Motorola to Embed Video Projector inside Mobile Phones

Interesting and pretty handy application.

Motorola to Embed Video Projector inside Mobile Phones

Microvision says that it has signed an agreement with Motorola to develop pico projector display solutions for mobile applications leveraging Microvision's ultra-miniature laser based display engine, called PicoP. Tiny laser-based projectors are expected to enable a "big screen" viewing experience from mobile devices, by projecting content displayed on the device screen onto a nearby wall or clean surface

"Motorola is committed to driving technology innovation that will enable the next generation of great consumer experiences," said Rob Shaddock, CTO, Motorola Mobile Devices business. "Working together with Microvision, we are pursuing ways that projection technology can redefine how mobile consumers view and interact with the media they take with them."
"With its slim form factor and low power requirements, Microvision's PicoP projector is optimized for the mobile environment," stated Alexander Tokman, President and CEO of Microvision. "We believe that our unique display technology, combined with Motorola's focus on delivering cool experiences, would allow mobile users to enhance their viewing of information and entertainment."

Terms of the agreement were not disclosed, however the companies revealed they will work together initially to integrate Microvision's latest PicoP projector inside a functioning mobile device for demonstration purposes. This prototype handset will utilize Microvision's new, WVGA (854 x 480 color pixels) wide angle scanner, first demonstrated in May 2007 at the Society of Information Display annual conference.

Moto: Hello Zero

Motorola seems to be going into a dangerous vortex. Portfolio and prospects for the enterprise division are modest at best, the networks business doesn't have the scale to be viable and the handsets group has a very weak and relatively narrow portfolio.

Moto: Hello Zero
JULY 19, 2007

Motorola Inc.'s second-quarter results are as bad as the networking giant had already warned they would be, with handset shipments slumping by approximately a third this spring.

The Schaumburg, Ill.-based company posted a net loss of $28 million, or $0.01 a share -- compared with a profit of $1.38 billion, or $0.55 a share, in the year-ago quarter -- on revenues that fell 19 percent to $8.7 billion. Thomson Financial analysts had expected earnings of less than a cent per share on revenues of $8.64 billion; Reuters Research analysts had expected EPS of zero.

Motorola, which has been the second-ranked handset vendor after Nokia Corp. for years, may see rivals like Samsung Electronics Co. Ltd. overtake it as its market share declines, according to analysts. Motorola says it shipped 35.5 million phones in the second quarter, giving it around 13.5 percent of the worldwide market.

Motorola reiterated its latest warning that the mobile devices unit will not be profitable in 2007, but it expects some financial improvement in the second half of year.

This week, Motorola has reorganized its business into three units in a bid to shore up its losses. These are: mobile devices; an enterprise unit that now includes the Good mobile email business; and a network equipment unit that includes its cable and set-top business.

Mobile devices is still the center of Motorola's pain, however. The company has not managed to replicate the worldwide success of its RAZR phone and has seen a decline in average selling prices for phones as competition gets more fierce.

The firm has already cut 7,500 jobs in a bid to to achieve $1 billion in cost savings through 2008.

Sprint & Google: Max Headroom

I see an increasing interest from Google in the telecoms services arena be it the involvement with Sprint's WiMax plans, the rumoured Google phone or the interest in the 700 MHz frequency auction in the US.


Sprint & Google: Max Headroom
JULY 27, 2007

Sprint Nextel Corp. says it may tap Google for more than just Web portal applications for its WiMax network, which is due to launch nationwide in April.

"We are exploring other avenues with them," a Sprint spokesman tells Unstrung, without offering any further details.

The pair have teamed up to develop a co-branded mobile Internet portal that will let users access email, search the Web for local attractions, and chat over the wireless broadband connection. The applications will be available in beta during the first quarter of 2008 and ready for commercial launch in April, according to Sprint.

"We want Sprint to be the name you think of when you think of the mobile Internet," the spokesguy says. [Ed note: I normally think of endless, nameless horror when I think of the present-day mobile Web, but... whatever...]

Unstrung predicted back in May that Google would get involved with Sprint's WiMax plans. Sprint has already said it is examining its options on how to pay for its 2008 WiMax deployment, and to that end is now jointly working with Clearwire LLC to build out the network.
Google, of course, has been in the news for its renewed interest in wireless broadband during the past week. The search giant proposed a $4.6 billion bid for 700MHz spectrum if the Federal Communications Commission (FCC) agrees to some "open access" conditions. This doesn't now seem likely to gain approval.

Google is also rumored to be carrying out its own WiMax tests in Mountain View, Calif. These, however, are mainly concerned with backhauling data off its mesh WiFi network.

DoT sets Indian WiMAX map

The WiMax Forum has globally begun certifying fixed/stationary equipment in the 3.5 and 5.8 GHz bands and mobile gear in the 2.3, 2.5 and 3.5 GHz bands.

To reap the benefits of standardisation such as wider choice and economies of scale, India's WiMax frequency allocation must be in line with global allocations.

DoT sets Indian WiMAX map

India’s Department of Telecommunications has set out its plans for WiMAX deployment proposing that initially only three WiMAX licenses should be allocated to operators in the 2.5GHz spectrum band, according to local reports.

Moreover, reports say that the DoT has also recommended that one of the three slots be reserved for state-owned operator MTNL in Mumbai and Delhi and sister-firm BSNL in the rest of the country meaning that private ISP’s would be left to compete for just two slots.

The DoT’s WiMAX plans run counter to those issued earlier by the Telecom Regulatory Authority of India (TRAI) which had suggested that WiMAX be deployed in the 3.3-3.4GHz and 3.4-3.6GHz bands with up to 13 licenses issued. The DoT’s WiMAX proposals must now be given the green light by communications minister A. Raja.

Apple Hopes to Sell 1 Million iPhones in Three Months

A pretty rocking start mr. Jobs ! I also expect some new/improved models from Apple before the end of the year. Issues like 3G, better camera, more compact form factor, etc. are likely to be addressed in the same.

Apple Hopes to Sell 1 Million iPhones in Three Months

SAN FRANCISCO -(Dow Jones)- Apple said Wednesday that it hopes to sell its one millionth iPhone by the end of its first full quarter of sales, slower than some may have anticipated.
Apple's overall strong results lifted the company's stock in after-hours trading. Shares recently traded at $147.80, up 7.3% from Wednesday's close. The stock's all-time intraday regular-session high, set Monday, is $145.22.

Apple's iPhone forecast suggests the wild estimates surrounding its launch - such as those suggesting 700,000 units sold over the first weekend - may have been off base. In light of that, Apple may face pressure to spur sales by introducing the next version of its iPhone sooner than planned, such as one that fixes the iPhone's most discussed flaws, its slow Internet network.
The iPhone operates on AT&T's Edge wireless data network, which provides an Internet experience that is similar to a fast dial-up connection.

That's too slow for some people, especially those weaned on broadband. As a result, many say they are putting off buying the device until it can be connected to a faster wireless data network.
"It's just too slow for me," said Ben Creighton, a 45-year-old Richmond, Calif., resident who was shopping for an iPhone in San Francisco. While the iPhone offers a faster Wi-Fi wireless connection, "there's going to be lots of times when I won't be near a Wi-Fi network,' he added.
Speculation is increasing that Apple will introduce an improved iPhone around November, in order to keep sales momentum going. Apple's goal is to sell 10 million iPhones by the end of 2008.

"Steve Jobs (Apple's Chief Executive) admitted the iPhone's connectivity could use an improvement," said George Iwanyc, of CIBC World Markets. "We believe that 'improvement' could come soon."

That improvement would be an iPhone compatible with the growing number of third-generation cellphone networks that have Internet connections that rival and, in some instances, surpass the performance of a wired Internet connection.

An upgraded iPhone is expected. Recent patents point to a smaller, slimmed down version of the device, but many don't expect that until sometime next year.

