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Android’s tablet share at 39% as sales triple, says study | View Clip
01/26/2012
Computer World Hong Kong
Android’s tablet share at 39% as sales triple, says study
Apple still dominates with the iPad
By Mikael Ricknas
IDG News Service – Sales of Android-based tablets more than tripled during the fourth quarter of 2011. But Apple still dominates, even as its market share dropped, according to Strategy Analytics.
Global tablet shipments reached 26.8 million units in the fourth quarter of 2011, a 150% increase from 10.7 million during the same period in 2010.
Consumers are increasingly choosing tablets over netbooks and even entry-level notebooks or desktops, Strategy Analytics said.
Android is picking up momentum, and together vendors backing the operating system shipped 10.5 million units, compared to 3.1 million a year ago. That gives Android a 39.1% share of global tablet shipments, compared to 29% a year earlier.
Apple’s share dropped from 68.2% to 57.6%, according to Strategy Analytics.
Apple shrugged off the much-hyped threat from entry-level Android-based models. It is inevitable that Apple loses market share as more vendors enter the tablet space, according to Neil Mawston, executive director at Strategy Analytics. But its tablet business is still growing at a healthy rate, he said.
Apple shipped 15.4 million tablets during the fourth quarter, up from 7.3 million during the same period last year.
Microsoft captured just 1.5% of the tablet market during the last three months of 2011. The upcoming release of Windows 8 later this year can’t come quickly enough for Microsoft, allowing its hardware partners to start competing more effectively, according to Strategy Analytics.
66.9 million tablets were shipped during 2011, up 260% from 18.6 million in 2010.
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Android tablets closing in on iPad: researcher | View Clip
01/26/2012
Thomson Reuters – Helsinki
Android tablets closing in on iPad: researcher
(Reuters) – Tablet computers using Google’s Android software narrowed the lead of Apple’s iPad on the global market in the fourth quarter, research firm Strategy Analytics said on Thursday.
Global tablet shipments reached an all-time high of 26.8 million units in the fourth quarter, growing 2-1/2 fold from 10.7 million a year earlier, the research firm said.
“Dozens of Android models distributed across multiple countries by numerous brands such as Amazon, Samsung, Asus and others have been driving volumes,” analyst Neil Mawston said in a statement.
Android’s market share rose to 39 percent from 29 percent a year earlier, while Apple’s share slipped to 58 percent from 68 percent a year before.
The tablet computer market grew 260 percent last year to 66.9 million units as consumers are increasingly buying tablets in preference to netbooks and even entry-level notebooks or desktops.
Strategy Analytics said Microsoft had a 1 percent share of the global tablet market last quarter.
(Reporting By Tarmo Virki; Editing by Tim Dobbyn)
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AT&T’s Net Loss Tied to T-Mobile Merger Fees | View Clip
01/26/2012
New York Times, The
AT&T’s Net Loss Tied to T-Mobile Merger Fees
By JENNA WORTHAM
AT&T, the second-largest phone company in the United States, reported a substantial $6.68 billion net loss for the fourth quarter, primarily from the break-up fees incurred as a result of the company’s failed acquisition of T-Mobile USA. During the same period a year earlier, the company reported profit of $1.09 billion, or 18 cents per share.
However, a wave of momentum from iPhone sales and new subscribers nudged AT&T’s revenue up 4 percent during the quarter, with sales rising to $32.5 billion from $31.36 billion a year ago. Analysts expected the company to report $31.95 billion in revenue.
The company added 717,000 post-paid subscribers, the largest boost in five quarters, and a net total of 2.5 million wireless subscribers, which lifted the company’s base to 103.2 million wireless customers. AT&T also said it beat previous records for smartphone sales during the quarter, selling 7.6 million iPhones and 9.4 million smartphones overall.
Rick Franklin, an analyst with Edward Jones, said the report “sets AT&T up well for future wireless data growth and profitability.”
The company also beat results for Verizon, which said on Wednesday that it sold 4.2 million iPhones and 7.7 million smartphones during the same period. AT&T said that 76 percent of its overall revenue growth stemmed from the company’s growth in wireless, wireline data and services.
“We had a tremendous year in terms of execution, and we have excellent momentum across our growth platforms,’ said Randall Stephenson, the chief executive of AT&T, in a statement. “This was a blowout quarter for smartphone sales.”
After discounting charges from the $4 billion breakup fee paid to T-Mobile USA, AT&T’s per-share profit was 42 cents; analysts expected 43 cents a share.
“Looking ahead, we start 2012 with the best visibility we’ve had in some time, and we’re well-positioned to deliver solid results,” Mr. Stephenson said.
Investors seemed initially disappointed by the results, with shares slipping 2.4 percent to $29.50 in premarket trading.
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1 Billion Euro Loss and a Silver Lining for Nokia | View Clip
01/26/2012
New York Times, The
1 Billion Euro Loss and a Silver Lining for Nokia
By KEVIN O’BRIEN
BERLIN — Nokia, the world’s largest seller of mobile phones by volume, said Thursday that it suffered a huge loss in the fourth quarter but reported better than expected sales of its new Windows smartphones, sending its shares soaring.
Nokia said it lost almost €1.1 billion, or $1.4 billion, in the fourth quarter, compared with a €745 million profit a year earlier. Sales at Nokia, based in Espoo, Finland, fell 21 percent to €10 billion from €12.65 billion a year earlier. Operating profit shrank by more than half during the period to €478 million from €1.1 billion a year earlier.
But shares of Nokia rose sharply in Helsinki trading after the company reported that it had already sold more than a million Lumia phones, the first using the Windows operating system, since October. Nokia is currently selling two Windows models, the Lumia 800 in Europe and parts of Asia, and the Lumia 710 in the United States.
“The results suggest a good start for the Nokia Windows Phones,” said Franciso Jeronimo, an analyst in London at International Data Corp. He said that other makers of Windows phones, like Samsung and HTC, were also benefiting from Nokia’s promotion of the operating system. “The massive marketing investment to promote the Nokia Lumia 800 contributed to ship better-than-expected volumes.”
Stephen Elop, the former Microsoft executive who is directing Nokia’s transition from its own Symbian operating system to Windows, said the company planned to widen its aggressive selling of Windows devices, which I.D.C. estimates had only a 1 percent share of the global operating system market in the fourth quarter, far behind the leading operating systems, Android, made by Google, and iOS, made by Apple.
“From this beachhead of more than one million Lumia devices, you will see us push forward with the sales, marketing and successive product introductions necessary to be successful,” Mr. Elop said. The company announced planned to sell a third Windows phone, the Lumia 900, through AT&T Mobility in the United States.
Mr. Elop said Nokia would also start selling Lumia devices in China and Latin America by June. He said the Windows operating system and its associated services, which he refers to as a software-hardware “ecosystem,” are being embraced by operators who want a credible rival to Apple and Android, which together had more than three quarters of the global smartphone operating system market in the fourth quarter, according to I.D.C.
“In the war of ecosystems, clearly there are some strong contenders already on the field,” Mr. Elop said. “With Lumia, we have demonstrated that we belong on the field. Our specific intent has been to establish a beachhead in this war of ecosystems, and country by country that is what we are now accomplishing.”
But as Nokia navigates the transition to Windows, it is suffering financially, as operators abandon or demand price cuts on Symbian models, which still make up the vast majority of the 113.5 million phones Nokia sold in the fourth quarter. In the fourth quarter, the number sold declined by 8 percent from 123.7 million a year earlier. The average selling price of a Symbian phone slid 23 percent to €53 in the quarter from €69 one year earlier.
Sales fell 38 percent in Europe, Nokia’s largest market, and 40 percent in China, its third-largest market, during the quarter. In North America, Symbian sales dived 77 percent to 53 million units from 233 million a year earlier.
Mr. Elop said that Symbian devices were being undercut by lower-priced smartphones. Chinese rivals Huawei and ZTE sell basic smartphones for less than $100.
“In certain markets, there has been an acceleration of the anticipated trend towards lower-priced smartphones with specifications that are different from Symbian’s traditional strengths.”
Mr. Elop said Nokia expected to sell fewer Symbian devices than originally anticipated when he announced the decision to adopt Windows in February 2011. At the time, Mr. Elop predicted Nokia would sell 150 million Symbian devices as Nokia ramped up production and made the transition to Windows phones.
On Thursday, he said Nokia would sell fewer, without being more precise.
Nokia began selling its first Windows model, the Lumia 800, in October in selected markets in Europe and Asia. This month, it began selling Lumia 710 through T-Mobile U.S.A
Analysts are expecting Nokia to rapidly reassert its relevance in the smartphone market, which it had largely to itself before the 2007 introduction of Apple’s first iPhone. Over the next 12 months, Nokia will grow its smartphone market share more than sixfold, to 12.2 percent, overtaking Research In Motion, the makers of the Blackberry, according to I.D.C.
By 2015, Windows and Nokia will be the second-largest smartphone operating system in the world, I.D.C. estimates, with 21 percent, trailing Google’s Android with 47 percent but ahead of Apple, with 19 percent.
“What people are underestimating is how much operators in Europe and elsewhere are beginning to support and push Windows phones,” Mr. Jeronimo said in an interview. “Operators are very afraid of becoming dependent on the Android-Apple duopoly and as a result, they are pushing Nokia devices aggressively on the public.”
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NEC to Eliminate 10,000 Jobs After Loss | View Clip
01/26/2012
Bloomberg BusinessWeek
NEC to Eliminate 10,000 Jobs After Loss
By Kazuyo Sawa and Cheng Herng Shinn
The computer maker forecast a 100 billion yen annual loss, compared with a previous outlook for a 15 billion yen profit, as slower growth globally and in Japan trimmed demand. Photographer: Haruyoshi Yamaguchi/Bloomberg
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NEC Corp. (6701), forecasting its third annual loss in four years, will cut 10,000 jobs as slower global growth reduces demand for its mobile phones, computers and wireless gear.
“As macroeconomic concerns about Europe and developing countries increase, we decided to invest limited resources in lesser business segments,” President Nobuhiro Endo said today in Tokyo.
