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November 13th, 2007

A black or bleak Friday ahead?

Black_friday Black Friday, the day after Thanksgiving in the US, falls this year on its earliest possible date - November 23.

The big day of store sales when retailers are supposed to go into the black for the year also signals the unofficial start of the holiday shopping season.

The latest online retail figures from the comScore research firm suggest the industry will need all those extra days of shopping – Black Friday can fall as late as the 29th – to avoid a disappointing Christmas.

It reports retail e-commerce sales in October grew 19 per cent on last year to $9.96bn. That compares to year-to-date sales growth of 21 per cent up to the end of September.

Gian Fulgoni, comScore chairman, said October’s figures often gave a glimpse of what to expect during the holiday season:

“That online sales growth rates diminished slightly in October is not entirely unexpected, as many consumers are feeling the pinch of ballooning mortgages and gas prices, coupled with a decline in housing values. Even the rapidly growing online commerce sector appears to not be immune from these economic realities,” he said.

Apparel and accessories growing by only 5 per cent in October could be down to unseasonably warm weather, he added, and a recovery in this sector could change the picture for Christmas sales online.

There were also encouraging figures for some categories of retailers. Furniture, appliances and equipment grew 105 per cent on a year ago, while sales of the Nintendo Wii, Sony’s PlayStation 3 price cuts and the success of the game Halo saw the video game sector soar 264 per cent compared to October 2006.

November 12th, 2007

TomTom and Vodafone crowdsource traffic information

By Michael Steen, FT Netherlands Correspondent

You’re sitting in a traffic jam, late for a meeting, watching the estimated time of arrival on your satnav’s display creep later and later as it takes account of the fact that, right now, you’re not going anywhere. Do you cancel, try another route, or wait it out?

TomTom, the Dutch maker of navigation devices, is claiming to put an end to this kind of dilemma with a new service it launched today in the Netherlands, dubbed High Definition Traffic. It tracks the paths of about 4 million Vodafone mobile phone users to expand the amount of traffic information available.

Traffic information on satnav devices is not exactly new, but they tend to depend on patchy data compiled by sparse roadside cameras and traffic detectors.

Vodafone can track the whereabouts of each phone to within 500 metres and monitor its movement, says Luciën Groenhuijzen, managing director for TomTom Mobility Solutions. He is quick to point out that the data is not linked to the phone users.

The tracking element allows TomTom to strip out pedestrians and people travelling on trains that run alongside motorways. Each user is tracked for one hour before being re-assigned with a new random number.

"We introduced that [the one hour limit] so that we can’t follow someone, even if we don’t know who they are, for a whole day," Mr Groenhuijzen says.

TomTom blends the data collected from Vodafone with existing sources and sends updates to one of its new, €399 units every three minutes. (TomTom includes a year’s traffic information in the price after which it will charge €9.95 a month.)

So does it work? A test of the gadget at the height of Monday morning rush hour in the congested Randstad area around Amsterdam seemed to suggest it does.

Driving from the coast towards Amsterdam, the navigation device shows an accident has closed a lane on the motorway and a parallel main road is also clogged up. The gadget sends our car under the motorway, along a canal and through a village that looks onto fields near Schiphol airport. One feels a little smug.

What happens if everyone buys the gadget? Don’t you lose your edge? Mr Groenhuijzen claims not. The system is so fast at updating, he says, that the TomToms stuck to people’s windscreens would not send them all haring down a B-road into the same village to create a new traffic jam.

November 6th, 2007

Sony’s $100m HD campaign

8gb_walkman Despite fires in San Diego closing its factory there and forcing evacuations of its workers, Sony Electronics says it has now caught up with orders and is expecting a bumper holiday season in the US.

“It could be the best holiday season in the last couple of years,” Stan Glasgow, its president in the US, told us at a press event in San Francisco on Monday night.

His confidence is based on orders from retailers for Sony’s current third quarter and he also expects returns from a $100m marketing campaign in the US.

