Facebook's lead banker, Morgan Stanley, appears to have bought a huge amount of Facebook stock on Friday to try to stop the price from falling below the IPO price.

If Morgan bought all the shares sold near $38 in the final 20 minutes of trading, Reuters calculates, the firm might now be the owner of 50 million shares--or $2 billion--of Facebook stock.

And if Facebook stock threatens to break through the IPO price of $38 again on Monday, Morgan Stanley will probably buy a whole lot more.

Importantly, no one really has any idea how much Facebook stock Morgan has on its books, if any. The firm could have shorted a huge amount of stock earlier in the day--selling shares it didn't own--only to pile up "dry powder" buy shares if and when the stock threatened to break the IPO price. So, Morgan may not actually own any Facebook stock. It even conceivably could be net SHORT Facebook stock. But given the intensity of the selling pressure at the end of Friday, it seems likely that the firm owns some.

Meanwhile, Reuters says Morgan Stanley earned 38% of the overall IPO fees for placing the deal, a share that amounted to $67 million.

So, if Morgan Stanley ends up owning a bit more of Facebook, the stock would only need to drop by a dollar or two to wipe out Morgan's share of the IPO fees.

So, everyone who hates Wall Street now has something to cheer for!

The lower Facebook goes, the more money Morgan Stanley will lose.

And if the firm really does have 50+ million shares, the losses could get big quickly.

(Okay, not "big," at least not in Wall Street terms. Stocks are so safe relative to derivatives that Facebook would have to go to zero for the loss to be BIG. But Morgan could certainly lose several hundred million dollars.)

(This, by the way, is another reason the whining and umbrage about Facebook's small IPO "pop" is ridiculous--if Facebook's stock keeps dropping, it's the company's banker that's going to really take it on the chin.)

SEE ALSO: Facebook's Banker Bought A Huge Amount Of Stock To Keep Price Above IPO Level

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Yesterday, fewer than 100 people showed up at Mark Zuckerberg's Palo Alto home.

They thought they were attending a graduation party for Priscilla Chan, Zuckerberg's girlfriend of 9 years who had just finished medical school.

Instead, they found themselves at a wedding, AP reports.

Upon arriving they were told they weren't just party guests, they were wedding guests. Sheryl Sandberg, Facebook's COO, was in attendance.

"Everybody was shocked," a guest told The Associated Press.

The wedding had been planned for months, says this person. But its timing, so close to Facebook's IPO, wasn't planned as that date was more of a "moving target."

Hardly anyone -- aside from those close to the couple -- knew Chan and Zuckerberg were engaged. Last June a rumor was reported that the couple was tying the knot when Bill Gates accidentally called Chan his fiance in The Daily Mail.

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Yesterday, Mark Zuckerberg shocked everyone, including the wedding guests, when he and his long-time girlfriend Priscilla Chan wed yesterday.

No one even knew the couple was engaged; less than 100 guests attended the event but thought they were being gathered to celebrate Chan's recent med school graduation.

The billionaire gave his bride a "very simple ruby" he designed, the AP reports.

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Facebook CEO Mark Zuckerberg married his long time girlfriend Priscilla Chan today – a day after the company finally went public.

The two met at Harvard. She once offered him a Twizzler.

The ceremony was in the back yard of Zuckerberg's home in Palo Alto. 100 or so people attended.

Congratulations, Mark! Best wishes, Priscilla. Attaboy, Beast.

The AP Story:

Facebook founder and CEO Mark Zuckerberg updated his status to "married" on Saturday.

Zuckerberg and 27-year-old Priscilla Chan tied the knot at a small ceremony at his Palo Alto, Calif., home, capping a busy week for the couple, according to a guest authorized to speak for the couple. The person spoke only on the condition of anonymity.

Zuckerberg took his company public in one of the most anticipated stock offerings in Wall Street history Friday. And Chan graduated from medical school at the University of California, San Francisco, on Monday, the same day Zuckerberg turned 28, the person said.

The couple met at Harvard and have been together for more than nine years, the person said.

Zuckerberg designed the ring featuring "a very simple ruby," according to the person who gave the following characterization of the wedding.

The ceremony took place in Zuckerberg's backyard before fewer than 100 guests, who all thought they were there to celebrate Chan's graduation.

Even after the IPO, Zuckerberg remains Facebook's single largest shareholder, with 503.6 million shares. And he controls the company with 56 percent of its voting stock.

The site, which was born in a dorm room eight years ago, has grown into a worldwide network of almost a billion people.

Zuckerberg founded Facebook at Harvard in 2004.

He was named as Time's Person of the Year in 2010, at age 26.

Zuckerberg grew up in Dobbs Ferry, N.Y.

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Apple is on top of the world right now, but nothing lasts forever.

The company must find ways to innovate old products, fight off tough competitors, and keep up employee morale high—all without the leadership of visionary cofounder Steve Jobs.

It's easy to overlook these threats given Apple's tremendous success to date. But if Jobs's handpicked successor, CEO Tim Cook, is not careful, Apple could end up facing one of these nightmare scenarios in the future.

The new Apple TV could end up being a complete flop.

