Hot news " Google Nexus One phone parts cost $174: iSuppli"

 Google Inc's new Nexus One smartphone, which retails for $529 without a service plan, is built from components that cost about $174, according to a research report.

But analysts said the big gap between the components' costs and the phone's price tag did not necessarily mean the Internet giant was making a hefty profit, since the retail price includes expenses such as licensing fees and marketing costs.


Google began selling the Nexus One, which is made by HTC Corp, on its website last week, its first foray into selling electronics devices directly to consumers. The retail price is $529, but if a buyer agrees to a two-year contract with Deutsche Telekom's T-Mobile USA, the carrier will subsidize the phone and it costs only $179.

According to the teardown by research firm iSuppli, the cost of the Nexus One's various components, including $30.50 for the 1Ghz Qualcomm Inc Snapdragon processor and $17.50 for the Synaptics Inc touchscreen, totals $174.16.

In a note to investors last week, Goldman Sachs analyst James Mitchell estimated that the Nexus One's component costs were $300.

The bill of materials cited by iSuppli does not include other costs such as manufacturing, software and royalties -- all of which are factored in when calculating gross profit margin on a product.

Charter Equity Research analyst Edward Snyder said smartphone vendors typically achieve gross margins around 30 percent.

He said the iSuppli report suggested Google would make a "decent" margin on the product, but added that it was impossible to know exactly how much.

Analysts also noted that the component costs are the costs borne by HTC to produce the phone, with Google then likely paying HTC a mark-up to buy and resell the phones.

The Nexus One, which competes with Apple's iPhone and Research in Motion's Blackberry devices, is the first of a variety of smartphones that Google said were in the pipeline as the company seeks to expand its reach from the PC to the mobile world and ensure its online products and ads get prominent placement.

During an event unveiling the phone last week, Google Vice President of Engineering Andy Rubin said the company had an opportunity for an undisclosed margin selling the Nexus One.

Phones, PCs to drive tech rally into 2010

As technology companies make their annual trek to Las Vegas to unveil their coolest gadgets at the Consumer Electronics Show in January, investors are laying bets on another good year for the industry
The mood at CES 2010 should be far more buoyant than in early 2009, when the economy was deep in recession and financial markets reeled from the credit crisis.

Tech stocks have since recovered, with the Nasdaq Composite Index ending 2009 up more than 40 percent, near a 15-month high. Analysts say stronger corporate IT spending, an explosion of activity around smartphones and mobile computing, plus consolidation, should further bolster the sector in 2010.

Broadpoint AmTech analyst Brian Marshall predicted a climb of roughly 15 percent in the Nasdaq in 2010, noting that some of the good news was already factored in to stock valuations.

"It's going to be tough to find areas that won't do well next year," Marshall said.

Topping the list for many sell-side analysts are perennial blue-chip favorites like Google Inc, Apple Inc, Cisco Systems Inc and Intel Corp.

But with economic recovery slowly taking root and companies starting to upgrade their IT systems again, analysts say 2010 will offer tech investors a wide range of opportunities.

Microsoft Corp's latest Windows 7 operating system should help spur sales of personal computers, with research group IDC forecasting double-digit PC shipment growth through 2013. Top PC makers Hewlett-Packard Co, Acer Inc and Dell Inc could be a way for investors to capitalize on that trend, analysts say.

Many like data storage giant EMC Corp as a way to play the anticipated uptick in corporate spending, along with its software unit VMware Inc.

FBR Capital Markets analyst Daniel Ives is recommending "defensive stocks with offensive characteristics" because of uncertainty about the strength and pace of recovery in 2010. He likes EMC, infrastructure software maker Citrix Systems Inc, and security software names McAfee Inc and Symantec Corp.

CHIPS STRONG

With a more stable economy, investors' risk appetite should be higher than a year ago. But given the rise in valuations, the question is how much run the tech rally has left.

Tech stocks are trading in line with other growth sectors, such as materials, at around 16-1/2 times forward earnings, according to Thomson Reuters StarMine. Tech's price-to-earnings growth (PEG) ratio, however, is less attractive for investors, badly trailing materials.

The XLK, which tracks S&P 500 tech stocks, recently cleared a key resistance level and could be aiming for 2007 highs next year, which would be a near 25 percent gain from current levels.

