Candy Crush maker prices IPO

NEW YORK (CNNMoney)

King Digital Entertainment will begin trading Wednesday under the ticker KING on the New York Stock Exchange at $22.50 a share the company said on Tuesday night.

The Dublin, Ireland-based game maker sold 22.2 million shares raising nearly $500 million from the offering. Based on that, King would be worth about $7.6 billion.

Related: Candy Crush company founder left $1 billion on the table

By comparison, rivals Zynga (ZNGA) and Activision (ATVI) sport valuations of $4 billion and $14.6 billion, respectively.

Among the underwriters are JPMorgan Chase (JPM, Fortune 500), Credit Suisse and Bank of America Merrill Lynch (BAC, Fortune 500), the company said in its federal filing.

Candy Crush averages about 93 million daily users, who play the game more than a billion times a day, according to the company.

King reported annual revenue of $1.9 billion and a profit of about $568 million, despite offering games such as Candy Crush, Pet Rescue and Farm Heroes to players for free.

But its growth has soared. Sales in 2012 were $164 million with a profit of just $8 million. King makes money by selling virtual items to a small fraction of its players who wish to enhance their playing experience.

Despite its rapid gains, King's dependence on Candy Crush has some market strategists questioning its long-term strategy. There are concerns that this could be a repeat of Zynga, which has been unable to the match the success of former hit Farmville.

"Since only a a small group of players generate most of King's revenue, a loss of even a small number of these players would materially affect King's gross bookings," said financial data firm PrivCo in a recent report.

Other red flags include slowing growth for Candy Crush, as well as the way King "double counts" its players, according to PrivCo, which has advised investors to pass on the stock.

"An individual playing Candy Crush on his cell phone while commuting to work and then later plays Candy Crush on his computer during their lunch break would be counted as two users," PrivCo said. "If the person then played on a tablet during the same period, he would be counted as three users."

Still, King's profits are impressive and plenty of investors are hungry for a taste of what they view as a sweet IPO.

King's stock may be "fairly valued," said Tim Keating, chief executive of Keating Capital, a fund that specializes in making pre-IPO investments but does not own a stake in King. He added that King's profit margins are strong and its revenue growth over the past year has been an "eye popping" 1000%.

But using history as a guide, some analysts are harboring a healthy dose of skepticism. Zynga, for example, currently trades at around 50% less than its 2011 IPO price. Still, Zynga has regained some lost ground and is up almost 30% this year.

Related: How does King Digital compare to Zynga?

King's public debut comes amidst a busy year for new offerings. There have been 53 new listings in the United States so far this year, according to IPO research and investment firm Renaissance Capital. In the same period last year, there were just 30 companies that went public. At that rate, the number of IPOs this year could rival last year's total of 222, which was the highest number since 2000.

While the overall market has been volatile due to geopolitical concerns and the Fed's scaling back of stimulus, the average IPO has returned 28.3% from its offering price, according to Renaissance.

-- CNN's Ben Rooney contributed to this report

First Published: March 25, 2014: 7:00 PM ET

15.30 | 0 komentar | Read More

First legal steps taken against Malaysia Airlines, Boeing

NEW YORK (CNNMoney)

Monica Kelly, a lawyer at Ribbeck Law, asked an Illinois state judge on Tuesday to order Malaysia Airlines and Boeing, which manufactured the missing airplane, to provide documents and other information.

Kelly is seeking specific information about the airline's batteries, details on the fire and oxygen systems and records related to the fuselage.

The filing appears to be the first move toward U.S.-based litigation stemming from the March 8 incident. The firm said it plans to build a multi-million dollar suit against the airline and Boeing.

Related: How will families be compensated

Boeing (BA, Fortune 500) declined to comment late Tuesday, and Malaysia Airlines officials were not immediately available.

Kelly's client, Januari Siregar, is the father of a Flight 370 passenger. It was not immediately clear when a judge would consider the filing.

International law dictates where suits against an airline may be brought. The families of victims are allowed to pursue legal action in countries including where tickets were purchased and where the airline is based. Suits can also be filed in the passenger's final destination.

That means most suits against Malaysia Airlines would be filed in China or Malaysia.

