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Global conglomerate <keyword id="13722" type="General" weightage="100" keywordseo="lenovo" source="Orion">Lenovo</keyword> has announced plans to hire 12,000 <keyword id="13548014" type="General" weightage="20" keywordseo="RD-professionals" source="Orion">R&amp;D professionals</keyword> over the next three years, as it focuses on technologies from edge computing to <keyword id="11121339" type="General" weightage="20" keywordseo="metaverse" source="Orion">metaverse</keyword>.<br /><br />Alongside its R&amp;D commitments, Lenovo also outlined its vision to become net-zero by 2050, and is working with the 'Science Based Target' Initiative to establish goals to support this vision.<br /><br />"My vision for Lenovo's innovation is to become one of the world's leading ICT companies, a pioneer and enabler of intelligent transformation," said Chairman and CEO, <keyword id="1517812" type="General" weightage="20" keywordseo="Yuanqing-Yang" source="Orion">Yuanqing Yang</keyword>.<br /><br />"Our intention is to optimise between technology with quick market returns and foundational research, and between continuous improvement and breakthrough innovation," Yang said in a statement late on Monday.<br /><br />The company said R&amp;D remains a crucial priority in fiscal year 22-23.<br /><br />"R&amp;D investment will be doubled, and 12,000 new R&amp;D professionals hired over the next three years, in addition to around 5,000 brought into the company during fiscal FY21/22," it outlined.<br /><br />R&amp;D efforts will focus around the new and emerging IT architecture.<br /><br />"Teams will work on new product and business model innovation, incubating technologies from edge computing to technology which will help businesses capitalize on the metaverse, and emerging and disruptive innovation like next-generation AI and heterogeneous computing to help them prepare for the future," the company said.<br /><br /><strong>SEE ALSO:<br /><a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/tech/mobile/news/oneplus-10-pro-smartphone-vs-samsung-galaxy-s22-ultra-smartphone-comparison/slidelist/90658830.cms">OnePlus 10 Pro vs Samsung Galaxy S22 Ultra – price, specifications and features compared</a><br /></strong><a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/science/news/nasa-telescope-uses-moonlight-to-improve-satellite-accuracy/articleshow/90657804.cms"><strong>NASA telescope uses moonlight to improve satellite accuracy</strong></a>

Lenovo to hire 12,000 R&D professionals in the next 3 years

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(Image credit: Indiatimes)<br />
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<a href="http://www.businessinsider.in/searchresult.cms?query=lenovo&amp;sortorder=effectivedate">Lenovo </a>announced its fourth fiscal quarter and full year results today and it looks like the company’s fell down 19 percent year-on-year to USD 9.1 billion while annual revenue fell down 3 percent year-on-year to USD 44.9 billion, as the company suffered from the slowdown in the PC Market and the falling mobile phone sales. This is its first loss in six years.<br />
 <br /> Thankfully for <keyword id="13722" type="CITY" weightage="100" keywordseo="Lenovo">Lenovo</keyword>, its ongoing restructuring (that the company says is the largest restructuring in Lenovo history) that included job cuts delivered savings of $690 million in the second half of the year, preserving their net profit in Q4 2016. Its fourth quarter net income was up 80 percent year-over-year to US$180 million.<br />
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Thus, Lenovo managed to strengthen its core PC business, enhanced cost structure and protected its profit, despite facing internal and external challenges that impacted revenue.<br />
 <br /> “Facing the operational issues in the businesses, we have already taken a number of proactive actions, including making key decisions in organization, leadership, products and channels to get back to growth in mobile, and adopting a new multi-business operating system,” said <keyword id="202066" type="PERSON" weightage="100" keywordseo="Yang-Yuanqing">Yang Yuanqing</keyword>, chairman and CEO of Lenovo in a statement.<br />
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(Image credit: Bloomberg)<br />
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However, not all was well with its <a href="http://www.businessinsider.in/searchresult.cms?query=motorola&amp;sortorder=effectivedate">Motorola</a> business. The company admitted that it has indeed failed to build on its acquisition of <keyword id="11148" type="CITY" weightage="100" keywordseo="Motorola">Motorola</keyword>.<br />
 <br /> In late 2014, Lenovo had acquired the phone-maker from <keyword id="6355629" type="CITY" weightage="100" keywordseo="Google">Google</keyword> for $ 2.91 billion and in its end of the year earnings report published today; it claimed that the post-deal performance did not meet expectations.<br />
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The company shipped 10.9 million devices in the final quarter and 66.1 million smartphones over the full year. Lenovo said that the Motorola devices contributed just five million to that quarterly tally, which was below its target.<br />
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“These results show integration efforts did not meet expectations. In particular, China shipments declined 85% as the business shifted focus to open market and higher price bands and product transition in North America was not successful,” said Lenovo.<br />
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Lenovo admits its Motorola business has not met expectations even as net profit rises by 80%

