Friday, April 28, 2006
Vonage's IPO would value them at $2.6bn will be led by Citigroup, Deutsche and UBS. They have 1.8M customers almost entirely in the US. All of their customers are paying - whereas the majority of Skype's customers are free. Interestingly the valuation of Vonage would be similar to the up front payment Ebay made for Skype.
But, when Ebay bought Skype they had just over 50M customers - and they have nearly doubled them over the last 6 months. Which proves the value of their more international approach, for Vonage site that analysts believe that the US consumer market will reach around 15M by end 2007.
Vonage expects to have the lion share of them - but will face increasingly tough competition from the cable operators offering VOIP, including Comcast, Time Warner and Cablevision.
Mind you, if Internet phone users reaches 500M by 2010 - which we believe could even happen - then there's room for all of them. Vonage should do well - even though they will have to spend hard to stay ahead.
Thursday, April 27, 2006
The results echo similar strong performance by smaller operators, such as Cablevision, and suggest that customers are keen to sign up for bundled telephone, internet and video packages. Der, I wonder why?!
So now you have the real national battle for triple and then quadruple play ready to rock and roll. And this battle will drive down the price of TV, Internet access and telephony even further, as Comcast and Time Warner Cable slug it out with AT&T and Verizon. Expect DirecTV to sit somewhere in the middle and try to differentiate on price and content while waiting for their own satellite triple play to launch next year.
The real question for investors is who will win the triple/quadruple play battle - cable operators or telco's. Well, for now I would say that they'll will. In the US top 5 expect a couple of cable leaders and a couple of telco's.
So Comcast is well positioned as the US' largest cable company - even though they are late to the table on their triple play. But now that they have it out, they are raking in the customers and it is improving their core cable TV franchise as well.
No wonder their shares bounced up. They will really deserve a further bounce when Comcast proves that they can convert most of their 22M odd cable customers to the triple play and not just the early adopters.
They have announced that they expect the PC market to slow this year and only experience single digit growth (which is below most analyst expectations - ooh, I wonder why!). They then stated that their revenues would shrink this year (now I know why they predict such low PC growth numbers...), which is a stellar stuff up for the generally fast growing Silicon Valley icon.
Otellini then stated that Intel would imbark on the most gargantuan review over the next 90 days (too right!) and that the answer was not as simple as just dumping a bunch of their 100,000 employees in the name of cost cutting.
BUT, they do promise a $1bn reduction in costs this year and a $300m cut in capital spending. Which means they will of course shed a bunch of staff after all.
And boy do they need to do something radical for Intel expects sales to fall 3% in 2006 after three years of double-digit growth and at a time when the rest of the industry is performing strongly. Its stock has fallen more than 20% so far this year to become the worst performer on the Dow Jones Industrial Average.
Shame if you're an Intel shareholder - which is most investors on the planet. But, on the plus side Otellini seems serious this time and his job is on the line which is always a great motivator when it comes to doing something radical - and Intel is finally launching their whacky dual core chips in the 2nd half.
So, good luck Intel and boy must AMD be licking their lips - for they have never had a better chance to extend their recent market share gains while Intel attempts the highly distracting corporate reinvention management thingy.
Wednesday, April 26, 2006
Sprint said it added 1.3 million customers in the quarter, compared with average analysts’ estimates of about 1.4 million, according to five analysts contacted by Reuters. And this was considerable below Cingular Wireless addition of 1.7M customers.
And even their industry leading average revenues per customer (ARPU) slipped.
SprintNextel had better look out, for keeping up with Cingular and Verizon will get harder and harder and Deutsche Telekom continues to pour money into T-Mobile.
I guess Super Mario could turn into Bono and sing the latest U2 song while flying a Bombadier private jet!
But, gaming seems at be all the rage for tech and media companies right now. And Microsoft's planned purchase highlights a belief among game-industry executives that videogames could become a large new medium for advertising.
Major media companies have also begun to increase their investments in game-related media to ensure they stay abreast of consumers' tastes. This week, Viacom paid $102 million to acquire Xfire Inc., a start-up that operates an instant-messaging service that connects gamers over the Internet. Last September, News Corp agreed to pay $650 million to acquire IGN Entertainment Inc., a company that operates a collection of Web sites for game enthusiasts.
I am just left wondering whether Microsoft's purchase of Massive may prove even more industry changing than revealed thus far. I wonder whether one day gamers will get their video games for free as the cost will get subsidised by an ever increasing ad pot.
And it looks like their product diversification strategy as well as international operations are helping drive the sales growth. And Amazon is soon to launch their digital content services as they offer an online music service to rival iTunes and their video on demand service to rival Google Video as well as e-books.
All in all I would say that Amazon looks pretty well set as they go in to their seasonally quieter summer months.
