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Nokia smartphone market share shrinks to 31 percent, operating profit takes a beating too
Stephen Elop's first quarterly results as Nokia CEO have just come out, and while the company's still growing, others seem to be speeding ahead of it. Nokia's reporting its converged mobile devices (smartphones, to you and us) reached volumes of 28.3 million during Q4 2010, which is a neat bump from 20.8 million at the same time last year and 26.5 million in the previous quarter. However, in the context of the broader smartphone marketplace, that figure now amounts to only a 31 percent share, according to Nokia's own estimates, which is a major dip relative to its 40 percent slice in Q4 2009 and 38 percent in Q3 2010. Elop's perspective on the matter is as follows: "In Q4 we delivered solid performance across all three of our businesses, and generated outstanding cash flow. Additionally, growth trends in the mobile devices market continue to be encouraging. Yet, Nokia faces some significant challenges in our competitiveness and our execution. In short, the industry changed, and now it's time for Nokia to change faster." When your operating profit goes from €1.47b (€950m net) a year ago to €1.09b (€745m net) this year, the response should indeed be to change and to change fast. Nokia's still not disclosing sales figures of the N8, but given that this was the first full reporting period where the company's Symbian flagship has been on sale, it doesn't seem to have had quite the impact Espoo will have hoped for. Wanna try again with the N9? Update: Nokia's investor relations call has borne a few more interesting tidbits from the new man in charge. Elop is quoted as saying Nokia must "build or join a competitive ecosystem," with the latter verb in that sentence sure to renew discussions of why the Finnish company should / shouldn't switch to an OS such as Android or Windows Phone 7. We still think that'll be the very last resort over in Espoo, but Elop apparently believes Nokia has the brand recognition and operator relationships to make such a move if it wanted to. Which of course it doesn't. Or does it? Let's wait for Nokia's Strategy and Financial Briefing in London on February 11th -- Mr. Elop's expected to be a lot more specific about his company's roadmap going forward on that day.
iPhone app developer says MMOs will be abandoned
Although Kepa Auwae and his team are working on Rocketcat Games' first RPG for the iPhone, the developer doesn't see much of a future for MMORPGs. In an interview with MTV Multiplayer, the creator of hit iPhone smashes like Super QuickHook prognosticated a vastly different gaming future than what we see today: "I think developers will completely abandon MMOs and social games, for the most part. Both genres were dead-ends, and they always allowed only one developer at a time to have any real success. Instead, most developers will make games with deep mechanics, designed for heavy replay value mixed with community content. These games will also strongly feature hat customization... top hats, bowlers, straw boaters. SO badass." Ironically, Auwae voiced his dislike for the disposable nature of current games, which seems to describe the polar opposite of MMOs: "I think many games are too disposable. They're designed with no mod content tools in mind, no community involvement, no real replay value, no updates." You can read the full interview over at MTV Multiplayer.
Apple on iPad competition: Windows is 'big and heavy,' next-gen Android tablets are still vapor
Apple's COO (and current Steve Jobs stand-in) Tim Cook thinks "there's not much" competition to the company's iPad tablet. When queried about Apple's view on what the rest of the market offers, Cook was brutally candid in describing Windows-driven machines as generally being big, heavy and expensive, while current generations of Android-based slates are in his opinion merely "scaled-up smartphones." While we agree that Windows 7 isn't a terribly touch-friendly affair, we don't know that Cook's comments on Android are quite so pertinent now that Google's tablet-savvy Honeycomb iteration has been unveiled. Then again, he has something to say about the next generation of Android tablets as well, noting that the ones announced at CES lack pricing and release schedules, leading him to conclude that "today they're vapor." Ouch. As a parting shot, Tim took a moment to reaffirm Apple's belief that its integrated approach will always trump the fragmented nature of Android and its plurality of app stores. Hear his comments in full after the break.
Microsoft files motion to dismiss Apple's 'App Store' trademark claim, says term is generic
That Apple had the original App Store isn't under dispute, but should the company have the right to exclude others from using the same term to describe their program repositories? Microsoft says no, and has this week filed a motion with the US Patent and Trademark Office asking for it to dismiss Apple's trademark claim for "App Store." The application seeks to secure for Apple the exclusive use of the term in the context of computer software broadly, not just on the mobile front, but Microsoft is arguing that its constituent words are generic (or simply descriptive) both individually and as a pair. In making its case, the Redmond company cites Steve Jobs himself, whose exposition on the topic of Android fragmentation included specific mention of multiple "app stores" for the Google OS. It would seem this has been brewing for a while, too, as the last update -- dated 7th of July, 2010 -- on Apple's trademark application notes there's a pending opposition to its claim. Now that Microsoft's escalated its complaint to asking for a summary dismissal, it'll be interesting to see on which side of the great divide the decision falls.