<p><div class="KonaFilter image-container display-table float_right"><div><div class="image"><p class="source"><span>John West</span></p><p class="caption">Lenovo CEO Yang Yuanqing on stage.</p></div><p></p></div></div>Lenovo, the world's biggest computer manufacturer, reported a net loss of $714 million in Q3 2015 after <a href="https://twitter.com/charlesarthur/status/664353278893940736">reporting its earnings</a> five weeks late.</p><p>The loss - which has been put down to restructuring and acquisition costs - follows a net profit of $262 million during the same period last year. The loss is slightly lower than analysts' expectations of $787 million. </p><p>Lenovo is also suffering from the <a href="http://uk.businessinsider.com/pc-sales-plummet-in-q2-2015-gartner-idc-say-2015-7">worldwide global decline in PC sales</a>. Revenue from Lenovo's PC sales declined to $8.1 billion, while profits within the division declined 17% to $406 million.</p><p>As of November 12, Lenovo stock sits at 7.70 Hong Kong Dollars ($0.91) after reaching a high of 13.48 HKD ($1.75) in May 2015. The company is currently valued at 85 billion HKD ($10.9 billion).</p><p>The loss comes a year after Lenovo <a href="http://www.businessinsider.com/lenovo-to-buy-motorola-2014-1">purchased Motorola from Google</a> for $2.9 billion. According to Reuters, Lenovo has written off about $900 million in unsold inventory and is looking to cut around 3,200 non-manufacturing jobs. This, combined with declining PC sales, does not set a very good outlook for the company.</p><p>In a <a href="http://www.lenovo.com/ww/lenovo/pdf/Lenovo%20FY%202015-16%20July-Sept%20Q2%20earnings%20press%20release_English%20(FINAL).pdf">statement</a>, Lenovo chairman and chief executive Yuanqing Yang said:</p><p style="padding-left: 30px;">With strong execution, Lenovo acted swiftly and decisively to address challenges, while still delivering better-than-previous-quarter results," said Yuanqing Yang, Lenovo chairman and CEO. "Now, not only are we building a more competitive business model, but we are growing. In PC we hit record share with good profitability. In mobile, our strategy to shift our growth focus to outside of China continued to pay off, and we gained share and improved margin. The realignment of our organization and the restructuring of our cost structure will deliver results in the 2nd half of the year. In Enterprise, we reached an important milestone, growing revenue for the first time since our acquisition of System x. Digesting acquisitions and making transformations take time, but I am greatly encouraged by our strong results, and confident in both our near and long-term future.</p>    <div class="margin-top">        <h3>NOW WATCH: <a href="http://www.businessinsider.com/steve-jobs-never-wanted-a-stylus-2015-11">Apple is selling a $100 stylus for the iPad Pro -&#xa0;something Steve Jobs never wanted on the iPhone</a></h3>        <div>            <div>        <div class="ooyala-video-player" data-video-autoplay="false" data-video-id="RnZnlyeDr8Ew9D6747Qs1-oXfifk6JLJ" data-player-variable="ooyalapopvideo" id="ooyalaplayer_popvideo" style="width:1280px;height:720px"></div>        </div>        </div>            </div>

The world's biggest PC maker is in deep trouble

<p><div class="KonaFilter image-container display-table"><div><div class="image"></div><p></p></div></div>Lenovo, the world's largest PC maker, is going to try to become the world's biggest smartphone maker.</p>
<p>It just reported solid second quarter earning where <span style="line-height: 1.5em;">its </span><a href="http://www.businessinsider.com/r-lenovo-first-quarter-net-profit-climbs-23-percent-as-smartphone-sales-surge-2014-13">profits grew 23%, and its revenue grew 18%</a><span style="line-height: 1.5em;">. </span></p>
<p>After earnings, Yang Yuanqing, the CEO of Lenovo, <a href="http://blogs.wsj.com/digits/2014/08/14/qa-lenovo-ceo-on-how-it-plans-to-grow-in-smartphones/?mod=ST1">talked to the Wall Street Journal</a>. He was asked about he could topple Samsung to become the biggest smartphone maker in the world.</p>
<p><span style="line-height: 1.5em;">"</span><span style="line-height: 1.5em;">The smartphone market's focus is shifting from premium products to mainstream and entry-level products," Yang said. "We have seen this before in the PC market, and we have a lot of experience in these kinds of transitions."</span></p>
<p><span style="line-height: 1.5em;">He added that Lenovo's expertise in building <span>mainstream and entry-level </span>products will help it as it competes with Samsung.</span></p>
<p><span style="line-height: 1.5em;">Lenovo is a serious threat for Samsung. It is already number one in China smartphone sales. It's about to own Motorola, which, despite its struggles still has a strong brand in developed markets.</span></p>
<p><span style="line-height: 1.5em;">But Yang warns that the Chinese market is pretty crazy. </span></p>
<p>"<span>I would say China is the most competitive market in the world. There are so many local players, and some of them are not logical in how they do business," says Yang. "They don't want to make money in the short term. We definitely don't want to lose our leadership position in China, and we must balance growth in market share with profitability. Our smartphone business in China make a little bit of money, but not so much."</span></p>
<p><a href="http://blogs.wsj.com/digits/2014/08/14/qa-lenovo-ceo-on-how-it-plans-to-grow-in-smartphones/?mod=ST1"><span>Read the whole thing at the WSJ &gt;</span></a></p>

