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Code/red: Apple and the Holy Grail of Tax Avoidance

Plus, Retina Display iMacs, smack talk from Larry Ellison, monster leeches and robot octopi!


  • Ad Week kicks off in New York City.
  • Microsoft’s Xbox One goes on sale in China.
  • National Coffee Day.
  • Oracle OpenWorld continues.

Europe Looking Forward to Launch of Apple PayUp

Did Apple really seek “the Holy Grail of tax avoidance” in Ireland, as Sen. Carl Levin, D-Mich., of the U.S. Senate Permanent Subcommittee on Investigations once claimed? We’re about to find out. The European Commission, which has been investigating Apple’s tax affairs in Ireland since June, will on Tuesday explain its findings so far. And according to early reports, they don’t bode well for Apple, which has been using Irish subsidiaries for years to sidestep behemoth tax payments. Evidently, the thinking over at the EC is that the company’s tax dealings with Ireland may have constituted illegal state aid. Apple, for what it’s worth, claims this isn’t the case. “There was no special deal that we cut with Ireland,” CFO Luca Maestri told the Financial Times. “We simply followed the laws in the country over the 35 years that we have been in Ireland.”

Ah, Fall, When the Retina Display iMacs Begin to Drop

Mark Gurman at 9to5Mac says Apple has a new Retina Display iMac in the pipeline. I’m hearing pretty much the same thing. Said one source with knowledge of Apple’s plans, “Expect a fall release.”

Pic or It Didn’t Happen

Walmart added a bit more tech cred to its board today, tapping Instagram co-founder and CEO Kevin Systrom as its 15th director.

OpenWorld Begins With Annual Running of Founder’s Mouth

Oracle CTO and Executive Chairman Larry Ellison kicked off Oracle’s OpenWorld conference in San Francisco this weekend by slapping some of his rivals around. In a Sunday keynote, he trash-talked Workday and SAP and dismissed, even as he acknowledged it as a competitor. “At least Salesforce has a platform,” Ellison said. “The other guys, who, Workday? They don’t have a platform. They’re missing in action. … And SAP? I’m going to try to be nice, but it’s so hard. I have no idea what runs on SAP HANA. It’s rude, but it’s the truth. And it’s kinda funny. What cloud? Let’s just talk about Earth. I really like those guys.”

Okay, Here’s the Plan: Sell Enough BlackBerrys to Sell BlackBerry

BlackBerry is a dead man walking and everyone knows it, even CEO John Chen. This according to Allegis Capital general partner Jean-Louis Gassée, who says BlackBerry’s long-sought turnaround won’t be a turnaround at all — it will be an exit: “BlackBerry’s current stock price says the company is worth about $5B, $2B more than its cash position. Therefore, Chen’s endgame is to sell the company, either whole or, more likely, in parts (IP portfolio, QNX OS …) for more than $2B net of cash. Wall Street knows this, corporate customers know this, carriers looking at selling Passports and some services know this. And potential body parts buyers know this as well … and wait.”

iPhone Gray Market Blues, Redux

Paul Mozur and Shanshan Wang, the New York Times: “Wholesalers who helped orchestrate the smuggling of tens of thousands of the phones into the country are now slashing prices to move inventory. At an electronics market in central Beijing, one retailer was recently selling the low-end iPhone 6 and 6 Plus for 6,500 renminbi to 8,800 renminbi ($1,060 to $1,436), down from 12,000 renminbi to 15,000 renminbi ($1,960 to $2,450) just after the release.”

Evidently, Steve Jobs’s Reality Distortion Field Also Extended to NYC Zon­ing Laws

Designer Dan Shannon on the origins of the Fifth Avenue Apple store in New York City: “Steve wanted to show Harry what his vision was for that site. We got there and they had this beautiful wood model of the building and plaza, and there’s this 40‐by‐40‐foot glass cube in the middle of the plaza. And Harry knew immediately that that was the right answer. Our original ideas had the glass pavilion closer to the street, because the zon­ing laws required a street wall for that site. And the Apple team put it right in the middle, more like the Louvre.”

Microsoft Building Fifth Avenue Store to Accommodate Apple Store Overflow

Speaking of Apple’s iconic Fifth Avenue store, Microsoft plans to open its first flagship store just a few blocks away. Microsoft VP David Porter says the building “will serve as the centerpiece of the Microsoft Stores experience,” currently defined by a lack of foot traffic and a morgue-like atmosphere.

Report: Yahoo Directory Still Exists

Yahoo SVP Jay Rossiter: “Yahoo was started nearly 20 years ago as a directory of websites that helped users explore the Internet. While we are still committed to connecting users with the information they’re passionate about, our business has evolved and at the end of 2014 (December 31), we will retire the Yahoo Directory. Advertisers will be upgraded to a new service; more details to be communicated directly.”

Of Course, They Waste a Lot of Time Running to the Can, but Still …

Intelligence expert Vince Houghton on the CIA Starbucks: “Urban myth says the CIA Starbucks is the busiest in the world, and to me that makes perfect sense. This is a population who have to be alert and spend hours poring through documents. If they miss a word, people can die.”

Off Topic

Monster leech swallows giant worm.

Thanks for reading. Send tips, comments and robotic octopi to, @johnpaczkowski. Subscribe to the Code/red newsletter here.

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