Microsoft admits 'failure' with Xbox 360 faceplates, says nobody bought them
This one's strictly for the record, the one that documents failed aesthetic experiments. Microsoft's Albert Penello has been cornered for an interview by the British Official Xbox Magazine -- mostly to discuss the console's five-year anniversary -- and their discourse touched on the ill-fated frontal accessory for the original 360. Penello admitted that although "faceplates were what everybody wanted to do" five years ago, they pretty much fell flat in terms of retail success, which led Microsoft to kill them off pretty quickly. We can't say we ever developed strong feelings either way about these plastic prettifiers, let's just be happy that Microsoft's latest console peripheral probably won't be subject to similar mea culpa admissions five years from now.
Andy Rubin: over 300,000 Android phones activated daily
Cast your mind back to the ancient time that was this August and you'll recall Eric Schmidt telling you, with no lack of pride, that 200,000 Android phones were being sold each and every day. Skip past Steve Jobs' snide remarks about what's included in that tally, and fast-forward to today, where Andy Rubin is blowing minds with the latest, very nicely rounded, total: 300,000 daily activations. Yes, in spite of being the most fragmented thing this side of our 10-year old hard drives, the Android OS just keeps growing at an exponential rate. So Steve, any comment on today's data? Were they counting it wrong? [Thanks, Dell]
Verizon CEO: 4G can be a 'substitute' for home internet and cable, will accelerate cord cutting
Sometimes, you have to wonder if these CEO types are being paid the big bucks just because they can believe their own outlandish claims. Latest to try and push the boundaries of credulity is Verizon's Ivan Seidenberg, who told an investor conference that he sees the company's newly unveiled 4G offering as becoming a "modest substitute" for premium home entertainment services as offered by cable and online streaming companies. He concedes that for now VZW's new LTE network will be viewed as an addition, rather than a replacement, to our connected world, but, over time, Seidenberg expects that its presence will be enough to convince more people to cut the cord. Perhaps those who'll find the $50 per 5GB levy easiest to swallow will be people with no cord at all -- the folks in rural areas for whom wired broadband isn't yet an option. As to the rest of us, we'll just wait until the economics start to look a tiny bit more appealing. Update: Speaking of economics, Fierce Wireless has another disclosure from the same conference. On the topic of LTE smartphone plans, Ivan said Verizon is still undecided on pricing, but he sees 10GB a month as the "floor of what people will do," going on to say that Verizon must "hold firm as best we can until the entire environment is mature enough." Listen to the webcast of his speech at the link below.
CE-Oh no he didn't!: NVIDIA chief calls Galaxy Tab 'a large phone,' can't wait to show you some real tablets
We've literally been waiting for Tegra 2 tablets since CES in January, but that isn't stopping NVIDIA boss Jen-Hsun Huang from extolling their virtues yet again, this time on a roadmap that points to just after next year's CES. In his company's most recent quarterly results call, Huang was bullish about the disruptive potential of tablets, but insisted that they can't simply be built like the Galaxy Tab (or the Folio 100, for that matter), which uses a smartphone OS stretched out to a larger screen. "A tablet is not a large phone," says Huang, and he's of course not alone in expressing frustration with Android's current immaturity for the tablet realm, but once Google's slate-friendly OS update drops, he promises NVIDIA will be ready to capitalize: "Our tablet and phone business is going to ramp. And it's going to ramp hard." We're looking forward to all this ramping, oh yes we are. Update: Later on the call, Jen-Hsun Huang dropped a bit of knowledge on his listeners, showing Apple's iPad some love. "You can't just put an operating system on a tablet and hope that -- on a piece of glass -- and hope that you can compete against the iPad. The iPad is a wonderful product, and if you're going to give that wonderful product a run for its money, you'd better build something absolutely exquisite." Huzzah!