NEC forecast a 100 billion-yen loss ($1.3 billion) for the year ending March 31, abandoning a previous outlook for a 15 billion-yen profit, the Tokyo-based company said in a statement today. The job cuts equal about 8.6 percent of NEC’s workforce.
About 7,000 of those jobs will be eliminated in Japan, and NEC will take a 40 billion-yen charge for the restructuring, according to the statement. NEC also won’t pay a year-end dividend.
“The job cuts announced today are bigger than expected,” said Yuichi Ishida, an analyst at Mizuho Investors Securities Co. in Tokyo. “This will probably help the company reduce expenses, and we’ll probably see some improvements immediately from next fiscal year.”
Previous Cuts
The computer maker’s shares were unchanged at 168 yen as of the 3 p.m. close of trading in Tokyo, before the statement was released. NEC has lost 31 percent of market value in the past 12 months, compared with a 23 percent drop for Japanese computer maker Fujitsu Ltd. (6702) and a 17 percent decline for the broader Topix index.
Most of the job cuts will come from NEC’s mobile-phone handset business and may begin March 31, Endo said. The reduction is split between full- and part-time jobs, Endo said.
In 2009, the company said it was cutting more than 20,000 employees, mostly in the semiconductor and electronic-component businesses.
NEC, which formed a venture with Lenovo Group Ltd. (992) last year, had 115,840 employees at the end of March, compared with 154,786 in fiscal year 2007, according to data compiled by Bloomberg. Lenovo, China’s biggest personal-computer maker, agreed to invest $175 million in the venture to expand in Japan.
NEC’s net loss widened to 86.5 billion yen in the three months ended Dec. 31 from 26.5 billion yen a year earlier, according to the statement today. Sales fell 6.7 percent to 672 billion yen.
“NEC has to focus on its strengths and cut the rest,” said Mitsushige Akino, who oversees about $600 million at Ichiyoshi Investment Management Co. in Tokyo.
To contact the reporters on this story: Kazuyo Sawa in Tokyo at ksawa3@bloomberg.net; Cheng Herng Shinn in Tokyo at hcheng52@bloomberg.net
To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net
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Samsung Poised to Win Market Share on $42 Billion Capital Investment: Tech | View Clip
01/26/2012
Bloomberg – Seoul Bureau
Samsung Poised to Win Market Share on $42 Billion Capital Investment: Tech
By Jun Yang
Samsung Electronics , the biggest unit of South Korea’s largest industrial group, will spend as much as 40 trillion won of the group’s total budget, said four analysts.
Jan. 10 (Bloomberg) — David Steel, executive vice president at Samsung Electronics Co., talks about the outlook for voice-controlled televisions and other Samsung products. He speaks with Emily Chang on Bloomberg Television’s “Bottom Line.” Mark Crumpton also speaks. (Source: Bloomberg)
Sony hasn’t made a profit selling TVs in the past seven years. Photographer: Tomohiro Ohsumi/Bloomberg
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Samsung Electronics Co. (005930)’s capital expenditure dwarfs that of competitors and has helped make it the world’s biggest maker of TVs, memory chips and flat-screen panels. Record spending this year may further pressure rivals.
Samsung and its affiliates plan to spend 47.8 trillion won ($42 billion) this year on new product research and upgrading plants, the group said this month. The Suwon, South Korea-based company, which reports full-year earnings tomorrow, spent more than Sony Corp. (6758), Intel Corp. (INTC) and Cisco Systems Inc. combined in 2010, according to data compiled by Bloomberg.
The spending spree will enable the chips and display supplier to Apple Inc. and Sony to build on record sales last year and boost profit that doubled in the five years to 2010. That may leave competing makers, already mired in losses from a glut of commodity chips, even farther behind in their quest to diversify into the higher-margin specialty semiconductors for phones and tablets that have made Samsung so successful.
“We have a Goliath in the technology industry,” said Kim Hyung Sik, a Seoul-based analyst at Taurus Investment Securities Co. “The gap between Samsung and the laggards will keep widening, particularly in memory chips.”
Earnings Forecast
Sales by Samsung Electronics, the biggest unit of South Korea’s largest industrial group, were equal to 16 percent of the nation’s gross domestic product, based on figures from the company and the Bank of Korea. The company’s fourth-quarter profit probably rose to 3.99 trillion won from 3.42 trillion won a year ago, according to the average of 28 analyst estimates compiled by Bloomberg.
Samsung Electronics will spend as much as 40 trillion won of the group’s total budget, said four analysts, including Young Park, a Hong Kong-based analyst at Woori Investment & Securities Co. The semiconductor and display businesses will get the most, they said.
The spending amid burgeoning sales and profit contrast with Asian rivals including Japanese chipmaker Elpida Memory Inc. (6665), which was unprofitable for four straight quarters to September and faces a deadline to repay debts. Makers of dynamic random- access memory, the most common chip in computers, lost a combined $14 billion in the past three years, according to Bloomberg calculations.
‘Deep Pocket’
Sony (6758) hasn’t made a profit selling TVs in the past seven years. The Tokyo-based electronics maker is forecasting a fourth consecutive companywide loss this year amid slumping TV demand that’s prompted a restructuring of the business. Last month, Sony agreed to quit a panel-making joint venture with Samsung.
“Samsung’s strategy is to take advantage of its deep pocket and keep widening their lead over rivals,” said Im Jeong Jae, a Seoul-based fund manager at Shinhan BNP Paribas Asset Management Co., which oversees about $28 billion.
LG Group, which includes LG Electronics Inc. (066570) and LG Display Co., said Jan. 13 its companies would reduce expenditures by 15 percent this year, citing slowing consumer spending in the U.S. and Europe as a potential risk. Taiwan Semiconductor Manufacturing Co. (TSM), which competes with Samsung in contract manufacturing of chips, said Jan. 18 it will decrease its equipment budget to $6 billion this year from $7.3 billion.
Samsung v. Apple
In 2010, Samsung had $18.7 billion in capital expenditures, according to data compiled by Bloomberg. In comparison, Santa Clara, California-based Intel spent $5.2 billion.
Apple spent $2 billion in the year ended in September 2010. The Cupertino, California-based company, which more than doubled first-quarter profit and had cash and investments of more than $97 billion, contracts most of its manufacturing to other companies, reducing the need for high capital expenditure.
Samsung shares gained 11 percent last year, compared with a 26 percent jump for Apple and a 53 percent slump for Sony.
Samsung, expected to detail its capital expenditure plan tomorrow, should continue expanding investment and hiring to maintain industry leadership even as the global economic growth slows, Chairman Lee Kun Hee said this month.
Spending in the past has helped the company extend its dominance.
Samsung’s share in the global handset market increased to 22.6 percent from 20.9 percent in the third quarter, while market leader Nokia OYJ (NOK1V)’s share slipped to 27.3 percent from 32.3 percent, according to Strategy Analytics. The Korean company probably will pass Nokia in total mobile phone sales by the end of this year, Taurus’s Kim said.
‘Thrown in the Towel’
With the DRAM chip industry reeling from a glut and falling prices, Samsung is investing more in the semiconductor business to diversify. Apple is Samsung’s biggest customer as well as the biggest competitor in smartphones and tablet computers.
“The Japanese and Taiwanese memory-chip companies have almost thrown in the towel,” Shinhan BNP Paribas’s Im said. “In phones, Samsung and Apple’s dominance will continue.”
Samsung may almost double spending on its logic-chip business, which oversees manufacturing of Apple-designed A4 and A5 processors under an exclusive contract, to a record 8 trillion won this year, according to Hanwha Securities Co. and Korea Investment & Securities Co.
The Korean company has profitably diversified into specialty chips for smartphones, tablet devices and servers. Samsung sells twice as many specialty DRAM chips, where margins are higher, as commoditized chips used in PCs, Shinhan Investment Corp. said in a report in October.
In other businesses, Samsung may spend as much as 7 trillion won to expand production of OLED, or organic light- emitting diode, displays, Tong Yang’s Park said. Demand for screens using the technology is increasing, driven by use in smartphones including the Galaxy devices.
“The most important thing in this industry is to invest early so you can gain dominance and build an entry barrier against competitors,” Park said. “Samsung can do that because they have the financial firepower.”
To contact the reporter on this story: Jun Yang in Seoul at jyang180@bloomberg.net
To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net
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KDDI lifts revenue outlook on strong iPhone demand | View Clip
01/26/2012
Dow Jones International News
KDDI lifts revenue outlook on strong iPhone demand
By Kana Inagaki, Dow Jones Newswires
Japanese mobile operator saw 8.2% rise in data revenue on growing smartphone adoption.
KDDI Corp. on Thursday lifted its full-year revenue outlook by 2.6%, benefiting from steady growth in demand for Apple Inc.’s iPhone 4S and other smartphones.
The upward revision by KDDI comes after Apple earlier this week reported its best-ever financial results for its fiscal first quarter, thanks to the popularity of its smartphone and tablet computer.
KDDI, which competes with NTT DoCoMo Inc., said its net profit for the three months ended December dropped 17% from a year earlier to Y54.22 billion from Y65.67 billion. The company attributed the decline to tax adjustments caused by a change in Japan’s corporate taxes and a drop in revenue from voice calls.
Operating profit for the quarter fell 5.4% to Y117.48 billion from Y124.19 billion a year earlier, while revenue increased 5.7% to Y902.13 billion from Y853.42 billion on the back of an increase in data traffic for smartphones.
Average revenue per user–a key industry gauge to determine the long-term growth rate of telecom operators–fell 10% to Y4,470 as revenue from voice calls slid 26%.
Still, revenue from data traffic rose 8.2% as more subscribers switched to smartphones, especially after KDDI started selling Apple’s iPhone 4S. Prior to the Oct. 14 launch, Softbank Corp., Japan’s third-biggest mobile service provider, was the only iPhone carrier in Japan.
In a reflection of solid demand, KDDI increased its revenue target to Y3.55 trillion from an earlier-projected Y3.46 trillion for the full fiscal year through March and raised its sales target for smartphones to 5.55 million units from 4 million units.