Given the success Apple has had entering the smartphone and tablet markets in recent years, it's easy to assume that the company will do well should it launch a television in the near future. But one analyst suggests the odds are not in its favor.

"Television has been the death of pretty much every tech company that has tried to do it," said Rob Enderle, principal analyst at The Enderle Group. "People are expecting this thing to be huge, but it could very well not be."

If Apple's TV set does flop, Enderle says it could "take the wheels off the cart" for the company. The reason, Enderle says, is simple: Apple is a company that lives from hit to hit. Every successful product brings a halo effect to others—think of the way the iPod and iPhone boosted Mac sales.

The television could be Apple's new power product that boosts sales and brings more customers into the Apple ecosystem. But if it flops, the company will have to scramble to find another way to juice its product lineup while simultaneously dealing with critics who see the failure as proof that Apple's era of dominance is over—not to mention customers who have lost confidence in the Apple brand.

Apple never finds another Steve Jobs.

Apple can coast pretty comfortably for the next few years just on the products in its pipeline that were greenlit by Steve Jobs. But the key to the company's success is its ability to spot the next big market it can dominate. Without a visionary like Jobs at the helm, who will steer the company to that next big opportunity?

 "Tim Cook is a good manager ... but the fire in the belly that led to where they are was Steve," said Roger Kay, an analyst with Endpoint Technologies Associates. "The machine Steve Jobs set up is set to work for at least another half decade, but it's in the out years that it gets unclear."

 

Samsung could dethrone Apple as the tech industry's trendsetter.

If there's one company right now with the potential to take Apple down, it's Samsung. The two companies are already locked in a battle to control the smartphone market and Samsung continues to step up its tablet offerings to compete head-on against the iPad. As Enderle points out, Samsung is also doing well in markets Apple might have its eye on, like televisions.

"Samsung has the breadth to take on Apple on all fronts," Enderle said, which is all the more problematic because Samsung happens to be a major supplier of parts to Apple—everything it needs to build devices, from chips to screens. "So now a major partner for Apple who knows the most about how Apple markets and designs is the major competitor."

It's not likely Samsung will put Apple out of business anytime soon, but that's not the concern. Instead, Enderle says a justifiable fear is that Apple gets knocked out of the top spot and is forced to chase after Samsung's products, rather than the other way around. This, according to Enderle, could knock Apple "off its pedestal" as the trendsetter for the consumer technology industry.

See the rest of the story at Business Insider

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The New York Times has uncovered some more of the mysteries surrounding former PayPal executive Scott Thompson's messy departure as CEO.

Thompson left the company after activist investor Dan Loeb revealed that Thompson didn't have the computer-science degree his official bio in SEC filings listed.

Among the key revelations:

• Thompson had asked top Yahoo executives to pledge their support to him. At least one flat-out refused and told coworkers about Thompson's request. That conversation made its way up to the board. That executive wasn't named, but his identity should be a fun guessing game for Yahoos.

• A 2009 NPR interview with Thompson discovered by AllThingsD editor Kara Swisher played a key role in the board's deliberations. As Swisher reported, Thompson answered a question from the host about his supposed computer-science degree not by correcting her but by saying his background as an engineer began in college. The board listened to the whole interview.

• A statement by Heidrick & Struggles that Thompson's attempt to blame the executive-search firm for his falsified résumé was "verifiably not true" was "the final straw" for the board.

• Thompson had told the board he was having minor surgery weeks before the résumé scandal exploded. But he never told them it was for thyroid cancer.

• The Friday before Thompson was terminated, he texted and called Yahoo board member and Intuit CEO Brad Smith and pulled him out of a board meeting. He told Smith that the surgery had been for thyroid cancer and that medication he was taking might make him groggy. That's more or less how he let the board know he was willing to go.

• The next day, Smith and another board member, former eBay executive Maynard Webb, visited Thompson to tell him he was out. Thompson mostly talked about his ongoing medical treatments. 

The Times story still leaves lots of mysteries about Thompson's departure and its future under interim CEO Ross Levinsohn and a shaken-up board.

One of them centers around Maynard Webb. He's a well-qualified board member, having been COO of eBay and CEO of outsourcing startup LiveOps, where he's still chairman. But he was pretty clearly brought on the board as a Thompson ally when he joined in February. Besides their working relationship at eBay, Thompson was previously an advisor to Webb Investment Network, Webb's seed-stage venture-capital fund.

Webb was also one of the directors whose appointment Loeb had questioned in his fight with Yahoo.

Now they'll both be serving on the board together.

That should be fun.

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May 19 (Bloomberg) -- Morgan Stanley, the lead underwriter in Facebook Inc.’s initial public offering, stands to take a hit from a stock market debut that stoked disappointment among investors in the largest social network.

The bank stepped in to prop up the stock from dipping below its $38 IPO price yesterday, said people with knowledge of the matter, who asked not to be identified because the purchases were private. Morgan Stanley, based in New York, was the only underwriter among Facebook’s 33 banks with the responsibility to support the shares, the people said.

Underwriters “are acting like the cavalry to keep this thing going up,” Eric Jackson, founder of Ironfire Capital LLC, said in an interview on Bloomberg Television’s “Street Smart.” “They’re not going to be here a week from now, two weeks from now, a few months from now. It does suggest that there are going to be some rocky waters ahead.”