Meanwhile, Apple plans to sell the iPhone in Europe soon, as it tries to meet its goal of selling a million of the devices over the next three months. It will also introduce the iPhone in Asia in 2008.

AT&T was first to indicate this week that iPhone sales results may not have been as robust as suggested when it reported Tuesday that 146,000 iPhone buyers signed up for service in the first two days of its launch.

Apple said it sold 270,000 iPhones during the device's first 30 hours of availability, and it recorded $92 million in deferred revenue from iPhone and Apple TV sales for the quarter ended June 30. In the quarter ended March 31, before the iPhone went on sale, Apple reported $10 million in deferred revenue in that category.

As a whole, though, Apple's booming core businesses is masking any iPhone disappointment. As its third-quarter financial results show, its core businesses of selling computers is setting sales records and eating up market share.

Now Google wants to be a telco

Would be interesting to see if Google can impregnate the wireless bastion in the US and become an service provider/MVNO. Google would be delighted if it could subvert the existing mobile business model and subsidise both voice and data calls by advertising.

Now Google wants to be a telco
23/07/2007 11:51:00 - by Martyn Warwick

The Cookie Monster, whose gargantuan appetite simply cannot be assuaged no matter what it eats, having gobbled up much of the Internet is now about to get its teeth into telecoms. There is even the possibility that before too much longer there might even be such a things as a Google phone!

Over the weekend, the giant web company disclosed that it will be a bidder in the upcoming auction of a swathe of US wireless spectrum. Google says it is willing to bid at least US$6.4 billion as it seeks to become a mobile operator, but will do so only if the Federal Communications Commission (FCC) accepts and imposes a set of rules that would certainly be favourable to the search engine company but that have already been flatly rejected by other, established cell phone operators.

Google's gambit is to put pressure on the FCC in the remaining few days before the regulator published the parameters under which the tranche of 700MHz spectrum, newly freed-up by TV broadcasters going digital, will go on the slab. The auction itself will take place in January 2008.

The established US wireless carriers are understandably wary of what Google is up to and deeply suspicious of its motives. Verizon Wireless has dismissed Google's demands as "tantamount to corporate welfare" for the search engine company while AT&T refers to Google's "requirements" if it is to join the spectrum auction as an "all or nothing ultimatum" that should be ignored. Meanwhile, Steve Largent, the head of the wireless industry trade group the CTIA says Google is trying to get the auction "rigged with special conditions in its favour."

AT&T and the others do have some friends in high places in this regard. Kevin Martin, the chairman of the FCC, has himself already refused two of Googles four proposed "conditions". However, Mr. Martin has also indicated that he has some sympathy with Google's two remaining "suggestions" and so the door to the auction room remains ajar.

In point of fact, Google has already spent millions of bucks on mobile technology in an effort to be ready quickly to go beyond the mobile search and mobile map services it currently offers. However, the company has been reticent on exactly what it plans to do and only last week CEO Eric Schmidt, in a presentation to Wall Street analysts, parried questions about the company's mobile ambitions with the bland and non-commital response, "We are looking carefully at wireless and are thinking about what we want to do there." Yeah, well, we knew that much already.

Pressed on the issue, Mr. Schmidt did go so far as to stress that Google considers it of prime importance that a network should permit any device to have access to it, and those devices should provide users with a portal to the complete Internet rather than a subset of it.

To knowing nods and winks, the CEO added that were such circumstances to pertain, mobile phone subscribers would become "significant consumers" of online advertising on a cellular handset. Lest we forget, online advertising is Google's core business and the company's bread and butter and the Google would be delighted if it could subvert the existing mobile business model and subsidise both voice and data calls by advertising.

Thus the company's vision of the wireless future is very much at odds with that of the established operators. Google looks forward to the day when consumers will be able to buy a handset at almost any kind of retail outlet and would then be free to sign-up with any mobile operator and put any software from any source onto their cell phones.

Such a notion is absolute anathema to the likes of AT&T and Verizon who are determined to maintain the lucrative (for them) status quo.

It seems likely that the FCC's decision on the rules for the spectrum auction could determine the mobile and wireless Internet access landscape in the US for a generation. Google, and other ISPs too, say the auction, that is expected to raise at least $10 billion, should break the cosy broadband duopoly that the fixed-line telcos and cable companies have carved-out for themselves and are ferociously protecting againt any would-be competitors.

In the Google world, the top bidder for approximately 33 per cent of the spectrum on offer would adopt an "open access" policy that make it available to resellers on a wholesale basis and under "nondiscriminatory commercial terms".

Further, it would allow consumers to use any handset and access any mobile Internet service over the network without requiring the permission of the operator. This is a revised but markedly similar version of the "network neutrality" proposals put forward by ISPs in regard to America's fixed line networks.

The ISPs aren't doing too well in that regard and like their fixed-line brethren, the mobile carriers similarly oppose the wholesale terms proposal, saying that it would "Undermine the business model of the traditional wireless industry."

The trouble is that the US wireless operators regard the dead hand of duopoly control as their birthright. They do everything they can to keep power over the customer in their own hands in a way that would not only be unacceptable but also unthinkable in other parts of the world.

For example, they decide what features their subscribers may have access to and use from the vast menu of capabilities built into mobile handsets by the manufacturers; they also determine what software can be uploaded and how it can be used. Then they tie-in consumers with long and onerous contracts of Kafka-esque complexity and round the whole lot off with some swingeing and extremely expensive penalty clauses for subscribers who want to take their business elsewhere.

And let's remember this is the USA, the supposed bastion of individual choice and freebooting competitive capitalism. If the same thing applied in, oh, let's say Cuba, for example, you can bet that the US media would be up in arms about the abysmal treatment of the huddled masses. Strange that they're not doing the same thing on their home turf. Or maybe not given the power of the established wireless and cable lobby it's not strange at all?

One particularly questionable, nay, devious and nasty tack being taken by Verizon Wireless in its determination that Google's proposals shall not pass is that were the carrier be required to open its network to handsets that Verizon itself has not approved and that therefore "cannot reliably communicate with law enforcement" would prove a grave and intractable problem "in an era of national security concerns".

Of course it wouldn't, but Verizon's subtext is, "Stay with us or you'll let terrorists in".

Samuel Johnson was right when in April 1775, a year before the US Declaration of Independence, he said, "Patriotism is the last refuge of a scoundrel."

A couple of weeks ago, Representative Edward Markey, a Massachusetts Democrat, chaired a house hearing on wireless innovation and consumer protection. It was lobbied against hard by the established cellular operators. During the hearing Markey held up an iPhone as the perfect example of how the mobile service providers maintain a hammer-lock on the sector and exert "far too much control over the features, functions and applications that wireless gadget makers and content entrepreneurs can offer directly to consumers."

He than asked, "Why is it that AT&T imposes a two-year contract with a US$175 early-termination of contract fee even though the cost of the phone has not been subsidised and the consumer can't even take it to use with another network provider."

M Now that's a damn good question. Needless to say, AT&T has signally failed to answer it. Google may be turning into a monster, but the US mobile operators and their grudgingly accepted cable company cousins are equally ugly, and equally greedy.

New list of Top Ten Trends for global telecoms industry

Surprising to see Mobile TV missing in the pecking order. IPTV, Mobile Advertising and Convergence definitely figure amongst my favourites list

New list of Top Ten Trends for global telecoms industry
26/07/2007 - Commsday

A telecoms industry research company claims that subscriber growth will be the number one ‘critical development’ in the Asia Pacific region through 2008. Pyramid Research has just released a list of the Top Ten Trends that will influence the telecoms sector in the region (and elsewhere) throughout the coming year.