The company, meanwhile, lowered its net profit forecast to Y235 billion from an earlier-projected Y250 billion due to the tax adjustments while it continues to forecast a 0.7% increase in operating profit to Y475 billion.
KDDI bases its earnings on Japanese accounting standards.
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In China, Human Costs Are Built Into an iPad | View Clip
01/26/2012
New York Times, The
In China, Human Costs Are Built Into an iPad
By CHARLES DUHIGG and DAVID BARBOZA
SAFETY PRECAUTIONS After a rash of apparent suicide attempts, a dormitory for Foxconn workers in Shenzhen, China, had safety netting installed last May. Foxconn said it acted quickly and comprehensively to address employee suicides.
A SHRINE FOR A SON Lai Xiaodong was killed in a Foxconn factory explosion. His parents have built a memorial in their village.
A JOB TURNS DEADLY Aluminum dust from polishing iPads caused the blast at Foxconn’s plant in Chengdu, left. Lai Xiaodong was among those killed. He had moved to Chengdu, bringing with him his college diploma, six months earlier.
When workers in the cafeteria ran outside, they saw black smoke pouring from shattered windows. It came from the area where employees polished thousands of iPad cases a day.
Two people were killed immediately, and over a dozen others hurt. As the injured were rushed into ambulances, one in particular stood out. His features had been smeared by the blast, scrubbed by heat and violence until a mat of red and black had replaced his mouth and nose.
“Are you Lai Xiaodong’s father?” a caller asked when the phone rang at Mr. Lai’s childhood home. Six months earlier, the 22-year-old had moved to Chengdu, in southwest China, to become one of the millions of human cogs powering the largest, fastest and most sophisticated manufacturing system on earth. That system has made it possible for Apple and hundreds of other companies to build devices almost as quickly as they can be dreamed up.
“He’s in trouble,” the caller told Mr. Lai’s father. “Get to the hospital as soon as possible.”
In the last decade, Apple has become one of the mightiest, richest and most successful companies in the world, in part by mastering global manufacturing. Apple and its high-technology peers — as well as dozens of other American industries — have achieved a pace of innovation nearly unmatched in modern history.
However, the workers assembling iPhones, iPads and other devices often labor in harsh conditions, according to employees inside those plants, worker advocates and documents published by companies themselves. Problems are as varied as onerous work environments and serious — sometimes deadly — safety problems.
Employees work excessive overtime, in some cases seven days a week, and live in crowded dorms. Some say they stand so long that their legs swell until they can hardly walk. Under-age workers have helped build Apple’s products, and the company’s suppliers have improperly disposed of hazardous waste and falsified records, according to company reports and advocacy groups that, within China, are often considered reliable, independent monitors.
More troubling, the groups say, is some suppliers’ disregard for workers’ health. Two years ago, 137 workers at an Apple supplier in eastern China were injured after they were ordered to use a poisonous chemical to clean iPhone screens. Within seven months last year, two explosions at iPad factories, including in Chengdu, killed four people and injured 77. Before those blasts, Apple had been alerted to hazardous conditions inside the Chengdu plant, according to a Chinese group that published that warning.
“If Apple was warned, and didn’t act, that’s reprehensible,” said Nicholas Ashford, a former chairman of the National Advisory Committee on Occupational Safety and Health, a group that advises the United States Labor Department. “But what’s morally repugnant in one country is accepted business practices in another, and companies take advantage of that.”
Apple is not the only electronics company doing business within a troubling supply system. Bleak working conditions have been documented at factories manufacturing products for Dell, Hewlett-Packard, I.B.M., Lenovo, Motorola, Nokia, Sony, Toshiba and others.
Current and former Apple executives, moreover, say the company has made significant strides in improving factories in recent years. Apple has a supplier code of conduct that details standards on labor issues, safety protections and other topics. The company has mounted a vigorous auditing campaign, and when abuses are discovered, Apple says, corrections are demanded.
And Apple’s annual supplier responsibility reports, in many cases, are the first to report abuses. This month, for the first time, the company released a list identifying many of its suppliers.
But significant problems remain. More than half of the suppliers audited by Apple have violated at least one aspect of the code of conduct every year since 2007, according to Apple’s reports, and in some instances have violated the law. While many violations involve working conditions, rather than safety hazards, troubling patterns persist.
“Apple never cared about anything other than increasing product quality and decreasing production cost,” said Li Mingqi, who until April worked in management at Foxconn Technology, one of Apple’s most important manufacturing partners. Mr. Li, who is suing Foxconn over his dismissal, helped manage the Chengdu factory where the explosion occurred.
“Workers’ welfare has nothing to do with their interests,” he said.
Some former Apple executives say there is an unresolved tension within the company: executives want to improve conditions within factories, but that dedication falters when it conflicts with crucial supplier relationships or the fast delivery of new products. Tuesday, Apple reported one of the most lucrative quarters of any corporation in history, with $13.06 billion in profits on $46.3 billion in sales. Its sales would have been even higher, executives said, if overseas factories had been able to produce more.
Executives at other corporations report similar internal pressures. This system may not be pretty, they argue, but a radical overhaul would slow innovation. Customers want amazing new electronics delivered every year.
“We’ve known about labor abuses in some factories for four years, and they’re still going on,” said one former Apple executive who, like others, spoke on the condition of anonymity because of confidentiality agreements. “Why? Because the system works for us. Suppliers would change everything tomorrow if Apple told them they didn’t have another choice.”
“If half of iPhones were malfunctioning, do you think Apple would let it go on for four years?” the executive asked.
Apple, in its published reports, has said it requires every discovered labor violation to be remedied, and suppliers that refuse are terminated. Privately, however, some former executives concede that finding new suppliers is time-consuming and costly. Foxconn is one of the few manufacturers in the world with the scale to build sufficient numbers of iPhones and iPads. So Apple is “not going to leave Foxconn and they’re not going to leave China,” said Heather White, a research fellow at Harvard and a former member of the Monitoring International Labor Standards committee at the National Academy of Sciences. “There’s a lot of rationalization.”
Apple was provided with extensive summaries of this article, but the company declined to comment. The reporting is based on interviews with more than three dozen current or former employees and contractors, including a half-dozen current or former executives with firsthand knowledge of Apple’s supplier responsibility group, as well as others within the technology industry.
In 2010, Steven P. Jobs discussed the company’s relationships with suppliers at an industry conference.
“I actually think Apple does one of the best jobs of any companies in our industry, and maybe in any industry, of understanding the working conditions in our supply chain,” said Mr. Jobs, who was Apple’s chief executive at the time and who died last October.
“I mean, you go to this place, and, it’s a factory, but, my gosh, I mean, they’ve got restaurants and movie theaters and hospitals and swimming pools, and I mean, for a factory, it’s a pretty nice factory.”
Others, including workers inside such plants, acknowledge the cafeterias and medical facilities, but insist conditions are punishing.
“We’re trying really hard to make things better,” said one former Apple executive. “But most people would still be really disturbed if they saw where their iPhone comes from.”
The Road to Chengdu
In the fall of 2010, about six months before the explosion in the iPad factory, Lai Xiaodong carefully wrapped his clothes around his college diploma, so it wouldn’t crease in his suitcase. He told friends he would no longer be around for their weekly poker games, and said goodbye to his teachers. He was leaving for Chengdu, a city of 12 million that was rapidly becoming one of the world’s most important manufacturing hubs.
Though painfully shy, Mr. Lai had surprised everyone by persuading a beautiful nursing student to become his girlfriend. She wanted to marry, she said, and so his goal was to earn enough money to buy an apartment.
Factories in Chengdu manufacture products for hundreds of companies. But Mr. Lai was focused on Foxconn Technology, China’s largest exporter and one of the nation’s biggest employers, with 1.2 million workers. The company has plants throughout China, and assembles an estimated 40 percent of the world’s consumer electronics, including for customers like Amazon, Dell, Hewlett-Packard, Nintendo, Nokia and Samsung.
Foxconn’s factory in Chengdu, Mr. Lai knew, was special. Inside, workers were building Apple’s latest, potentially greatest product: the iPad.
When Mr. Lai finally landed a job repairing machines at the plant, one of the first things he noticed were the almost blinding lights. Shifts ran 24 hours a day, and the factory was always bright. At any moment, there were thousands of workers standing on assembly lines or sitting in backless chairs, crouching next to large machinery, or jogging between loading bays. Some workers’ legs swelled so much they waddled. “It’s hard to stand all day,” said Zhao Sheng, a plant worker.
Banners on the walls warned the 120,000 employees: “Work hard on the job today or work hard to find a job tomorrow.” Apple’s supplier code of conduct dictates that, except in unusual circumstances, employees are not supposed to work more than 60 hours a week. But at Foxconn, some worked more, according to interviews, workers’ pay stubs and surveys by outside groups. Mr. Lai was soon spending 12 hours a day, six days a week inside the factory, according to his paychecks. Employees who arrived late were sometimes required to write confession letters and copy quotations. There were “continuous shifts,” when workers were told to work two stretches in a row, according to interviews.
Mr. Lai’s college degree enabled him to earn a salary of around $22 a day, including overtime — more than many others. When his days ended, he would retreat to a small bedroom just big enough for a mattress, wardrobe and a desk where he obsessively played an online game called Fight the Landlord, said his girlfriend, Luo Xiaohong.
Those accommodations were better than many of the company’s dorms, where 70,000 Foxconn workers lived, at times stuffed 20 people to a three-room apartment, employees said. Last year, a dispute over paychecks set off a riot in one of the dormitories, and workers started throwing bottles, trash cans and flaming paper from their windows, according to witnesses. Two hundred police officers wrestled with workers, arresting eight. Afterward, trash cans were removed, and piles of rubbish — and rodents — became a problem. Mr. Lai felt lucky to have a place of his own.
Foxconn, in a statement, disputed workers’ accounts of continuous shifts, extended overtime, crowded living accommodations and the causes of the riot. The company said that its operations adhered to customers’ codes of conduct, industry standards and national laws. “Conditions at Foxconn are anything but harsh,” the company wrote. Foxconn also said that it had never been cited by a customer or government for under-age or overworked employees or toxic exposures.