LENOVO CEO: The Smartphone Market Is In 'Transition' Away From Expensive Phones

<p><div class="KonaFilter image-container display-table float_right"><div><div class="image on-image"><p class="source"><span><a href="http://www.flickr.com/photos/worldeconomicforum/2893924013/in/photostream/">World Economic Forum via flickr</a></span></p><p class="caption">Lenovo CEO Yang Yuanqing</p></div><p></p></div></div>Lenovo is the latest company to struggle with its purchase of Motorola. </p><p>The Chinese tech company, which <a href="http://www.businessinsider.com/lenovo-to-buy-motorola-2014-1">paid $2.91 billion to buy the ailing Motorola</a> from Google two years ago, <a href="http://news.lenovo.com/news-releases/lenovo-announces-fourth-quarter-and-full-year-201516-results.htm">confessed on Friday</a> that its efforts to integrate Motorola into its business "did not meet expectations."</p><p>In particular, shipments of mobile products such as phones and tablets in China's hypercompetitive mobile market plummeted 85% in the most recent quarter, Lenovo said.</p><p>And a "product transition" in North America, including a delayed launch of the Moto G smartphone, was "not successful." </p><p>Capturing large market shares in China and North America is key for Lenovo to successfully diversify its business and expand as a global mobile maker.</p><p><span>Lenovo is not the first tech giant to face challenges with Motorola, a pioneering US tech company that has struggled to adapt to the changing market. <a href="http://www.businessinsider.com/breaking-google-buying-motorola-mobility-for-125-billion-2011-8">Google acquired Motorola</a><span> and its many patents in 2012 for $12.5 billion but failed to reverse the phone-maker's years of decline. When Google sold Motorola to Lenovo, it retained a significant portion of Motorola's patents.</span></span></p><p><span><span>But Lenovo isn't giving up: "<span>Lenovo has learned a great deal since the close of the Motorola acquisition and is applying learnings quickly, with actions in organization, leadership and approach," the company said in <a href="http://news.lenovo.com/news-releases/lenovo-announces-fourth-quarter-and-full-year-201516-results.htm">its quarterly earnings press release. </a></span></span></span></p>    <div class="margin-top">        <h3>NOW WATCH: <a href="http://www.businessinsider.com/robot-hand-learns-on-its-own-2016-5">Researchers built a robot hand that mimics human dexterity and learns on its own</a></h3>        <div>            <div>        <div class="ooyala-video-player" data-video-autoplay="false" data-video-id="dnbzFrMzE6o_gBmbxv2Tt8RNo97fnEg2" data-player-variable="ooyalapopvideo" id="ooyalaplayer_popvideo" style="width:1280px;height:720px"></div>        </div>        </div>            </div>

Lenovo is not happy with its purchase of Motorola from Google

<p><div class="KonaFilter image-container display-table float_right"><div><div class="image"><p class="source"><span>John West</span></p><p class="caption">Lenovo CEO Yang Yuanqing.</p></div><p></p></div></div>Lenovo, the world's largest PC maker by shipments, is <a href="http://windowsitpro.com/security/lenovo-flags-its-own-support-software-unsecure-suggests-customers-uninstall">instructing users on how to uninstall its own software</a> after a vulnerability was discovered. </p><p>The warning, which is posted on <a href="https://support.lenovo.com/us/en/product_security/len_4326">Lenovo's Support pages</a>, reads as follows (emphasis ours): </p><p style="padding-left: 30px;">Lenovo was recently alerted by a cyber-security threat intelligence partner and US-CERT to a vulnerability report concerning its Lenovo Solution Center (LSC) application. We are urgently assessing the vulnerability report and will provide an update and applicable fixes as rapidly as possible. <strong>To remove the potential risk posed by this vulnerability, users can uninstall the Lenovo Solution Center application using the add / remove programs function.</strong></p><p>The US-CERT Vulnerability report <a href="https://www.kb.cert.org/vuls/id/294607">states that</a>: "The Lenovo Solution Center application contains multiple vulnerabilities that can allow an attacker to execute arbitrary code with SYSTEM privileges."</p><p>This is not good news. </p><p>Lenovo was previously <a href="http://www.v3.co.uk/v3-uk/news/2422015/lenovo-caught-installing-bloatware-again-with-windows-bios-backdoor">caught up in the "Superfish" scandal</a>. Its PCs came preinstalled with software that served up intrusive and unwanted adverts on websites like Google.</p><p>Lenovo also bought Motorola Mobility, the smartphone company, <a href="http://uk.businessinsider.com/lenovo-to-buy-motorola-2014-1">for $2.9 billion (£1.9 billion) from Google</a>. The costs of the purchase mixed with poor smartphone sales forced the company into a <a href="http://uk.businessinsider.com/lenovo-is-in-deep-trouble-2015-11">$750 million (£500 million) loss in Q3 2015</a>. </p>    <div class="margin-top">        <h3>NOW WATCH: <a href="http://www.businessinsider.com/usps-emails-mail-before-delivered-post-office-2015-12">The US Post Office will now email your mail before it's delivered</a></h3>        <div>            <div>        <div class="ooyala-video-player" data-video-autoplay="false" data-video-id="A3b2RkeTplENrccHQoIH_JmZwO6Lnv_V" data-player-variable="ooyalapopvideo" id="ooyalaplayer_popvideo" style="width:1280px;height:720px"></div>        </div>        </div>            </div>

The world's largest PC maker is suggesting that users uninstall its own software

<p><div class="KonaFilter image-container display-table float_right"><div><div class="image"><p class="source"><span>REUTERS/Jason Lee</span></p><p class="caption">Lenovo Chairman and CEO Yang Yuanqing (L) takes a "selfie" with Microsoft CEO Satya Nadella (C) and Intel CEO Brian Krzanich at Lenovo Tech World in Beijing May 28, 2015</p></div><p></p></div></div>Microsoft's Selfie app has been downloaded over 500,000 times in two weeks, <a href="http://blogs.technet.com/b/inside_microsoft_research/archive/2016/01/21/popular-microsoft-selfie-app-updated-with-social-sharing.aspx">according to a company blog post</a>. </p><p>The app, which seemingly came out of the blue, is iPhone-only and does exactly what it says: Takes selfies, offers editing options, and can upload to social media. </p><p>"Within two weeks after releasing, our app has achieved more than half a million downloads, which is a lovely surprise for our team," said Peggy Dai, a Microsoft programme manager.</p><p>"Together with the research team we will introduce more innovative features to the app, and expand availability on more platforms," she continued. </p><p>Microsoft has released a series of apps recently, <a href="http://uk.businessinsider.com/microsoft-mimicker-alarm-clock-for-android-2016-1">including an Android-only alarm clock</a> that requires the user to perform tasks - such as smiling or finding an object - to switch it off. </p><p>The backbone of these projects is artificial intelligence and machine learning, which is <a href="http://uk.businessinsider.com/microsoft-is-using-fun-apps-to-dominate-ai-2016-1">an important goal for the company</a>. Microsoft's Garage team, a small group of engineers and developers who make one-off fun apps, has produced multiple apps that seem silly but actually showcase AI. </p><p>The success of the apps is, in many ways, not as important as the development of them. The fact that the Selfie app is successful is a "surprise" to the team shows this. </p>    <div class="margin-top">        <h3>NOW WATCH: <a href="http://www.businessinsider.com/the-wings-of-this-airbus-plane-can-bend-way-more-than-you-thought-possible-2016-1">The wings of this Airbus plane can bend way more than you thought possible</a></h3>        <div>            <div>        <div class="ooyala-video-player" data-video-autoplay="false" data-video-id="R5Y2YxMDE6wzRei5HZqBLs9cI8_l8Brv" data-player-variable="ooyalapopvideo" id="ooyalaplayer_popvideo" style="width:1280px;height:720px"></div>        </div>        </div>            </div>

