack wrote. “These kinds of statements just don’t hold water and are completely misguided.” He added, “The future market cap of the company will ultimately be orders of magnitude greater if they are stewards of the open nervous system of the planet than if they are the next Myspace trying to sell ads on their own pages and apps. It’s really that simple.”