“All assembly line employees are given regular breaks, including one-hour lunch breaks,” the company wrote, and only 5 percent of assembly line workers are required to stand to carry out their tasks. Work stations have been designed to ergonomic standards, and employees have opportunities for job rotation and promotion, the statement said.
“Foxconn has a very good safety record,” the company wrote. “Foxconn has come a long way in our efforts to lead our industry in China in areas such as workplace conditions and the care and treatment of our employees.”
Apple’s Code of Conduct
In 2005, some of Apple’s top executives gathered inside their Cupertino, Calif., headquarters for a special meeting. Other companies had created codes of conduct to police their suppliers. It was time, Apple decided, to follow suit. The code Apple published that year demands “that working conditions in Apple’s supply chain are safe, that workers are treated with respect and dignity, and that manufacturing processes are environmentally responsible.”
But the next year, a British newspaper, The Mail on Sunday, secretly visited a Foxconn factory in Shenzhen, China, where iPods were manufactured, and reported on workers’ long hours, push-ups meted out as punishment and crowded dorms. Executives in Cupertino were shocked. “Apple is filled with really good people who had no idea this was going on,” a former employee said. “We wanted it changed, immediately.”
Apple audited that factory, the company’s first such inspection, and ordered improvements. Executives also undertook a series of initiatives that included an annual audit report, first published in 2007. By last year, Apple had inspected 396 facilities — including the company’s direct suppliers, as well as many of those suppliers’ suppliers — one of the largest such programs within the electronics industry.
Those audits have found consistent violations of Apple’s code of conduct, according to summaries published by the company. In 2007, for instance, Apple conducted over three dozen audits, two-thirds of which indicated that employees regularly worked more than 60 hours a week. In addition, there were six “core violations,” the most serious kind, including hiring 15-year-olds as well as falsifying records.
Over the next three years, Apple conducted 312 audits, and every year, about half or more showed evidence of large numbers of employees laboring more than six days a week as well as working extended overtime. Some workers received less than minimum wage or had pay withheld as punishment. Apple found 70 core violations over that period, including cases of involuntary labor, under-age workers, record falsifications, improper disposal of hazardous waste and over a hundred workers injured by toxic chemical exposures.
Last year, the company conducted 229 audits. There were slight improvements in some categories and the detected rate of core violations declined. However, within 93 facilities, at least half of workers exceeded the 60-hours-a-week work limit. At a similar number, employees worked more than six days a week. There were incidents of discrimination, improper safety precautions, failure to pay required overtime rates and other violations. That year, four employees were killed and 77 injured in workplace explosions.
“If you see the same pattern of problems, year after year, that means the company’s ignoring the issue rather than solving it,” said one former Apple executive with firsthand knowledge of the supplier responsibility group. “Noncompliance is tolerated, as long as the suppliers promise to try harder next time. If we meant business, core violations would disappear.”
Apple says that when an audit reveals a violation, the company requires suppliers to address the problem within 90 days and make changes to prevent a recurrence. “If a supplier is unwilling to change, we terminate our relationship,” the company says on its Web site.
The seriousness of that threat, however, is unclear. Apple has found violations in hundreds of audits, but fewer than 15 suppliers have been terminated for transgressions since 2007, according to former Apple executives.
“Once the deal is set and Foxconn becomes an authorized Apple supplier, Apple will no longer give any attention to worker conditions or anything that is irrelevant to its products,” said Mr. Li, the former Foxconn manager. Mr. Li spent seven years with Foxconn in Shenzhen and Chengdu and was forced out in April after he objected to a relocation to Chengdu, he said. Foxconn disputed his comments, and said “both Foxconn and Apple take the welfare of our employees very seriously.”
Apple’s efforts have spurred some changes. Facilities that were reaudited “showed continued performance improvements and better working conditions,” the company wrote in its 2011 supplier responsibility progress report. In addition, the number of audited facilities has grown every year, and some executives say those expanding efforts obscure year-to-year improvements.
Apple also has trained over a million workers about their rights and methods for injury and disease prevention. A few years ago, after auditors insisted on interviewing low-level factory employees, they discovered that some had been forced to pay onerous “recruitment fees” — which Apple classifies as involuntary labor. As of last year, the company had forced suppliers to reimburse more than $6.7 million in such charges.
“Apple is a leader in preventing under-age labor,” said Dionne Harrison of Impactt, a firm paid by Apple to help prevent and respond to child labor among its suppliers. “They’re doing as much as they possibly can.”
Other consultants disagree.
“We’ve spent years telling Apple there are serious problems and recommending changes,” said a consultant at BSR — also known as Business for Social Responsibility — which has been twice retained by Apple to provide advice on labor issues. “They don’t want to pre-empt problems, they just want to avoid embarrassments.”
‘We Could Have Saved Lives’
In 2006, BSR, along with a division of the World Bank and other groups, initiated a project to improve working conditions in factories building cellphones and other devices in China and elsewhere. The groups and companies pledged to test various ideas. Foxconn agreed to participate.
For four months, BSR and another group negotiated with Foxconn regarding a pilot program to create worker “hotlines,” so that employees could report abusive conditions, seek mental counseling and discuss workplace problems. Apple was not a participant in the project, but was briefed on it, according to the BSR consultant, who had detailed knowledge.
As negotiations proceeded, Foxconn’s requirements for participation kept changing. First Foxconn asked to shift from installing new hotlines to evaluating existing hotlines. Then Foxconn insisted that mental health counseling be excluded. Foxconn asked participants to sign agreements saying they would not disclose what they observed, and then rewrote those agreements multiple times. Finally, an agreement was struck, and the project was scheduled to begin in January 2008. A day before the start, Foxconn demanded more changes, until it was clear the project would not proceed, according to the consultant and a 2008 summary by BSR that did not name Foxconn.
The next year, a Foxconn employee fell or jumped from an apartment building after losing an iPhone prototype. Over the next two years, at least 18 other Foxconn workers attempted suicide or fell from buildings in manners that suggested suicide attempts. In 2010, two years after the pilot program fell apart and after multiple suicide attempts, Foxconn created a dedicated mental health hotline and began offering free psychological counseling.
“We could have saved lives, and we asked Apple to pressure Foxconn, but they wouldn’t do it,” said the BSR consultant, who asked not to be identified because of confidentiality agreements. “Companies like H.P. and Intel and Nike push their suppliers. But Apple wants to keep an arm’s length, and Foxconn is their most important manufacturer, so they refuse to push.”
BSR, in a written statement, said the views of that consultant were not those of the company.
“My BSR colleagues and I view Apple as a company that is making a highly serious effort to ensure that labor conditions in its supply chain meet the expectations of applicable laws, the company’s standards and the expectations of consumers,” wrote Aron Cramer, BSR’s president. Mr. Cramer added that asking Apple to pressure Foxconn would have been inconsistent with the purpose of the pilot program, and there were multiple reasons the pilot program did not proceed.
Foxconn, in a statement, said it acted quickly and comprehensively to address suicides, and “the record has shown that those measures have been successful.”
A Demanding Client
Every month, officials at companies from around the world trek to Cupertino or invite Apple executives to visit their foreign factories, all in pursuit of a goal: becoming a supplier.
When news arrives that Apple is interested in a particular product or service, small celebrations often erupt. Whiskey is drunk. Karaoke is sung.
Then, Apple’s requests start.
Apple typically asks suppliers to specify how much every part costs, how many workers are needed and the size of their salaries. Executives want to know every financial detail. Afterward, Apple calculates how much it will pay for a part. Most suppliers are allowed only the slimmest of profits.
So suppliers often try to cut corners, replace expensive chemicals with less costly alternatives, or push their employees to work faster and longer, according to people at those companies.
“The only way you make money working for Apple is figuring out how to do things more efficiently or cheaper,” said an executive at one company that helped bring the iPad to market. “And then they’ll come back the next year, and force a 10 percent price cut.”
In January 2010, workers at a Chinese factory owned by Wintek, an Apple manufacturing partner, went on strike over a variety of issues, including widespread rumors that workers were being exposed to toxins. Investigations by news organizations revealed that over a hundred employees had been injured by n-hexane, a toxic chemical that can cause nerve damage and paralysis.
Employees said they had been ordered to use n-hexane to clean iPhone screens because it evaporated almost three times as fast as rubbing alcohol. Faster evaporation meant workers could clean more screens each minute.
Apple commented on the Wintek injuries a year later. In its supplier responsibility report, Apple said it had “required Wintek to stop using n-hexane” and that “Apple has verified that all affected workers have been treated successfully, and we continue to monitor their medical reports until full recuperation.” Apple also said it required Wintek to fix the ventilation system.
That same month, a New York Times reporter interviewed a dozen injured Wintek workers who said they had never been contacted by Apple or its intermediaries, and that Wintek had pressured them to resign and take cash settlements that would absolve the company of liability. After those interviews, Wintek pledged to provide more compensation to the injured workers and Apple sent a representative to speak with some of them.
Six months later, trade publications reported that Apple significantly cut prices paid to Wintek.
“You can set all the rules you want, but they’re meaningless if you don’t give suppliers enough profit to treat workers well,” said one former Apple executive with firsthand knowledge of the supplier responsibility group. “If you squeeze margins, you’re forcing them to cut safety.”
Wintek is still one of Apple’s most important suppliers. Wintek, in a statement, declined to comment except to say that after the episode, the company took “ample measures” to address the situation and “is committed to ensuring employee welfare and creating a safe and healthy work environment.”
Many major technology companies have worked with factories where conditions are troubling. However, independent monitors and suppliers say some act differently. Executives at multiple suppliers, in interviews, said that Hewlett-Packard and others allowed them slightly more profits and other allowances if they were used to improve worker conditions.
“Our suppliers are very open with us,” said Zoe McMahon, an executive in Hewlett-Packard’s supply chain social and environmental responsibility program. “They let us know when they are struggling to meet our expectations, and that influences our decisions.”