Microsoft's Selfie app has been downloaded by over half a million iPhone users in 2 weeks

<p class="p1"><div class="KonaFilter image-container display-table float_right"><div><div class="image on-image"></div><p></p></div></div>Speaking at the APEC CEO summit in Beijing, BlackBerry CEO John Chen said he is not interested in hiring reality TV star Kim Kardashian West as the company's spokesperson, even though Kardashian West admitted her love for the phone brand last month.</p>
<p class="p1">"I'm not into bringing celebrities on board," Chen said. "It's not that it's a waste of money but a question of where you should spend the money today."</p>
<p class="p1"><a href="http://www.bloomberg.com/news/2014-11-10/blackberry-s-chen-hangs-up-on-idea-of-kardashian-as-celebrity-spokeswoman.html">According to Bloomberg</a>, Chen said he'd prefer to spend those potential ad dollars on investing in next-generation technology for future smartphones. And he insists BlackBerry has "pulled back" from the consumer market, where Kardashian's name would probably help, instead choosing to emphasize security, encryption, and privacy for government and business clients.</p>
<p class="p1">This is potentially disappointing news for Kardashian West, who <a href="http://www.businessinsider.com/kim-kardashian-hoards-blackberry-phones-2014-10">gave BlackBerry some fresh publicity last month</a> when she told Re/code's Kara Swisher that she buys BlackBerry phones on eBay whenever she can because she's "afraid they'll go extinct."</p>
<p class="p1">Chen said he hasn't exactly ruled out a return to the consumer market, but he wants "to make sure the base business is solid."</p>
<p class="p1">Credit Chen for being one of the few people in the world who would turn down Kim Kardashian, whose popularity is <a href="http://www.google.com/trends/explore#q=kim%20kardashian%2C%20beyonce%2C%20kanye%20west&amp;cmpt=q">skyrocketing</a> at the moment. But it doesn't sound like the BlackBerry CEO is closed to partnerships of any kind: Chen has reportedly met with a few notable company executives in China, including Xiaomi CEO Lei Jun, Lenovo CEO Yang Yuanqing, and HTC chairwoman Cher Wang.</p>

BlackBerry Says 'No' To Kim Kardashian

<p><span class="KonaFilter image-container display-table float_right"><span><span data-post-image="" class="image"></span><p></p></span></span>Executive bonuses <a href="http://www.businessinsider.com/shareholders-not-happy-oracle-ceo-pay-2014-9">often</a> <a href="http://www.businessinsider.com/google-executive-bonuses-2014-3">get</a> <a href="http://www.businessinsider.com/warren-buffet-v-coca-cola-plan-to-pay-executives-13-billion-2014-10">ridiculous</a>.&#xa0;</p>
<p>In light of that, <a href="http://www.plumcreek.com/" target="_blank">Plum Creek Timber Co</a>.'s CEO&#xa0;Rick Holley just did something quite admirable.</p>
<p>He gave back&#xa0;44,445 restricted stock units,&#xa0;<span>worth nearly $2 million.&#xa0;</span></p>
<p>According to a <a href="http://www.sec.gov/Archives/edgar/data/849213/000084921314000041/a201412128k.htm" target="_blank">regulatory filing</a>,&#xa0;"Mr. Holley elected to return the restricted stock units because he does not believe that he should receive such an award unless Plum Creek's stockholders see an increase in their investment return."&#xa0;</p>
<p>Plum Creek has hit some choppy water.&#xa0;</p>
<p>As observed by Dan Primack&#xa0;<a href="http://fortune.com/2014/12/18/ceo-gives-back-bonus-says-he-doesnt-deserve-it/" target="_blank">on Fortune</a>, the <a href="https://www.youtube.com/watch?v=hHUbLv4ThOo" target="_blank">timber</a> company has had flat revenue for two years, with net income expected to fall this fiscal year.</p>
<p>"It's hard to remember the last time a CEO voluntarily gave up stock as a sort of apologia to disappointed investors," Primack says.&#xa0;</p>
<p>If an exec does anything with their bonus other than squirrel it away, they often redistribute the money <span>to their hardworking teams&#xa0;</span>as a massive high five.&#xa0;</p>
<p>In 2013, for example, Lenovo CEO Yang Yuanqing shared&#xa0;<a href="http://www.huffingtonpost.com/2013/09/02/lenovo-ceo-bonus-given-to-hourly-workers_n_3856763.html" target="_blank">$3.25 million</a>&#xa0;of his bonus with employees - equivalent to a month's salary for many Chinese workers - as <a href="http://www.bloomberg.com/news/2013-09-01/lenovo-chief-yang-shares-bonus-with-workers-for-second-year.html" target="_blank">a toast to the company's setting sales records two years in a row</a>.</p>
<p>That same year,&#xa0;<a href="http://www.huffingtonpost.com/2013/04/17/lord-wolfson-donates-bonus_n_3101799.html" target="_blank">Next CEO&#xa0;Lord Wolfson gave his&#xa0;$3.7 million bonus&#xa0;</a>to his employees as "a&#xa0;gesture of thanks and appreciation from the company for the hard work and commitment you have given to Next over the past three years and through some very tough times."</p>
<p>If Plum Creek can turn it around, maybe&#xa0;Holley can use his bonus for a celebratory share, too.&#xa0;</p>