Ballmer: next release of Windows will be Microsoft's 'riskiest product bet' (video)
Windows 7 might be a massive commercial success and an undeniably rock solid piece of software, but Microsoft is apparently unwilling to rest on those soft and cozy laurels. Asked about the riskiest product bet the Redmond crew is currently developing, its fearless leader Steve Ballmer took no time in answering "the next release of Windows." His interviewers sadly failed to probe any deeper on the subject, but it might be notable that Steve calls it the next release rather than simply Windows 8, while the idea of it being risky also ties in with previous indications that Microsoft is aiming for a revolutionary leap between iterations. We'll have to just be patient and wait for more on that, though if you'd like a peek at Steve dodging question on tablets and the potential for Windows Phone 7 appearing on them, you need only jump past the break for the video. Update: It's also worth noting that Ballmer may not have been talking about revolutionary leaps as much as he's referencing the past issues the company has had when it's issued a major OS update (hello, Vista). The idea that making any big change to the operating system most of the world runs would invite a certain amount of high risk makes sense to us.
Sony Ericsson's CEO promises 'big surprises in the next few months' (video)
The grand opening of Sony Ericsson's new Americas HQ in Atlanta isn't the sort of thing we spend sleepless nights thinking about, but a PSP Phone is. It's mighty encouraging, therefore, to hear the company's CEO Bert Nordberg tease "big surprises" coming from his team over the next few months. That revelation was accompanied by plentiful references to SE as an entertainment phone maker, a sly grin, and the usual disclaimer that "we never announce them in advance" -- though considering the gap between the Xperia X10 announcement and arrival to market, maybe Bert should reconsider that part. Either way, unless SE's big surprise is the delivery of a smartphone with an up-to-date OS and cutting-edge components on time (which would, admittedly, be a surprise), we're happy to take this as a sign that the Android 3.0-powered gaming platform-cum-smartphone is brewing nicely behind the scenes.
CE-Oh no he didn't!: Anssi Vanjoki says using Android is like peeing in your pants for warmth
You've been asking and imploring, so Anssi Vanjoki -- straight shooter, that he is -- now has an answer. Why doesn't Nokia switch to Android? Because Google's software represents only a short-term solution that will lead to bigger quandaries down the line, says he. Anssi was even graceful enough to illustrate this point with a vivid example, saying that mobile manufacturers who go the Android route are doing no better than Finnish boys who "pee in their pants" for warmth in the winter. Yeah. We don't know where to go from here either. To be honest, there's a legitimate point behind this trash talk, as the FT notes some analysts agree with Anssi that relying on Android as the universal OS may lead to "permanently low profitability" with users failing to distinguish among different brands if they all offer the same experience. Then again, tell that to HTC. [Thanks, Maark]
iPad has halved laptop sales, claims Best Buy CEO (update: he meant netbooks)
Well, the iPad is about one half of a laptop -- both in its form and functionality -- so it makes perfect sense that it'd chop laptop sales by 50 percent. We might be pulling your leg, but Best Buy CEO Brian Dunn isn't. The dude in charge of the yellow label empire has told the Wall Street Journal that his company's internal estimates indicate the iPad has eaten up as much as half of laptop PC market demand. In response to this perceived trend toward more portable gadgets, Brian's outfit is rearranging its inventory to include more e-readers, tablets and smartphones for this holiday season, while slimming down its selection of desktops and HDTVs. Moreover, new demo zones will be set up in-store to allow people to experience the wonders of Microsoft's Kinect and Sony's Move motion-controlled gaming solutions. So it looks like the future's coming, whether we like it or not. Update: It did seem weird to us that the mighty laptop would be that vulnerable to the iPad, and sure enough, our queries with Best Buy were met by the following response: "The paraphrase that was used in the WSJ wasn't really an accurate reflection of what Brian said to the reporter. What Best Buy CEO Brian Dunn said was that we had no firm numbers, but that we speculated there was some replacement of netbooks by iPads going on. We did not provide specifics because we do not presently have the hard numbers on which to base those specifics." So, Brian was not only talking about netbooks, but his words were exaggerated too. Phew, and we were just about to start selling our shares in Dell and HP. You can find his full clarification on this issue after the break.