The Explosion
On the afternoon of the blast at the iPad plant, Lai Xiaodong telephoned his girlfriend, as he did every day. They had hoped to see each other that evening, but Mr. Lai’s manager said he had to work overtime, he told her.
He had been promoted quickly at Foxconn, and after just a few months was in charge of a team that maintained the machines that polished iPad cases. The sanding area was loud and hazy with aluminum dust. Workers wore masks and earplugs, but no matter how many times they showered, they were recognizable by the slight aluminum sparkle in their hair and at the corners of their eyes.
Just two weeks before the explosion, an advocacy group in Hong Kong published a report warning of unsafe conditions at the Chengdu plant, including problems with aluminum dust. The group, Students and Scholars Against Corporate Misbehavior, or Sacom, had videotaped workers covered with tiny aluminum particles. “Occupational health and safety issues in Chengdu are alarming,” the report read. “Workers also highlight the problem of poor ventilation and inadequate personal protective equipment.”
A copy of that report was sent to Apple. “There was no response,” said Debby Chan Sze Wan of the group. “A few months later I went to Cupertino, and went into the Apple lobby, but no one would meet with me. I’ve never heard from anyone from Apple at all.”
The morning of the explosion, Mr. Lai rode his bicycle to work. The iPad had gone on sale just weeks earlier, and workers were told thousands of cases needed to be polished each day. The factory was frantic, employees said. Rows of machines buffed cases as masked employees pushed buttons. Large air ducts hovered over each station, but they could not keep up with the three lines of machines polishing nonstop. Aluminum dust was everywhere.
Dust is a known safety hazard. In 2003, an aluminum dust explosion in Indiana destroyed a wheel factory and killed a worker. In 2008, agricultural dust inside a sugar factory in Georgia caused an explosion that killed 14.
Two hours into Mr. Lai’s second shift, the building started to shake, as if an earthquake was under way. There was a series of blasts, plant workers said.
Then the screams began.
When Mr. Lai’s colleagues ran outside, dark smoke was mixing with a light rain, according to cellphone videos. The toll would eventually count four dead, 18 injured.
At the hospital, Mr. Lai’s girlfriend saw that his skin was almost completely burned away. “I recognized him from his legs, otherwise I wouldn’t know who that person was,” she said.
Eventually, his family arrived. Over 90 percent of his body had been seared. “My mom ran away from the room at the first sight of him. I cried. Nobody could stand it,” his brother said. When his mother eventually returned, she tried to avoid touching her son, for fear that it would cause pain.
“If I had known,” she said, “I would have grabbed his arm, I would have touched him.”
“He was very tough,” she said. “He held on for two days.”
After Mr. Lai died, Foxconn workers drove to Mr. Lai’s hometown and delivered a box of ashes. The company later wired a check for about $150,000.
Foxconn, in a statement, said that at the time of the explosion the Chengdu plant was in compliance with all relevant laws and regulations, and “after ensuring that the families of the deceased employees were given the support they required, we ensured that all of the injured employees were given the highest quality medical care.” After the explosion, the company added, Foxconn immediately halted work in all polishing workshops, and later improved ventilation and dust disposal, and adopted technologies to enhance worker safety.
In its most recent supplier responsibility report, Apple wrote that after the explosion, the company contacted “the foremost experts in process safety” and assembled a team to investigate and make recommendations to prevent future accidents.
In December, however, seven months after the blast that killed Mr. Lai, another iPad factory exploded, this one in Shanghai. Once again, aluminum dust was the cause, according to interviews and Apple’s most recent supplier responsibility report. That blast injured 59 workers, with 23 hospitalized.
“It is gross negligence, after an explosion occurs, not to realize that every factory should be inspected,” said Nicholas Ashford, the occupational safety expert, who is now at the Massachusetts Institute of Technology. “If it were terribly difficult to deal with aluminum dust, I would understand. But do you know how easy dust is to control? It’s called ventilation. We solved this problem over a century ago.”
In its most recent supplier responsibility report, Apple wrote that while the explosions both involved combustible aluminum dust, the causes were different. The company declined, however, to provide details. The report added that Apple had now audited all suppliers polishing aluminum products and had put stronger precautions in place. All suppliers have initiated required countermeasures, except one, which remains shut down, the report said.
For Mr. Lai’s family, questions remain. “We’re really not sure why he died,” said Mr. Lai’s mother, standing beside a shrine she built near their home. “We don’t understand what happened.”
Hitting the Apple Lottery
Every year, as rumors about Apple’s forthcoming products start to emerge, trade publications and Web sites begin speculating about which suppliers are likely to win the Apple lottery. Getting a contract from Apple can lift a company’s value by millions because of the implied endorsement of manufacturing quality. But few companies openly brag about the work: Apple generally requires suppliers to sign contracts promising they will not divulge anything, including the partnership.
That lack of transparency gives Apple an edge at keeping its plans secret. But it also has been a barrier to improving working conditions, according to advocates and former Apple executives.
This month, after numerous requests by advocacy and news organizations, including The New York Times, Apple released the names of 156 of its suppliers. In the report accompanying that list, Apple said they “account for more than 97 percent of what we pay to suppliers to manufacture our products.”
However, the company has not revealed the names of hundreds of other companies that do not directly contract with Apple, but supply the suppliers. The company’s supplier list does not disclose where factories are, and many are hard to find. And independent monitoring organizations say when they have tried to inspect Apple’s suppliers, they have been barred from entry — on Apple’s orders, they have been told.
“We’ve had this conversation hundreds of times,” said a former executive in Apple’s supplier responsibility group. “There is a genuine, companywide commitment to the code of conduct. But taking it to the next level and creating real change conflicts with secrecy and business goals, and so there’s only so far we can go.” Former Apple employees say they were generally prohibited from engaging with most outside groups.
“There’s a real culture of secrecy here that influences everything,” the former executive said.
Some other technology companies operate differently.
“We talk to a lot of outsiders,” said Gary Niekerk, director of corporate citizenship at Intel. “The world’s complex, and unless we’re dialoguing with outside groups, we miss a lot.”
Given Apple’s prominence and leadership in global manufacturing, if the company were to radically change its ways, it could overhaul how business is done. “Every company wants to be Apple,” said Sasha Lezhnev at the Enough Project, a group focused on corporate accountability. “If they committed to building a conflict-free iPhone, it would transform technology.”
But ultimately, say former Apple executives, there are few real outside pressures for change. Apple is one of the most admired brands. In a national survey conducted by The New York Times in November, 56 percent of respondents said they couldn’t think of anything negative about Apple. Fourteen percent said the worst thing about the company was that its products were too expensive. Just 2 percent mentioned overseas labor practices.
People like Ms. White of Harvard say that until consumers demand better conditions in overseas factories — as they did for companies like Nike and Gap, which today have overhauled conditions among suppliers — or regulators act, there is little impetus for radical change. Some Apple insiders agree.
“You can either manufacture in comfortable, worker-friendly factories, or you can reinvent the product every year, and make it better and faster and cheaper, which requires factories that seem harsh by American standards,” said a current Apple executive.
“And right now, customers care more about a new iPhone than working conditions in China.”
Gu Huini contributed research.
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LTE-Advanced is the future, but no rocket ship | View Clip
01/26/2012
IDG News Service – San Francisco Bureau
LTE-Advanced is the future, but no rocket ship
The newly approved mobile standard is expected to help carriers maintain reliable LTE performance
Stephen Lawson
The 4G network standards approved last week by the ITU may improve the mobile data experience soon, even if consumers don’t actually see the 100M bps mobile speed for which they were designed.
The International Telecommunication Union gave its seal of approval to the two new standards, LTE-Advanced and WirelessMAN-Advanced, at the ITU Radiocommunication Assembly in Geneva last Wednesday. WirelessMAN-Advanced, the second generation of WiMax, is not expected to be widely deployed. But LTE-Advanced, the next version of the Long-Term Evolution standard chosen by most carriers moving to 4G, could start improving mobile networks soon.
What the ITU technically did last week was to certify the two network specifications as IMT-Advanced, or officially 4G (fourth generation). When it originally planned for 4G, the successor to the 3G technologies that started to be deployed early in the past decade, the ITU insisted the next-generation networks be able to deliver 100M bps (bits per second) downstream with high mobility and 1G bps from one location.
After the slower WiMax, LTE and even HSPA+ technologies started to be called 4G, the agency loosened its definition. But its goals for IMT-Advanced stayed in place.
Consumers shouldn’t look for 100M bps when the first carriers start implementing LTE-Advanced, probably later this year. In most cases, it won’t even bring a speed increase like the move from 3G to LTE did. But the new standard should improve the wireless experience, according to industry analysts.
The upgrade to LTE Advanced, which most carriers will do gradually, will basically help them add lanes to a highway, said analyst Monica Paolini of Senza Fili Consulting. Drivers don’t necessarily go faster on a multilane highway, but the additional lanes are needed if more drivers want to go full speed in the future. “Capacity might not be an issue today, but it is going to become an issue pretty soon,” she said.
The LTE-Advanced standard is actually made up of several components, of which service providers can use some or all, said analyst Peter Jarich of Current Analysis. These include aggregation of separate spectrum bands, better integration between small and large cells, the use of four or more antennas in a device, and relay devices at the edges of cells.
Jarich expects most service providers to start out with LTE-Advanced by combining frequencies and adding more antennas. So-called “carrier aggregation” allows an operator to build up a big chunk of spectrum virtually, out of frequencies spread around the spectrum band. LTE already uses MIMO (multiple-in, multiple-out) antenna systems, but only with two antennas per device. LTE-Advanced will allow for four or more antennas, potentially boosting speed and reliability. However, it’s not clear how many antennas may ultimately fit in a smartphone, Jarich said.
Heterogeneous networking is another promising tool in the new standard, Jarich said. It includes mechanisms to make conventional macro cells work better with the smaller cells now being developed to better serve crowded and indoor areas. For example, it could prevent subscribers from being bounced back and forth between large and small cells because of small differences in power between them, he said.