Chipmakers in particular enter the new year riding a wave of positive sentiment. Despite a jump of around 70 percent in the Philadelphia Semiconductor Index in 2009, many believe the sector could be poised for more gains next year.

Gartner expects 2010 worldwide semiconductor revenue to rise 13 percent and rebound to 2008 levels, driven by PCs.

"Demand has been good, inventories are lean and we have a number of areas that are starting to recover," said Canaccord Adams analyst Robert Burleson.

He pointed to companies with their own chipmaking facilities -- Intel, ON Semiconductor Corp, Fairchild Semiconductor and Analog Devices Inc -- as being particularly well-situated for 2010 due to cost-cutting.

Burleson said PCs make up roughly one-third of overall chip revenue, but noted that demand in less-flashy areas like automotive and medical equipment is also coming back.

Other analysts recommend graphics chipmaker Nvidia Corp and Marvell Technology Group Ltd, whose chips are used in storage products, as another way to benefit from a surge in PC sales.

SMARTPHONE STRENGTH

As computing becomes ever more mobile, smartphones will continue to be a hot area. CES should provide a showcase for more devices, while Google is widely expected to unveil the first Google-branded phone on January 5.

Gartner expects the smartphone market to grow to 525 million units in 2012 from 179 million in 2009.

Apple's iPhone and a growing universe of devices based on Google's Android mobile software dominated much of the conversation in 2009. Stumbles by Research in Motion Ltd took the shine off the BlackBerry maker, while Palm Inc's Pre-led recovery hit a stumbling block.

Frost & Sullivan analyst Ronald Gruia likes Google, Apple and Samsung Electronics Co Ltd in the smartphone race. He said Google is the biggest potential star, but is skeptical about revival efforts at cellphone makers Nokia, Motorola Inc and Palm.

Gruia said Nokia needs to innovate in operating systems, while Motorola may be too closely tied to the Android platform, and Palm will have to spend to attract new customers.

The rapid rise in data usage on mobile networks is pushing carriers to upgrade wired broadband connections to cell towers, providing demand for so-called backhaul equipment providers such as Alcatel Lucent, Gruia added.

Speculation rife on Google phone

The web is awash with gossip and rumour about the imminent arrival of a Google-branded phone.

The search firm is widely expected to unveil the Nexus One phone at a press conference scheduled for 5 January at its California HQ.

It is believed Google will sell the gadget directly to customers and that it will also be available, subsidised, from mobile operators.

Google has remained tight-lipped about what will be unveiled at the event.




Hands on

Photos of the Nexus One have appeared online at gadget sites such as Gizmodo, Engadget and many others. The first look at the slim phone reveals that it is built by HTC, has a 9.3cm (3.7in) screen, five megapixel camera and runs version 2.1 of Google's Android operating system.

Early reviews were underwhelming, with Engadget declaring that it was "really not very different" from existing Android phones such as Motorola's Droid.

Engadget said the phone shifted quickly between different applications but lacked what might be thought of as standard features for comparable smartphones such as a multi-touch screen.

Gizmodo said leaked documents showed that the phone will cost more than $500 (£308) unlocked, ie not tethered to a network, or $180 (£111) with a two-year contract from T-Mobile.

No information has yet been revealed about when, and if, the phone will be available outside the US.

Google has kept secret the exact details of what will be unveiled on 5 January. Media organisations are limited to sending one correspondent to the press conference. A spokesman for the company would only say the announcement was "significant".


"All eyes are on the Nexus One," said analyst Rob Enderle of Silicon Valley-based Enderle Group.

"It looks like Google is moving to see if they can do the Apple thing," he added.

The Nexus One is widely believed to have been tested out inside Google when the search giant issued the device to many of its employees.

"For Google to go into the business of selling phones just doesn't make a whole lot of sense," said Van Baker, an analyst with market research firm Gartner.

Before now Google has been content for established phone makers, such as SonyEricsson, to make the phones that run its Android operating system.

Chatter about the Nexus One sets the stage for the Consumer Electronics Show that takes place in Las Vegas from 7-10 January.

The giant gadget shindig will see more than 110,000 people stroll through halls in which they will find more than 20,000 new products.