Nokia software engineer says 'hardware rules,' software follows
Care for a little more insight into Nokia's smartphone development habits? In an email to our pal John Gruber, a former Nokia software engineer has laid out his perspective on why the Finnish phone maker seems to be struggling in that lucrative high-end smartphone market: "Here's the problem: Hardware Rules at Nokia. The software is written by the software groups inside of Nokia, and it is then given to the hardware group, which gets to decide what software goes on the device, and the environment in which it runs. All schedules are driven by the hardware timelines. It was not uncommon for us to give them code that ran perfectly by their own test, only to have them do things like reduce the available memory for the software to 25% the specified allocation, and then point the finger back at software when things failed in the field." He goes on to say that Nokia's haughtiness extended to the point of turning an assessment of the iPhone's relative strengths into a list of reasons why it wouldn't succeed, which -- considering that the doc was compiled at around the 3GS' launch -- seems like a distinctly foolish thing to do. The really interesting bit here, though, is where that leaves Nokia today. As far as its Design chief Marko Ahtisaari is concerned, the future's MeeGo all the way, but that new platform was nowhere to be seen at Nokia World this year, and Gruber raises the question of whether Nokia shouldn't perhaps switch to the already ubiquitous Android or soon-to-be-everywhere Windows Phone 7. Neither makes a ton of sense on the surface, as Nokia's proud tradition doesn't exactly mesh with dancing to Microsoft's stringent spec tune or becoming yet another Android phone manufacturer. But in the current fast-moving market, a good smartphone software platform today might just be better than a great one tomorrow -- more to the point, we probably wouldn't be pondering this if Olli-Pekka Kallasvuo was still in charge, but now that a software guy has finally taken the helm, maybe the winds of change might blow once more in Espoo?
CE-Oh no he didn't!: Acer founder characterizes Apple as a mutant virus
Wow, a mutant virus? This analogy may sound like a ringing bell for another cat fight on the playground, but Acer founder and retired chairman Stan Shih is actually semi-praising Apple here. Speaking at the launch of an Acer touch-themed design competition, Shih said that while Apple's taking the "revolution" highway to tackle the PC market, Acer's success has always depended on its time-consuming but more pragmatic "evolution" strategy, and it'll keep doing so to lay the ground for the next 30 years or so. Here's how China Times paraphrased Shih: "Apple is like a mutant virus, escaping from the traditional structure of the PC industry, but the industry will still eventually build up immunity, thus further blocking this trend, and we believe the size of the non-Apple camp will exceed Apple's, because this is how the industry normally evolves." Assuming the second half of Shih's quote refers to the tablet market share, this certainly echoes the words of his good friend JT Wang. That said, this is also the man who's boldly predicted that all American PC brands will be gone within 20 years, but there's no promise that Apple won't be kicking out a few more revolutions in the coming years. Anyway, doesn't Acer have more to worry about for the mean time?
Overheard @ Gamescom: Competitive Kinect fighting is dangerous
Since shortly after the Wii Remote first brought motion control to the masses, we've known that over-enthusiastic use (and slippery hands) can lead to controllers (and other things) getting broken. So what happens when Kinect's 3D camera turns your entire body into the controller? Well, not surprisingly, it turns out you're the one that could get broken. "Versus mode was a bit too dangerous," Fighters Uncaged producer Luc Verdier said when asked about a competitive mode for his newly announced Kinect-enabled fighting game. "It's possible to do, but people just end up hitting each other." Thus, the game's only multiplayer mode is a cooperative battle, where two players work together against the artificial intelligence. Of course, people don't usually end up killing one another while playing games like Just Dance, even if four players are moving about in an enclosed space. But Verdier said motion-controlled games where multiple players are synchronized are safer than games where the players can just "do whatever." We'd also hazard to guess that dancing players just tend to be less intentionally violent than fighting game players, especially when those fighting game players are actively playing.
Ce-Oh no he didn't!: Larry Ellison likens HP board to 'idiots' at Apple
Larry Ellison, Oracle CEO and regular tennis buddy of the disgraced (and now former) chief of HP Mark Hurd, has decided to share his thoughts on the matter of Hurd's departure in an impassioned email to the New York Times: "The H.P. board just made the worst personnel decision since the idiots on the Apple board fired Steve Jobs many years ago. That decision nearly destroyed Apple and would have if Steve hadn't come back and saved them." The communique, also obtained by the Mercury News, included other tasty tidbits such as Ellison describing HP's disclosure of the apparently unfounded sexual harassment claim against Hurd as "cowardly corporate political correctness," and dismissing the financial irregularities that forced the former CEO's resignation as "petty expenses report errors." So, in short, the world according to Larry is populated by messianic CEOs who shouldn't be held up to the same petty standards as the rest of us.