The announcement comes a day after rival Channel 4 made a similar decision as they extended their reach into community-led offline offerings by launching a user-generated comedy channel which follows the earlier launch of a channel that allows audiences to post their own documentaries.
The BBC has also stated thast they want to become the premier destination for unsigned bands through broadband, podcasting and mobile phone services.
And it looks like this newfound desire to embrace the latest Internet trends is designed to make the BBC more appealing to youngsters. Yep, that'll work as long as the BBC and others create the right content and brand for the younger tech-savvy audience as well as getting users involved.
For the future is not about re-creating MySpace functionality alone - the future is truly understanding what converged media is all about for it is not only the convergence of media, tech and tellecomms that is at stake here, but is also about the convergence of user generated content as well as media company content - and that's gonna take a lot of thinking about.
And the more distant future lies in digital content marketplaces as explained by sister channel BigTrends. Let's see who wins this war. But competition will come from all sides - the traditional media companies such as the BBC as well as Internet giants, telcos and new start-ups. Let's see how the BBC manages the next phase of Web 2.0 and the digital content marketplace!
Tuesday, April 25, 2006
This is a historic move for the once leading Silicon Valley tech giant. McNeally was one of 5 that founded Sun and was reluctantly persuaded to become CEO as they went to raise their seed money (from one of my ex-investors).
And he had one mean task ahead of him given that Sun was the 17th workstation company to launch. But he did it, and led them to victory in the workstation space and then to glory and fame in the Internet server space.
Even though Sun have struggled since the dotcom collapse, McNeally now hands over a solid franchise. And with their recent acquisitions, their new software strategy (centred around open source), Java and their all new Galaxy range of servers, Sun could be on the up again.
I just can't help feeling that if they could pull off a transformative merger then they could get back on top. Maybe McNeally should focus on that while Schwartz runs the shop. And with their share price gains this year (up over 20%) - they almost have the currency as well.
Monday, April 24, 2006
Sun said it had a net loss of $217 million, or 6 cents per share, for its fiscal 3rd quarter ended March 26, compared with a year-ago net loss of $28 million, or 1 cent per share. Revenue rose 21% to $3.18 billion.
It looks Sun's their acquisitions are paying off. And their open source software strategy looks timely. Next up will be their new line of Galaxy servers. If they do well, as they should, 2006 could prove a dicisive year for Sun.
And they will publish these DVD's on-demand (i.e. made to order) so there is little of risk of being left with a bunch of inventory from whoever loses the battle that Toshiba and Sony are about to wage.
Amazon are trying to place themselves front and centre in the new digital media space. They will soon launch both their music and video download services.
Amazon, Google, Yahoo, Apple, AOL and MSN are driving digital content delivery systems worldwide. By 2010, digital content will be king and one of them will have to be it's queen.
I wonder who will win that battle? It's still wide open - but the prize will be massive.
You can't help wondering whether this proliferation of platforms and brands will help Intel or confuse us all so much that we resort to good ol' single chip branded PC's with AMD on them.
In the mean time though Intel assure us that their platform strategy is better for users and PC makers (I wish I knew why?). And VPro will make the management and security of corporate PC's more straight forward. Sounds good so far.
Intel said vPro includes an updated version of a feature called Intel Active Management Technology that can perform management tasks remotely, such as helping a PC recover from a so-called "blue-screen" system crash. Another feature is Intel Virtualization Technology, which partitions a computer into secure zones and user-controlled sections.
Intel plans to work with software vendors, including Symantec, to load special protection programs into the chip that can filter out packets of data that have been corrupted by viruses.
Sounds good for Symantec, Intel and the corporate help desk, but maybe less good for Microsoft who are trying to bake PC management and security into Vista - presuming that they launch it some time soon.
The CA executives were indicted in September 2004 on financial fraud charges in connection with allegedly back-dated contracts that allowed the business software giant to appear to meet financial goals by continuing to book revenue even after a quarter ended.
Apparently they specialised in 35 day months. Hey, that's original. If proven guilty Kumar could be put away for a very long time. Let's hope cases like this send a message to future fraudulant executives severe enough that they behave as they should - protecting investors, customers and employees - not ripping them off.
But, Deutsche has the where with all to become the Verizon or AT&T of Europe and is well positioned to be a leader in the quadruple play - video on demand, hi-speed Internet access, fixed and mobile telephony.
And it isn't cool to be a single play operator any longer a la Vodafone. Convergence is the future. I guess Blackstone also like Deutsche's strategy of growing their mobile business in the US while also investing in Eastern Europe and driving integrated, converged services elsewhere.
Plus, Deutsche has been restructuring and laying folk off so hard that their share price is probably due for a technical bounce.