Though all these features may add up to the potential for a true 100M bps mobile service, it’s not clear that carriers could build one or that subscribers even need it. Analyst Phil Marshall of Tolaga Research estimated it would take 50MHz of spectrum to deliver that much speed. To put that in perspective, Verizon Wireless uses just 10MHz each for its upstream and downstream channels today.
With most mobile applications, users couldn’t even see any additional speed beyond 20M bps, said Chetan Sharma, of Chetan Sharma Consulting.
“It’s not like the market is crying for 100M bps,” Sharma said.
Most LTE networks aren’t even heavily loaded yet, because compatible devices haven’t been on the market very long and are still relatively expensive, Marshall said. However, service providers and users may want some of the performance advantages of LTE-Advanced soon, just to preserve or extend the good experience subscribers enjoy now, he said.
“Service providers will rapidly use features of LTE-Advanced that don’t dramatically impact their spectrum or network requirements,” Marshall said. The result may be just the kind of invisible competence that carriers want.
“The speeds will hold better,” Marshall said. “You won’t see as much variation in performance as you move about the network.”
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Obama at Intel: America, make more stuff | View Clip
01/26/2012
CNET News.com
Obama at Intel: America, make more stuff
by Brooke Crothers
President Obama speaking at Intel’s Chandler, Arizona chip plant, now under construction. ‘I’m here because the factory being built behind me is an example of an American that is within our reach…An America where we make stuff and sell stuff all over the world.’
President Obama paid a visit to Intel’s Chandler, Ariz., chip plant today, praising the chipmaker for keeping high-tech manufacturing jobs in the U.S.
Here are some excerpts from his remarks. The event was streamed live at whitehouse.gov.
An America that makes more: “I’m here because the factory being built behind me is an example of an America that is within our reach. An America that attracts that next generation of good manufacturing jobs. An America where we make stuff and sell stuff all over the world…We can’t go back to a economy weakened by outsourcing. And last night in the State of the Union, I laid out a vision of how we move forward. Laid out a blue print of an economy built to last. It’s an economy built on American manufacturing with more good jobs and more products made in America.”
Incentives to create domestic jobs: “This [Intel] project is going to employ thousands of construction workers [and] when this project is finished, Intel will employ about a thousand men and woman making the computer chips that power everything from your smartphone to your laptop to your car. As an American, I’m proud of companies like Intel that create jobs here. We have a huge opportunity to create more high-tech manufacturing jobs in the United States and bring back some of these jobs from overseas but we’re going to have to seize the moment.”
Obama continued. “That starts with changing our tax system. Right now, companies get all kinds of tax breaks when they move jobs and companies overseas but when a company chooses to stay in America, it gets hit with one of the highest tax rates in the world. That doesn’t make sense. Let’s stop rewarding business that ship jobs overseas, let’s reward companies that are investing and creating jobs right here in the United States of America…What we should do is subsidize and give tax breaks to companies that are investing here. High tech manufacturers like Intel. Today my administration is laying out several concrete actions we could take right now that would discourage companies from outsourcing jobs and encourage them to invest in the United States.”
U.S. auto industry: “It starts with manufacturing…Look what’s happened to the auto industry. On the day I took office it was on the verge of collapse. Some people said we should let it die, but we had a million jobs at stake, and I refused to let that happen. And, so, we said to the auto companies, in exchange for help we’re going to demand responsibility. We’ve got to make sure that industry retools and restructures and that’s what they did. Over the last two years, the entire industry has added 160,000 jobs. GM is No. 1 in the world again, Ford is investing in new plants, Chrysler is on the mend.”
Engineering jobs: “Because [Intel is] supporting science and math education, they’re helping to train new engineers. Paul [Otellini] (who is a member of Obama’s jobs council) is chairing a project initiated through the jobs council. We’re looking to get thousands of new engineers all across America. We can use more engineers.”
Note: One of the cranes in the background (see photo above) is the largest land-based crane in the world and can lift up to 4,000 tons.
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Was the battle over AT&T-Mo a fight worth having? | View Clip
01/26/2012
Giga Om
Was the battle over AT&T-Mo a fight worth having?
By Kevin Fitchard
The government scored a huge victory for consumers when it defeated AT&T’s acquisition of T-Mobile, preserving a wireless landscape with four nationwide competitors. Now that the dust has settled, though, there’s a lingering question in my mind: Was the fight worth it? Would we have been better off if the AT&T-Mo saga never happened, or are we better off that AT&T tried and failed?
It’s easy to reach the former conclusion if you tally up the enormous amounts of time, effort and money AT&T, its allies and its opponents wasted fighting for or against the merger. The Hill reported Monday that AT&T alone spent $20.2 million lobbying lawmakers and regulators in 2011. Operators like Sprint, industry associations like the Rural Cellular Association, and numerous public interest groups also devoted considerable resources to oppose the deal before regulators and in the courts. AT&T-Mo weighed down the Federal Communications Commission’s docket for the greater part of a year, and the U.S. Department of Justice spent taxpayer dollars forming its antitrust case against the carriers.
AT&T and T-Mobile could have directed all of that effort and cash building more 4G networks and expanding the ones they already had. Instead, their consolidation drive actually stymied mobile broadband. Cellular infrastructure maker Ericsson on Wednesday reported a huge drop off in North American revenues for the fourth quarter, largely because AT&T and T-Mobile practically stopped investing in their networks while they waited on the merger’s outcome. Instead of fending off the outsized ambitions of Ma Bell, the FCC could have dealt with any number of pressing regulatory issues on its plate.
Still, I would argue that we gained plenty from having fought that fight. Those gains may not be as tangible as a new network or cash in the bank, but here are three reasons why the merger’s failure shaped the U.S. wireless market for the better:
No. 1: We know what to watch for
I think Sprint CEO Dan Hesse summed it up best in an interview last year right before the merger was killed:
When AT&T announced its intention to take over T-Mobile USA, it made me realize the industry has been gradually moving toward being a duopoly and how tenuous the competitive situation is in the U.S. wireless industry. … [Before the merger was announced] I could see this gradual creep in size and market dominance of the big two—growing gradually each year, though not to the extent that it became alarming. But the attempted acquisition of T-Mobile set off all sorts of alarms and had you step back and notice what’s been happening each year for a number of years.
With four nationwide operators it’s easy to reach the conclusion that we have a vibrant competitive market, but the reality is there hasn’t been such a thing as a ‘Big 4′ in the industry for some time. While Verizon Wireless and AT&T have grown considerably in the last five years, Sprint actually shrank in size and T-Mobile’s growth has been fitful.
As Hesse points out, there is now such a gaping difference in size between the No. 2 and the No. 3 operators, that ‘Big 2′ has become a much better characterization of the industry’s top tier. We may not face quite the duopoly that Hesse claims, but there’s no questioning that AT&T and Verizon wield enormous power. It took AT&T trying to swallow up one of the remaining national carriers for many people, including myself, to realize just how lopsided the market had become.
Regulators, lawmakers and a large part of the public now realize that preserving what remaining competition is left in the U.S. wireless market is vital. Just as AT&T can’t buy T-Mobile, Verizon can’t buy Sprint, and either would face stiff opposition if they tried to pick up a smaller regional operator like MetroPCS or Leap Wireless. And AT&T and Verizon now know better than to try.
No. 2: Regulators have grown fangs
AT&T approached the merger with the attitude it was inevitable, and it appeared to be right until the Justice Department filed its antirust lawsuit on August 31. Much to AT&T’s shock, the government’s free-market cops were in no mood to negotiate. They said the deal was simply anti-competitive and had to be stopped.
The FCC appeared docile at first, but began asserting itself after the DOJ stepped in. In November, the FCC recommended the deal be killed and it released a damning report refuting every single claim AT&T made about the merger’s supposed benefits. When a desperate AT&T tried to play the DOJ and FCC against one another, neither agency fell for the carrier’s tactics. Within a month the deal was dead.
After a decade of nearly unfettered consolidation in the wireless industry, regulators took a huge stand against the most egregious anti-competitive deal of them all, showing AT&T absolutely no deference. What’s more, those regulators don’t appear to be returning to hibernation.
The DOJ is now looking into Verizon’s purchase of the cable companies’ unused 4G spectrum. Normally the Justice Department steers clear of deals only involving the transfer of airwaves, leaving licensing matters to the FCC. In a recent interview, John Hane, an antitrust lawyer with Pillsbury Winthrop Shaw Pittman, said that we may be witnessing the rebirth of much more aggressive DOJ, one that is willing to examine every telecom deal through a trust-busting lens.
No. 3: Dormant spectrum is finally being put to use
Though AT&T claimed that the U.S. is facing a spectrum crisis, the deplorable fact remains that it and many other operators have been hoarding frequencies for years. AT&T, Verizon and the cable companies won their advanced wireless service (AWS) licenses at auction in 2006 but haven’t built a single commercial cell over those airwaves for six years. Clearwire and Sprint have nearly 100 MHz of unused 2.5 GHz frequencies they’ve owned for a better part of decade.
But as AT&T-Mo died, an astonishing spate of license sales followed. Verizon made a deal with the cable providers to buy their SpectrumCo licenses, giving Big Red a goldmine of 4G airwaves over which it will expand its LTE network. AT&T may have failed in its bid for T-Mobile, but it did land Qualcomm’s 700 MHz FLO TV spectrum, which AT&T has also earmarked for LTE. As part of its break-up fee from AT&T, T-Mobile got a healthy chunk of AT&T’s own AWS licenses, which T-Mobile can put to immediate use in expanding its HSPA+ network.
I do agree with the operators that those airwaves won’t be enough. To meet the colossal demand for mobile broadband, the FCC will have to identify and repurpose hundreds of megahertz of spectrum for 4G use. But the carriers have no business complaining about the oncoming data tsunami when they aren’t using the spectrum they already own. But now it looks like they will be forced to use them. If operators now can no longer buy networks from their competitors, they will have to build them.
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Nokia Names Siilasmaa as Chairman to Replace Retiring Jorma Ollila | View Clip
01/26/2012
Bloomberg BusinessWeek
Nokia Names Siilasmaa as Chairman to Replace Retiring Jorma Ollila
By Diana ben-Aaron
Nokia Oyj (NOK1V) nominated entrepreneur Risto Siilasmaa to succeed Jorma Ollila as chairman, signaling that key decisions at the world’s biggest mobile-phone company by handsets deliveries will stay in Finland.