Related: Malaysia Airlines' $5,000 payment is just the beginning

International law does not, however, dictate where lawsuits against other parties, including Chicago-based Boeing, may be brought. Legal experts say crafting a case against the airplane's manufacturer is more difficult than against the airline.

Malaysia Airlines said it believes the plane crashed in the Indian Ocean and that all 239 people aboard the aircraft died. No physical evidence of the plane or passengers has been found.

First Published: March 25, 2014: 11:21 PM ET

15.30 | 0 komentar | Read More

Pew: Online news organizations have created 5,000 jobs

A select few news organization, including Al Jazeera America, have greatly expanded their operations.

NEW YORK (CNNMoney)

Pew Research Center has tried to put a number on it: 5,000.

The center's annual State of the News Media report, released on Wednesday, includes a first-of-its-kind tally of jobs at 30 big websites, like Buzzfeed and The Huffington Post, and 438 smaller startups.

"In a significant shift in the editorial ecosystem, most of these jobs have been created in the past half dozen years, and many have materialized within the last year alone," write the authors of the 2014 report, who credit the startups with bringing "a level of energy to the news industry not seen for a long time."

The Pew report cites hiring sprees at digitally-oriented companies like Gawker, Business Insider, First Look Media, Vox Media, and Vice Media. But it emphasizes that "the growth in new digital full-time journalism jobs seems to have compensated for only a modest percentage of the lost legacy jobs in newspaper newsrooms alone in the past decade."

"The vast majority of bodies producing original reporting still lie within the newspaper industry," the authors write. "But those newspaper jobs are far from secure." While reliable data for 2013 is not yet available, the report says that full-time newsroom employment dipped by 6.4% in 2012, "with more losses expected for 2013."

Related: Narrow ratings win for 'Today' shows how much trouble it's in

The State of the News Media report is an annual assessment of American journalism, financed by the nonpartisan Pew Research Center. This time last year, Pew focused on what it called signs of "shrinking reporting power" due to cutbacks at newspapers and television networks. That report warned of "a news industry that is more undermanned and unprepared to uncover stories, dig deep into emerging ones or to question information put into its hands."

This year's edition relays what it calls "a new sense of optimism," partly due to recent investments at a wide variety of online news organizations, some for-profit and others not-for-profit. It cites "a new breed of entrepreneurs" like Jeff Bezos, who acquired The Washington Post last year, and an increase in philanthropic support for news producers.

Related: China playing rough with big media

Pew arrived at the number of 5,000 new digital news gathering jobs by compiling the number of staffers at 30 big websites and estimating the head count at many smaller ones. The authors acknowledge that "while that does not represent a complete census of a digital news world, it is a robust a sample as may be possible from a variety of credible sources."

They say that "many digital outlets are working to fill reporting gaps created by the strain on resources at traditional outlets -- from niche topic areas like education to international coverage to local community news to investigative journalism." Others are experimenting with new ways to tell stories, whether through videos or lists or data visualization techniques.

"But the question of whether digital news outlets can ultimately replenish the loss of legacy jobs and reporting resources hinges on creating the kind of successful business model or models that have proved elusive," the authors say.

First Published: March 26, 2014: 12:24 AM ET

15.30 | 0 komentar | Read More

Disney to pay at least $500 million for YouTube video maker

NEW YORK (CNNMoney)

Maker Studios is a leading producer and distributor of short, entertaining videos on YouTube, many of which are geared toward millennials. Its vast array of online channels total 5.5 billion YouTube views per month, according to Maker, which makes it one of the most successful online video companies of its kind.

In effect, Maker has helped create a whole new universe of shows, made for the Web rather than television, and now Disney can learn from them. This is especially important because key Disney demographics — like teenagers — are flocking to YouTube and other online video destinations.

"By acquiring Maker Studios, Disney will gain advanced technology and business intelligence capability regarding consumers' discovery and interaction with short-form online videos, including Disney content," the press release about the acquisition said.

Interestingly, Maker will not be folded into one of Disney's television or film divisions; instead, its executives will report directly to Disney's chief financial officer, under the theory that this will ease collaboration with multiple divisions.

Related: Coming soon, TV truly on your phone

Disney said it expected the acquisition to close sometime in the spring. On top of the $500 million, Maker's shareholders may receive up to $450 million more over time, depending on whether Maker achieves its performance targets.