“You will see more advertising than we have ever done before,” he said. The emphasis will be on High Definition , with Sony’s HDNA campaign prominent.

Sony also showed off the new version of its Sony Reader and an 8Gb Walkman that competes with the iPod Nano. Significantly for Sony, its proprietary Atrac format is gone and it now seems more open format than Apple, with WMA, MP3 and AAC music files supported.

Mr Glasgow said Sony’s announcements at the Consumer Electronics Show in Las Vegas in January would emphasise integration between Sony’s different product lines – a key goal of Sony’s chief executive, Sir Howard Stringer.

His US president was particularly critical of supporters of the HD-DVD standard, which competes with Sony’s Blu-ray DVD players. He said Toshiba and perhaps Wal-Mart had substantially subsidised an HD-DVD player that went on sale for $99 at the retailer last week.

He also claimed that HD-DVD supporters had paid the Hollywood studios as much as $500m in incentives to bring out movies in that format. The studios are also reported to have asked for incentives from Sony and the New York Times reported in August that Paramount and Dreamworks alone had received $150m for choosing HD-DVD over Blu-ray for their releases.

October 22nd, 2007

Wireless audio wit..out th.. dr..o..p out

Acoustic_research_awd210 For all its convenience, wireless in the home always seems to have trade-offs – mysterious signal losses, degradation in quality and less-than-easy set-up.

This can apply to both Wi-Fi internet connections and other applications, such as wireless speakers and headphones.

Avnera, a fab-less chip company based in Oregon, has unveiled a technology today that concentrates on conquering one problem area – wireless audio.

It claims six innovations: forward error correction so the receiver can repair lost data, a dispersion technology that spreads out errors in time, a small spectrum footprint that allows it to choose from 40 possible channels, dynamic frequency selection which changes to the optimum channel, two separate antennae and dynamic power control to increase power if the receiver is far away.

Avnera has packed all of its features onto a single chip rather than using several, enabling 30 per cent lower system costs. Its wireless systems are also plug and play.

Wireless headphones from Acoustic Research at $199 performed well in a demonstration. The sound was crystal clear until cutting out sharply from about 50 feet away, although an amplifier unit would have extended the range. A second product already available is the RocketFish Wireless Rear Speaker Kit at $99.

Avnera’s management team has previous experience with Bluetooth and sound software companies. Their solution is a proprietary one but “there’s lots of examples where in certain markets it hasn’t made sense to use a standards-based technology,” says Mats Myrberg, head of product development.

Avnera has been developing its AudioMagic and VoiceMagic chips since 2004 with this one market in mind.

Wireless products have the highest return rate of any items in the stores of electronics retailer Best Buy. It is therefore an endorsement of Avnera that Best Buy is its first customer and is also an investor among regular VCs such as Bessemer, Redpoint and Intel Capital.

September 6th, 2007

Reasons to be touchy about the iPhone

Nanos So those who queued for days for an iPhone before its launch on June 29 have now been made to look double doofuses by Apple.

Not only did they wait needlessly when there were plentiful supplies, but a price cut just 10 weeks later means they paid $200 more than necessary.

For those that didn’t really want the phone, but the elements that made it the “best iPod ever” ( Steve Jobs’ description), it’s even worse. They could have saved $300 and got the new 8Gb iPod touch for $299.

The touch looks a winner with its touch-screen and wi-fi that brings internet browsing to a media player.

The new nano also sees Apple finally get it right with its most popular model – it can now play videos, sophisticated games, has more storage, a much better display, a full-metal jacket, better interface, cooler colours and 24-hour battery life for playing music.

The original iPod was renamed the “classic” today, but it is looking more like the “prehistoric” squeezed between the nano and the touch. The only thing in its favour seems to be storage – 160Gb for $349. Jobs emphasised you could store 40,000 songs on it, but who has 40,000 they need to carry around with them?