This year the show is likely to see the unveiling of many netbooks, e-book readers and tablet computers. The conference officially opens on 6 January with an evening keynote from Steve Ballmer, Microsoft chief executive.

Nokia says most Apple products violate its patents

Nokia has ramped up its legal fight against Apple, arguing that almost all of its products infringe Nokia patents.

Nokia, the world's largest phone maker, filed its new complaint with the US International Trade Commission (ITC).

The Finnish phone maker alleges that Apple is using patented technologies to "create key features in its products", including iPods and iPhones.

In October Nokia sued Apple, saying that the company's popular touchscreen iPhone infringed 10 of its patents.

Apple told the BBC that it would not comment on Nokia's latest legal move.

However, the US firm recently countered by filing its own lawsuit against Nokia, saying the phone maker had copied certain aspects of the iPhone and infringed 13 of its patents.

The new complaint to the ITC relates to seven patents related to "user interface, as well as camera, antenna and power management technologies".

Nokia told Reuters that the firm expected the ITC to decide whether to pursue the case in around 30 days.

by :BBC news

Cell phone mania forces scramble for more airwaves

WASHINGTON – Wireless devices such as Apple's iPhone are transforming the way we go online, making it possible to look up driving directions, find the nearest coffee shop and update Facebook on the go. All this has a price — in airwaves.

As mobile phones become more sophisticated, they transmit and receive more data over the airwaves. But the spectrum of wireless frequencies is finite — and devices like the iPhone are allowed to use only so much of it. TV and radio broadcasts, Wi-Fi networks and other communications services also use the airwaves. Each transmits on certain frequencies to avoid interference with others.

Now wireless phone companies fear they're in danger of running out of room, leaving congested networks that frustrate users and slow innovation. So the wireless companies want the government to give them bigger slices of airwaves — even if other users have to give up rights to theirs.

"Spectrum is the equivalent of our highways," says Christopher Guttman-McCabe, vice president of regulatory affairs for CTIA-The Wireless Association, an industry trade group. "That's how we move our traffic. And the volume of that traffic is increasing so dramatically that we need more lanes. We need more highways."

That won't happen without a fight. Wireless companies are eyeing some frequencies used by TV broadcasters, satellite-communications companies and federal agencies such as the Pentagon. Already, some of those groups are pushing back.

That means tough choices are ahead. But one way or another, Washington will keep up with the exploding growth of the wireless market, insists Rep. Rick Boucher, D-Va. He is sponsoring a bill that would mandate a government inventory of the airwaves to identify unused or underused bands that could be reallocated.

"It's not a question of whether we can find more spectrum," says Boucher, chairman of the House Commerce Subcommittee on Communications, Technology and the Internet. "We have to find more spectrum."

CTIA, the industry group, is asking the government to make an additional 800 megahertz of the airwaves available for wireless companies to license over the next six years. That would be a huge expansion from the industry's current slice of roughly 500 megahertz. The Federal Communications Commission is preparing to make more frequencies available for commercial use, but has just 50 megahertz in the pipeline.

Two trends are driving the demand.

First, advanced new wireless applications — such as mobile video and online games — devour far more bandwidth than voice calls or basic text messages, says Neville Ray, senior vice president for engineering operations for T-Mobile USA Inc.

Second, consumers are flocking to wireless Internet connections, in some cases dropping landline accounts altogether. ABI Research projects U.S. mobile broadband subscriptions will climb to 150 million by 2014, up from 48 million this year and 5 million in 2007.

The predicament, says Jamie Hedlund, vice president of regulatory affairs for the Consumer Electronics Association, is that many users "assume the wireless experience should be the same as the wired experience, but the capacity is just not there for that."

The industry's concerns are finding a sympathetic ear in Washington.

Julius Genachowski, chairman of the FCC, says finding more room for the wireless industry will be an important part of his agency's broadband plan. That plan, mandated by the 2009 stimulus bill, is due in February and will propose using wireless systems to bring high-speed Internet connections to corners of the country that are too remote for landline networks.

"If we are going to have a world-leading broadband infrastructure for the nation, wireless is an indispensable ingredient," says Genachowski aide Colin Crowell.