Days before the sale, Facebook and Morgan Stanley decided to bump the offering price range to one with $36 as a midpoint to persuade the company’s backers to sell more of their stock, one of the people said. Facebook and the bankers knew pre-IPO investors were willing to sell more, though not at the initial midpoint range of $31.50 a share, the person said. Goldman Sachs Group Inc. and Accel Partners were among backers that decided to sell additional shares in the IPO.

The IPO price, at the top of the increased range, prevented a first-day pop in the shares, which advanced 23 cents to $38.23 yesterday.

“It does indicate that investors are conscious of the risk, that the revenue model is still unproven, that operating costs are high and rising,” said Brian Wieser, an analyst at Pivotal Research Group LLC with a $30 price target on Facebook. “Those factors are weighing on the investors. The stock is greatly overvalued.”

Crossed Quotes

The debut was also marred by glitches at the Nasdaq Stock Market, where initial pricing of the first transaction was pushed back by a half-hour amid delays in trade confirmations, crossed quotes and signs that orders were mishandled.

Facebook executives and bankers met on May 17 to discuss the final IPO price, people familiar with the matter said. Among the underwriters, Morgan Stanley was the main bank handling pricing, the people said. Some co-managers of the offering advised Morgan Stanley against expanding the sale and price range because their clients’ demand didn’t support the move, two people said.

Pen Pendleton, a spokesman for Morgan Stanley, declined to comment. Jonathan Thaw, a spokesman for Menlo Park-based Facebook, declined to comment.

Market Value

Facebook raised $16 billion in the IPO selling 421.2 million shares on May 17, valuing the company at $104.2 billion. The offering price gave Facebook a market capitalization almost double the $60 billion United Parcel Service Inc., previously the biggest company to complete an IPO, was valued at when it went public in 1999, according to data compiled by Bloomberg and Dealogic.

That means Facebook bankers will split about $176 million for managing the social-networking company’s initial public offering after accepting a lower-than-average fee of about 1.1 percent. The biggest share of IPO fees typically goes to the lead underwriter on the deal, though the cost of propping up the stock in the first day of trading could potentially outweigh any underwriting fees generated from the sale.

Key Bankers

Dan Simkowitz, Morgan Stanley’s chairman of global capital markets, was one of the main bankers on the offering, said a person familiar with the matter. He also helped run General Motors Co.’s 2010 IPO that raised $18.1 billion.

Michael Grimes, global co-head of technology investment banking at Morgan Stanley, also played a key role. He introduced Facebook executives to investors at a lunch meeting last week in Palo Alto, California, part of a road show to pitch the deal to prospective buyers. Grimes became acquainted with Facebook Chief Operating Officer Sheryl Sandberg when he handled the IPO for Google Inc., her former employer. He meets regularly with investors in search of the next promising startup and is an avid consumer of his clients’ products.

Sandberg recused herself from picking bankers for Facebook’s IPO because she had relationships with several banks from her previous job at Google, one person said.

Facebook Chief Financial Officer David Ebersman was the point person on the deal, starting with the selection of the lead bankers, one person said. Sandberg and Chief Executive Officer Mark Zuckerberg were involved in major decisions throughout the process, the person said.

The performance may hurt the entire IPO market in the short term, people said. Some technology companies considering initial offerings are readjusting timing and valuations based on the day’s events, one of the people said.

“I know a bubble when I see one,” Bill Gross, Pacific Investment Management Co.’s co-chief investment officer, wrote about Facebook in a posting on Twitter.

--With assistance from Ari Levy, Brian Womack and Douglas Macmillan in San Francisco, and Sarah Frier and Michael J. Moore in New York. Editors: Jennifer Sondag, Tom Giles

 

To contact the reporters on this story: Serena Saitto in New York at ssaitto@bloomberg.net; Jeffrey McCracken in New York at jmccracken3@bloomberg.net

 

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

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This isn't going to be a popular thing to say, but it needs to be said. So here goes...

All this whining and umbrage about Facebook's IPO is ridiculous.

When are people who voluntarily speculate on stocks finally going to take responsibility for their decisions?

Never, apparently.

On Thursday, Facebook priced its IPO at $38.

On Friday, the stock opened at $42, a 10% jump, and spent most of the day trading above $40. Then, thanks to heavy support from the company's bankers, the stock closed just above $38.

In other words, even after the sharp selling at end of the day, Facebook IPO buyers were better off than they had been the day before. And if they were among those who took the abundant opportunity throughout the day to sell stock above $40, they locked in a nice overnight gain.

But to hear people bitch, you'd think they'd been swindled out of their life savings.

The New York Post captured the prevailing sentiment perfectly:

ZUCKERS!

They were Mark Zuckerberg’s cash cows.

Hordes of everyday New Yorkers played the fool yesterday to Wall Street fat cats and Facebook insiders, who used a bloated stock price to milk them of billions of dollars during an overhyped IPO.

With a $38-a-share price tag and forecasts for a 10 percent jump, mom-and-pop investors blindly bought in with dreams of instant riches that never came true.