Friday, April 21, 2006
For the Wall Street Journal have announced that Microsoft is about to announce that Steve Berkowitz, ex-head of Ask.com and one of the most senior executives at Barry Diller's IAC/InterActiveCorp, is to take over the running of MSN.
Berkowitz is credited with the recent success at Ask.com. He sure needs the practice for MSN - which looks to need a serious dose of improvement. First up will be figuring out where MSN should go and how they can compete vis a vis Google, Yahoo et al.
Given that MSN is and likely always will be owned by Microsoft - I would have thought that their USP should be "the portal for advanced and comprehensive software services". If I want to I should be able to manage my diary, my life, my data and even my office applications from MSN.
The new MSN should have the most advanced email service and they should tightly integrate everything with MS Mobile. Then they should deliver the most functional and value adding search engine a la Ask.com. Maybe they should even buy Ask.com?!
Content should be secondary, comprehensive, but secondary. MSN should be my online alternative to a PC's hard drive. Then MSN can differentiate versus the other giant portals and search engines - and maybe even get a great deal more attention and respect within Microsoft.
And if they do not do it - Google or Yahoo probably will. Then Microsoft will have thrown away their Internet legacy and one of the most valuable franchises on the Web going fowards.
Ericsson and Alcatel/Lucent look set to drive the telecom network equipment market going forwards - for they have the focus and the scale. And they will need it to compete in a world where their customers will get larger and larger through competition and aggressive new Chinese compettors will take share and drive margins down (further).
It makes you wonder when Nortel will consider an acquisition/sale and when Nokia and Motorola will spin out their network divisions.
In the mean time - the future looks bright for Ericsson and the mobile industry in general and Ericsson remind us that “The evolution to mobile broadband is accelerating. This new powerful HSPA technology dramatically improves the consumer experience of new multimedia services such as mobile office, music and mobile TV,” said Mr Svanberg. “We have a clear lead and are rolling out HSPA networks in four continents.”
Two more WCDMA networks were launched during the first quarter, bringing the total number across the world to 93, 50 of which are supplied by Ericsson.
Ericsson said that long-term industry growth drivers “remain solid” and the number of mobile subscriptions continued to grow, primarily driven by emerging markets. They also said the global number of mobile subscriptions was expected to pass the 3bn mark in 2007.
And this all stems from Google launching Google Base, a free online classified service, that strikes at the heart of Ebay's business. In my opinion Ebay is using these conversations to better leverage their position with Google rather than do much more with Yahoo or Microsoft.
After all, Ebay is one of the largest advertisers on Google and Google delivers the most traffic to Ebay. I do not quite see how they could threaten that critical customer generation process. And if Ebay did take material business away from Google and develop a deeper partnership with Yahoo or Microsoft that would almost guarantee that Google would accellerate plans and promotion of Google Base.
Plus, both Yahoo and Microsoft have their own fledgling plans for classified services. Ebay may be best served to try and persuade Google to partner more deeply with them and maybe even integrate Google Base more closely with Ebay's services. Ebay for auction - Google Base for free classifieds.
And if Google are too stubborn, building deeper relationships with Yahoo or Microsoft or both, while still advertising with Google, may be the best way forwards.
And if all these options have you dizzy with confusion - think what a nightmare it is running a major Internet business. For it's all about partnering!
Thursday, April 20, 2006
Net income for the first quarter rose to $592 million, or $1.95 per diluted share, compared with the year-earlier quarter's $372 million, or $1.29 per diluted share. Revenue rose 79% to $2.25 billion, compared with Wall Street forecasts for 63% to 78% growth.
The markets loved the results and sent Google's shares up 5% in after hours trading. Google's results have knocked all of the concerns out of their Q4 performance and should help them to further share price gains - particularly as this is supposed to be their seasonally quieter period.
And Google's market share continues to strengthen. They had 49% of US searches conducted on their sites, according to recent data from Nielsen//NetRatings. Yahoo! remained in second place with 22.5%, while MSN ranked third with 10.9%.
Globally, Google's share of the Web search market is estimated by industry analysts to be greater than 60%.
As always, the biggest question on investors minds will be how in future quarters Google delivers concrete progress in developing other meaningful revenue streams from any one of their new initiatives. If I had to I would bet on Google Base, Google Video (if they ever improve it's looks and feel) and Google Software (mainly corporate search).
Let's see, but this is a great start to the year. Google could one day be the next Microsoft and with a revenue run rate already fast approaching $10bn annually they have one mean franchise.
For SAP yet egain delivered powerful results thanks to continued progress in the US market. Overall their software sales increased 22% to €528 million from €434 million in 2005, largely driven by a 25% rise in the US to €165 million, and an 8% increase in German sales.
SAP, the world's largest business software maker by market share, reiterated its financial outlook for 2006, including its expectation for a jump in software sales between 15% and 17%.