Lawrence Strickling, head of the National Telecommunications and Information Administration, the arm of the Commerce Department that manages the federal government's use of the airwaves, says the agency is also hunting for more frequencies the wireless industry can use.

Some of the crunch can be addressed with technologies that make more efficient use of airwaves and new equipment that lets users share bands. The FCC also wants to promote greater use of frequencies that aren't licensed to anyone, such as the "white spaces" between the bands used by TV channels.

But such solutions alone won't solve the crisis, the wireless industry warns.

The FCC's attention for now is on TV broadcasters, which hold nearly 300 megahertz of airwaves that are mainly used to serve just 10 percent of American homes — those that still rely solely on over-the-air TV signals.

The FCC is exploring multiple options, most of which would leave broadcasters with enough capacity to deliver a high-definition signal over the air. One possibility, which might require congressional approval, is a voluntary program that would let broadcasters sell excess bandwidth through an auction, to either the government or directly to wireless companies. Although the FCC awarded spectrum licenses to broadcasters for free many years ago, those licenses are worth millions today.

"Fewer people are getting over-the-air TV and at the same time, more and more people are using mobile broadband," says Blair Levin, the official overseeing the FCC broadband plan. "So it only makes sense ... to get that asset into the hands of whomever can realize its greatest value."

The idea faces opposition from the powerful broadcast lobby. Dennis Wharton, executive vice president of the National Association of Broadcasters, says the proposal would stunt the industry's plans to make innovative use of the airwaves that became free when it turned off analog broadcasts and went entirely digital in June. Broadcasters have already returned more than 100 megahertz of those airwaves to the government and plan to use the rest to transmit high-definition signals, "multicast" multiple channels and deliver mobile TV to phones, laptops and cars.

"The FCC proposal would kill many of our future business plans in the cradle," Wharton says.

Wireless carriers are also setting their sights on frequencies held by companies that deliver voice and data services through satellites.

Hedlund, of the Consumer Electronics Association, notes that some of these companies have a lot of bandwidth but not a lot of customers. TerreStar Corp., for one, launched its satellite in July and is just building a subscriber base. And ICO Global Communications, which is running tests on a satellite launched last year, has not announced when it will begin commercial service.

But TerreStar General Counsel Doug Brandon believes the company has a strong argument for keeping its airwaves: Satellites can provide a critical lifeline in emergencies when other communications links go down and in rural areas where other carriers don't offer service.

If anything, added ICO Vice President Christopher Doherty, satellite phone companies are ideal partners for cell phone companies that want to expand coverage. TerreStar, for one, has a deal for AT&T Inc. to resell the satellite service.

More potential sources of frequencies are federal agencies that handle everything from emergency communications to surveillance operations. The Defense Department, for instance, needs the airwaves for such critical equipment as radars, precision-guided weapons and drone planes.

The Pentagon has vacated some frequencies and is developing technology that can make more efficient use of airwaves. It also says it is committed to finding compromises that work for the government and commercial sector, so long as those don't jeopardize military capabilities.

Karl Nebbia, head of the NTIA's Office of Spectrum Management, points out that federal agencies may be open to moving to different bands because the government is "a huge user of commercial broadband services." But one challenge will be to ensure federal users get the resources to relocate — including new equipment, potentially paid for with spectrum auction proceeds.

For now, one thing everyone agrees is that there are no easy pickings in the airwaves.

"There is no open space anywhere," says Kathleen Ham, vice president of regulatory affairs for T-Mobile.

Netbook decision: Windows XP or 7 Starter?

Windows 7, Microsoft's newest operating system, has received positive reviews; Windows 7 Starter, the version for netbooks, not so much.

Some critics think Microsoft's previous operating system, Windows Home XP, remains a better choice for netbooks in terms of overall battery life and some other features. This holiday season, shoppers are seeing netbooks on shelves loaded with XP and others with Windows 7 Starter. The latter is an essentially stripped-down version of Windows 7, released in October. `(Msnbc.com is a joint venture of Microsoft and NBC Universal.)

Windows 7 Starter may be too stripped down, some say. Among its frustrations: The background screen on the computer desktop cannot be personalized or changed from Microsoft's dominant logo, and there is no way to play back a DVD with an external DVD drive attached to the netbook.
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"You cannot change the desktop background on any Windows 7 Starter system," wrote Joanna Stern in an article on SlashGear's site recently. "That’s simply ridiculous. I have been changing backgrounds in Windows since my very first desktop that ran Windows 95!

