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Palm's preliminary quarter-end results show drooping revenues, bleak outlook
Remember when we used to write about Palm in order to talk about its devices and / or operating system(s)? Man, those were the days. Now, it just seems like one sadness-filled report after another, and just days after hearing that it would be cutting an undisclosed amount of employees in order to trim operating expenses, in comes even more doom and gloom courtesy of its preliminary Q2 (fiscal year 2009) results. The company is expecting to record revenues ranging between $190 million to $195 million, far short of the $331 million Wall Street had been counting on. The shortfall was blamed on "a difficult economic environment [which had] greatly intensified the negative impact on product sales." Of course, the visionary Ed Colligan (CEO) still maintains that by reducing its cost structure it can "launch next-generation products as planned," but seriously, why should we believe that line now? Time to put up or shut up, Palm.[Via CNET, image courtesy of PalmFocus]
Analyst sez iPhone 3G production could fall 40% in Q4
No clue if you've been paying attention the past few months, but quite a bit of belt tightening has been going on. Granted, Apple's been making out just fine, but a fresh report from the doors of FBR Research asserts that it may be cutting its Q4 iPhone 3G production in the wake of a global spending slowdown. It should be noted that a 10% cut was already on the table, making this 30% larger than anticipated. According to the report, the firm's reported decision to scale back production "suggests that the global macroeconomic weakness is impacting even high-end consumers, those that are more likely to buy Apple's expensive gadgets." As we restrain ourselves from thanking Captain Obvious, we should also point out that this may not be nearly as big a deal as the numbers make it seem -- maybe it overshot Q3 production in order to guarantee 100% service levels in all markets, for instance. How's that for analysis?[Via Silicon Alley Insider]
Reggie: Wii production up; holiday supply might not meet demand ... again
So sayeth the immortal Pete Burns, "You spin me right round baby, right now, like a record baby, round, round, round, round." In an interview with Los Angeles Times, Nintendo of America President Reggie Fils-Aime has hinted that, yet again, the supply for the Nintendo Wii might not meet the demand this holiday. The Regginator (a nickname noted in the article) said that production is up 33% over last year, from 1.6 million consoles per month to 2.4 million. We've talked about Wii shortages once or twice before. "One of our competitors' projects," he said (we're thinking he meant Sony), "they will sell 10 million consoles worldwide this year. For us, that's three months of production." By his numbers, it would actually be closer to four months, but when you're dealing with multiples of infinity all day long, math tends to get a little fuzzy. We still find it hard to believe that there's still potential shortages after 708 days, but the sales numbers seem to suggest scholars will need to create a new number system for sales calculations.
App Store Trends: Prices race to the bottom
Last spring, TUAW asked how much you would pay for iPhone software. Well, it looks like $0.99 and $1.99 are the new $39.99 and $49.99 as far as mobile distribution goes. The App Store bucked the trend of high-priced phone software and now is ratcheting those prices down even further. Developers are responding to high application supply and dwindling demand by lowering their prices across the board. As the App Store novelty wears off and consumers forget about once-"hot" items, the typical price tag continues dropping. Games that cost $9.99 at launch are almost universally $4.99 and less. Apps like Koi Pond proved that $0.99 can generate a lot of sales. Short term sales are quickly being eclipsed by long term price drops. We typically get our tips about upcoming price changes directly from developers; 148Apps has introduced a automated price drop detector. As the App Store continues to evolve from "get rich quick" to make money slowly, devs are working to find that sweet spot -- charging enough to earn a living but not so much that they aren't out-competed. Based on these downward pricing trends, I expect ad-supported apps to really start taking off soon, the way they are doing in the jailbreak world. If developers can't build their revenue stream from charging higher prices, they may turn to alternative monetizing models instead.