That looks hard to beat. The real question is how the business applications market will look in 2 or 3 years, by which time oracle and Microsoft will have fully integrated their acquirees technology. SAP needs to drive as much market share gain between now and then while they still have the edge. I guess that's their strategy.
The Finnish telecom-equipment maker earned €1.05 billion ($1.29 billion), or 25 European cents a share, compared with €863 million, or 19 cents a share, in the year-earlier period. Sales jumped 29% to €9.51 billion from €7.40 billion.Both earnings and revenues were considerably above analyst expectations. This was also the first time in a few years that Nokia has achieved a sizeable jump in market share. Nokia and Motorola seem to be distancing themselves from the other handset makers as both achieved strong volume gains.
Nokia's N70 Multimedia device was it's best seller for the quarter and provided evidence that Nokia's new higher end devices (including cameras and music players) are starting to pay off - both in developed and developing markets.
Nokia's weak spot was it's network division and Enterprise division - which proves that RIM's Blackberry is still the device/service to beat. Given that both Nokia and Motorola's network divisions are struggling - perhaps they should spin them off and merge them. They more than likely need the scale now that Alcatel and Lucent are merging and Ericsson is strengthening.
Wednesday, April 19, 2006
And the picture for the next quarter looks no better. In fact most of 2006 should prove a bad one for Intel, particularly now that Microsoft have delayed their launch of Vista until next year.
Intel has inventory problems, a weak PC market and is caught in transition moving to next generation technology. This has allowed their arch-rival AMD to gobble up market share. And the trend looks set to continue.
The real questions is can Intel get out of their current conundrums by doing more of the same - or do they need a real make-over and a new CEO much as IBM needed in the early '90's. The latest quarter will most certainly not have helped the existing team led by Otellini.
I must say I am becoming less bullish on Intel. And AMD sure have the chance of a lifetime to play catch-up!
Sales rose to $1.39 billion, up 35% from a year earlier, as revenue from eBay's online payments service, PayPal, rose 44%. That business now contributes a quarter of eBay's total revenue, while the majority of its sales come from its online marketplace.
Ebay was hit by a bunch of stock option charges. And it may be that the auction business is heading for a period of steadier, less heady growth. Ebay's acquisitions of PayPal and Skype may prove more important than anyone imagined to help going forwards.
And competition from the Google, Yahoo and Amazon is increasing. International epxansion may also prove more crucial than ever for Ebay.
Apple shipped 1.1 million Macintosh computers and 8.5 million iPods during the quarter, representing 4% growth in Macs and 61% growth in iPods over the year-ago quarter.
Now that most Macs have shifted over to Intel chips - Apple should see sales improve. All in all this was a good start to the year - but Apple have a lot to live up to given their extraordinary performance last year.
And it looks like broadband is fuelling this usage. Expect it to continue and develop. By 2010 more and more people will use the Internet not just to research new homes, but to order architect plans and to buy their new home. Children will use the Internet for home schooling and the Internet will directly employ more and more people.
I quote some of the more interesting findings:
"Some 45 percent of Internet users, or an estimated 60 million Americans, said the Internet helped them make big decisions or face a major moment in their life during the previous two years, the survey found. That was up from 40 percent of Internet users who answered the same survey questions in 2002.
Specifically, the survey asked 2,201 adults last month if the Internet played a crucial or important role in making at least one of eight major life decisions.
An estimated 21 million Americans turned to the Internet when seeking more training for a career, while 17 million used it to choose a school for a family member or to help another person with a major illness, the Pew Internet group said.
Some 16 million Americans used the Internet when buying a car or making a major investment or financial decision, it said. An estimated 10 million Americans used the Internet when looking for a new place to live; 8 million when changing jobs; and 7 million when dealing with their own major illness or health condition, the survey said."
The new Google Search Appliance integrates Google's OneBox technology that will allows companies to offer search short cuts to commonly asked questions across their business applications, such as corporate contact directory, customer resource management and financial programs.The search appliances have also improved security. The Google Search Appliance is for large organisations and costs $30,000 and the mini for SME's costing $2,000.
Google looks deadly serious about the corporate search space and looks to have corporate search leader Autonomy formally in their sites. If I was Autonomy I would be trembling about now.
The big question for Google is whether they may have found their first $1bn revenue business unit which is not reliant on ad revenues. If they have - that'll get the analysts singing from the trees!
And Hu even arranged tangible steps to help Microsoft fight copyright challenges in his country.
For in the days leading up to Mr. Hu's visit, four Chinese personal-computer companies signed deals with Microsoft agreeing to install the company's Windows operating system on computers in the factory, a move to head off piracy. The latest deal came Monday, when Lenovo Group agreed to a deal to install Windows on its computers.