The new research shows that subscriber growth is expected to be highest in Indonesia, which will see a 45 per cent increase in its broadband market ever year for the next five years. By 2012, 80 per cent of Asia’s mobile subscribers will be from China, India, Indonesia, and Pakistan, with regional subscriptions totaling 2.2 billion.

Second on the list of trends is the almost exponential growth of mobile data revenue. It is expected to triple over the next five years to US$110 billion. However, the report also notes that as the mobile data market grows, spending per user will decrease as broadband penetration increases.

Mobile advertising takes third position, with the report stating that “competition from free advertising models will serve as a litmus test for future business models in the region.” This fits well with estimates predicting mobile advertising globally is set to boom and will grow from a value of $871 million in 2006 up to US$4 billion by 2008.

WiMax adoption has been identified as the fourth most important trend for the industry in 2008, even though the report states that WiMax deployment “remains elusive” in the Asia Pacific. It adds that Australian implementation of WiMax may prove influential to the success of the technology in the region, but the US, Japanese and Korean markets will also affect its spread.

The report also says that 2008 will be a critical year for IPTV services, noting that although IPTV has been widely adopted in Korean and Hong Kong markets, it may continue to struggle to reach profitability.

The other five factors that to influence the industry are handsets, capital expenditures, mergers and acquisitions, convergence, and mobile virtual network operators. The report says global MVNO subscribers will reach 129 million by 2011.

The Mobile TV Wars

In my opinion, the business model for broadcast Mobile TV is yet to be proven and we don't have too many details from the Italian DVB-H deployments, the oldest and largest broadcast Mobile TV deployments. I just feel that any viable model will have to be based on a combination of advertising and subscription.

The Mobile TV Wars

Qualcomm's MediaFlo and MobiTV are set to duke it out in the battle for this emerging business.

The mobile TV shakeout has begun: Modeo, a subsidiary of cellular tower operator Crown Castle International, has shut down its one broadcast network in the New York City area, leaving the emerging business of delivering live TV programs to just a handful of players.

For months, Modeo had stubbornly clung to life as it searched for a carrier willing to share its network development costs and subscribe to its service. Having already lost out on a potential customer in Verizon Wireless, which signed on last year with a rival venture backed by Qualcomm, Modeo suffered a second major blow in early 2007 when AT&T also decided to go with MediaFlo.

Verizon now offers MediaFlo's eight-channel service on cell phones in 32 markets, and AT&T plans to go live in the fall. "It's full steam ahead for us," says Gina Lombardi, president of MediaFlo USA.

Selling Spectrum

Other carriers, including Sprint Nextel, have reaffirmed their ties to MobiTV, a pioneer in this new market. MobiTV streams video channels over a carrier's cellular network instead of a separate, dedicated network of wireless towers like those planned by Modeo and being built by MediaFlo.

Modeo insisted there was still a business to be built in delivering TV to laptops, iPods, and other mobile devices. But with three of the nation's four national cell carriers divided between MediaFlo and MobiTV, there was truly little market opportunity left for Modeo.

So on July 23, Crown Castle announced that it had reached a deal with the investment firms Telecom Ventures and Columbia Capital to lease Modeo's spectrum licenses to use certain portions of the airwaves in markets around the country. The venture capital firms will pay $13 million a year for six years, after which they'll have the option of renewing the lease or buying the spectrum for $130 million.

For Crown Castle, which originally paid $13 million for the licenses, "it was a very profitable outcome," says Jay Brown, Crown Castle's treasurer. The company won't say, however, how much it invested in developing Modeo, building the New York network, or running that trial.

Subscribers Needed

Even with Modeo out of the way, it's not clear how easily the remaining competitors will recoup their investments in this unproven market. Though many have scoffed at the notion of squinting at videos on a tiny screen, cell-phone users are showing an appetite for mobile TV just as consumers have come to love watching scratchy amateur videos from Google's YouTube on their computers. By the end of March, the number of U.S. mobile subscribers watching video on their phones had more than doubled, to 8.4 million people, compared with 12 months earlier, according to the research firm Telephia. Still, that number represents just 3.5% of all U.S. wireless users, and the vast majority of them are downloading short prerecorded clips rather than watching live TV channels like MediaFlo's.

One key question is how much consumers will be willing to spend on mobile TV. While some users may spend $4 or $5 a month to download video clips to their cell phones, the more robust mobile TV services with live channels are typically priced at $10 to $20 a month. Kanishka Agarwal, an analyst at Telephia, estimates that mobile TV revenues totaled $146 million in the first quarter, approaching the $168 million generated by mobile video games. "The mobile video business is catching up to businesses that have been around a while," he says.

To make it a profitable business, though, those revenues will have to grow much higher to pay back the investment required to build a network like MediaFlo. By the end of 2007, Qualcomm may have nearly 300,000 MediaFlo subscribers through Verizon and AT&T, according to consultancy In-Stat.

Making a hypothetical calculation, let's assume Qualcomm receives $10 a month per user (two-thirds of the fee Verizon collects from its MediaFlo subscribers), and that each of these customers pays for a full year. That would add up to just $36 million for the year.

By contrast, Qualcomm plans to spend $800 million just to build its nationwide network. And in terms of operating costs, Qualcomm reported July 25 that it spent $95 million in its just-ended quarter to deliver MediaFlo in just 32 of those planned markets. The bottom line: Getting a dedicated mobile TV network to pay for itself without a surge in subscribers will be tough.

Tough Competition

But for now, it appears that few wireless users are eager to pay for a mobile TV service. In June an In-Stat survey of some 1,000 U.S. households found that while 35% of the respondents were interested in free mobile video, fewer than 7% said they'd pay $15 a month. "People like those cool things, they just don't want to pay for them," sums up David Chamberlain, principal analyst with In-Stat. That means low-priced or free mobile video services that rely on ads to recoup their costs may prove more popular.

MediaFlo faces a cost disadvantage against some of those rivals. A service like MobiTV is cheaper for both carriers and users. While MediaFlo requires the purchase of special handsets that can pick up both cellular and TV broadcast signals—so far, Verizon Wireless only offers two—MobiTV works on some 175 cell-phone models. It also streams programs over the same network a carrier uses to connect wireless calls, cutting out the cost of a separate infrastructure. Initially, that also means MobiTV can offer wider coverage than does MediaFlo, a network that's still being built. On the downside, a cellular-based TV service could potentially clog a carrier's network if too many users are tuning in at the same time.

Cellular-based video services also can offer more TV channels and a wider selection of video downloads. Mywaves, introduced to Alltel subscribers on July 25, offers thousands of channels or recorded content to suit highly specific interests such as cooking shows on preparing spicy foods. The outfit, launched last December and already serving more than 1 million users, is adding new customers at a rate of 25,000 a day—a rate far greater than MediaFlo's—says Rajeev Raman, founder and CEO of mywaves. Alltel will only charge $3.99 a month for the service.

Testing the Water

Another source of competition for MediaFlo may be Internet video companies, which are just starting to dip their toes into the mobile TV waters. YouTube was introduced on Verizon Wireless' VCast service late last year and is now available on Apple's new iPhone device on the AT&T network. Also in July, YouTube teamed up with handset maker LG to design phones for viewing, shooting, and sharing user-generated videos.

There's also the possibility of new mobile video services being launched on the wireless spectrum that the government plans to auction next year. Google has said it might bid in the auction, a move that would enable it to potentially stream YouTube videos over its own network.

With so many competitive pressures percolating, industry insiders believe that Telecom Ventures and Columbia Capital won't seek to enter the mobile TV business with the Modeo spectrum. Columbia declined to comment, but the VC firms could be planning to use the spectrum to set up a wireless broadband network offering Web access, phone calls, and video services, suggests Scott Wills, president of Hiwire, a venture that just launched a mobile TV service trial in Las Vegas.

Since Columbia's investments include satellite properties such as XM Satellite Radio, Wills believes the firms may use the leased spectrum to enable XM or another satellite provider to deliver wireless broadband services.