Making/Money: Economic Equilibrium is MIA
When I first started playing MMOs I was in college. I'd bounced from major to major but ultimately settled on Economics (from a starting point of Medieval and Renaissance Studies - how'd that happen?). Like other economists in games like EverQuest and Ultima Online, I was thrilled to find a lively economy and interested to apply classical economic models in the study of it. The most basic of these models is the typical supply and demand curve. Any economic model starts with price and quantity. The higher the price, the more suppliers want to sell but the less consumers want to buy. As the price decreases, more consumers are interested in purchasing, but fewer suppliers are able to produce profitably. In theory, there is a magical level in the middle where supply and demand meet. That is equilibrium (see graph). What I have since found, which is furiously debated by other economists in the field, is that the typical supply and demand curves do not fit well with the economies of most MMORPGs these days. Depending on the game, add-ons used, and availability of additional market data, there may be sort of invisible caps to the price, and thereby the quantities, of goods traded. Furthermore, auction house fees and vendor sales act much in the same way as taxes or subsidies in real world economies.
Wii Warm Up: Are you still looking?
We're coming up on the second anniversary of our favorite console this November, and with the supply of Wii consoles still not catching up with the demand, we were wondering how many of you out there are still hunting for a system still? Are you hunting one down for yourself or for somebody else? Already have one, had your folks try it, now they want you to find them one?
Analyst: Global demand for DS hardware has peaked
According to Kotaku, KBC Securities Japan's Hiroshi Kamide believes that demand for DS hardware has reached its saturation point and is now on the way down, just as the company predicted two months ago. "A downturn in software demand is likely to follow, as casual gamers are 'happy with their lot' and do not need to consume more," Kamide said. We're not sure that the drop in DS hardware sales in Japan is indicative of any trend other than Monster Hunter Portable 2nd G finally selling some PSPs. If you really want to predict a downturn in software sales, how about the PSP market post-Monster Hunter? The DS has several Dragon Quest games, Professor Layton, and Inazuma Eleven on the way. And in the U.S., there's the Guitar Hero bundle, and a million games.
DirecTV enjoys fruitful Q1, demand for HD / DVRs to thank
Nah, Comcast wasn't shedding any tears after announcing its Q1 2008 earnings, but DirecTV must be grinning from ear-to-ear. Aside from seeing its earnings rise 10-percent and revenues climb 17-percent, the satcaster also managed to grab 275,000 net subscriber additions. Analysts were quite pleased with the exceptionally low churn rate, as many of its subscribers seem to be staying put. And with close to a hundred HD channels on tap, who can blame them? It was also noted that average revenue per subscriber crept up from $73.40 to $79.70, and an increasing demand for high-definition programming and DVRs were largely to thank. Is making the switch from cable to satellite worth it? Seems that quite a few folks said yes with their wallets this past quarter.[Via BloggingStocks]
Sony doubles production capacity of BRAVIA LCD HDTVs to meet demand in Europe
Whoa, Europe. We thought only 5-percent of your HDTV owners even bothered to check out programming in high-def, right? Just days after Sony dished out a plethora of HDD / DVD recorders across the pond comes word that the firm is doubling the annual production capacity of BRAVIA LCD HDTVs in order to "meet growing demand in Europe." More specifically, the outfit is aiming to boost production from two million sets in 2007 to four million sets by the end of 2008, and its Nitra, Slovakia factory is all set to become its largest producer of LCD TVs worldwide. This also means that the amount of employees there will increase from 2,300 to 3,500 by December. Aside from expanding the capabilities of the aforementioned Nitra Technology Center, it will also construct a logistics facility nearby in order to better manage distribution. Now, if only content providers would give these obviously HD-hungry citizens something good to watch, the circle would be essentially complete.[Via I4U News]
Gold prices dropping in the US
PlayNoEvil is a blog that claims to do "MMO security news and analysis" -- they've got an interesting post up trying their best to track gold selling prices over time in various MMOs (the information itself seems to come from MMOBux.com). The World of Warcraft graphs (US seen above, EU on the site) show that for whatever reason, in the US at least, gold prices seem to be dropping. Of course, whether that's driven by low demand (thanks to Blizzard's daily quest implementation and other anti-gold selling mechanics), or high supply, we aren't quite sure.In the EU, things aren't so clear -- while there are still bumps around content releases, things are holding pretty steadily at a price well below the United States. Either way, no matter what price it is, we should note as well that buying gold from anywhere is against Blizzard's terms of service and will get you banned. Hopefully, these lower prices in WoW mean that Blizzard's attacks on goldsellers are working, and that low demand has driven the price down further than its been in a long time. Even so, and even assuming that these prices actually do correspond to the market (no idea where MMOBux gets their info from), there's not much concrete info we can suss out of this other than the fact that prices are dropping in the US.[Via Worldofwar.net]