CEO Gives Back $2 Million Bonus Because 'He Does Not Believe That He Should Receive Such An Award'

<p><em><div class="KonaFilter image-container float_right"><div class="image"><p class="source"><span>REUTERS/Paul Yeung</span></p><p class="caption">An employee casts a shadow against a screen showing the logo of Lenovo during a news conference of interim results announcement in Hong Kong November 9, 2006.</p></div><p></p></div>Having conquered the global market for personal computers, China's Lenovo is setting its sights higher.</em></p>
<p>"Lenovo is the best company in the world at balancing innovation and efficiency." So declares Yang Yuanqing, the chairman of the Chinese computer-maker.</p>
<p>The boast is at least half right. The firm has certainly displayed its ruthless efficiency of late, by keeping costs down and grabbing market share from its big Western rivals. Lenovo has recently bested HP to become the top peddler of desktop computers worldwide. From a negligible share a few years ago, it is rising fast in the global smartphone market too.</p>
<p>It has managed this expansion while remaining in rude financial health. On May 21st Lenovo announced its full-year results (its fiscal year runs to the end of March) in Hong Kong, where it has been listed since 1994.</p>
<p>Its revenues were 14% higher than in the previous year, at $38.7 billion. For the first time, pre-tax profits topped $1 billion, rising by 27% on a year earlier. The firm had a cash pile of $3.5 billion at the end of March--and at the end of April it raised another $1.5 billion in its first bond offering.</p>
<p>This news will cheer investors, who have raised some questions about the firm's strategy of late. For a number of years, Western institutional investors have favoured its shares. This is partly because Lenovo has, unusually among Chinese companies, strong corporate governance.</p>
<p>It was also because Mr Yang has had a clear growth strategy and his firm has delivered predictable earnings. But at the end of January there was a heart-stopping moment, when the firm announced two startling acquisitions in the space of a few days.</p>
<p>The first deal, worth $2.3 billion, involves Lenovo buying the part of IBM that makes low-end computer servers. These servers should bolster Lenovo's efforts to appeal to corporate clients.</p>
<p>The other, more controversial, deal is a $2.9 billion purchase from Google of Motorola Mobility, a pioneer in mobile phones that has fallen on hard times. If regulators approve--America's are sure to scrutinise the IBM deal carefully, since its government agencies buy those servers--both deals should close by the end of the year.</p>
<p>The size and suddenness of these purchases, and concerns about them turning sour, upset even loyal investors. Pressed to defend his buying binge, Mr Yang promises no more big acquisitions for the foreseeable future. But he defends his firm's ability to make a go of these two. "We have a good track record turning money-losing businesses into treasure," he says.</p>
<p>He points to Lenovo's first big foray overseas, when it bought IBM's unprofitable PC business in 2005. Many doubted that an obscure Chinese firm could save a Western premium brand in trouble, but that is precisely what Lenovo has done.</p>
<p>Indeed, it is perhaps the only Chinese firm so far to have developed world-class marketing skills. Big Blue's former PC division is now a cash cow, Mr Yang declares, smiling broadly. So too is the Chinese market, where the firm has a vast distribution network and universal brand awareness: "We have two cash cows."</p>
<p>The firm's recent financial performance is impressive, but two big questions still hang over Lenovo's future. First, how can it keep making money as demand for PCs shrinks? Second, how can it keep up with the formidable Samsung and Apple in smartphones? The answer to both questions springs from the other half of Mr Yang's boast: innovation.</p>
<p>Most industry experts think the mobile revolution means that desktops and laptops are headed for the dustbin of history. Mr Yang disagrees: "This is still a very big industry, and with innovation there will be further growth."</p>
<p>He reels off a long list of features his firm is working on: longer battery life, "always on" modes, thinner and lighter designs, better touchscreens and so on. He points to the runaway success of the Yoga, his firm's touch-screen PC, whose screen folds completely back to transform it into a tablet computer.</p>
<h3>Hand-to-handset combat</h3>
<p>The firm's challenge in handsets is even more daunting. Chinese rivals offering smartphones for less than $100 are nipping at its heels even as Apple and Samsung surge ahead with ever whizzier offerings. Mr Yang is not worried about the cut-price rivals--not even Xiaomi, a fast-growing Chinese firm offering cheapish but clever handsets.</p>
<p>None of those will be profitable over the long run, he insists, whereas Lenovo's handsets are already profitable outside China. He points out that it beat back similar challenges from low-end Chinese PC-makers with unsustainable business models years ago.</p>
<p>Fine, but how will he catch up with the innovative global giants? At the moment, most of Lenovo's handsets are of middling sophistication and it has not penetrated America. It has come up with high-end offerings, but when it tried to sell them in advanced markets it was forced to pay 25% of revenues to patent holders.</p>
<p>Such payments are the "club fees" to enter the elite fraternity of global smartphone firms, explains Alberto Moel of Sanford C. Bernstein, a research firm. This is not such a problem in emerging markets, where patent enforcement is spotty: in China, it spends barely 2% of revenues on licensing.</p>
<p>So, over the past couple of months, the firm has scooped up thousands of smartphone patents from NEC, a Japanese electronics firm, and Unwired Planet, a patent-gathering "troll". The Motorola deal gives Lenovo royalty-free access to Motorola patents retained by Google; it also makes Lenovo party to useful licensing deals Motorola had struck with others. Now, says Mr Yang, entering America should cost a more manageable 10% of handset revenues.</p>
<p>That pragmatic approach offers a clue as to how Lenovo really innovates. Last month, at a black-tie event attended by the leading lights of Silicon Valley, Mr Yang won an award for championing innovation at Lenovo. But Mr Moel argues that the Chinese firm is not an imaginative innovator like Apple, whose radical designs transform whole markets.</p>
<p>Rather, its ability to turn firms around deftly, execute strategies economically and overcome obstacles nimbly suggests that a better description of its strength would be "frugal innovation", an ideal that has been much touted in recent years but seldom achieved.</p>
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Lenovo: The Rise Of The Frugal Investor