Hiwire is conducting its mobile TV trial with T-Mobile USA, the one national cell carrier that hasn't yet put down its chips on mobile TV. Hiwire says it's simply trying to determine whether there's demand for the service—and a business model to support it. "The industry jargon is," says Wills, "Will the dog eat the dog food?"

Amp'd Switches Off

Does this reflect the lack of long term viability for the MVNO business model ? They might start of well by addressing certain niches but am sceptical on how this model would scale and how margins would be protected in the longer term.

Amp'd Switches Off
JULY 23, 2007

Short-lived mobile virtual network operator (MVNO) Amp'd Mobile Inc. is likely to shut its doors by the end of the month, according to a post on the firm's Website.

The two-year old operator has updated a statement on its Website to say that it is "potentially suspending U.S. operations on July 31st." Amp'd originally said it was shutting up shop this week. It claims that another carrier could buy its assets, saying that it is in talks with "several interested parties."

Amp'd had filed for Chapter 11 bankruptcy protection early in June, following revelations that many of its young customers hadn't been paying their bills, and that the firm owed its network operator, Verizon Wireless , millions of dolllars.

Even as it filed for Chapter 11, however, the Los Angeles-based MVNO was saying it would be able to return "stronger than ever" by working with a large investor to "obtain debtor-in-possession financing."

Apparently, this funding lifeline hasn't come through yet. Amp'd hasn't returned calls or emails on the matter.

Amp'd amply illustrates one of the two extremes in the U.S. virtual mobile operator market. Firms such as Amp'd have spent big and flamed out in short space of time. On the other hand, Virgin Mobile USA LLC has also built up debts but is plotting a $506 million IPO.

Nokia: It Takes Web 2.0 to Twango

Another addition to Nokia's expanding Web 2.0 armoury. Will be very interesting to see how the company, which is today solely device focused, morphs itself into an internet services company.

Nokia: It Takes Web 2.0 to Twango
JULY 24, 2007

Nokia Corp. has continued its advance into the Web 2.0 world of file sharing with the acquisition of Redmond-based social networking startup Twango . Financial details were not disclosed, though The Wall Street Journal reported that the deal was set to be worth no more than €70 million (US$96.7 million).

This isn't the first time Nokia has acquired a media sharing business based in the Seattle area: In August 2006 the mobile phone giant paid $60 million to buy wholesale music download services specialist Loudeye. And in June, Nokia's private equity arm invested in online TV startup kyte.tv .

That investment and the Twango acquisition will feed into Nokia's planned Services and Software division, one of the company's three new business units that will begin operations on January 1 next year.

Twango, though, operates in YouTube Inc. and MySpace territory, which is becoming increasingly crowded.

Twango, founded in 2004, which describes itself as "a free and fun place to share your photos, videos and audio," is a social networking site that allows its users to upload media files from fixed and mobile devices.

It launched in October 2006, boasting ease of use and the ability to support more than 110 file types. For example, users can add new files to their Twango "channel" by sending an email (with attachment) from a PC or mobile device to their Twango account. Twango is believed to have quite a small user base of a few tens of thousands.

Nokia says the acquisition will give it a "seasoned team with strong social media and Web services expertise." That team, which is now set to grow, currently totals just 10 people, including the five founders, all former Microsoft Corp. staffers (hence the Redmond location) -- Philip Carmichael, Serena Glover, Randy Kerr, Jim Laurel, and Mike Laurel. The company has, to date, been based in Glover's house and funded entirely by the founders.

The deal allows Nokia to tap into the application development sector, as well, as Twango has made a point of publishing its API (Application Programming Interface) code so that third-party developers can create new applications to work with the Twango platform. "The API gives developers the freedom to create innovative software and services such as uploaders, mashups, and new ways to display and manipulate media stored on Twango," according to the Twango Website.

It also offers Nokia another way to generate revenues, as it plans to introduce paid-for Twango accounts in the future, though no details are available yet. The Finnish company stresses that a "free level of service" will still be available once paid services are introduced.

Nokia also plans to expand Twango internationally, as the Finnish firm expects to introduce the service in different languages and store user data outside the U.S.

The Twango name may not survive long-term, though, as Nokia says it "may decide on a name that is more suitable" as it takes the service global.

Nokia says it will provide details about its future plans for Twango's service some time in the first half of 2008, though it seems certain that Nokia will at least add file-sharing functionality based on Twango's code to its range of multimedia handsets.

While India is recording sky rocketing growth, this is humbling and reiterates the opportunity that exists in rural India. We just need to crack the code for offering services viably in those regions.

China’s mobile users pass 500 mil. milestone

China’s Ministry of Information Industry (MII) has announced that the number of mobile subscriptions in the country increased by 40.56 million from the end of last year to 501.64 million at the end of June, representing an increase of 6.76 million a month on average. In the first five months of this year, western regions of the country showed the strongest growth in mobile phone subscriptions. The number of mobile phone subscriptions in rural area is also increasing, the MII said. The news comes as the MII looks to set up the foundations for the use of more advanced mobile services in China. Yesterday the Ministry unveiled an industrial standard for 3G mobile videophone services based on the homegrown TD-SCDMA network and the Europe-based WCDMA.

Nearly 8 millions adds in June - Definitely a new benchmark and big home run !

Indian ops score record month in June

Indian mobile operators added a record 7.6 million subscriptions in June, compared to the 6.8 million seen in May, with total subs now standing at 181 million. The subscriber base grew 4.4% quarter on quarter and 56% year on year.

The strong resurgence in net adds is in line with Credit Suisse’s average monthly run rate forecast of 7 million net adds for FY08. Bharti and Reliance added their highest ever subscriptions in a month of 1.95 million and 1.45 million respectively. Both the operators have shown increasing net adds for the past 2- 3 months, and market share gains take Bharti’s market share of incremental adds to 42.7%, followed by Reliance on 31.9%. Meanwhile, BSNL’s additions continue to be affected by rollout delays and remained low at 500,000, with its market share of 31% only just ahead of fourth-placed Vodafone Essar’s 30.8% market share.

UPDATE: EU Backs DVB-H As Bloc's Single Mobile TV Standard

DVB-H finally getting its due.

DVB-H is well on course to becoming the predominant broadcast Mobile TV technology and in large measure due to its open nature and the fact that standards are being driven by the industry rather than any particular vendor. Measures like this would help reduce excessive market fragmentation and allow for economies of scale and consequently lower prices to kick-in.

UPDATE: EU Backs DVB-H As Bloc's Single Mobile TV Standard

BRUSSELS -(Dow Jones)- The European Commission Wednesday urged national governments and industry to take up DVB-H as the single standard for mobile television in the 27-nation bloc.
While Wednesday's call isn't a legal mandate to solely use DVB-H to broadcast TV over a wireless handheld device, the commission said it may in 2008 propose binding rules requiring the exclusive use of DVB-H in the European Union.

The Brussels-based executive and regulatory branch of the E.U. "is not choosing a winner" but is simply giving "the market the clear signal that it should move voluntarily, but quickly, to a single standard."

The DVB-H standard is based on Nokia technology for mobile TV, which the commission said is the strongest standard for mobile TV.

Other technologies for mobile TV include Qualcomm's platform, known as MediaFLO, which has gained much ground in the USA, and ISDB-T technology, which is standard in Japan and Brazil.
Choosing a single standard is a controversial measure more common in the E.U. than the U.S., where regulators prefer to let different technologies compete. Brussels says a single standard will ensure interoperability for the emerging market, will help spur internal demand for mobile TV and will overcome differing rules and regulation for telecoms across the E.U., the commission says.