Roughly $70 million had been invested into Maker, including $25 million from the investment arm of Time Warner, the parent of this website.

The $500 million — possibly $950 million — figure will set a new bar for startup online video networks. When The Wall Street Journal broke the news earlier this month that Disney and Maker were talking, the newspaper said it "would mark the biggest acquisition by a major media company in the fast-growing but challenging business of producing and promoting video programming on Google's YouTube."

"Maker's YouTube-centric DNA would give Disney valuable insight into how to extend its star-making machine to the still quite opaque online realm," industry analyst Will Richmond, the publisher of Videonuze, wrote at the time. "But star-making is just half of the equation. The other, equally important half is mastering (and quite possible shaping) how online video distribution works, and what role YouTube will play."

Other major media companies have pursued similar questions through acquisitions. Two years ago, Discovery Communications bought a different kind of video startup, Revision3, for a reported $30 million. One year ago, DreamWorks Animation agreed to an initial sum of $33 million to acquire AwesomenessTV, a network of teen-oriented YouTube channels. Depending on the performance of AwesomenessTV, that deal may be worth $117 million over time.

Earlier this month, the Warner Bros. division of Time Warner led an $18 million round of funding for another YouTube-centric online video network, Machinima.

Bob Iger, the chief executive of Disney, said in a statement on Monday that "short-form online video is growing at an astonishing pace and with Maker Studios, Disney will now be at the center of this dynamic industry with an unmatched combination of advanced technology and programming expertise and capabilities."

First Published: March 24, 2014: 7:48 PM ET

15.30 | 0 komentar | Read More

'The Big Short' will hit the big screen

Paramount and Brad Pitt's Plan B production company will turn the book about the housing bubble and burst into a movie.

NEW YORK (CNNMoney)

Paramount Pictures and Brad Pitt's Plan B production company are teaming up to make Lewis' book "The Big Short: Inside the Doomsday Machine" into a movie.

In the non-fiction book, Lewis writes about the housing bubble and follows people who predicted it would burst. The book was published in 2010 and spent months on the New York Times bestseller list.

"(He) has the amazing ability to take complex formulas and concepts and turn them into page turners," said Adam McKay in a statement.

McKay will be adapting and directing the movie and is most recently known for co-writing, producing and directing "Anchorman 2."

Related: Make 6 figures on Wall Street, but life stinks

Lewis, a former Salomon Brothers bond salesman, penned "Moneyball" and "The Blind Side," which have both been made into movies. He is also the author of "Liar's Poker," a book based on his experiences on Wall Street in the 1980s.

First Published: March 24, 2014: 8:06 PM ET

15.30 | 0 komentar | Read More

Payday loan borrowers pay more in fees than original loan

NEW YORK (CNNMoney)

More than 60% of payday loans are made to borrowers who take out at least seven loans in a row -- the typical point at which the fees they pay exceed the original loan amount, according to a study of more than 12 million loans made over 12-month periods during 2011 and 2012 by the Consumer Financial Protection Bureau.

Also known as cash advances or check loans, payday loans are typically for $500 or less and carry fees of between $10 to $20 for each $100 borrowed, according to a separate CFPB report last year.

A $15 fee, for example, would carry an effective APR of nearly 400% for a 14-day loan. Yet, payday lenders defend these loans as a source of emergency cash for consumers who are unable to secure more favorable credit products.

Related: Americans in love-hate relationship with payday loans

The problem is that borrowers often can't afford to pay off the first loan, forcing them to roll over their debt and even take out a new, sometimes larger loan so they can pay off the original debt. The CFPB found that more than 80% of all payday loans are rolled over or renewed within two weeks.

"This renewing of loans can put consumers on a slippery slope toward a debt trap in which they cannot get ahead of the money they owe," CFPB Director Richard Cordray said in a statement.

The agency has been cracking down on payday lenders since 2012 and considering possible new lending rules for the industry.

Not all payday borrowers get trapped in a cycle of debt, however. When looking solely at initial loans -- meaning those that aren't taken out within 14 days of a previous loan -- the CFPB found that nearly half of borrowers were able to repay with no more than one renewal.