<p><div class="KonaFilter image-container float_right click-to-enlarge"><div class="image on-image"><a title_source="Ronald Woan/Flickr" title_caption="Gravity Payments CEO Dan Price." class="zoomin" href="https://static-ssl.businessinsider.com/image/553154cc6bb3f7ce7e8b4567-960/dan-price-3.jpg"><span class="sprites click-to-enlarge-icon" title="Click to enlarge"></span></a><p class="source"><span><a href="https://www.flickr.com/photos/rwoan/">Ronald Woan/Flickr</a></span></p><p class="caption">Gravity Payments CEO Dan Price.</p></div><p></p></div>Dan Price, CEO of Gravity payments, <a href="http://www.businessinsider.com/ceo-dramatically-raised-minimum-wage-at-his-company-2015-4">announced this week</a> that he's raising the minimum salary at his 120-person company to $70,000 a year, <a href="http://www.nytimes.com/2015/04/14/business/owner-of-gravity-payments-a-credit-card-processor-is-setting-a-new-minimum-wage-70000-a-year.html?smid=tw-nytimes&amp;_r=0">the New York Times reports</a><span style="line-height: 1.5em;">.</span></p><p>To do this, he's cutting his own nearly $1 million annual pay to $70,000, as well.</p><p>For contrast, federal minimum wage in the US is $7.25 an hour, which comes out to about $15,000 a year for someone working a typical 40-hour week. Seattle, where Gravity Payments is based, started phasing in a minimum wage of <a href="http://www.businessinsider.com/r-seattle-starts-phasing-in-15-minimum-wage-amid-us-pay-debate-2015-4">$15 an hour in early April</a>.</p><p>Price is being widely lauded for his decision not only because it's a feel-good story that makes him seem like an awesome guy and desirable boss, but also because most CEOs cling tight to their pay - and it's risen steadily over the years. By some estimates, <a href="http://www.businessinsider.com/why-ceos-are-wildly-overpaid-in-one-chart-2014-9">CEOs in the US make 354 times as much as their average employees</a>. </p><p><a href="http://www.businessinsider.com/ceo-gives-back-2-million-bonus-2014-12">Notable exceptions</a> include Rick Holley, the CEO of Plum Creek Timber Co., who gave back a stock bonus worth about $2 million in 2014; Lenovo CEO Yang Yuanqing, who shared <a href="http://www.huffingtonpost.com/2013/09/02/lenovo-ceo-bonus-given-to-hourly-workers_n_3856763.html" target="_blank">$3.25 million</a> of his bonus with workers in 2013; and <a href="http://www.huffingtonpost.com/2013/04/17/lord-wolfson-donates-bonus_n_3101799.html" target="_blank">Next CEO Lord Wolfson</a>, who gave his $3.7 million bonus <a href="http://www.huffingtonpost.com/2013/04/17/lord-wolfson-donates-bonus_n_3101799.html" target="_blank"></a>to his employees the same year.</p><p>Other companies have also made headlines for their generous compensation. The Container Store, for instance, <a href="http://www.businessinsider.com/how-to-get-a-50000-a-year-job-at-the-container-store-2014-10">pays retail workers an average of nearly $50,000 a year</a>, and Costco pays hourly workers <a href="http://www.businessinsider.com/costco-pays-retail-employees-20-an-hour-2014-10">an average of $20 an hour</a>. </p><p>Price told the New York Times he started thinking about making such a massive change in his company's pay rate after reading an article about a <a href="http://www.pnas.org/content/107/38/16489.full">2010 study by Daniel Kahneman and Angus Deaton</a> that found people's happiness levels off around $75,000 a year - meaning as they earned more, they didn't get measurably happier.</p><p><div class="KonaFilter image-container float_right click-to-enlarge"><div class="image on-image"><a title_source="Gravity Payments / Youtube" title_caption="Price is cutting his own salary to better compensate his workers." class="zoomin" href="https://static-ssl.businessinsider.com/image/55315763eab8ea965b8b4567-960/dan-price-gravity-payments.png"><span class="sprites click-to-enlarge-icon" title="Click to enlarge"></span></a><p class="source"><span><a href="https://www.youtube.com/watch?v=BUb_BSCS33w&amp;feature=youtu.be">Gravity Payments / Youtube</a></span></p><p class="caption">Price is cutting his own salary to better compensate his workers.</p></div><p></p></div>This is one of the most interesting plot points in the story of a CEO giving up his million-dollar compensation to better pay his workers. </p><p><span style="line-height: 1.5em;">Since the 2010 study came out, different numbers have emerged as the benchmark for happiness. In a 2012 survey of 13 European countries, </span><a href="http://www.businessinsider.com/perfect-income-for-your-happiness-2012-11">CNBC reports</a><span style="line-height: 1.5em;"> it was found that the needed income to be happy was around $161,000, ranging from $85,781 (Germany) to $276,150 (Dubai).</span></p><p>In 2014, <a href="http://www.businessinsider.com/happiness-benchmark-for-annual-income-2014-7">Doug Short from Advisor Perspectives</a> pointed out that since the 2010 paper analyzed 2009 data, thanks to inflation, $75,000 doesn't hold up a few years later. He says that the new number for the US, based on purchasing power, is $83,000.</p><p>Plus, <a href="https://www0.gsb.columbia.edu/faculty/eravina/Ineq_Happiness.pdf">research from Karen E. Dynana and Enrichetta Ravina</a> finds that for people who are middle class and somewhat affluent, a certain amount of money can't guarantee happiness - unless you have more than the people around you. In 2013, <a href="http://www.brookings.edu/research/interactives/2013/income-well-being">Betsy Stevenson and Justin Wolfers</a> also found that the more money people have, the more it takes them to be happy. Essentially, their research suggests, "you can never have too much money."</p><p>From the examples cited above, you might draw the conclusion that there's no such thing as an amount of money that will universally increase people's levels of happiness. And if that's the case, Price's actions may be based on a flawed premise.</p><p>Price made an impressive move on behalf of earning inequality and deserves praise. However, it will be interesting to see if, beyond <a href="http://www.nbcnews.com/nightly-news/video/seattle-ceo-announces-70-000-minimum-wage-to-employees-427977795884">the elation of the crowd when he made his initial announcement</a>, his choice actually makes his employees happier.</p>    <div class="margin-top">        <h3>NOW WATCH: <a href="http://www.businessinsider.com/container-ships-collide-suez-canal-egypt-2015-3">Watch these giant container ships collide near the Suez Canal</a></h3>        <div>            <div>        <div class="ooyala-video-player" data-video-autoplay="false" data-video-id="E4MDQ2dDq9xjV9qTP2lvmq2AeTRu-HAW" data-player-variable="ooyalapopvideo" id="ooyalaplayer_popvideo" style="width:1280px;height:720px"></div>        </div>        </div>            </div>