This all bodes well for Microsoft and sadly proves the value to their shareholders of tech companies new found willingness to tackle piracy by giving in on freedom of rights. Oh well.
Revenue rose 34% to $1.6 billion. Excluding commissions paid to marketing partners, Yahoo had revenue of $1.088 billion, in line with its projection of $1.04 billion to $1.1 billion on that same basis. Yahoo kept its 2006 revenue projection on that basis unchanged at $4.6 billion to $4.85 billion.
And both search and banner advertising was strong (which also bodes well for Google's results). Yahoo looks well set, with International operations delivering better and better (now 30% of overall revenues) and with their new ad technology coming out - with improved search based ads.
Yahoo and Google remain the guys to beat in the Internet advertising and portal game.
Motorola said net income for the quarter dipped to $686 million, or 27 cents a share, from $692 million, or 28 cents, a year earlier. Overall sales leaped 23% to $10.01 billion from $8.16 billion, as Motorola bucked the typical trend of slower sales following the year-end holiday season.
And their market share of the handset industry bounced up another 4%. But investors sold their stock off on fears for the networks division as well as likely price and margin erosion for the Razr as Motorola push it out to the true mass market (including developing nations).
With the merger of Alcatel and Lucent, a spin off of Motorola's network division has to be considered.
The highlight was the software business and chips - largely for games consoles (including the soon to be launched Playstation 3).
Among its divisions, revenues from global services fell 1.2% to $11.6bn, while the disposal of the PC business led to a decline in hardware sales of 32.3%. Software revenues grew by 2.4%, or 6% adjusted for currency fluctuations, thanks to strong sales of middleware.
Net income rose 22% to $1.7bn, while earnings per share were up 27% to $1.08, compared to Wall Street expectations of $1.04.Allowing for the fact that Wall Street had low expectations of IBM given their awful performance at the start of last year, these results are at least solid. IBM seems to be on a path to recovery - albeit an extremely unexciting one.
I can't help feeling that they have to keep improving the software, hardware and chip divisions. They cannot rely on services alone - they just won't get the growth or margins over the long term.
Tuesday, April 18, 2006
Allow users of existing Windows based PC's to bring them in to any Apple Store and give them a trade in when they buy a new Intel Mac.
Then Apple just need do a deal with Ebay to take all the used Windows computers and sell them via their sites.
In one fell swoop Apple would rapidly grow their share of the PC market and Ebay would become one of the US' largest resellers of PC's and laptops. Now, isn't that a good idea?
[Shout in the comment box if you agree - Apple may even be listening.]
Burst.com has filed a countersuit against Apple Computer claiming that the iTunes software, the iPod and the Quicktime streaming software all infringe on patents held by Burst.com.
Apple believe that they're technology does not infringe Burst patents, but Burst disagrees. And disagreeing seems lucrative for them - they recently won a $60M settlement against Microsoft!
Burst.com's technology is pretty impressive - it speeds up the delivery of video and audio across the Internet enormously. It just doesn't do it for Apple services - according to Apple!
It added that during the remainder of the year, it would continue to explore opportunities to add to organic growth through “targeted acquisitions”.
And flat panel computer and TV sales are going particularly well. OK, so that's enough on Philips - before we all zzzzzzzz...
Monday, April 17, 2006
The retailer’s US customers can now buy almost 2,000 basic packaged foods online, including 12-packs of Campbell’s Cream of Mushroom soup for $12.99, and multi-packs of 70 individual servings of Kellogg’s Corn Flakes for $28.
And their prices are lower than most. Plus you get free shipping of you spend over $25. The only draw back is the delay in delivery. Amazon offers a range of estimates for delivery of its food items, with the Campbell’s soup taking up to five weeks. Without free shipping, it would incur standard delivery costs of $9.65.
There's still a way to go - but Amazon looks more likely than ever to be the Wal-Mart of the Internet. And that could make them even more valuable going fowards.
Microsoft plans to jazz up its music player in Windows Vista, the company's next operating system. But at least some of the new features will debut much sooner.
The software, which will be built into Vista, is designed to offer better synching with portable devices, make it easier to scroll through long libraries of music, and be tightly integrated with Urge, a new subsciption and download music servive co-developed by Microsoft and MTV Networks.
Windows Media Player 11 looks set to come out in June and is clearly designed to try and take on Apple's iPod. I just wonder if it can - after all the iPod has such a huge lead and of course Media Player downloaded songs will not play on the iPod - unless of course your in France later this year!
And Ellison mentions that he may buy Novell to achieve his objectives. This would be a canny move - even though it could prove yet another fatal step in the corporatisation of the open source movement. Particularly as IBM looks set to follow.