Sony refuses to get caught up in a price war with Kindle, intends to compete on quality
Boy, Sony sure loves to drag its heels when it comes to obvious industry trends. First netbooks were "a race to the bottom," now the company's saying it "won't sacrifice the quality and design" of its e-readers in order to lay claim to being the cheapest. This comes as a reaction to the Kindle's aggressive new $139 entry price point and continues Sony's reluctance to fiddle with what it sees as a successful formula. We're not going to second-guess the reasoning (too much), but it's not like there's that much room to differentiate yourself when you're using the same E Ink tech as the competition, is there? Guess if all else fails, Sony can always innovate the hell out of those leatherette cases and bundle them with the Reader.
Nokia quarterly profits drop 40 percent year-on-year as CEO says speculation must end 'one way or another'
Olli-Pekka Kallasvuo was already a man in a hot seat and these latest numbers will do little to lower the temperature. Nokia's net profit for Q2 2010 was €221 million, which most companies would be happy with were it not for the fact that this company pulled in €380 million in the same quarter last year -- and that's with 2009, as Nokia's own report indicates, representing an economically tougher environment. Average selling prices for Nokia handsets used to be €64 back then, which dipped to €62 in the first quarter of this year, and is now at €61. Nokia says this has been caused by price pressures, "particularly in certain high-end smartphones," and though the change may appear small, a Euro's difference tends to be amplified when you're shifting upwards of 111 million units each trimester. For his part, OPK has said that the speculation about him being replaced isn't doing Nokia any good and he's determined that it "must be brought to an end one way or another." Guess we better keep an eye on this one then.
Prince offers the first proof that he's actually aging, says the internet is 'over'
This probably isn't going to go well. Prince -- who has famously fought for complete copyright control of his work -- has said something about the internet, and it's not good. In fact, the diminutive all star has been quoted in a Mirror interview as saying that the "internet's completely over." He explains: "The internet's like MTV. At one time MTV was hip and suddenly it became outdated. Anyway, all these computers and digital gadgets are no good." Now, we know that the artist formerly known as "The Artist Formerly Known As Prince" is going to (deservedly) take a lot of flack from the "internet" for this one -- after all, nobody likes to hear that they're "over," right? But, in his defense, he was never really into the internet to begin with -- as is evidenced by the awesome YouTube clip below. [Thanks to commenter xkaosu9x for the image]
Ralph de la Vega 'laughs' when asked about AT&T iPhone exclusivity expiration date, says most customers will stay
We still have no idea what's going on with Apple, Verizon, and the iPhone, but it sounds like AT&T isn't sweating it -- speaking at a J.P. Morgan conference today, Ralph De La Vega reportedly "just laughed" when asked when Ma Bell's iPhone exclusivity would run out, and indicated he wasn't worried about other carriers potentially getting the phone. According to Ralph, some 80 percent of AT&T iPhone customers are on family or business plans, and they're generally less likely to switch, so AT&T thinks it can hang onto them if Apple's phone hits another carrier. That certainly sounds like AT&T's been giving the issue some thought -- another piece of kindling for our ever-smoldering Verizon iPhone Rumor Fire, or just tough talk to keep Apple in line? We might never know -- but we do know that it'll be much harder to keep those iPhone customers if AT&T's service quality continues to suffer, and Ralph acknowledged the troubles, saying that AT&T's biggest issue right now is simply getting enough equipment built in China and put into place. We'll see what happens -- we're not going to believe that a Verizon iPhone is real until Steve asks if we can hear him now. Update: AT&T just sent us a tiny snippet of de la Vega's comments: Having said that, all the improvements that we have seen are not just driven by the iPhone. The non-iPhone customer churn has seen the same reductions as the overall total postpaid customer churn improvement levels. So we've seen improvements in churn that are driven by the iPhone and by non-iPhone customers. And so we view that having a great portfolio of devices and services has been the key to our success and will continue to be. And I think the iPhone will be a part of our portfolio. And I think that customers are still going to come to us, like they've done in the past, looking for great choices, great devices and great services. Interesting -- it certainly doesn't sound like he's betting too heavily on keeping the iPhone exclusive, but we'd like some more context here. We're looking for the full transcript (or better yet, video), so stay tuned. Update 2: And here's the followup question specifically regarding exclusivity: Q: I thought you might share with us the exclusivity end date, Ralph. A: No, I don't think I'm going to be able to do that, Mike. (laughs) Pithy!