Meanwhile, the social network’s hoodie-wearing CEO finished the day with a net worth of $19.25 billion. The average Facebook employee saw their on-paper wealth shoot up to $2.9 million.

Wow, sounds horrible.

And what happened, exactly?

Apparently, IPO buyers got less free money than they expected to.

The hope, presumably, was that--no matter where Facebook's IPO priced--the enormous demand from suckers would cause the stock to "pop" when it started trading--thus allowing the shrewd IPO buyers to flip their shares at a profit only hours after buying them.

Of course, that's exactly what the IPO buyers were given a chance to do. For about 4 hours yesterday, the IPO buyers could have locked in an instant 5%-10% gain. But apparently this wasn't the 50%+ gain they were looking for.

Well, it's time for people to grow up.

The $38 that Facebook IPO buyers voluntarily paid for the stock--emphasis on voluntarily--was already an extremely rich price for a company with decelerating revenue and only ~$0.35 of earnings last year. The only way these buyers were going to get a big "pop" from that price was if other investors seeking the same instant riches were even more aggressive and reckless than they were.

And it turned out that those even-more-aggressive-and-reckless traders stayed home.

So Facebook IPO buyers only got their 10% instant gain.

And a lot of them, apparently, did not take the opportunity to lock in that gain. Instead, they held on to the stock, either hoping that it would trade higher (likely), or because they are actually long-term investors.

And now, with the stock looking as though it will crash through the underwriters' support and the IPO price on Monday, the IPO buyers are blaming their decision to hold onto it on Facebook, too.

So, what exactly were you looking for, folks?

Even more free money?

Just for pressing "buy"?

In what other normal universe would you ever expect that?

Facebook could not have been clearer about how it was going to emphasize the long-term at the expense of the short-term, and that's exactly what it did in choosing its IPO price. Facebook now has a lot more cash at its disposal than it would have if it had lowballed the IPO just to give buyers a "pop." That cash is valuable to the company, and it will help the company create more value over the long-term.

In the weeks leading up to the IPO, moreover, many analysts screamed from the rooftops that Facebook's stock seemed extremely expensive. We even went to far as to call it "muppet bait."

And when the stock opened on Friday at merely an extremely expensive price, instead of a ludicrous one, we were relieved. Because it meant that millions of investors weren't buying it at absurd prices in the after-market... and thereby setting themselves up to get creamed when the hype faded.

But apparently those who did buy the IPO were expecting to get something for nothing. (And not just "something." They were expecting to get a lot for nothing.)

And when they didn't, they started taking their frustrations out on Facebook.

Trading stocks is a risky business. Perhaps it's time for those who voluntarily choose to do it to acknowledge that.

SEE ALSO: And Now, If Facebook's Bankers Can't Hold The IPO Price, The Stock Will Crash To The Low $30s

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Another week, more app releases. We sifted through the week's hottest apps to compile this awesome list of things you can't afford to miss.

The apps this week include an old favorite, looking at the weather in a different way, a Flipboard update and much, much more.

The latest Sonic game comes to iOS

Sonic the Hedgehog is back in the newest version of his iOS adventures. Steer the famous hedgehog through ramps and loops, collecting rings and jumping on bad guys.

Price: $6.99

Google's new activity recommendation app is called Schemer

Google released Schemer as a sort of activity recommendation app. For example, it might tell you to take a mixology course at Bourbon and Branch speakeasy, relive Ferris Bueller's Day Off in Chicago, or use leftover tortillas to make chilaquiles.

You can then create new activities to be recommended to other people on Schemer.

Price: free

DC Comics got a new upgrade

If you love your Batman comics, now you can read them on your new iPad with this app's new Retina display compatibility. Fight scenes and colored sound effects never looked so good.

Price: free

See the rest of the story at Business Insider

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The New York Post is pulling no punches this morning. 

Here's an excerpt from today's cover story:

They were Mark Zuckerberg’s cash cows.

Hordes of everyday New Yorkers played the fool yesterday to Wall Street fat cats and Facebook insiders, who used a bloated stock price to milk them of billions of dollars during an overhyped IPO.

With a $38-a-share price tag and forecasts for a 10 percent jump, mom-and-pop investors blindly bought in with dreams of instant riches that never came true.

Meanwhile, the social network’s hoodie-wearing CEO finished the day with a net worth of $19.25 billion. The average Facebook employee saw their on-paper wealth shoot up to $2.9 million.

Reporters Georgett Roberts, Josh Saul, and Jeane Macintosh interview experts and new investors, who respond to yesterday's lackluster IPO.

Read the whole story at NYPost.com.

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Part way through the Facebook IPO roadshow, scattered reports appeared that Facebook had reduced the earnings guidance it was giving research analysts.

This seemed bizarre on a number of levels.

First, I was unaware that Facebook had ever issued any earnings guidance--to research analysts or anyone else.

Earnings guidance is highly material information (meaning that any investor considering an investment decision would want to know it). It represents a future forecast made by the company. Any time any company gives any sort of forecast, stocks move--because the forecast offers a very well informed view of the future by those who have the most up-to-date information about a company's business.

So if Facebook had issued any sort of guidance, even quietly, this should have been made very public by the company and its bankers--especially because millions of individual investors were thinking of buying the stock.