Sony underestimated 80GB PS3 demand
Sony America VP of marketing, Scott Steinberg, admits in an extensive interview with GameDaily that the company underestimated the demand for the 80GB PS3. He says the $100 extra for the 80GB model at $499 didn't seem "that big of a deal" to certain consumers. Beyond the price and obvious drive space difference, the 80GB enjoys backwards compatibility with many PS2 games, which the 40GB does not.Steinberg states Sony is replenishing the marketplace with the 80GB model and expects to see "mass market appeal" from the upcoming $500 Metal Gear Solid bundle. At a minimum, expect one significant change in future PS3 models with the Sixaxis being tossed out and the DualShock 3 becoming the new hotness.[Via PS3 Fanboy]
March Madness to drum up demand for nearly one million HDTVs
Sure, this year's Super Bowl was said to be responsible for some two million HDTV purchases, but driving another million just a month later isn't anything to sneeze at. According to a new release from the Consumer Electronics Association (CEA), the 2008 NCAA Men's Basketball Tournament "will help inspire the purchase of nearly 1 million HDTVs (934,000), which represents slightly more than $1 billion in retail sales." Beyond that, the data also found that over half of existing HDTV-owning sports fans would end up turning their attention to the internet in order to fetch highlights and statistics. Of course, it also discovered that the amount of fans viewing whole games online is on the rise, and considering that The Man will likely have you right where he wants you tomorrow (read: nowhere near a TV), we don't find that surprising at all.
Gamestop expects at least six more months of Wii shortages
The Nintendo Wii will be nearing its second birthday before there's any chance you'll see it routinely clogging up retail shelves. At least that's the determination of mega-retailer Gamestop, which predicted in a recent investors conference call that the Wii "won't meet demand for the next two quarters."While the Xbox 360 and DS have seen increased production to make up for temporary holiday shortages, Gamestop COO Dan DeMatteo said the seemingly endless lack of Wii supply looks likely to continue for at least another six months. DeMatteo also predicted shortages for the surging PSP, as well as price drops for the PS2 ($30), and PS3 and Xbox 360 ($50 each) sometime this year. For the Wii, though, it seems like a price increase is the only way they're going to be able to stay on the shelves. Not that Nintendo would ever do that. Would they? (Note: No, they wouldn't)
LCD TV shipments forecasted to double by 2012
2012 is really turning out to be a banner year in the world of HDTV -- after all, we'll have 900 HD channels via satellite, 33 million homes engaging in HD streaming and everyone and their cousin will own a LCD TV. Okay, so maybe that's a stretch, but according to new data from iSuppli, global shipments of LCD TVs will "nearly double" from 2008 to 2012, "driven mainly by falling prices and consumer demand for flat-screens and the HD format." If you're scouting numbers, the report suggests that we'll see worldwide shipments rise to nearly 194 million in just four years, and unsurprisingly, the thin designs and big resolutions are at the forefront of reasons why. Oh, and if prices keep sinking ever closer to zero, we wouldn't be surprised one iota to see this milestone passed a few months earlier than predicted.[Via WidescreenReview, image courtesy of Sciam]
Consumer demand for HD content on the rise in Middle East
It's no surprise to hear of consumer demand swaying decisions in America in regard to HD content, but it seems as if the cries for more high-def are making their way east. According to the Dubai World Trade Centre, "discerning consumers in the region are driving broadcasters to expedite their shift towards high definition transmission and upgrade their existing facilities at a faster pace." The 2007 industry report by the Satellite Industry Association also "indicated a huge upswing in consumer demand for more high definition (HD) content." As it stands, broadcasters in the Middle East are just starting to employ HD technology, but given the rate at which areas such as Dubai adopt newfangled technology, we wouldn't be surprised to see guests at the Burj Al Arab enjoying a hundred or so HD options in the not-too-distant future.[Image courtesy of Volja]
Microsoft issues response to 360 shortages
We all know that the Xbox 360 suffers from a fairly high failure rate, as we've all known someone (or been someone) who has experienced first hand the devastating effect of the dreaded Red Ring. However, many of us haven't seen the widespread effect this failure rate is having on the gaming market -- in a recent convo with Reuters, Microsoft's Jeff "Jeff Bell" Bell reported that retailers are having a hard time keeping the system in stock, and that MS is "running short of product here in the United States."Microsoft issued their own official announcement on the matter in their response to the January NPD report (the same response that those GameDaily gumshoes discovered was chock full o' statistical gerrymandering), saying that "due to this high demand, Xbox 360 is experiencing temporary shortages." We can't help but wonder how much of the shortage is caused by actual post-holiday demand for the system, and how much is caused by the high numbers of Red Ring replacements being shipped out.Then again, we haven't bought any 360s in a while; the shortage might not be as bad as MS is making it out to be. Has anyone had a hard time getting their hands on Microsoft's console/radiator lately?