The only other disappointment in the presentation was the lack of any content announcements – the anticipated availability of the Beatles catalogue failed to materialise.

There were also no new video deals to accompany the nano’s empowerment, only a bitch from Jobs about his row with NBC, which is moving its content to Amazon.

Making an individual ringtone for his iPhone out of John Lennon’s “Give Peace A Chance”, he said: “That’s for when NBC calls.”

August 22nd, 2007

Apple’s European iPhone deals

Colleagues at our sister paper Financial Times Deutschland have unearthed some tantalising details about Apple’s iPhone distribution deals in Europe. FTD reports that T-Mobile of Germany, Orange of France and O2 of the UK have agreed to hand over 10 per cent of their iPhone service revenues to Apple in exchange for the honour of being the first European mobile networks to partner with Apple on the new mobile handset. Most industry watchers are fairly certain that Apple had struck a similar revenue-sharing deal with AT&T in the US, but today’s story marks the first time that a concrete number has been established.

Assuming that Apple’s 10 per cent cut applies not only in Europe but to its US AT&T deal as well, and further assuming an average monthly iPhone bill of $79.99 (that’s not including overages or roaming charges - which have proved substantial in some cases), Apple could be making an additional $95.88 per handset per year on service revenues on the iPhone. If Apple hits its goal of selling 10m iPhones by the end of 2008, that would mean an extra $950m in service revenues by the end of next year. Not half bad.

Leaving the numbers aside, the fact that Apple has managed to hold out for such a high percentage of service charges in Europe - where the mobile market is much more advanced than in the US - is a sign that the iPhone and Apple really are changing the rules of the mobile game. While Research in Motion managed to get a revenue share on its Blackberry, no one until now has managed to do it with a consumer-oriented handset. The question now is whether the iPhone really is a unique case or whether Nokia, Sony Ericsson and other handset makers have the bargaining power to follow Apple’s lead.

August 2nd, 2007

Video editing for the YouTube generation

Moviestudio_2 The pieces are starting to fall into place for the synergy demanded by Sony chief Howard Stringer and breaking down of silos between different divisions of the consumer electronics company.

Take online video. The company is just about there in what could be described as providing an end-to-end solution from the consumer’s camera viewfinder to a YouTube debut.

Sony’s answer to YouTube is Crackle, a relaunch last month of its Grouper acquisition, with the emphasis on more professionally produced video and high definition.

Crackle is working with Sony Electronics on the display of its internet content on TV and with the HD camera people on some as yet undisclosed features.

Camcorders themselves are already being designed for the YouTube generation, with simpler recording and uploading methods.

The software part of the puzzle that creates professionally edited pieces from raw footage and prepares them for uploading is Sony Creative Software’s Vegas Movie Studio, the best-selling video editing package.

Movie Studio is one of the products Sony acquired when it bought Madison, Wisconsin-based Sonic Foundry in 2003. Other products include Sound Forge Audio Studio and Acid Music Studio and all three are consumerised versions of professional products.

The Platinum Edition of Movie Studio, just released, adds Vista support and high-definition and surround-sound editing. Movie Studio also makes it easy to upload to Crackle or the 10-year-old ACIDplanet.com site – it provides a friendly interface with buttons like “Publish to Web” and a variety of options to reduce file sizes for faster transfers.

It’s also a relief to discover that the Sonic Foundry roots and a loosening of Sony’s attitude mean the software is not tied to Sony’s proprietary formats such as ATRAC and M2TS – import and export is possible for every flavour of Mpeg as well as Quicktime, AVI and Windows Media formats.

July 26th, 2007

Camcorders for the YouTube generation

Scmx10left Consumer electronics companies are catching on to the quick-sharing habits of the YouTube generation, with everything from iPhones to internet televisions becoming online video enabled.

The camcorder market sees this as a major opportunity for growth. Unit sales have been stuck at around 4.7m in the US for the past few years but the Consumer Electronics Association is predicting a 20 per cent increase next year due to the growth of user-generated content on the web and high definition.