Second, if Facebook really had "reduced guidance" mid-way through a series of meetings designed for the sole purpose of selling the stock this would have been even more highly material information.

Why?

Because such a late change in guidance would mean that Facebook's business was deteriorating rapidly--between the start of the roadshow and the middle of the roadshow.

Any time a business outlook deteriorates that rapidly, alarm bells start going off on Wall Street, and stocks plunge.

So the report that Facebook had "reduced earnings guidance" during the roadshow just seemed like a typical misunderstanding between Wall Street and the public--something lost in translation between what a reporter was hearing from sources and what actually made it into print.

But now Reuters has just reported the same thing again. Here's a sentence from a story Reuters just published on the IPO:

Facebook also altered its guidance for research earnings last week, during the road show, a rare and disruptive move.

Hmmm.

If this really happened, anyone who placed an order for Facebook who was unaware that 1) Facebook had issued any sort of earnings guidance, and 2) reduced that guidance during the roadshow, has every right to be furious.

Because this would have been highly material information that some investors had and others didn't--the exact sort of unfair asymmetry that securities laws are designed to prevent.

This seems so obvious that I'm still very skeptical of the report. I'll now look into it. In the meantime, if anyone knows what Facebook did and didn't tell analysts, I'd be grateful for your help. (hblodget@businessinsider.com).

SEE ALSO: Morgan Stanley Was A Control-Freak On The Facebook IPO -- And Now It's Screwed

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Five Star Feature Films, the company behind Ashton Kutcher's  made-for-TV movie "Jobs: Get Inspired," says it will use several actual locations for filming Steve Jobs' story as head of Apple, including the original company garage, reports Cnet.

That particular location is at 2066 Crist Drive in Los Altos, California and it served as the company's official headquarters before it moved into its Cupertino campus.

It saw the invention of the first Apple computer as well as the Apple II.

This movie is not to be confused with Aaron Sorkin's adaptation of Walter Isaacson's biography of Steve Jobs, currently in development by Sony and ultimately headed to theaters.

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An amusing thread on Quora points out that Facebook cofounder Mark Zuckberg is user number four (click here to check).

So who were users one, two, and three?

Co-founder Dustin Moskovitz has the following response:

1-3 were accounts used to test registration. Evidently it only took Mark 3 tries to clear the bugs.

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AT&T is sold out of the One X on its website. Thankfully, the phone launched early enough that several third-party retailers, such as Amazon and Target, still have stock.

Sprint just launched its EVO 4G LTE flagship phone, but it’s impossible to find that device. You might want to blame Apple or HTC for the delay, but you shouldn’t.

We spoke with one expert to shed light on the whole situation.

First, a little background.

The phones are locked down in U.S. Customs and Border Protection (CBP) due to an ITC exclusion order, which was issued on April 19th after a judge ruled that HTC was infringing on Apple’s technology. The tech was specifically related to HTC’s custom messaging app and Android’s own browser and messaging applications. HTC’s software originally allowed users to click a phone number to see a menu of choices asking the user what he or she wanted to do with the number, but that was Apple’s technology. You can see it all over iOS. HTC had to create a workaround and no longer presents that menu option on the AT&T One X or Sprint EVO 4G LTE.

“It appears HTC has made the changes they need to make,” Nilay Patel, a former U.S. copyright attorney who now works for The Verge, and who has followed the case closely, explained to TechnoBuffalo. ”So what’s happening now is the exclusion order bars HTC from importing anything that violates the patents. Customs has to tell its guys at the ports what this means.”

It’s the job of U.S. Customs to make sure that HTC’s products don’t infringe on Apple’s technology, and customs has to do this at the border right when the phones come into the country. AT&T’s One X and Sprint’s EVO 4G LTE are the first phones from HTC that have had to enter the country since April 19th, so it’s the first time HTC is dealing with this situation. “There’s a little bit of naivety on HTC, they didn’t know,” Patel said. “I don’t think they were expecting customs to enforce the order in this way. HTC should have probably stretched their [launch] dates, I think they got the first batch in and assumed everything was fine. That’s all you can blame them for.”

“HTC is a little new to the game and this enforcement action at customs is happening without Apple and without HTC – they don’t seem to be directly involved,” Patel said. It typically takes about a month for specific instructions to be written up and passed to the dockworkers at customs. That’s why it might have been possible for the initial allotment of HTC One X phones to get through.

Patel said HTC is doing all that it can to avoid infringing on Apple’s patents and to make sure the phones get to carriers and in consumer’s hands. “They are doing, in some ways, a better job than Samsung,” he said. “You can’t blame them for anything other than they didn’t expect customs to do this. Why would they expect customs to do this? They don’t have visibility to customs the way you would expect them to.” Customs has to inspect the new phones to make sure they don’t infringe on the patent or HTC could potentially infringe on the patent again and the two companies could end up back in court. It would be a tireless loop of litigation, otherwise.

You can’t blame Apple, either. Patel said the legal battle, which Apple won, was over a legacy Apple patent that was used back as far as Mac OS 9. “They invented it then and they should protect it now,” he explained. Unfortunately, nobody knows exactly what’s going inside the doors at Customs, which is why we haven’t seen updated shipment dates from AT&T or Sprint.