"The Commission sees a strong risk of market fragmentation in Europe, due to many technical options for mobile TV," the commission said in a statement. "Only a common European strategy... will enable consumers and industry to reap the full benefits of economy of scale."
In the early 1990s, E.U. regulators selected GSM as the single standard for mobile phones, making the devices compatible across the bloc. This helped the mobile industry develop more rapidly in Europe than in the U.S., which has several competing standards. Brussels hopes the single standard for mobile TV will do the same. The E.U. "can either take the lead globally - as we did for mobile telephony based on the GSM standard developed by the European industry - or allow other regions take the lion's share of the promising mobile TV market," said E.U. Telecom Commissioner Viviane Reding.

The global market for mobile TV could reach EUR20 billion by 2011, the commission predicts.
The commission also pointed out Wednesday that mobile TV use is close to 10% in South Korea where a single standard exists, while Italy - the E.U.'s most advanced mobile TV market - has a mobile TV use rate of less than 1%.

"Choosing standards I think is no bad thing - it certainly focuses the market," said David McQueen, a U.K.-based principle analyst with Informa telecoms and media. McQueen said single standards across the E.U.'s national borders make it easier for operators and device-makers to roll out pan-E.U. mobile TV services.

However, industry leaders in the telecom sector have warned that mobile TV is such a cutting-edge service that only time, free competition and a flexible market will tell which type of technology will prove the best.

European broadcasters "believe that it should be up to businesses to define attractive business models that will entice consumers to opt for the standard they like best" and warn "the pace of technological development precludes the adoption of any one standard for mobile broadcasting at this stage," according to a statement released Wednesday from the European Broadcasters Union. The union lobbies for some 75 broadcasters in 56 countries including Vivendi's Canal+, ITV PLC and Television Francaise 1 SA.

The commission said it will continue to closely monitor the mobile TV market.

Mobile TV Technology Choices Should be Driven by Consumer Needs

That Mobile TV is likely to witness mass market adoption seems to be a given.

I however definitely agree that, the key to success in the mobile TV market lies with matching the technical solution to the consumption model and users' demand for different content types.

The real advantages of broadcast mobile TV technologies lies in the ability to provide a ubiquitous baseline of content, available on demand, with other technologies being used either where long-tail or interactive content is required, or where consumption is to some extent pre-planned.

Mobile TV Technology Choices Should be Driven by Consumer Needs

Investment decisions for mobile TV need to be made in light of expected market dynamics, substitute technologies and the competitive landscape, according to recent work undertaken by Analysys. The firm's study suggests that, whilst most observers expect mobile TV to become a multi-billion Euro industry by 2010, and will be well on the way to being accepted as a mass-market product by then, the supply-side industry dynamics are not yet clear.

Many operators are actively considering broadcast technologies as a solution for mobile TV, but their research suggests that a decision to invest in a broadcast mobile TV network should follow a review of the underlying demand and analysis of the contribution that alternative technologies can make.

"Our research shows that there is an expectation of real demand for mobile TV services, driven by the premium that users place on convenience, and this could be expected to represent a significant revenue opportunity. However, recent evidence suggests that the mobile TV market could be significantly more complex than the existing terrestrial broadcast environment", says Jim Morrish, Senior Consultant at Analysys.

Specifically, the findings of the research recently undertaken by Analysys suggest the following points:

* Latent demand appears to be strong and a plethora of trials worldwide have established that mobile TV is generally regarded by consumers as an appealing product, to the extent that it can be expected to become a mass-market proposition in the future. The same research indicates that mobile TV has a positive effect on average revenue per user (ARPU), and some mobile users can be expected to switch their service provider in order to secure mobile TV services.

* The consumption model is becoming clearer, with usage driven by convenience, typically resulting in shorter viewing sessions than would be expected with traditional TV services. Usage in the home, in the office and whilst commuting are emerging as key consumption locations.

* The debate around the technologies that will be required to support mobile TV in a cost-effective manner is moving beyond a simple discussion of the relative merits of tailored broadcast TV technologies (for example DVB-H vs DMB) and is now beginning to encompass complementary technologies. However, the debate does not yet fully take into account the expected consumption model and preferred content types in order to establish an optimal technical solution.

Morrish warns that the key to success in the mobile TV market of the future lies with matching the technical solution to the consumption model and users' demand for different content types:

"With some studies suggesting that up to 35% of mobile TV consumption will take place in the home, femtocells must surely figure in any operators' technical plans for offering mobile TV. Given the popularity of services that are non-real time in nature (for example, soap operas), consideration must also be given to the 'sideloading' phenomenon that is currently displacing some of the revenues that MNOs might otherwise have hoped to generate from music downloads. The real advantages of broadcast mobile TV technologies lie in the ability to provide a ubiquitous baseline of content, available on demand, with other technologies being used either where long-tail or interactive content is required, or where consumption is to some extent pre-planned."

"As each alternative technology is introduced, a new potential route is established from content owners to consumers, and thus MNOs must bear the risk of disintermediation, while content owners and aggregators have the opportunity to secure customer relationships. Mobile TV is a huge opportunity, but it is not yet clear how the pie will be shared", Morrish concludes.

Another record month of Chinese net telephony additions

China now has a whopping 500 million mobile subscribers and still continues to add over 7 million mobile subscribers per month ! Some pent up demand !! Am sure it has all other leading mobile carriers globally salivating !

Another record month of Chinese net telephony additions

Latest figures from the Ministry of Information Industry show that China had 494 million mobile users as of end- May compared with 372 million fixed line subscribers. According to the MII, a record 7.16 million mobile net additions were recorded in May, while fixed line net additions were 4.39 million between January and May. The MII puts total rural subscribers at just over 118 million.

Is AT&T Putting Out Femto Feelers?

Very interesting trend. Femtocells could help telcos tide over the frequency crunch being faced in many parts of the world and enhance coverage and consequently QoS though network planning and deployment costs could be prohibitive.

Other issue is the brewing battle between femtocell deployment and WiFi based FMC. The advantage of the former is that all standard GSM handsets would work while in case of the latter dual mode [GSM & WIFi] handsets would be required.


Is AT&T Putting Out Femto Feelers?
JULY 16, 2007

AT&T Inc. is the latest major operator to start examining the prospect of using so-called femtocells to bolster cellular coverage and capacity in subscribers' homes, industry sources tell Unstrung.

The largest cellular operator in the U.S. -- formerly known as Cingular -- is said to have to a request for proposal (RFP) regarding this new technology currently doing the rounds, industry sources say.

"There is an RFP out," one industry source notes. "Our partners have got it."

A home base station -- or femtocell -- is a low-cost, low-power radio system that can be used to boost bandwidth and coverage and enable new applications such as fixed/mobile convergence (FMC) in a subscriber's dwelling. Vendors have been pushing the idea for a while, but it appears that mobile operators are now starting to take them seriously.

A spokesman for AT&T refused to talk about the rumors when reached by Unstrung on Monday afternoon. "We're not going to comment on that, sorry," he said.

An AT&T RFP could be further validation for this emerging technology -- especially following recent news about Vodafone Group plc checking out the prospects for femtocell technology over the last several months.

AT&T already works with 2Wire Inc. , a home gateway vendor that announced late March that it will introduce initial femtocell products early in 2008. The company wouldn't say whether it had seen an AT&T RFP.

"We don't comment on any of our contracts," says a 2Wire spokeswoman.

There are plenty of other telco equipment players, large and small, that would be interested in a potentially large contract from AT&T. Vendors in this space include:
Alcatel-Lucent, Ericsson AB, Huawei Technologies Co. Ltd., ip.access Ltd., Motorola Inc.,
NEC Corp., Nokia Siemens Networks, UbiquiSys Ltd. and ZTE Corp.

Other major operators said to be looking at the home broadband technology include Sprint Nextel Corp., French mobile operator SFR and Softbank Mobile Corp.