"Can I live with a blue Windows logo on my notebook's desktop? Sure, but why should I? Yes, Windows 7 may be more aesthetically appealing than Windows XP, but who wants to look at a blue shaded Windows logo forever?"

Sales still strong

Netbooks continue to remain a strong part of the laptop market, representing between 15 and 20 percent of sales, said Stephen Baker, vice president of industry analysis for The NPD Group research firm.

The little laptops, generally weighing between 2 and 3 pounds and with 7- to 10-inch screens, are considered second computers for many, and provide wireless Web access on the go.

"What we’re seeing this holiday is that XP has been predominantly available on door-buster, lower-cost netbooks, those $300 and less, but the bulk of the netbooks out there are going to come with Windows 7 Starter," he said.

A recent check of Amazon.com's top-10 selling netbooks showed sales evenly divided between netbooks with XP and Windows 7 Starter.

'Solid, basic experience'

Benjamin Rudolph of Microsoft's Windows Business Group said the company extensively tested Windows 7 Starter, with "hundreds of thousands of people testing the product for thousands and thousands of hours," and concluded that for "people looking for that solid, basic experience" of Web surfing and checking e-mail on netbooks, Windows 7 Starter was a good choice.

"There are a couple of the visual elements that the higher versions of Windows 7 has that Windows 7 Starter doesn’t have, including the ability to change the background," he said.

The lack of DVD playback with Windows 7 Starter has also come as a surprise to some, who have gone out and bought USB DVD drives to plug into their netbooks, only to find such drives won't work.

"If you want to engage in more mobile entertainment, you want to be able to play DVDs back, you want the richer media experience, you might want to consider Windows Home Premium. That's why the Windows 'anytime upgrade' is such a good option," letting users decide if or when they want to move to a more robust operating system, said Rudolph.

The cost to upgrade from Windows Starter 7 to Windows 7 Home premium is $79.99. Some consider that a steep price, considering most netbooks themselves are between $300 and $400.

On one of its blogs, "Let's talk about Windows 7 Starter," Microsoft talks about many of the issues that have gotten attention of netbook users.

7 Starter plusses

Alex Spektor, netbook share tracker for Strategy Analytics, said that "part of Microsoft's reasoning for the fixed wallpaper (or background) may have been to limit the consumption of system resources on constrained machines like netbooks."

He believes there are "several key advantages" to using Windows 7 Starter vs. XP Home on netbooks. Among them: "The user interface, while largely a carryover from Windows Vista, holds some significant improvements over Windows XP," especially with improved "Wi-Fi connection management" that is easier than XP's.

The newer operating system, released in October, "displays all available Wi-Fi connections in a pop-up menu on the desktop, allowing for easy lookup of nearby hotspots and quick toggling between routers," Spektor said. "In contrast, Windows XP uses a somewhat cumbersome dialog box, which is somewhat less intuitive." Support timeline
Because Windows 7 is new, there is also "the benefit of ongoing support from the software giant," he said. "While Microsoft is still supporting Windows XP because of use in netbooks and the general resistance in the PC community to Windows Vista, the operating system is getting quite dated.

"At some point, Microsoft will end support for XP, which might leave users out in the cold with respect to patches or technical support."

That point will be Aug. 4, 2014, when Microsoft ends extended support for XP, according to the company's product "lifecycle" policy.
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XP's strengths

Points in favor of XP Home on netbooks are that "Windows 7 is a heavier operating system, consuming more resources than XP," Spektor said.

"While Microsoft has improved 7's power management functionality, early tests have shown that the OS takes a toll on the weak specifications of the typical netbook, affecting important factors like battery life."

Several tech publications — including PC World, Laptop magazine and Liliputing — have done comparison tests of battery life using both versions of Windows, and found that netbooks using XP have anywhere from 10 to 20 percent more battery life than those with Windows 7 Starter.

Battery life on many netbooks can be more than five hours, and so the difference may not be as keenly felt as for those with netbooks that have two or three hours' battery life.