The CEO raising his company's minimum salary to $70,000 highlights an important point about money and happiness

<p><div class="KonaFilter image-container float_right"><div class="image"><p class="source"><span>Suhaimi Abdullah/Getty Images</span></p></div><p></p></div>YANG YUANQING, Lenovo's boss, hardly spoke a word of English until he was about 40: he grew up in rural poverty and read engineering at university.</p>
<p>But when Lenovo bought IBM's personal-computer division in 2005 he decided to immerse himself in English: he moved his family to North Carolina, hired a language tutor and-the ultimate sacrifice-spent hours watching cable-TV news.</p>
<p>This week he was in São Paulo, Brazil, for a board meeting and an earnings call: he conducted all his business in English except for a briefing for the Chinese press.</p>
<p>Lenovo is one of a growing number of multinationals from the non-Anglophone world that have made English their official language. The fashion began in places with small populations but global ambitions such as Singapore (which retained English as its lingua franca when it left the British empire in 1963), the Nordic countries and Switzerland. Goran Lindahl, a former boss of ABB, a Swiss-Swedish engineering giant, once described its official language as "poor English". The practice spread to the big European countries: numerous German and French multinationals now use English in board meetings and official documents.</p>
<p>Audi may use a German phrase-Vorsprung durch Technik, or progress through engineering-in its advertisements, but it is impossible to progress through its management ranks without good English. When Christoph Franz became boss of Lufthansa in 2011 he made English its official language even though all but a handful of the airline's 50 most senior managers were German.</p>
<p>The Académie française may be prickly about the advance of English. But there is no real alternative as a global business language. The most plausible contender, Mandarin Chinese, is one of the world's most difficult to master, and least computer-friendly. It is not even universal in China: more than 400m people there do not speak it.</p>
<p>Corporate English is now invading more difficult territory, such as Japan. Rakuten, a cross between Amazon and eBay, and Fast Retailing, which operates the Uniqlo fashion chain, were among the first to switch. Now they are being joined by old-economy companies such as Honda, a carmaker, and Bridgestone, a tyremaker. Chinese firms are proving harder to crack: they have a huge internal market and are struggling to recruit competent managers of any description, let alone English-speakers. But some are following Lenovo's lead. Huawei has introduced English as a second language and encourages high-flyers to become fluent. Around 300m Chinese are taking English lessons.</p>
<p>There are some obvious reasons why multinational companies want a lingua franca. Adopting English makes it easier to recruit global stars (including board members), reach global markets, assemble global production teams and integrate foreign acquisitions. Such steps are especially important to companies in Japan, where the population is shrinking.</p>
<p>There are less obvious reasons too. Rakuten's boss, Hiroshi Mikitani, argues that English promotes free thinking because it is free from the status distinctions which characterise Japanese and other Asian languages. Antonella Mei-Pochtler of the Boston Consulting Group notes that German firms get through their business much faster in English than in laborious German. English can provide a neutral language in a merger: when Germany's Hoechst and France's Rhône-Poulenc combined in 1999 to create Aventis, they decided it would be run in English, in part to avoid choosing between their respective languages.</p>
<p>Tsedal Neeley of Harvard Business School says that "Englishnisation", a word she borrows from Mr Mikitani, can stir up a hornet's nest of emotions. Slow learners lose their self-confidence, worry about their job security, clam up in meetings or join a guerrilla resistance that conspires in its native language. Cliques of the fluent and the non-fluent can develop. So can lawsuits: in 2004 workers at a French subsidiary of GE took it to court for requiring them to read internal documents in English; the firm received a hefty fine. In all, a policy designed to bring employees together can all too easily have the opposite effect.</p>
<p>Ms Neeley argues that companies must think carefully about implementing a policy that touches on so many emotions. Senior managers should explain to employees why switching to English is so important, provide them with classes and conversation groups, and offer them incentives to improve their fluency, such as foreign postings. Those who are already proficient in English should speak more slowly and refrain from dominating conversations. And managers must act as referees and enforcers, resolving conflicts and discouraging staff from reverting to their native tongues. Mr Mikitani, who was a fluent English speaker himself, at first told his employees to pay for their own lessons and gave them two years to become fluent, on pain of demotion or even dismissal. He later realised that he had been too harsh, and started providing lessons on company time.</p>
<h3>Nuance and emotion, or waffle?</h3>
<p>Intergovernmental bodies like the European Union, which employs a babbling army of translators costing $1.5 billion a year, are obliged to pretend that there is no predominant global tongue. But businesses worldwide are facing up to the reality that English is the language on which the sun never sets. Still, Englishnisation is not easy, even if handled well: the most proficient speakers can still struggle to express nuance and emotion in a foreign tongue. For this reason, native English speakers often assume that the spread of their language in global corporate life confers an automatic advantage on them. In fact it can easily encourage them to rest on their laurels. Too many of them (especially Englishmen, your columnist keeps being told) risk mistaking their fluency in meetings for actual accomplishments.</p>
<p><em>Click <a href="https://subscriptions.economist.com/nwcd">here</a> to subscribe to The Economist.</em></p>
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A Growing Number Of Firms Worldwide Are Adopting English As Their Official Language