Related: Debt collection horror stories

But for those who aren't able to pay off the loans quickly, it can be difficult to get out from under the debt. The CFPB has heard from thousands of struggling consumers since it began accepting payday loan complaints last fall.

For example, one Pennsylvania woman who took out a total of $800 in payday loans to help pay for rent after losing her job told the CFPB that she meant for the loan to be only short-term. But after rolling over her first loan and eventually taking out another one to help pay for it, she has already paid more than $1,400 towards the debt and still owes more.

Many payday borrowers live on fixed monthly incomes, such as retirees or disabled Americans receiving Social Security disability benefits. Of those payday borrowers receiving monthly payments, the study found that one out of five borrowed money every single month of the year.

"These kinds of stories are heartbreaking and they are happening all across the country," Cordray said in a prepared statement. "They demand that we pay serious attention to the human consequences of the payday loan market."

First Published: March 25, 2014: 12:46 AM ET

15.30 | 0 komentar | Read More

Apple eyes partnerships in bid to reinvent TV

Television is thought to be a focus for Apple and CEO Tim Cook.

NEW YORK (CNNMoney)

The computing giant's next foray into TV could come in partnership with Comcast, the largest television and broadband provider in the United States, The Wall Street Journal reported Sunday night.

The Journal said that the two companies are holding talks that could result in Comcast delivering an Apple-branded TV service the same way it delivers phone calls and cable video-on-demand. These are called "managed services," and are set apart from the broadband connections that bring Netflix (NFLX), YouTube and other websites to customers. The arrangement would allow Apple to be confident that its video offerings won't sputter the way some other streams do.

The two companies are not close to an agreement, The Journal said.

Talks may be picking up where talks between Apple and another distributor, Time Warner Cable, left off in February. The companies were known to be in extensive talks about a partnership of some kind, possibly involving a cable TV app for the Apple TV box.

The talks were interrupted by the acquisition of Time Warner Cable by rival Comcast (CMCSA, Fortune 500), a deal that is now awaiting regulatory approval.

Apple's (AAPL, Fortune 500) talks with distributors reflect its long-rumored interest in rethinking how television is packaged and sold to subscribers.

Right now its hockey-puck-shaped Apple TV box is used in millions of homes to connect TV sets to Internet services like Netflix and the iTunes store. But the device is missing a connection to the much wider world of broadcast and cable television, where the vast majority of TV is viewed.

Related: How to fix the Apple TV

A distribution deal with Comcast could help Apple get there, though a number of other hurdles would remain. Chief among them: If Apple wants to sell a cable-like bundle of channels to paying subscribers, it needs to obtain the rights from the channel owners.

Apple has conducted negotiations with major media companies about gaining the rights to their live channels and, in some cases, "in-season stacking rights" for video-on-demand, according to people with direct knowledge of the talks who insisted on anonymity.

"In-season stacking rights" would allow Apple to stream complete current seasons of shows on major networks and cable channels, reducing or eliminating the need for a digital video recorder. In one scenario discussed by the companies, advertisement fast-forwarding would be disabled for a certain period of time after the premiere of a new episode.

Related: Apple's iPhone sales disappoint

Apple is not known to have struck deals with any channel owners to date. One distribution executive at a channel owner said that negotiations are not on the fast track.

"Everybody is afraid to make a bad deal, so the deals are very slow to be made," the executive said.

But many television executives are intrigued by Apple's imaginative plans. A successor to the existing Apple TV box could incorporate voice search through Siri and use the iPhone or iPod as a remote control.

Representatives for Comcast and Apple declined to comment on Sunday night.

First Published: March 24, 2014: 1:03 AM ET

17.43 | 0 komentar | Read More

Stocks: Preparing for a rush of IPOs

Click chart for in-depth premarket data.

NEW YORK (CNNMoney)

The company behind the popular Candy Crush Saga online game is one of 14 companies set to go public this week.

The IPO mania is part of a longer term, global trend that has seen many companies make their public debut.

U.S. stock futures were relatively firm heading into the first day of the trading week. There's little economic or corporate news on the docket Monday that could influence market sentiment.

The latest reading on the CNNMoney Fear & Greed index shows investor sentiment is in 'neutral mode.'