“It’s like the KGB,” Patel explained. “It’s not subject to the Freedom Of Information Act. The instructions are delivered electronically directly to the agents, there isn’t any paperwork.”

When can we expect the phones to be back on store shelves? It could happen tomorrow or it could happen 6 months from now, nobody knows for sure.

One thing is clear: Customs is putting a damper on carrier sales. The One X is AT&T’s most powerful 4G LTE smartphone right now and the EVO 4G LTE is supposed to help usher in excitement for Sprint’s 4G LTEnetwork. If customers can’t buy the phones they want, they’ll likely gravitate to other devices, or maybe even choose other carriers with similar options. Sprint customers have already waited long enough for the next flagship EVO, what’s to say they won’t just give up on the carrier and jump to Verizon or T-Mobile instead?

Sprint desperately needs its customers. Any roadblock preventing them from buying its best phone isn’t going to help it hang on to subscribers. Worse, HTC needs to compete against Apple and Samsung for consumer mindshare, and U.S. smartphone market share, especially ahead of the Samsung Galaxy S IIIlaunch and Apple’s incoming next-generation iPhone. The company’s CEO has already said recovery of its U.S. market share will be “difficult.”

A judge has ordered Apple and HTC to meet in a courtroom on August 28th to attempt to settle multiple patent disputes. Hopefully, for the sake of AT&T, Sprint, HTC and consumers, the phones make it through U.S. Customs long before then.

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NEW YORK (Reuters) - Lead Facebook Inc underwriter Morgan Stanley took a bet earlier this week when it increased the size of the social networking firm's $16 billion initial public offering and it boosted the price.

Thanks to massive hype surrounding Facebook's historic public offering, the wager looked safe. But a rocky first day of trading has raised questions about whether it paid off.

After a delayed start to trading, Facebook's shares spent much of the day struggling to stay above the $38 IPO price - and ended with just a 23-cent gain.

As a result, Morgan Stanley may have spent billions of dollars to support the stock price by buying shares in the market. Some market participants said that the underwriters had to absorb mountains of stock to defend the $38 level and keep the market from dipping below it.

The firm did this by tapping into a 63 million share over-allotment option, or greenshoe, according to sources familiar with the deal.

As an indication of the cost, had Morgan Stanley bought all of the shares traded around $38 in the final 20 minutes of the day, it would have spent nearly $2 billion. Underwriters are not obligated to prop up a stock on debut, but typically do.

Morgan Stanley declined to comment.

The debut marks a rare stumble for a high-profile IPO. Facebook is the only recent U.S. internet listing not to enjoy a large price jump on its first day of trading. LinkedIn <LNKD.N>, Groupon <GRPN.O> and Pandora Media <P.N> all saw significant gains at their public debuts.

The debut also underscores Morgan Stanley's go-it-alone handling of the offering process. Though 32 other underwriters signed on to the deal, Morgan Stanley retained tight control over information, decisions and allocations of shares, according to other underwriters.

To be sure, Morgan Stanley's strong approach may have been crucial to managing such a large, high-profile offering with so many underwriters. And the fact that the stock didn't soar on its first day means they achieved full value for their client.

Some issues were beyond Morgan Stanley's control. Glitches at the Nasdaq stock exchange delayed the start of trading by 45 minutes, and throughout the day many investors did not receive confirmations that their orders had been completed, brokers at Morgan Stanley, Raymond James & Associates and others said. That uncertainty about their positions may have prompted some investors to sell, worsening the downward pressure on the stock.

Nasdaq posted a notice late in the day saying that orders entered for the stock before trading started "resulted in nothing being done" and offering to match orders if customers send in requests by Monday. Sources said the exchange was working through the weekend to deal with the botched trades.

Facebook also altered its guidance for research earnings last week, during the road show, a rare and disruptive move.

In many ways, the deal is a crowning moment for Morgan Stanley. When it won the coveted role as Facebook's primary underwriter for its IPO, veteran technology banker Michael Grimes managed to convince executives at the social media giant that his bank would single-handedly control the process.

And as Grimes, co-head of global technology investment banking, boarded a Bombardier Global Express jet at Mineta San Jose International Airport with Facebook executives last week along with Morgan Stanley Internet banker Marcie Vu -- according to documents obtained by Reuters -- he had effectively accomplished his goal.

Successfully pulling off one of the largest IPOs in U.S. history would underscore Morgan Stanley's status as the top underwriter for tech offerings and set it above arch rival Goldman Sachs <GS.N>, with total global proceeds last year of $2.2 billion, according to Thomson Reuters data. But even with high profile deals like LinkedIn and Zynga <ZNGA.O> under its belt, Morgan Stanley had to be careful.

And so the bank led a highly secretive, tightly controlled process in which other institutions -- including top underwriters JPMorgan Chase & Co <JPM.N> and Goldman -- were effectively shut out.

"There was some frustration by JPMorgan and Goldman, as they were getting limited information. They thought they would be more inside the process," one source close to the matter said.

Goldman Sachs declined to comment. JPMorgan did not return calls seeking comment.