Plasma manufacturers relish uptick in demand from China
We already heard that flat-panel demand in China was seeing a fairly substantial spike, and apparently, a number of plasma manufacturers are champing at the bit to turn around the currently poor performing segment of their portfolios by giving the Chinese something they suddenly crave. Reportedly, both Samsung and LG have "increased PDP production" in the lead-up to the 2008 Beijing Olympic Games and Euro 2008. Additionally, Hitachi is busting out some confetti of its own, as it will purportedly sell some "30-percent of plasma panels it plans to produce in the year to March 2009 [to] Chinese television manufacturers." Also of note, it's being reported that the outfit "may consider withdrawing from Australia and focusing on developing and making products for key markets such as Japan, North America and Asia," but we've seen nothing official either way.[Via Widescreen Review]Read - Japan's Hitachi to supply plasma panels to Chinese TV makersRead - Plasma TV Industry to jump this year
Pachter states the obvious: strong sales in early '08
Oh, that Michael Pachter. Even when he's running off at the mouth, he manages to at least keep us entertained. Now he's back with some terribly obvious predictions on industry sales for the early months of 2008. Pachter's latest revelation? Due to the strong upcoming release schedule, gaming sales will continue to stretch for the heights. Now, we understand that Pachter is an expert and we are but peons here, but, really -- wasn't that a little ... predictable? In keeping with the spirit of prediction here, we have one of our own: we anticipate that the Wii and DS will continue to be snapped up whenever and wherever they appear on shelves for a few months, due to all the people who couldn't get their hands on one during the holidays.
'Most shocking': The death of Jennifer Strange
The end of every year is fraught with polls and recaps, but this one easily caught our eye for a variety of reasons. The death of 28-year-old Jennifer Strange after a radio station's "Hold your Wee for a Wii" contest was voted the most shocking tech story of the year by readers at geeksugar. Would you agree? The story faced some fierce competition, particularly when considering that one of the other contenders was the story of a Nevada couple too wrapped up in their games to care for their young children. To us, the latter is certainly more horrific, but that wasn't the question.Water intoxication is not exactly a commonly known cause of death; it's one of those rarities that's always guaranteed to raise an eyebrow. But with the extreme demand for the Wii since its very release, it's hard to say we're surprised at the lengths people will go to get one. For once, however, we can easily say we'd rather see people paying scalpers on eBay than putting themselves at risk.
Nintendo, Wii GHIII make list of blunders
Next-Gen has compiled a fairly accurate list of some of the worst -- or at least, dumbest -- events to befall the industry this year. From Gerstmanngate to Jack Tretton offering to buy any PS3s hanging around on shelves (boy, that one was embarrassing), the year's greatest flubs are tied up here in one neat package. And success aside, even Nintendo is not immune.Despite their banner year, Nintendo made a few miscalculations of their own -- namely, in their lack of Wii supply. While it seems that every effort was made to ramp up production, the shortages cost Iwata and co. a fair share of that giant pile o' cash they're lounging upon. But the real head-shaker came with the Wii's Guitar Hero III and the Case of the Missing Audio Necessities, which popped in at number three on the list. Thanks to a tipster, we first noticed the sound problems in late October, and while a fix has been promised, owners are still waiting on replacement discs, which will be available in "early 2008." Now that's a blunder.