Meanwhile, T-Mobile USA -- AT&T's smaller GSM rival -- recently launched its own WiFi-based fixed/mobile convergence (FMC) service nationwide. Hotspot@Home uses WiFi to achieve some of the same aims of the femtocell crowd, such as easier wireless connections in the home. The difference is that T-Mobile's offering requires a dualmode handset, while femto-based systems do not.

Sony Ericsson reports strong year-on-year, ASPs suffer

Strong quarterly performance by another handset vendor - Motorola oddly seems to be the sore exception to the party !

Decline in ASPs is a given in view of the increasing proportion of sales in the emerging markets and a trend likely to continue over the medium term. Is this another sign of the handset business getting commoditized ?


Sony Ericsson reports strong year-on-year, ASPs suffer

Sony Ericsson today reported strong year-on-year growth in 2Q07. Income before tax for the quarter was €327 million (US$450 million), up from €211 million in 2Q06, an increase of 55%, while net income for the quarter was €220 million, up from €143 million in 2Q06. Meanwhile, operating income stood at €315 million, up from €203 million, a 10.1% increase year-on-year.

Sales for the quarter were €3.1 billion, up from €2.3 billion in 2Q06, representing a year-on-year increase of 37%. In line with Sony Ericsson’s expectations, the increase in 2Q in low- and mid-priced phones in the product portfolio resulted in a decline in average selling price, to €125.

“While we believe Sony Ericsson’s gross margin would have remained flat with Q107 at roughly 30.3% versus the 29.6% in Q207 if not for this new payment, we anticipate these payments will continue in future quarters,” analysts at Piper Jaffrey wrote. “As such, we are lowering our Sony Ericsson margin assumptions. Given our lower Sony Ericsson margin assumptions slightly offset by our increased global handset market share assumptions, we are slightly lowering our 2007 Ericsson EPS estimates from US$2.70 to US$2.66 and our 2008 estimates from US$2.92 to US$2.91.”

Units shipped in the quarter reached 24.9 million, up from 15.7 million units, a 59% increase year-on-year, generating both year-on-year and quarter-on-quarter market share gains. Gross margin stood at 29.6%, up from 28.5% a year earlier.

Growth came at the cost of lower average selling prices. The group said that the ASP of its mobile devices was US$125 in 2Q07, down from US$134 in 1Q07 and US$145 in 2Q06. The lower ASP was “in line with Sony Ericsson expectations,” the group said, noting the increase in its sales of low- and mid-priced phones in Latin America, Western Europe and CEEMEA (Central and Eastern Europe, the Middle East and Africa).

Sony Ericsson forecasts that more than 1.1 billion handsets will in use worldwide by end-2007. The company had increased its market share about 3 percentage points year-on-year at end-2Q07, to over 9%.

In 2Q07, Sony Ericsson continued to capture market share in Latin America, Western Europe and CEEMEA, because of low- and mid-tier feature phones, such as the W300 and W200 Walkman phones and the K310 and Z310 phones.

In January, Sony Ericsson announced plans to begin making handsets in India through manufacturing partners Flextronics and Foxconn. In 2Q07, new trademark-royalty fees were agreed upon with the parent companies, and these additional expenses were recorded for the first time in the same quarter.

Reliance Awards CDMA & GSM Contract to Huawei

Another notch for Huawei. Entry into the ultra-competitive wireless segment in India with a leading pan-India private service provider is a big break through for Huawei which has till now been kept out by all the private service providers inspite of the highly competitive pricing and a very broad portfolio of cutting edge products.

Reliance Awards CDMA & GSM Contract to Huawei

India's Reliance Communications has announced the award of a network expansion contract, worth over US$200 million, to Huawei Technologies. Under the agreement, Huawei will supply and provide services for CDMA & GSM base stations, including BSC (Base Station Controller) and switches, and help to create first class all-IP Next Generation Network infrastructure.

"We have chosen Huawei based on its established credentials as a global company producing high quality products and solutions. The relationship with Huawei will help us maintain and strengthen our leadership position in India, the world's fastest growing telecom market," said Mr. Anil Dhirubhai Ambani, Chairman of Reliance Communications.

Reliance Communications and Huawei formalized the relationship on July 12 with a "special handshake" between Mr. Anil Ambani, Chairman of Reliance Communications and Ms. Sun Yafang, Chairlady of Huawei Technologies, at a function at the Dhirubhai Ambani Knowledge City (DAKC), the world-famous headquarters of India's largest integrated telecommunications service provider.

2Q results see Samsung overtake Motorola as No. 2 vendor

We finally see a change in the pecking order as Samsung has for long been snapping at Motorola's heels.

I still feel Samsung is under performing and with all the innovation it churns out, deserves a larger market share than being a distant No. 2 vendor.

2Q results see Samsung overtake Motorola as No. 2 vendor

Asia’s largest vendor, Samsung Electronics, today reported solid 2Q07 results in its telecoms division, with revenues of KRW4.5 trillion (US$5.3 billion) representing a 5% increase year-on-year.

Samsung overtook Motorola as the No. 2 handset vendor in 2Q07, shipping a company record 37.4 million units, up 8% quarter-on-quarter and 49% year-on-year. Samsung said
growth in emerging markets and solid 3G sales led to the strong results. The number of shipments to Western Europe increased roughly 18% quarter-on-quarter, to nearly 12 million.

Samsung’s share of the global handset-manufacturing market could rise to about 14% by year-end, from its current 11%, the group said. Motorola, the world’s second-biggest vendor, reported 2Q losses this week after sales fell short of forecasts.

Robust sales of premium handsets, including the Ultra Edition, and a solid performance in emerging markets helped boost Samsung’s sales. The cumulative sales of the Ultra Edition now exceed 12 million units, while the SGH-E250 saw sales of 4.6 million units in 2Q, leading
the company to increase its annual sales target to more than 150 million units. Handsets contributed KRW4.23 trillion to the telecoms division’s sales, up 5% from KRW4.04 trillion in 2Q06.

“Based on indications for continued strong orders for its handsets, Samsung increased its 2007 handset unit guidance from 133 million units to more than 150 million units,” analysts at Piper Jaffrey wrote. “We were encouraged by Samsung management comments that it is currently working with its U.S. carrier customers and does not anticipate an impact to its business from the current ITC injunction on Qualcomm chipsets violating a Broadcom patent.”

Profits fell 13% from KRW4.28 trillion in 2Q06 to KRW350 billion in 2Q07, on revenues of KRW4.5 trillion. Samsung said, however, that it expects sales and profits at the division to increase in 3Q.

Samsung saw its consolidated net income fall 5% year-on-year, from KRW1.5 trillion to KRW1.42 trillion, in 2Q07. Total revenues, however, increased 4%, to KRW14.63
trillion, compared with KRW14.11 trillion in 2Q06. Operating profit was KRW910 billion, down 36% from KRW1.42 trillion in 2Q06.

5.4 million GSM subscriber adds in Jun07

Looks like a tally of 6.5-7 million wireless adds again in June. Capacity constraints is the key reason behind BSNL's poor performance.

5.4 million GSM subscriber adds in Jun07

The Cellular Operators Association of India (COA) has reported that GSM subscriber net additions for June rose to 5.4 million, up from 5.1 million in May, with market leader Bharti again recording a record number of nets adds for the month. Bharti garnered a record 1.95 million new subs in June, up from 1.85 million in May, to end the month with 42.7 million subs. Meanwhile, Vodafone Essar (formerly Hutchison Essar) also performed well with the additions of 1.5 million new subs in June, repeating its May performance, raising its total subs base to 30.8 million.

State-owned operators MTNL and BSNL again performed poorly with the addition of a combined 500,000 net adds for the month, still well down from their normal combined average of 900,000 monthly new subs in the previous year. The GSM subscriber base hit 136 million at end June up 4.12% from 130.1 million at end May.