Support issue

Michael Cherry, analyst for Directions on Microsoft, an independent research firm, said while XP is "a well-known and familiar operating system, the downside is simply this: Microsoft will not be supporting it in the future."

In XP's favor, he said, is that it is "so widely used that most problems have been discovered and either repaired or a workaround is well-known.

"In reality, the concern is that a new security vulnerability will be found and Microsoft chooses not to fix it because XP’s architecture differs significantly from the versions of the OS it currently supports, or fixing it would break too many applications. This is the risk of becoming a new user of Windows XP today."

Windows 7 Starter is "less well-known and familiar, but people will not have trouble working with it," he said. "It is currently in mainstream support, so Microsoft is more likely to fix any problems that are uncovered.

"It has been trimmed down so that customers have the ability to download some features from Windows Live if they want them. I run it on a netbook that originally came from the manufacturer with XP, and I am satisfied with the performance."


Rudolph, of Microsoft, said Windows XP  "is a great OS, but for somebody looking for a netbook, Windows 7 is really what they want. It's the best OS we ever made, whether you pick Windows 7 Starter edition or a higher version, like Home Premium, you get to take advantage of all the speed, all the security, all the usability improvements. They’re present to the core in all editions of Windows 7.

"It’s a common misconception that going to Windows 7 Starter is a step down from Windows XP. It’s not; it’s definitely a step up."

Microsoft, Intel to cede tablet market to Apple?

If the Apple tablet emerges as expected, this will be another big device market, following smartphones, that the PC industry cedes to Apple.

The writing is already on the wall already for Microsoft and smartphones, as spelled out in a previous post and as documented in shrinking market share numbers.

That's not to say that Microsoft, Compaq (later Hewlett-Packard), and Intel didn't have a chance. Remember the Compaq iPAQ PDA that debuted way back in 2000, powered by an Intel StrongARM chip running an early version of Windows Mobile?

That device had a lot of potential. The operative word being "potential." An iPAQ could have been an iPhone. Or at the very least an iPod. And everybody could be drooling over iPAQs today instead of iPhones. Or using iPAQs instead of BlackBerrys. But of course things didn't turn out that way.

Fast forward to 2010 (January?). Apple announces a tablet and suddenly everyone wants a tablet.

And what have Microsoft, Intel, HP, and others been offering in the interim years when they had every opportunity to come out with a blockbuster tablet? Unattractive, bulky, half-baked convertible laptops that, let's put it this way, have not taken the PC market by storm.

So, here's the $64,000 question, uh, make that the $64 billion question. Why can't the combined R&D smarts, market clout, and overall technological resources of Microsoft-Intel-HP-Dell come up with a thin, sexy compelling tablet and/or media pad that will turn heads and convince the unbelievers (the average why-would-I-need-something-like-that consumer) that a tablet is a must-have product?

Answer: Because Apple will.

Here's a not unlikely scenario. Apple brings out the tablet/media pad, wows U.S. (and world?) consumers, sells a ton of units, Microsoft-Intel-HP-Dell follow suit with slavishly copied devices that don't sell very well comparatively.

That's how the market for successful newfangled devices works these days. Apple creates the market and everyone else follows in a panic.

Then there's the Intel factor. Intel also wants to be a player in this space. But Intel and its coterie of PC makers can't get off the traditional-design laptop gravy train. Plus, as formidable a chipmaker as Intel is, it is still behind the Qualcomms and Texas Instruments of the world in building the power-efficient system-on-a-chip silicon that goes into smartphones and will likely go into tablets.

So, here's my question for Intel et al: How many people will be buying Netbooks or Intel-based MIDs (mobile Internet devices) in 2011 if Apple has a more compelling alternative? Answer: a lot less if the Apple tablet exists.

And add Asia-based device makers offering tablets using an Nvidia Tegra 2 chip to that. A number of these tablets are expected too in 2010. In fact, Nvidia is already doing what Intel should have finished doing a long time ago: make a competitive system-on-a-chip that powers small devices. Intel had the chance to make XScale (what StrongARM eventually became) into something big for small devices six years ago. But it didn't. And now Intel is trying to reinvent the wheel by squeezing the upcoming "Moorestown" Atom chip into smartphones.

Intel, I'm sure you think Moorestown is a great idea, but it's a little late. Apple beat you to it by about three years.