The $120 Flip video camcorder has led the way with idiot-proof recording and a USB connection that flips out. I’ve used the movie option on my Sony DSC-T100 digital camera to record and upload to YouTube and Sony’s "Net Sharing Camcorder" , which will also function as a webcam, goes on sale in September at $200. A Casio Exilim stills camera, out next month, even has specific YouTube uploader software.

Samsung have just showed me their MX-10 camcorder, also out next month and costing around $300.

It’s shaped like a soda can and has simple controls like the Flip’s, including a record button and zoom built into the flip-open display.

The MX-10 records on a standard SD flash memory card used in digital cameras. It comes with a 512Mb one, but 4Gb and even 8Gb cards are now becoming affordable, giving several hours of recording time.

In the demonstration, Samsung took the card out and slotted it into a notebook’s card reader, quickly uploading the footage to YouTube. The lightweight camcorder also has both TV and PC playback modes, recognising that many people are now hooking their devices to their computers rather than their TVs to review their home video efforts.

July 7th, 2007

Freeing the iPhone

Jajah_iphone So what if you don’t want to use the iPhone as a phone?

A perverse notion perhaps, until you add up the cost of the minimum $60 a month voice and data plan that is provided by AT&T.

It comes to more than $1,400 over the two-year minimum period, meaning buying an iPhone can be a $2,000 commitment.

Hence, some iPhone owners are talking about ways round activating their phones, from bent paper clips to hackers’ code.

The bent paper clip method involves removing the SIM card from a friend’s activated iPhone by pushing the clip in a small hole to spring the SIM card. This is then put in your phone to be resynced and activated again on iTunes. The SIM card can then be returned and you will have an iPhone that cannot make regular calls but will have a wi-fi connection for surfing and iPod functionality. Eventually, someone may come up with a solution for Voice over IP calls using the wi-fi connection.

The hacker’s way in was discovered by DVD Jon, who earned his moniker after cracking the copy-protection codes on DVDs. He posted details on his blog this week and commenters reported success using his method.

I wonder if a third, even easier, way is to cancel your AT&T contract within the 30-day grace period. The phone line may be deactivated, but you will still have the SIM and hopefully an unlocked iPhone, although syncing it with iTunes could alert Apple to its deactivated status.

Most people will stick with AT&T, but Jajah is touting how you can avoid expensive international roaming charges by signing up for its service through the Safari browser.

Meanwhile, many people have had the same problem as me in connecting to their wi-fi networks. Reading Apple forums, the iPhone appears to have a problem resolving DNS addresses in many cases. I followed advice to manually change my DNS address to 4.2.2.2 and am now surfing at broadband speeds.

July 3rd, 2007

One born every minute

01largecashmoneyWhen we headed down to the Apple store last week ahead of the iPhone launch, we found a substantial number of punters who were hoping to flip their newly-purchased iPhones for a substantial premium on Ebay. Sorry to take the wind out of your sails, guys, but data released today by Ebay indicate that the secondary iPhone market may not be as vibrant as some people predicted.

Just over 3,770 iPhones had changed hands on Ebay as of 3:45pm on Monday, at an average price of $701.98. A further 5,483 were listed for sale. Assuming that most of the iPhones sold were 8GB models (a Piper Jaffray note this weekend said 95 per cent of customers were walking out with 8GB models), that’s a premium of just $100 or so over the purchase price, and that’s not even including tax. That’s hardly a great return, especially when factoring in the opportuity cost of taking time off work to wait in line for hours, or, in some cases, overnight. 

It’s not all bad news for iPhone entrepreneurs, however. On Saturday, one iPhone sold for an eye-popping $12,500, according to Ebay Marketplace Research, which warns that Ebay "cannot verify that the transaction is complete, however the sale appears legitimate."

One born every minute, I guess.


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