So Microsoft may wish to add Oracle to their most feared competitor IBM. And with Google and a resurgent Apple taking up the rear, Windows may find it harder to control the industry this millenium.
Kaboodle is a free ad-based service that allows people to do collaborative research. Kaboodle enables people to create pages of Web links, photos and discussion on specific topics and share them with others.
It's worth checking out. And the social networking Internet phonomenon keeps rolling on.
Friday, April 14, 2006
News Corp.'s Fox network has signed a six-year agreement with its 187 affiliated stations that will let it show reruns of its TV programs on the Internet.
The revenue-sharing agreement allows Fox to make 60% of its prime-time schedule available online the morning after the shows air. As a result digital TV takes another major step forwards.All other networks have to follow now and all other markets. Then the hollywood film studios need follow. But Internet TV has reached the tipping point from a content availablity perspective.
Go buy your Media Center PC or Mac Mini with Front Row!
And given that they are still in a major legal scrap with Apple over their use of the Apple brand on iTunes (the Beatles have a company called Apple Corp which has the rights to the fruity brand in music creation etc.) - I guess we can expect that they may not go that route out of the blocks!
For Beatles fans this is exciting news. And one that other digital shunners such as Garth Brooks may even take note of. Let's face it over the next couple of years all muscians will embrace the media - they have no choice.
Thursday, April 13, 2006
I have been predicting for 20 years that the calendar/diary market would go digital and the Google announcement is just another step in the relentless and endless drive to diary digitisation. Everyone laughed at me 20 years ago - now they can't understand how anyone can use anything other than a digital diary/calendar.
And Google have re-invented the online calendar space (as they do with most of their new product developments). Google Calendar will supposedly be more open than others, easier to share, use and tightly fused with Gmail. Plus searching calendars will be a breeze.
Now they just need to crack a ubiquitous mobile calendar and they will have their next direct challenge to Microsoft. On we go, one great step for diarykind proves another great step for Google!
Intel announces results next week, but looks destined to show that AMD is having an ever more negative impact on their performance. No wonder Intel is racing to get their new 64bit chips into the market and is diversifying into multimedia chips and mobile.
Intel still supplies the processors in four out of every five PCs made globally but AMD’s market share has increased significantly of late – rising from 11.9 per cent to 15.3 per cent from the third to fourth quarters of 2005.
AMD have a one off chance to become a real number 2 to Intel at least in the PC market. They need to maintain their gains and at one point they have to win Dell as a customer. Plus they need to remain the innovator in the PC market.
AMD sure have their work cut out for them, but this is their chance!
Sony Ericsson expect that more than 800M mobile handsets will be sold worldwide in 2006. This is becoming a huge market and grows unabated. Expect all the leading mobile players (and particularly the top 5) to benefit handsomely.
Also expect them all to structure themselves and their handsets around the three core sectors of the market: mass market, entertainment and corporate. The latter two provide the margins and the former the volumes. Sony Ericsson is extremely well positioned to take advantage of the entertainemt sector and have just launched a hi-end video phone.
And the Walkman phone continues to outperform. It may prove the single largest threat to Apple's iPod in the short term.
The reall battle as always is two pronged, market share and high average selling prices. So far all the leading players are achieving both. But as competition hots up - can they hang on to it?
Sony Ericsson also need to figure out how take take on LG and Samsung for the number 3 slot. If they pull that off they will prove an enormously valuable company for both parents.
Wednesday, April 12, 2006
The Orion search engine is the work of Ori Allon, a 26-year-old PhD student, inspired by an idea a year ago from his supervisor Dr Eric Martin. Mr Allon is understood to have moved to Google’s headquarters in Silicon Valley to develop the algorithm further.
Allon said results to queries were displayed in the form of expanded text extracts “giving you the relevant information without having to go to the web-site”.
The question is how much gets extracted? Google need ensure they do not compromise any copyright issues. But, they should be able to get beyond that and provide a valuable new service. It looks like an interesting move.
Tuesday, April 11, 2006
This looks like bt will be a solid year for Nokia. Great new products at most ends of the market and a thriving developing markets business. But they'll need, it for the competition from Motorola, Samsung and SonyEricsson has never been stronger.
Monday, April 10, 2006
Given that video is one of the hottest applications on the Internet this year and social networking the latest web craze - the combination looks set to become a huge payout for MyTube founders (ex PayPal guys) and backers Sequoia.
MyTube could even be worth over $1bn by the end of this year.
So what's the next big social networking idea? Get working on it - it could earn you a fortune!
Now majority-owned by US buyout fund Cerberus, Aozora is sprucing up ahead of a widely expected share listing, and it has asked Apple to outfit 2,500 work stations at its main office, data center and 17 branches.
The order has made Aozora the iPod-maker's biggest financial industry client worldwide.