For its efforts, Morgan Stanley will receive 38 percent of the overall IPO fees, about $67 million, which is more than JPMorgan and Goldman combined, according to regulatory filings.

But more importantly, Morgan Stanley was the only bank actively talking to investors on the deal and able to pull the order book together, a rare feature for IPOs where top underwriters typically split the work more evenly.

At one of the venues during the investor roadshow, dozens of fund managers congregated at the St. Regis Hotel in New York including Neuberger Berman, SAC Capital Advisors LP, Soros Fund Management LLC, Tiger Global Management LLC and Och Ziff Capital Management Group LLC, trying to get a piece of the pie, according to the sources.

Representatives for Neuberger Berman, Tiger Global and Och Ziff declined to comment. The other funds were not immediately available for comment.

With almost all 33 Facebook underwriters kept in the dark about the deal, including additional changes to terms such as pricing range and IPO size, one underwriter called the process the "Morgan Stanley show" while another underwriter said the bank is "essentially running it by themselves."

JPMorgan pulled out all the stops when Facebook executives visited its New York headquarters. A Facebook-branded flag adorned the building and the bank gave out Facebook baseball hats and coffee cup holders. But the moves "mostly attracted press," said one source.

Facebook Chief Financial Officer David Ebersman and VP of Finance & Treasurer Cipora Herman were the primary executives working with underwriters, a separate source close to the matter said. Facebook Chief Operating Officer Sheryl Sandberg also remained actively involved.

Ebersman had been very thorough in his thinking throughout the process, one of the sources close to the matter said, considering everything from the more transparent Dutch Auction process that Google Inc <GOOG.O> used to a directed shares program. In the end, Facebook decided it wanted a traditional IPO process.

Their thought was to "bring in the right shareholders" as part of the IPO process and not get tangled up in other strategies that would be disruptive to the running of Facebook's business, the source said.

Zuckerberg was less involved, and also chose not to attend a majority of the roadshow stops last week, other than a brief appearance in his trademark hooded sweatshirt on May 7 at the Sheraton Hotel in New York and then again in Palo Alto that Friday.

The roadshow -- in which Zuckerberg was treated less as CEO and more as rockstar -- only lasted nine days rather than the typical 12.

Security was so tight that in New York attendees were asked for multiple forms of identification and were cross- checked against a list of names. According to one source, even one of Morgan Stanley's equity sales heads had difficulty entering the roadshow lunch because his name was accidentally left off of the list.

Until late Thursday night, co-managers were still left in the dark about their allotments and if they were even going to get shares, said one underwriter who preferred anonymity because the talks are private.

"Everything was very hush hush," he said.

(Reporting By Nadia Damouni and Olivia Oran. Additional reporting by Noel Randewich in San Francisco; Editing by Alwyn Scott, Gary Hill)

SEE ALSO: How Goldman Sachs Blew The Facebook IPO

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Every once in a while you might want to save what see on the screen of your iPhone.

Here's how to do it:

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Pejman Nozad could have made $50 million today.

In 2005, he had a chance to invest roughly $50,000 in Facebook, he told the Wall Street Journal. Facebook's then-president, Sean Parker, was keen on nabbing space in 165 University Avenue, a building Nozad and his partners, the Amidi family, owned.

Park sought out Nozad, who's known as a matchmaker in Silicon Valley—a role he developed as he sold carpets in a well-placed business, the Amidis' Medallion Rug Gallery in Palo Alto.

Google and PayPal had previously occupied 165 University Avenue, which is now thought to be a lucky one for startups. (PayPal cofounder Peter Thiel was an early investor in Facebook.)

Facebook not only wanted the lucky space, but hoped the the lucky angel investor would take a stake.

The leasing department turned Facebook down, and Nozad said he didn't fight the decision. Facebook found other office space along University Avenue.

Don't feel bad for Nozad, though.

He and the Amidis now run Amidzad Partners, which sold startups like Danger Research and Powerset to Microsoft and shopping search engine Milo to eBay. Dropbox is a current investment.

UPDATE: Here's the conversation we had with Nozad on Twitter about this story:

@owenthomas all good here!

— pejmannozad (@pejmannozad) May 18, 2012 

That's a relief!

DON'T MISS: These People Walked Away From Early Jobs At Billion-Dollar Companies

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Since we first published our report about impending mass layoffs at HP, we've heard from a bunch of HP employees offering us more details.

They paint a scary picture, particularly about the beleaguered HP Enterprise Services group.

In 2008, HP spent $13.9 billion to buy EDS, folding in HP's smaller services arm and renaming it HP Enterprise Services (HP ES). This group handles outsourcing contracts for HP.

• Layoffs have been going on for years. HP originally said it would shed 25,000 workers and that it was done with this in October, according to documents filed with the SEC.

• Perhaps as many as 5,000 more people have been laid off since March, said one former employee who was let go in April.

• In March, HP employees began hearing that HP was planning on laying off 30,000 people across all units, with ES hardest-hit.

• Employees have been steadily leaving, too. This could be hurting some of HP's contracts, like its Navy Marine Corps Intranet/Next Generation Enterprise Network.  The Navy renewed its contract with HP in 2010 for $3.3 billion in a five-year deal, but the Navy would rather end the relationship, Wired reported at the time. "Over the past 10 months, over 70 employees have left the NMCI/NGEN contract. All for higher-paying jobs, better jobs," said one former employee.