<p><div class="image-container float_right" style="width:400px"><div class="image"></div><p class="source">Albert Gea/Reuters</p></div>BARCELONA, Feb 27 (<keyword id="76338" type="CITY" weightage="60" keywordseo="Reuters">Reuters</keyword>) - The next billion people to connect to the internet in developing countries will do so largely via <keyword id="6354775" type="TECHNOLOGY" weightage="60" keywordseo="Smartphones">smartphones</keyword>, prompting a battle that could favour low-price Chinese manufacturers like Huawei and ZTE over market leaders Samsung and Apple.</p>
<p>Fixed-line telephone networks are often weak in emerging markets and building new ones is expensive, and so smartphones are becoming a vital way to connect populations to the web and bolster economic growth.</p>
<p>Consumers in markets from Nigeria to Indonesia are hungry for features now standard in the United States and Europe that allow them to tweet or watch video on the go.</p>
<p>The challenge for smartphone makers is offering those features at a price local populations can afford.</p>
<p>Manoj Kohli, chief executive of Indian operator Bharti Airtel, said emerging market consumers were ready to leapfrog basic phone models and go straight for smartphones, but that prices could not come down fast enough.</p>
<p>"People in the developing world are going straight to the mobile Internet," he said in a keynote session at the Mobile World Congress in Barcelona.</p>
<p>The focus on low-price smartphones could step up the challenge to market leaders Apple and Samsung , which are best-known for their top-end iPhone and Galaxy S3 models.</p>
<p>Lenovo, known for its PC business, has quietly become the fifth-biggest smartphone maker in the world by almost exclusively focusing on a single market: its home country <keyword id="1334" type="COUNTRY" weightage="60" keywordseo="China">China</keyword>.</p>
<p>It is now expanding into Indonesia, India and Russia in a bid to appeal to the rising middle classes there.</p>
<p>And Huawei and ZTE have built share by bringing features pioneered by Apple and Samsung such as touch screens, fast processors and better cameras to the market at prices around $100.</p>
<h3>OPPORTUNITIES</h3>
<p>The opportunities in emerging markets appear huge.</p>
<p>Just 4 percent of Africans had smartphones in 2012, according to research group Informa. The figure was slightly higher at 11 percent in the developing countries in the Asia Pacific region. In comparison, North America had the highest take up of web-connected phones, at 47 percent.</p>
<p>Between 2012 and 2017, telecoms consultancy Ovum expects that there will be 1.6 billion new mobile connections across the world, with 61 percent of these coming from Asia-Pacific. Africa will be the fastest-growing region, with mobile connections growing at a compound annual rate of 6.5 percent.</p>
<p>Lenovo's Chief Executive Yang Yuanqing said strong price competition among Chinese players had resulted in a smartphone boom in the country of 1.3 billion. Of all the phones sold in 2012, he said 70 percent were smartphones, and he's looking to repeat the trick elsewhere in Asia and Russia.</p>
<p>"We have been very successful in China, so we know how to win in emerging markets," he told reporters.</p>
<p>"In a mature market you need to build a very strong relationship with the carriers so they can give you a subsidy, but in emerging markets you can sell in the open market."</p>
<p>He pinpoints a problem for the big players. Top-end devices, like the iPhone and Galaxy S3 attract subsidies from network operators in Europe and the United States, hiding the cost of around $500-600 over a two-year contract. Such deals are much harder to find in emerging markets.</p>
<p>The result of a lack of subsidies means the appeal of a phone largely comes down to its upfront cost, which combined with the Chinese companies' growing ability to match and in some cases surpass the technical specifications of the market leaders, could prove troublesome for Apple and Samsung in emerging markets.</p>
<p>Ben Wood, chief of research at CCS Insight, said the Chinese players, which also include TCL Corp, were already raising concerns at Samsung, which leads the Chinese market.</p>
<p>"If Samsung is worried, you've got to imagine that Nokia is terrified," he said. "The Chinese companies can find enough volume in the Chinese market to sustain the volumes they need and the money they need to keep pushing internationally."</p>
<p>Companies like Nokia, Samsung and Apple are not standing still, however.</p>
<p>Nokia, which has for years been strong in emerging markets with basic devices, is introducing new lower-priced phones with email and basic web browsing to target consumers in Africa and Asia-Pacific countries in particular.</p>
<p>At the same time, though, Chinese manufacturers like Huawei and ZTE are trying to shake off their copycat reputations by introducing marketing slogans and top-end devices in Barcelona.</p>
<p>Huawei's Ascend P2 is billed as the fastest smartphone on the market, and has other innovations, such as power saving technology, priced at 399 euros.</p>
<p>Wan Biao, chief executive of Huawei Device Co, said the high innovation level in the Ascend P2 had already started to attract the attention of operators.</p>
<p>France Telecom's Orange appeared on stage at the launch. It will sell the device in France from June 2013.</p>
<p>The operator's VP of devices, Yves Maitre, said Orange was placing a bet on Huawei just as it had in the past with Apple and Samsung.</p>
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