And it begs the question of how many other corporate users will switch to Apple now they have Intel chips and the ability ot run Windows XP on Macs (thanks to Apple's new software). I think that Microsoft and Dell may have a more dangeroius competitor in Apple than ever they thought.
IBM's new technology is called "SecureBlue" and it hard-wires encryption capabilities into a section of the central processor chip, giving a hardware solution that is faster and more efficient than existing security software. IBM hopes to license the technology to chipmakers.
This is good news for corporate IT managers and one that no doubt will get Intel and AMD to take small device security on chips much more seriously.
Saturday, April 08, 2006
First and foremost they have revealed what their wireless Internet access modeol may look like. In their bid for the San Francisco free wireless access service they show that they will subsidise free access by offering location based advertising in their growing local listings service.
And by doing this they also provide insight and opportuntiy for wireless firms all over to reduce wireless data charges by offering such localised and digital advertising, for both Wi-Fi technology and mobile networks can pin point your location down to at least a couple of blocks.
And Google make it clear to us that both wirless search and advertising as well as Internet directory/local listings will be big business for them going forwards.
Separately Google launched a real estate search and advertising service on Google Base and a partnership with Discovery Channel to run streaming video of world leading locations on top of Google Maps.
Google had another strong week. The year is picking up for them and their stock price seems to be edging up nicely again to reflect this.
The BlackBerry maker reported fiscal 4th quarter net income of $18.4 million, up from a $2.6 million loss a year earlier. But it said it expects 1st quarter revenue of $580 million to $610 million and to add some 675,000 new subscribers, signs of slowing growth. And their shares fell $4.60, or 5.4% on Nasdaq.
The inevitable slowdown for Blackberry has begun. Their legal battles with NTP may be behind them - but it has dented confidence in them and their popular wireless devices. And growing competition from Microsoft and Nokia is already having an effect.
The million dollar question is whether the legal tussles have just led to a short term delay in purchases of Blackberry technology or is this the beginning of a longer term decline for the leader in wireless email. I'm afraid I think it could be the latter.
Wednesday, April 05, 2006
For Vodafone's stake in Verizon Wireless is probably worth over $50bn. Nice investment. I would expect some announcement soon - but let's see!
Bingo, now a major reason why so many Windows users have never dared to convert to Mac's has just disappeared and in one fell swoop Apple should be open to many digit point increases in their market share.
Consumers can really have their cake and eat it. Windows for office applications and functions and Mac applications for your personal life and digital entertainment. This is a big announcement for Apple and could prove more bad news for Dell.
Equipped with a color screen for playing videos and an external memory slot, the silver, candy-bar-shaped t509 phone is 9.8 millimeters thick, which makes it thinner than the 11.5-millimeter Slvr, a sibling of the clamshell Razr.
Samsung is on a rip this year and plans to launch a barrage of new cell phones and MP3 digital music players. Motorola, Nokia and Apple need watch their backs. Samsung's breathing down teir necks.
Tuesday, April 04, 2006
About 2,000 cases were launched in 10 countries, the International Federation of the Phonographic Industry (IFPI) said in a statement, bringing the total to 5,500 people in 18 countries.
This is a massive attack on illegal music and one which should truly begin the process of killing off the abuse of music copyright and will set important precedent for all digital copyright. Thank goodness.
Sure helps boost iTunes at the same time!
NTL will have the use of Virgin’s brand for its consumer business under a 30-year licensing agreement that stipulates a minimum royalty each year of £8.5m.
The deal creates the UK’s first media company to offer “quadruple play”, comprising television, broadband and fixed-line and mobile phone services. And creates a new communications and entertainement juggernaut with the all-powerful Virgin brand behind it.
In my oppionion Richard Branson has just pulled off one of his most brilliant and strategic moves. As the leading shareholder in NTL he can become a key player in the new media space - where media, tech and telecomms converge.
BBC and Sky had better watch out! I'm a big believer in the potential of the new NTL and if they get it right, with converged digital music and video, mobile TV and broadband Internet access, utilising the Virgin brand and even Virgin services and content - they can truly become a leader in the next generation of communications and entertainment companies.
And they'll shake the entire UK market up behind them. That'll benefit every consumer.
And you can't really blame them, for outsourcing has become less du jour lately. IT has become strategic again and companies are taking IT back in-house. Plus, the large all-encompassing outsourcing contracts are no longer the way governments or businesses want to go. If they outsource they want specific processes covered under specific contracts.
The likes of CSC have also not been helped by a bunch of new Indian lower cost outsourcing firms entering the market. It could prove a tough challenge to find a buyer. Lots have looked, including EDS, HP and a bunch of private equity players - and no one has bitten.
But, with CSC's announcement that they will shed 8,000 staff in Europe - that just might make them more attractive. Expect the Private Equity dudes to circle.