• The HP ES team never felt integrated with the rest of HP. When HP bought EDS, it just about doubled the size of HP. EDS had 139,500 workers and HP had 172,000.

• The cost overruns that Meg Whitman complained about in March were caused by "the HP side," an ES employee said. HP took over the management of EDS's IT tools, like its telephone system. They added staff to manage the tools and charged the extra staff back to what used to be EDS. "Is it any wonder that HP ES's costs rose 10% last fiscal year?"

• A good chunk of the next round of layoffs could be coming from a part of HP ES known as the Business Process Outsourcing unit, sources at HP ES believe. HP has been talking about selling the unit or shutting it down, our sources say. This unit lets big companies hire HP to do tasks such as customer support, human resources, payroll, and accounting.  One employee said that BPO had about 25,000 employees when HP bought EDS and is about half that size now.

• ES had a string of leaders—none of them with a clue, employees complain. "HP ES was never managed properly.  Management never had proper direction from the top down. Almost every 6-8 months, we would get an email about leadership changes," one employee told us.
  
  John Visentin was put in charge of ES last year. "He's been so invisible it's just ridiculous," our source told us. "Meg Whitman came out and said HP ES was HP's biggest problem ... that was in March. He made no statement at all … no emails, nothing."

Last quarter, ES reported $8.6 billion in revenue. At the time, it was HP's second largest unit. (The PC unit was a little bigger.) HP has since reorganized.

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Facebook took the media on a wild roller coaster of emotion today as it dealt with an excruciating 30-minute delay caused by some technical issues at the NASDAQ. Then, after peaking at $43, Facebook stock collapsed and ended the trading day back near its IPO price of $38.23.

Watch the media freak out over today's Facebook IPO drama below:

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Facebook and its bankers priced today's IPO well.

This morning, when the stock finally started trading, the fair-market price for the stock was about $40--just a couple of dollars north of where the deal priced.

This modest increase meant that Facebook didn't make the expensive mistake that most companies make, which is to let their bankers price the IPO too low and then see a huge IPO "pop." Although these "pops" are often viewed as a sign of a successful deal, they're anything but. They're merely a sign of that the IPO was underpriced: The company and its bankers give pots of free money to IPO buyers for doing nothing more than placing orders. (See: "Congratulations, LinkedIn, You Just Got Screwed!")

To illustrate this, imagine selling your house to a real-estate broker today for $1 million only to have the broker turn around and sell it to a buddy tomorrow for $2 million (a huge "pop"). If that happened to you, you'd feel like a moron. You'd also feel ripped off. And that's exactly what happens with IPO pops.

The ideal IPO is priced just below the market value, just as Facebook's was. This meant that Facebook and its selling shareholders got nearly full value for their shares.

It also meant, importantly, that individual investors who bought the stock after it started trading didn't get stuck buying it at a truly ludicrous price--say, $70. (At $40, Facebook's stock was merely very expensive, not absurd).

And it also means that Facebook won't have to try and fail to live up to a preposterous price.

So the deal was priced well.

But by the end of the day, the broader market, and Facebook's stock, were breaking down.

In the last 15 minutes of trading, Facebook's stock threatened to break through the IPO price of $38. At that point, as they always do, the company's underwriters stepped in to buy shares, trying to keep the stock above the IPO price. And, as they did earlier in the day, they succeeded. The stock closed just above $38.

If the broader market continues to deteriorate, and there's no excellent Facebook news over the weekend, Facebook's stock will likely make another run at $38 on Monday. And, once again, the banks will likely buy humongous amounts of stock to try to keep the stock above the IPO price.

But, if the selling pressure becomes too intense, the banks will give up--and let the stock fall to wherever the new market price is.

And because the banks probably artificially propped the stock up at the end of the day today, there may well be a gap between the true current market price and the price at which the bank-supported stock closed.

So that means that anyone who still owns Facebook might be in for a rude awakening if and when the stock  cracks the IPO price.

But doesn't that mean that the deal was overpriced?

No.

The market value for Facebook's stock for most of today was ~$40. It wasn't just the company's banks that were buying it at that level--nearly 600 million shares changed hands. That's more than the entire amount of stock sold in the IPO.

So anyone who doesn't think Facebook is worth $38--a conclusion that would beg the question why they bought it--could have gotten out today with a gain.

Companies and underwriters do not owe investors a positive return for buying IPOs. And trading stocks is a risky business. So no one should feel that, if Facebook's stock does "break" the IPO price, investors got screwed. (No one forced them to invest. And lots and lots of people warned that, even at the IPO price, Facebook was very expensive.)

In any event, Monday will be interesting.

As I've said frequently over the past few weeks, Facebook's current business does not support the IPO valuation. To justify that valuation, Facebook will have to roll out products and services that we haven't seen yet. So it will be interesting to see whether investors are as committed to the "long term" as they were when they also hoped that Facebook's IPO might deliver an IPO "pop" for the ages.

SEE ALSO: Facebook Is Muppet Bait

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