Related: Candy Crush mania coming to Wall Street

U.S. stocks slumped Friday, at the end of a strong week. The Dow Jones industrial average, the S&P 500 and the Nasdaq all closed in the red.

Related: CNNMoney's Tech30

European stock markets were all lower in morning trading. The Dax in Germany registered the biggest move with a 0.8% decline.

Asian markets ended with some significant gains. Japan's Nikkei jumped by 1.8% after a long weekend. The Hang Seng in Hong Kong shot up by 1.9% and the Shanghai Composite rose by 0.9%.

The stock surge comes despite HSBC data that showed Chinese manufacturing activity fell to an eight-month low in March.

First Published: March 24, 2014: 5:53 AM ET

17.43 | 0 komentar | Read More

China's factories hit 8-month low

HONG KONG (CNNMoney)

HSBC said that its "flash" measure of sentiment among manufacturing purchasing managers fell to 48.1 in March. Analysts had expected the index to rebound from its final reading of 48.5 in February.

Any number under 50 indicates a deceleration in the manufacturing sector.

Some improvement was seen in new export orders. But almost all other index components -- including output, employment and domestic orders -- worsened.

HSBC economist Qu Hongbin said that the poor results are likely to spur Beijing to undertake a series of policy changes to stabilize growth.

He said that targeted spending on new subway systems, anti-pollution measures and public housing are among the most likely stimulus options.

Related story: Risks in focus as China's economy slows

China's economy is off to a sluggish start this year, with trouble extending beyond the manufacturing sector.

The real estate market is showing signs of weakness. Industrial production, retail sales, and investment growth have all disappointed. The economic slowdown has also led to a steep decline in the price of copper and iron ore.

Many economists have now downgraded their growth forecasts, and some think Beijing may not be able to meet its 7.5% GDP target for 2014.

Related story: China's big tech moves onto banks' turf

Beijing will almost certainly respond with some stimulus measures, but the question is how far officials are willing to go.

In the past, policymakers might have responded by pushing cheap credit into the economy and pursuing other quick fixes to boost growth.

But Beijing has started a series of market-oriented reforms that include a crackdown on the shadow banking sector and runaway local government debt. Another sugar high of easy credit could endanger those initiatives.

First Published: March 23, 2014: 10:30 PM ET

17.43 | 0 komentar | Read More

Arizona may allow Tesla sales

NEW YORK (CNNMoney)

The bill is part of Arizona's effort to be the home state of a massive Tesla factory currently under development.

Arizona is one of four southwestern states Tesla is considering for its so-called gigafactory, a $1.6 billion battery production center that the company says could employ 6,500 workers.

Tesla has showrooms in 23 states and is explicitly allowed to sell its cars directly to consumers in four states. That model is illegal in many others.

One of Tesla's dozens of showrooms is in an upscale mall in Scottsdale, Arizona. Potential buyers can learn about the vehicles, but to buy, must head to a state where it is legal to do so, such as neighboring California.

Related: Where it's legal to buy a Tesla

Sponsor Warren Petersen, a Republican member of the state house, said the bill was written to bring Tesla to town.

"We wanted to send a message that Arizona is open for business," Peterson told CNN affiliate KPNX-TV.

The bill would apply only to electric cars.

The measure would have "a very small impact" on the state's auto market, Peterson said, but would be good for Tesla.

A state senate committee last week passed the measure over strong objections from an auto dealers' group. But its fate in the full legislature is uncertain, said Brahm Resnik, political reporter for KPNX-TV.

"Much like other states, our auto dealer lobby is quite powerful," Resnik said.

If the bill passes, it would become part of the portfolio of incentives each state in the running for the factory is expected to pitch to Tesla. Nevada's dealership law is under dispute. New Mexico and Texas do not allow direct sales.

If Arizona scores the gigafactory, it would be the state's second big-name acquisition. Last year, Apple announced one of its two new U.S. plants would be built in Mesa, Arizona. The other is in Texas.

New Jersey, which is not in the running for the factory, recently banned direct sales. Tesla had been selling its cars at two Garden state showrooms.

--CNNMoney's Chris Isidore contributed to this report

First Published: March 23, 2014: 4:11 PM ET

15.30 | 0 komentar | Read More