Monday, April 03, 2006
The service is being launched by Movielink, an online joint venture formed in 2002 by MGM Studios, Paramount Pictures, Sony Pictures Entertainment, Universal Studios and Warner Brothers. Movielink has so far been slow to gain momentum because it traditionally received films 30 to 60 days after they were released on DVD, and could only rent them to customers on a temporary basis. Der!
Thanks to an agreement between the founding studios and Fox, you can now both own the movies (on your hard disc - you can't burn them to a DVD yet) and get them at the same time as they come out on DVD. If you go to the site today for around $20 you can buy the likes of "Walk the Line", "King Kong" and tomorrow you can get "Brokebeck Mountain".
This will prove to be a major boost for digital films. And with the opening up of MovieLink expect Hollywood to get much more aggressive about offering their movies on iTunes, Google Video, Yahoo and AOL.
The day has arrived where each and every one of us can start building our digital film library. And the beginning of the real slowdown in DVD sales has just begun.
The company's premium music phone, the N91, will start shipping this week, according to Nokia's Multimedia division. The phone's 4GB hard drive stores up to 3,000 songs.
The N71 and N80 phones, designed to take on Blackberry devices, will start deliveries in the next two weeks.
These devices in my opinion respectively present the first real and present danger to both the iPod and to the Blackberry. Storing 3,000 songs makes the mobile phone/music player a reality. And the email and calender functions of the two Nokia business devices will allow corporations a real alternative to the Blackberry.
The multi-million dollar question is how easy Nokia's devices will be to use. For Apple and RIM's success relies strongly on their simplicity out of the box, something they can pull of more effectivley given both companies control the hardware, software and services.
Nokia only has the hardware and software part of the equation - leaving the services part to the operators, something the operators to date have not been great at. But, they're learning fast.
Apple and RIM both have to keep pushing innovation's envelope to stand a chance of hanging on to their existing market shares. That means more features on your Blackberry and a mobile phone enabled iPod - surely!
"According to Bridge Research, there are about 9 million podcast listeners today. Conservative analyst projections peg that the audience will reach around 12 million in the United States alone by 2010.
The "corportization" of podcasts is contributing somewhat to this growth, as the big media brands take over the format from the geek fringe. But almost every pundit agrees the biggest killer app for the format is the one most difficult to obtain--music."
And Podcasting is allowing a whole new generation of radio entrepreneurs to reach new audiences and generate revenues through advertising. Podcasting is a new digital media and one which alongside video podcasting can allow anyone to create a mutli-media portal at almost no cost.
The garage radio station and film studio has almost arrived! And with it record labels and film studios will be forced to jump on the bandwagon by 2010 at the latest.
This is consistent with Verizon's strategy of focusing on rolling out hi-speed fibre optic newtorks in the US so they can become a leader in telecomms, broadband Internet and TV-on-demand alongside AT&T.
This will also improve their balance sheet a little - though they do need to get on with buying the rest of Verizon Wireless from Vodafone - and that won't come cheap.
Sunday, April 02, 2006
Alcatel's boss will become Chairman and Lucent's head will be CEO. The company will be based in Paris and have combined revenues of $25bn and a global workforce of 90,000, which will shrink by 10% as they gain merger efficiencies.
It has taken the two companies 5 years to actually manage to put a merger together - and the fact that they have to now proves how much the telco landscape has changed in the last 5 years as their customers, such as Verizon and AT&T have bulked up and put pressure on their suppliers margins.
Alcatel and Lucent have also been forced to merge with the entry of lower cost competition from the Chinese and from the entry of Cisco to the market with their new fangled Internet gear for operators.
So the telecomms equipment market starts its path to consolidation, mirroring that of their telcco customers. The only question is who will merge next - Siemens, Ericcson or Nortel? I wonder...
Saturday, April 01, 2006
Sony's dream of freeing TV from the confines of the living room is looking more like reality with a gadget that allows you to watch local broadcasts on a PC even if you are thousands of miles from home.
And it's simple. You just buy a little black box which connects to your anntenae at home and streams compressed TV to your "LocationFree" enabled device over a broadband Internet connection. So if travelling you could have your local TV beamed to your laptop while in the airport or even your cellphone while in the Metro.
The price is good and the idea strong. This could be a winner for Sony. Shame I can't beam it to my iPod.
Or maybe not. The two are for ever at odds over the boards composition and currently arguing over whether Alcatel should have two more board seats to reflect the 60/40 ownership split in Alcatels favour.
And they do love falling out over management issues - but with the prize of creating such an industry juggernaut I would have thought that this time they'll come to a compromise and the telecomms equipment space will have a new trans-altlantic 800lb gorrilla. Let's see!