Siilasmaa, 45, is chairman of security software maker F- Secure Oyj (FSC1V@FH), which he founded, and of telephone company Elisa Oyj. Known in Finland as a representative for entrepreneurs and business investors, he joined Nokia’s board in 2008.
Nokia investors lost more than 60 billion euros ($79 billion) in share value after Apple Inc. leapfrogged it with the iPhone. Siilasmaa will oversee Chief Executive Officer Stephen Elop’s efforts to win customers as Apple and Google Inc. expand into new markets.
Ollila, 61, will retire, Nokia said in a statement. As CEO from 1992 to 2006, he transformed Nokia from an industrial conglomerate to the world’s top mobile-phone maker. He has been chairman since 1999. Last year, he replaced hand-picked CEO successor Olli-Pekka Kallasvuo with Elop, a Microsoft executive, to reverse the tailspin.
The fact that Nokia had been eclipsed in smartphones gradually became apparent to shareholders in the three years after the 2007 Apple iPhone introduction. Nokia’s debt ratings were cut last year by Standard & Poor’s and Moody’s on concerns that a turnaround would take too long.
Finnish Startups
An investor in Finnish startups, Siilasmaa may also broker more tie-ups with new companies such as “Angry Birds” maker Rovio Entertainment Ltd.
“I don’t want to leave a fortune to my kids,” Siilasmaa told a panel on startup investment at Aalto University in September. “I want to spend it on startups.”
Siilasmaa started F-Secure, originally called Data Fellows, in 1988 as a student at the Finnish technology institute that is now Aalto University. The company listed shares on the Helsinki stock exchange in 1999, the last major high-tech company to join the stock exchange in the Nordic country.
He owned 39.73 percent of F-Secure as of Dec. 31, according to the company’s website. He has invested in Finnish startups including online shopping portal Fruugo Oy, together with Ollila, and micropayment supplier Ape Payment Oy, and worked with the Finnish government to establish startup incubators.
To contact the reporter on this story: Diana ben-Aaron in Helsinki at dbenaaron1@bloomberg.net
To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net
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Apple CEO faces first test with cash mountain | View Clip
01/26/2012
Reuters
Apple CEO faces first test with cash mountain
By Poornima Gupta
(Reuters) – Apple CEO Tim Cook has a problem, a $98 billion problem.
Just 18 months ago, Apple’s $46 billion mountain of cash – while huge by most standards – attracted only muted complaints from investors, who did call for a dividend or share buyback, but were mostly happy with the meteoric rise in the stock price.
But with the growing cash balance now a much bigger overhang on the stock, widely considered to be undervalued, investors are clamoring more vocally for Cook to put the money to work.
No one could have foreseen just how quickly that warchest would grow. Indeed, some analysts estimated Apple’s cash holdings would increase to $65 billion at the end of 201l. That it has swelled nearly 50 percent above even those lofty projections is nothing short of awesome.
Apple now has about $104 in cash per share.
But to paraphrase rapper P. Diddy, with more money comes more problems. Apple’s runaway success presents Cook with his first real public test as chief executive officer – figuring out what to do with the money.
Apple’s cash balance is now a quarter of its $415 billion market capitalization and roughly equals California’s 2012-2013 state budget. And even though $64 billion of Apple’s cash is overseas – meaning it will have to pay a hefty tax to bring it into the United States – calls for a dividend on Wall Street grew louder after the company said on Tuesday it was in “active discussions” internally on what to do with the money.
Wall Street is strongly in favor of Apple returning the money to shareholders through buybacks or dividends, even if it is only a one-time deal. But the ultra-conservative company, which typically ignores Wall Street, gave no clues about that during its earnings call on Tuesday.
“They are clearly trying to signal that they are not ignoring the issue,” said Michael Holt, an analyst with Morningstar. “It doesn’t mean that a decision is imminent.”
Others, however, are convinced a dividend will be paid this year.
“With Apple stating that it is ‘actively’ pursuing its options with regards to its cash balance, we believe the commentary may be setting itself up for a cash dividend in FY12,” Ticonderoga Securities analyst Brian White said, raising his target on the stock to $666.
Katy Huberty, an analyst with Morgan Stanley, echoed White’s view, saying: “Apple appears committed to making a decision on cash return in the near-term and we continue to believe a dividend makes the most sense.”
Some big technology companies have started paying a dividend to help allay investor concerns about slowing growth by returning part of their ample cash holdings. Cisco Systems Inc began paying a dividend last year, while Microsoft Corp started in 2003.
FAR TOO MUCH MONEY
Apple stock gained 25 percent in 2011, adding about $77 billion to its market cap and it touched an all-time high of $454.45 on Wednesday. Some continue to bank on a share-price rise to as high as $700.
The company’s core business is throwing off massive amounts of cash every quarter – Apple recorded a $16 billion increase in cash sequentially – in part because of its reluctance to pay a dividend or buy back stock and its limited acquisition history.
The company earned a mere 0.77 percent on its cash and investments in fiscal 2011, mostly due to its preference for safe, but low-yielding U.S. Treasury and agency debt.
This is a tad higher than the 0.75 percent it earned in fiscal 2010, but down from 1.43 percent in fiscal 2009, 3.44 percent in 2008 and 5.27 percent in 2007.
Fiscal prudence has long been part of Apple’s mantra and the Cupertino, California-based company runs a tight ship with total revenue rising 66 percent in fiscal 2011, but operating expenses rising only 37 percent.
For now, Apple’s Chief Financial Officer, Peter Oppenheimer, has veered away from his usual script, which was to tell Wall Street that Apple has always had internal discussions on the best use of its cash, with capital preservation being key.
He characterized these discussion as “active” on Tuesday.
“We recognize that the cash is growing for all the right reasons,” Oppenheimer said, but added he had nothing to announce. “In the meantime, we’re not letting it burn a hole in our pockets.”
Oppenheimer also suggested that Apple might invest in its supply chain or make acquisitions. But Apple has typically preferred to acquire small companies, which has had little or no material impact on its results so far.
Apple’s major expense last year was paying the lion’s share to acquire – along with Microsoft and a few other companies – the patent portfolio of bankrupt telecommunications company Nortel for $4.5 billion.
Apple said it spent $4.3 billion in fiscal 2011 to acquire “property, plant and equipment,” $3.2 billion in “acquisition of intangible assets” and $244 million in “payments made in connection with business acquisitions,” according to its annual regulatory filing.
That is in sharp contrast to rivals such as Google Inc, which is acquiring Motorola Mobility for $12.5 billion in cash, and which completed 54 acquisitions during the first nine months of last year alone. The company’s $44.6 billion warchest of cash and investments at the end of December was far lower than Apple’s.
Google has also resisted pressure to announce a dividend or buy back stock.
Apple may do the same in the next few months, said Michael Walkley, an analyst with Canaccord Genuity.
“We believe Apple is likely to announce a dividend during 2012, potentially next quarter when crossing $100 billion in cash and cash equivalents,” Walkley said. “We view this as very bullish for investors, as we believe a new group of investors seeking dividends would invest in Apple and drive shares higher.”
(Reporting By Poornima Gupta; editing by Andre Grenon)
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Ericsson would consider buying Nokia Siemens assets – CFO | View Clip
01/26/2012
Total Telecom Online
Ericsson would consider buying Nokia Siemens assets – CFO
By Nick Wood, Total Telecom
Jan Frykhammar says company has responsibility to shareholders to identify assets that ‘can add value’ to company.
Ericsson CFO Jan Frykhammar revealed to Total Telecom this week that the company would consider acquiring assets from rival Nokia Siemens Networks – provided they were up for sale.
“If they put out assets for sale and there comes official processes, I think our responsibility… is – if we are invited to have a look – [to] look at them,” he said on the sidelines of Ericsson’s fourth quarter results presentation on Wednesday.
“If we see that an asset can add value to our company we consider acquiring it,” he continued, citing recent examples including Ericsson’s $1.15 billion purchase of Telcordia in June 2011 and its participation in the consortium that bought Nortel’s patent portfolio a month later for $4.5 billion.
A GigaOM report on Wednesday also linked the Swedish kit vendor with a move for Canadian WiFi specialist BelAir networks.
However, Frykhammar insisted Ericsson is not specifically planning to buy parts of NSN.
“As a leadership team we do not speculate on consolidation,” he said. “If assets are available we look at them; whether we go and acquire assets, that’s completely different.”
Nokia Siemens Networks in November announced plans to refocus the business entirely on mobile broadband and divest or manage for value any assets that fall outside that remit. The move will see 17,000 jobs cut in a bid to reduce costs by €1 billion.
So far NSN has offloaded its WiMAX business to Skyview Capital-owned NewNet Communication Technologies, and its fixed broadband access division to network specialist Adtran for undisclosed fees.
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Apple Q1 results show why the iPhone doesn’t have LTE–yet | View Clip
01/25/2012
Ars Technica
Apple Q1 results show why the iPhone doesn’t have LTE—yet
By Chris Foresman
Apple released its iPhone 4S without high-speed LTE capabilities amidst a sea of high-profile LTE Android handsets. While technophiles complained about lack of support for the next-generation wireless standard, there are multiple reasons Apple has so far shied away from the technology. Poor battery life and lack of a suitable baseband processor to fit the iPhone’s form factor are two reasons that have been cited by Apple in the past. But the company’s most recent financial results offer another clear reason: the majority of iPhones sold today are in areas without 4G networks of any kind.
The US has one of the only significant LTE rollouts in the world. A few major cities in Canada, Sweden, and Saudi Arabia account for most of the rest of the global LTE network availability. Nearly all of Europe, Asia, South America, Africa, and Australia lack any LTE service outside of tiny test markets.
After looking at Apple’s results for its fiscal first quarter of 2012, there’s no question that the iPhone continues to be a success. The company sold a record 37 million handsets—as much as the two previous quarters combined, including the record 20 million sold in fiscal third quarter 2011. A large majority of those iPhones were sold outside the US.