Another milestone in the cap of the Chinese vendors. Indian operators till now were very reluctant to source wireless gear from the Chinese duo on account of quality and support concerns. I guess this will open the door for them at the other private service providers too

Reliance plans GSM expansion

Indian CDMA market leader Reliance is pushing forward with its expansion in the GSM market with a INR3 billion (US$741 million) plan to deploy 17 million new lines to its existing GSM operations in eight operating circles over the next nine months, according to local reports. Reports say Reliance will increase its capacity in areas including Kolkata, West Bengal, Orissa, Bihar, North- East, Assam, Madhya Pradesh and Himachal Pradesh to over 20 million lines once the expansion is completed. The firm plans to source equipment for the expansion from ZTE, Alcatel Lucent and Huawei.

Mobile Advertising Still Showing Very High Click-rates on Adverts

Mobile advertising and its intricacies. Still early days yet and a virgin sector with huge potential which is starting to be explored.


Mobile Advertising Still Showing Very High Click-rates on Adverts

MoMac has published the results of its first Mobile Advertising Attitudes report, supporting the launch of its GoSell mobile ad campaign management tool. MoMac's research, conducted by independent research agency Tickbox, clearly emphasises the need for mobile advertising to match specific audience requirements. Results from different demographics indicate that responsiveness to different kinds of advertising changes according to age and gender, giving brands and marketers valuable guidelines around which to design their mobile advertising campaigns.

MoMac's GoSell platform has been developed to help publishers easily integrate and manage the inclusion of mobile banners and sponsored content within editorial and branded environments and will be available as part of MoMac's integrated mobile publishing platform, GoMedia.

Advertising Formats

Despite the fact that mobile advertising is in its infancy, the report reveals that as many as 13% of 16-24s have already responded to or clicked-on a mobile advert. Given the limited inventory currently available for mobile advertising, and the relative rarity of mobile users being served mobile ads, the figures show the potential for a significant future take-up - if the communication is delivered in the right way.

When it comes to mobile advertising formats, MoMac's research shows clear differences in the preferences of men and women and the different demographic groups. When on mobile sites, text based advertising links are the most popular (56%) with a clear female bias of 60% compared to just 47% of men. Picture or banner-based advertising was the second most popular option, favoured by 29% overall and just under one in three 25-34 year olds. Interestingly, video based advertising has a strong male bias with 22% of men compared to just 12% of women stating they would be most likely to respond to a video advert. Video formats were also more popular with younger mobile users selected by 23% of 16-24s but only 12% of the over 55s.

Payment Models

The research results also indicate that content providers will need to consider a number of payment models to appeal to the diverse groups of mobile users in the UK looking for content. The ad-funded model could become dominant with younger mobile users, with 47% of 16 to 24s preferring to access content for free in exchange for viewing advertising. Only 32% of this group opted for a pay-as-you-download (PAYD) model and only 3.9% stated they would want to pay for content via a subscription. In contrast the PAYD method is more popular with older mobile users, with 55% of those aged 45 and older opting to pay for content on demand, and also appeals more to women, with 54% choosing PAYD compared to 41% of men who are more open to advertising.

Sham Careem, MD of MoMac UK, comments: "The research shows that brands and media companies must think carefully about who their primary targets are before they decide how to deliver both their content and advertising campaigns. Different demographics will respond better to different methods of advertising and the key to a successful campaign will be ensuring that the format matches the target audience."

The Mobile Advertising Attitudes Report surveyed a cross section of 1,400 UK mobile phone users during May 2007.

Universal refuses to renew iTunes contract

Interesting development. If Universal can resort to brinkmanship with Apple inspite of its dominance in the portable music segment, what chance do lesser mortals also propagating download music services stand against the major music labels.

I personally feel raising prices is not an option and would kill the fledging legal download market - iTunes is the only successful legal music venture today. Verdict on whether the Apple initiative to drop DRM in case of music from consenting major labels like EMI will have some positive rub off on music downloads is still out.

Universal refuses to renew iTunes contract
04/07/2007 14:44:07 - by Martyn Warwick

Apple enjoyed a predictable weekend in the limelight with the launch of the uber-hyped iPhone handset (while partner AT&T tried its best to hide from it after thousands of iPhone buyers found they couln't use their expensive new phones because the operator was unable to register their presence on its old-fashioned and under-invested just about 2.5G network). iPhone sales are said to have topped the 525,000 mark and half the company’s West coast US retail stores reported that they had sold out of the handsets completely.

But drowned out by all the hoo-hah and flooded by rivers of bugle oil, was the news that the Universal Music Group has chosen not to renew its iTunes contract. Rumour has it that Universal Music will switch to an “at will” agreement and model that will allow the company to walk away from Apple at very short notice.

The move, if it comes, will give Universal some leverage against Apple, which has annoyed dominant music publishers by insisting on a US 99¢ price cap for music downloads. That figure recently rose to $1.29 for tracks from major label EMI without DRM protections – another move that has aggravated Universal and its peers.

Labels have also criticized the tight link between iTunes and the iPod, which dominates the digital music player market and which poses a challenge to efforts to launch wholly-owned download sites.

Although neither company will comment on the rumours, analysts believe the refusal by Universal to sign another annual contract with Apple is likely to pave the way for a price rise – with Universal threatening to vote with its feet should iTunes decline to charge more for its music. Every third record sold in the US is on a Universal label and digital music accounted for 15 per cent of the company's Q1 revenue. “This is a bit of gamesmanship on Universal’s part.

Apple can’t afford to have to turn around to its customers and say it no longer offers Universal’s catalogue, and Universal is hoping is that this may prompt Apple to renegotiate their revenue split. Apple’s monopoly in the music download market has come to be a source of unease for the record industry in the past couple of years,” says Forrester analyst Rebecca Jennings.

It remains to be seen whether Apple has more to fear from the loss of a major label or the migration away from its 99¢ price point, which has been widely credited with transforming iTunes into the only legal online music site to gain mass-market traction. “When your customers are iPod addicts, who are you striking back against?” says entertainment attorney Ken Hertz.

“The record companies now have to figure out how to stimulate competition without alienating Steve Jobs, and they need to do that while Steve Jobs still has an incentive to keep them at the table.” iTunes has become the third-largest US music seller after just four years of operation, while Apple has sold more than 100 million iPods.

Taking the iPhone Apart

4GB - BOM $200, ASP $ 499
8 GB - BOM $220, ASP $ 599

Wow ! Wouldn't it be a utopian world if we could all manage such margins !!!

Taking the iPhone Apart

An analysis from teardown firm Portelligent estimates that the new smartphone costs Apple a mere $220 to make

by Arik Hesseldahl

As the creator of the iPhone, the most highly anticipated piece of consumer-electronics equipment in a decade or more, Apple certainly has much riding on the device's success. So too, in turn, do Apple's many, mostly anonymous suppliers.

Apple, always secretive and tight-lipped about its supply-chain and manufacturing arrangements, almost never says anything in public about its suppliers, not even to disclose names. The exceptions are Intel, the chipmaker that supplies the microprocessors for Apple's Macintosh computers, and NVIDA and ATI, which supply the graphics chips for those same computers.

So it's left to teardown firms such as Austin-based Portelligent, to sleuth out not only who supplies all the parts but what it costs to make a device. And David Carey, Portelligent's CEO, did something that few others in the country did after buying an iPhone: He took it apart.

A Hearty Margin

Portelligent estimates that the cost of the materials used in the iPhone add up to about $200 for the 4-gigabyte version, which sells for $499 and about $220 for the 8-gigabyte version, which sells for $599. Their estimate doesn't include costs of final assembly, but it does give some insight into the gross margin on the device. Historically Apple's gross margins have run ball park of 50% plus or minus a few points. "We had taken a speculative stab at what the costs would be back in January, when the phone was first announced and we were pretty close to the mark," Carey says.

The most expensive component on the phone, Carey says, is the touch screen, for which Apple tapped a little-known German concern called Balda. The estimated cost of $60 per unit is mostly an educated guess. "This screen is like nothing I've ever seen before," says Carey.

Even the fact that Balda made it, is in fact, an educated guess. Carey told BusinessWeek that his analysis found no apparent markings that identified the screen's origin. But Balda's role in the screen has been something of an open secret in the wireless industry since the iPhone was first announced by Apple CEO Steve Jobs in January. Even so, Apple apparently took steps to make the source of the screen hard to identity.

How the Chips Fall

Another big winner is Samsung, which supplied the main microprocessor chip. It was stamped with an Apple logo, but with a serial number that matches closely a chip that Samsung sells. Samsung also supplied the NAND-type flash memory that stores data on the phone, including songs, video, and pictures.

Samsung's microprocessor chip, interestingly, is based on a core design that is owned by the British chip technology licensing firm ARM Holdings, which is another big winner among the iPhone suppliers. Instead of selling chips, ARM licenses its patented designs for "cores," or the central working brain of a chip. Customers take those core designs and then build their own chips around them. At least one other ARM-based chip, from NXP Semiconductor, the former chip division of Royal Philips Electronics, shows up in the iPhone. Other chips might have some ARM technology on them as well, Carey says.

Apple recently announced that it had improved the talk time on the iPhone's battery to eight hours. At least some of this improvement was accomplished by paying close attention to power management. Three chips are involved in that function: one from Philips, one from Texas Instruments, and one from Linear Technology.

Handling various aspects of the wireless communications on the iPhone, from connection of AT&T's wireless voice and data network to local Wi-Fi networks, are components from Infineon, Skyworks, RF Micro Devices, and Marvell Technology Group. Cambridge Silicon Radio supplied chips that connect the iPhone to wireless headsets.

An accelerometer—a chip that senses motion—from STMicroelectronics helps the iPhone sense when its orientation has changed, which causes the orientation of pictures and video being displayed on the screen to change accordingly. Also handling various aspects of the display are chips from National Semiconductor, Broadcom, and NXP. Idaho-based Micron Technology supplied the imaging chip that is central to the camera.

Mysterious Maker

Carey points out that the chip-packed iPhone offers "a very calm and serene user experience" that belies its internal complexity. "A great deal went into the internal mechanics and how it all came together," he observes. "There are lots of tiny nooks and crannies where things have to be very precisely tucked in to make it all fit together."

The complex design calls for equally complex manufacturing, which dictated that the iPhone be made outside of the U.S. "You have to build something like this in a place where labor is inexpensive," says Carey, which in this case means China. But Carey says it's unclear who manufactured the iPhone: "There are no markings indicating exactly who built it."

Apple's iPods have been built by Hon Hai Precision Industry and its Foxconn operating unit. BusinessWeek reported in January that Hon Hai had won the contract to manufacture the iPhone. But last month Samuel Chin, CEO of Foxconn, told investors that the company would not be making the iPhone. "Previous devices that Foxconn had made for Apple had their markings stamped all over the place," Carey says. "We just don't know who's making this one yet."

Apple had come under fire in 2006 for doing business with Hon Hai after allegations emerged in a British newspaper that its employees worked under sweatshop conditions. Subsequent Apple investigations found some problems that it insisted be fixed and were fixed.

Server in your Pocket

Pretty neat application. The most interesting is the ability for the phone’s owner to use a web browser on a PC to access the handset remotely

Server in your Pocket
03/07/2007 12:31:49 - by Guy Daniels

Nokia has released a software download that turns your mobile into a web server. The obvious question is “why?” and the easiest and glibbest answer is “because it can”. But there’s more to this than at first meets the eye.

According to Nokia, the “Mobile Web Server is a phone application to which you can connect over the Internet with your web browser. This allows you to easily manage and use phone functions with a PC, no external software needed.”

To run the Mobile Web Server, you'll first need a free online account and a compatible Nokia Series 60 phone. Once you’re set up, you download the server as a sis file and away you go. Nokia lists the features you’ll be able to take advantage of, including (in the words of Nokia’s website);“Contacts - look up phone numbers; SMS sending; Blog - tell stories on your journeys; Calendar - colleagues see your availability; Gallery - browse pictures taken with camera phone; Messaging - send instant messages; Camera - share instant pictures; Phone log - view missed calls; Guestbook - visitors can leave their comments; and Guest and friend user accounts.”

The server concept first emerged about 18 months ago. The idea is two-fold. First, it enables the sharing of content created or stored on the phone with other people. Secondly, the phone’s owner can use a web browser on a PC to access the handset remotely (maybe to search for a name in the contact list, or to send SMS messages).

The phone can be accessed either via the GSM network or by WiFi. If using cellular, a proxy method is used to reach the phone, with the URL registered at the Nokia website (which then forwards requests) rather than on the phone itself – as many operators do not permit public access to handset IP addresses. WiFi access is a lot simpler, as well as being cheaper and faster.

So why is it clever? Well, a few applications are starting to emerge, and no doubt many more will soon follow. Firstly, the camera application; “Permitted users can invoke a server side application that takes a picture with the phone's camera which is then returned to the web browser,” said Sauter. “An excellent way for home monitoring purposes.”

He added; “The phone's calendar can be viewed and new calendar entries can be created in the web browser.” SMS sending rounded out his initial picks; “Gone are the days of fiddling around with the keys on the phone when writing an SMS. Now, the SMS can be written in the [PC’s] web browser no matter if the phone is next to the notebook or 5,000km away.”

The Mobile Web Server concept was developed by the Nokia Research Center. The software includes a whole host of features. These include a Nokia gateway infrastructure for HTTP connectivity to devices; registration of your own domain name; ready-made content that allows users to easily use, create content, and browse it immediately after setup; a web cache; an SSL connection security; and an authentication system for accessing the terminal content.

The mobile server is open for HTML content and application development with Apache technology and Python programming environment.

For more information, and to try out the server for yourself, visit http://mymobilesite.net

YouTube increases its dominance

Not surprised. Just keen to see how Google monetizes this as that would set a benchmark for all the other video sharing sites. Would it just be pure advertising or would it be something more ?

YouTube increases its dominance
03/07/2007 10:02:53 - by Martyn Warwick

YouTube is growing faster than than all 64 of its nearest "rivals" put together – and this despite the fact that already holds the predominant position in the Internet video space. The Google portal saw visitor numbers surge by a massive 70 per cent in the twelve months through to the end of May. The best of its competitors managed growth of just eight per cent.

This remarkable performance has resulted in a market share half as large again as the next 64 players combined. YouTube commands 60.2 per cent of online video viewers whilst its chief rival MySpace boasts a comparatively paltry 16.2 per cent. And, to put things in even starker perspective, those competitors ranked lower than eighth place all have less than a derisory one per cent of market share.!

The figures come from the analyst Hitwise. However, the organisation is unable to determine how many site visits actually translate into viewed video streams. Google’s command of Internet video is larger than its impressive YouTube operation due to the 7.8 per cent market share held by Google Video.

Meanwhile, MySpace stands out as the most likely to contend for YouTube's crown. The site, a unit of Rupert Murdoch's News Corp empire, hopes its standing will be enhanced thanks to a new site that has been designed to replicate its larger rival. MySpaceTV provides a platform for surfers who do not want to register their profiles on the MySpace social network. Video clips are presented in themed channels, including those by authorised content providers as well as amateur uploads.

Commenting on the MySpace drive to capture hearts and minds, the company's general manager, Jeff Berman, says, “It’s just going to get easier and easier for everyone from the soccer mom to the garage band to create video,”

The site claims that it has doubled the number of its video streams since January this year and says it now has 50 million viewers a month.