Comparing Apple’s revenue sources for the past two years, you can see that the iPhone is critical to Apple’s bottom line.
Data: Apple financial resultsWho would an LTE iPhone benefit?
According to fourth quarter 2011 results, AT&T activated 4.1 million iPhones, while Verizon activated 4.2 million. Sprint would not disclose the number of iPhones it activated last quarter, but we feel safe in assuming that number is less than 4 million. Assuming Sprint was able to activate (perhaps a generous) 2 million or so iPhones, only a little over a quarter of iPhones were sold in the US. The other three-quarters, then, are sold in areas with practically no LTE coverage.
Considering the US market alone, only Verizon has LTE service available to most of its customers. AT&T very recently turned on its first round of LTE towers in a few major US cities, though it will be well to the end of 2012 before its LTE network closes in on Verizon’s. Sprint has a large 4G WiMAX footprint, but that is incompatible with the technology behind LTE. The company announced earlier this month that it would begin rolling out LTE in limited markets by the first half of 2012.
Since roughly less than half of US iPhone users would even have the chance of getting LTE reception, at most 15 percent or less of iPhone users globally could take advantage of 4G speeds. Though Apple has been known to occasionally make separate devices for different markets—for instance, you could get an iPhone 3GS without WiFi in China, or an iPhone 4S without a camera in Singapore—the company generally prefers to stick to a single device configuration whenever possible. So far, it just hasn’t been practical to include LTE hardware in the iPhone when only a small fraction of users could benefit from it.
LTE iPhone sooner than later
Still, that doesn’t mean other factors won’t come into play that could bring LTE to the iPhone later this year or early next year. Qualcomm, Apple’s current baseband supplier of choice, has new versions of chips with integrated LTE support coming this year. Similar in design to the chips currently in use in the iPhone 4S and iPad 2, the MDM9615 supports LTE category 3, HSPA+, and EV-DO rev B high-speed wireless networks. It’s also manufactured on a 28nm process, offering significant size and power consumption advantages over existing single or multi-chip solutions.
The MDM9615 is supposed to be available in quantity to OEMs in this first quarter of 2012, so it’s possible that chip could make it into a next-generation iPad expected around March or April, as well as a next-generation iPhone likely targeted for late summer or early fall.
Since the US will still be the only major LTE market throughout 2012, Apple might rely on one of two other possible strategies for LTE adoption. It may make iPhones using the newer Qualcomm chip specifically for the US and perhaps some of the few other LTE markets later this year. iPhones for the rest of the world may still use a chip that only includes compatibility with HSPA+ and EV-DO networks.
Alternately, Apple may hold out for greater LTE adoption among its carrier partners. This is similar to the situation with the original iPhone—that device launched with support for relatively slow 2G EDGE networks in 2007 instead of the faster, 3G UMTS networks more popular outside the US. As the iPhone became available globally, Apple added support for the faster standard in the iPhone 3G one year later. In this scenario, Apple may wait for a third-generation MDM9×25 series baseband chips from Qualcomm slated for 2013.
Though LTE has been seen as a competitive advantage for Android-based smartphones, the iPhone’s lack of LTE compatibility clearly hasn’t slowed down its brisk sales clip. Apple CEO Tim Cook claimed during Apple’s quarterly analyst call on Tuesday that the company could have sold even more iPhones if it could keep up with demand. However, Apple won’t be able to ignore LTE forever, particularly in the US. Where exactly the tipping point lies is uncertain, but we’re betting on sooner rather than later.
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Google’s Superphone Delivers Ultimate Android: Rich Jaroslovsky | View Clip
01/25/2012
Bloomberg BusinessWeek
Google’s Superphone Delivers Ultimate Android: Rich Jaroslovsky
For the last couple of years, Google has reserved the “Nexus” label for smartphones that provide the purest experience of its Android operating system. Meanwhile, Samsung (005930) has used the “Galaxy” brand on its top-of- the-line mobile devices.
So what do you get when you marry the two and put the result on the best 4G network? The Galaxy Nexus, a superphone that is still somehow a little less than the sum of its considerable parts.
The Galaxy Nexus, which costs $299 on a two-year contract from Verizon Wireless, is the first device to ship with Android 4.0, or in Google’s dessert-based nomenclature, “Ice Cream Sandwich.” It is supposed to blend the separate cell-phone (“Froyo,” “Gingerbread”) and tablet (“Honeycomb”) flavors of Android’s operating systems.
The idea is to simplify things both for developers, who otherwise have to worry that apps written for one version of Android won’t run on another, and for consumers, giving them a similar experience no matter what kind of device they’re using. Apple (AAPL), not surprisingly, set the bar here with one operating system — iOS — running iPads, iPhones and iPod Touches.
Lard-Free
The Nexus phone is mercifully free from the proprietary user interfaces and apps that manufacturers and carriers often lard atop Android. And Ice Cream Sandwich brings some welcome enhancements.
Physical buttons are out. In their place are on-screen back, home and recent-apps controls that rotate along with the display when you turn the phone into portrait mode. You can also create folders of apps by stacking them one atop the other, and — as on Honeycomb tablets — summon thumbnail images of open apps with the recent button. If you see one you don’t need, a sideways finger flick dismisses it.
One major innovation isn’t so successful: Face Unlock, which theoretically allows you to unlock your phone simply by holding it up to your face and letting it recognize you. It’s a neat trick when it works, but I repeatedly got error messages telling me I couldn’t be recognized. Take it from me: Few things in technology are as depressing as being rejected by your own phone.
Insecure
Some users, meanwhile, have reported being able to fool the feature by holding up a photo of themselves; even Google (GOOG) warns during the set-up process that Face Unlock is less secure than other ways of protecting your phone.
As for the Galaxy Nexus hardware, it’s handsome without being particularly distinctive. The nicest feature is the big 4.65-inch screen that, typically for Samsung devices, is absolutely gorgeous, with deep blacks and ultra-rich colors. My main complaint was the automatic-brightness level, which is supposed to adjust to ambient light but that I found consistently too dim for my tastes. Eventually, I went into the settings and disabled it.
Under the hood is a dual-core Texas Instruments (TXN) processor, plus a gigabyte of memory and 32 gigs of storage. There are also 1.3-megapixel front and 5-megapixel rear-facing cameras, and it shoots video in full 1080p high-definition. The whole package is still only a third of an inch thick and weighs about 4.8 ounces.
Power Outage
In the U.S., the Galaxy Nexus runs on Verizon (VZ)’s LTE 4G network. LTE is the fastest network technology, and Verizon has the broadest coverage. But there’s a catch: LTE also gobbles battery life. I’ve generally found that Samsung does the best job among LTE handset-makers in managing power. But I’d be tempted to take advantage of the fact that — unlike iPhones — the Galaxy Nexus’s battery is user-replaceable, and carry a spare.
A version of the phone is also in the works for Sprint (S), which will start rolling out LTE this year. A model with 16 gigabytes of storage and using HSPA+ — yet another network technology — is available in other nations where LTE isn’t widespread. Carriers offering this version of the phone include Vodafone (VOD) and Telefonica (TEF)’s O2.
Because of Google’s open-to-all-manufacturers approach, it’s hard for any Android phone to match the seamlessness of an iPhone, Research In Motion (RIM)’s BlackBerry or even devices running Microsoft (MSFT)’s Windows Phone 7. Perhaps that will change after Google takes control of handset-maker Motorola Mobility Holdings (MMI). Until then, the Galaxy Nexus comes closer than anything yet to providing the definitive Android experience.
(Rich Jaroslovsky is a Bloomberg News columnist. The opinions expressed are his own.)
To contact the reporter on this story: Rich Jaroslovsky in San Francisco at rjaroslovsky@bloomberg.net.
To contact the editor responsible for this story: Manuela Hoelterhoff at mhoelterhoff@bloomberg.net.
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H-P Reveals Details Of WebOS Plan | View Clip
01/25/2012
Wall Street Journal – San Francisco Bureau
H-P Reveals Details Of WebOS Plan
By Ben Worthen
Hewlett-Packard took a step towards following through on its promise to make webOS, its operating system for mobile devices, available for free to any programmer who wants to use it.
The technology giant on Wednesday said it would make a program for writing apps that can run on different devices available immediately this way, known in tech circles as open source, and that webOS itself would be available by the end of September.
H-P also laid out certain milestones it intends to hit between now and then, and specified that it would make the software available using the Apache open-source model.
Bill Veghte, H-P’s chief strategy officer, said the timeline would help drive interest in webOS, a widely praised technology that was a commercial failure. “Some people were interested but they wanted to see a timeline, see a license, and see what we were going to release first,” he said.
Veghte also stressed that H-P unveiled its plans for webOS just 47 days after it first said it would make it open source. (Expect a lot of talk about execution and following through on commitments from H-P moving forward, as it looks to be an early theme of new Chief Executive Meg Whitman’s tenure.)
WebOS still has an uphill battle to be relevant, as it trails in market share to several other mobile operating systems. H-P’s move to make it open source is an effort to let developers carve out a niche for it, something H-P was unable to do on its own.
It isn’t yet clear how H-P will benefit from making webOS available this way, even if it does become popular. Veghte said that isn’t the primary concern right now and that it is “too early to tell” how H-P will make money from the effort. Over time, however, he expects a business model to present itself.
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New RIM CEO eyes consumer push | View Clip
01/25/2012
Reuters – Toronto Bureau
New RIM CEO eyes consumer push
The new Chief Executive of Research in Motion Ltd plans to reorganize the company’s marketing in order to do a better job at promoting its products to consumers.
Thorsten Heins told analysts on Monday that reaching beyond the corporate smartphone market to consumers will be particularly important in the U.S. market, where RIM’s BlackBerry smartphone has lost ground to rivals like the Apple Inc’s iPhone.
RIM announced on Sunday that Heins would take over as CEO from founders and Co-CEOs Mike Lazaridis and Jim Balsillie.
(Reporting By Alastair Sharp and Sinead Carew; Editing by Gerald E. McCormick)
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