Tech wrap: Earnings hit as Apple reigns
Quarterly earnings suffered at major technology and telecoms companies in part because of demand for gadgets made by Apple, one day after core suppliers to Apple savored strong earnings results posted by the iPhone and iPad maker on Tuesday.
AT&T posted a $6.7 billion quarterly loss as it was weighed down by a hefty break-up fee for its failed T-Mobile USA merger and other big charges on top of costly subsidies for smartphones such as Apple’s iPhone. While the wireless provider beat analysts’ expectations for subscriber additions, the growth came at a massive cost as its wireless service margins plummeted. On top of the $4 billion break-up package charge, AT&T also took a big impairment charge for its telephone directory business, which it said it was considering selling.
Nokia reported a 73 percent fall in fourth-quarter earnings as sales of its new Windows Phones failed to dent the dominance of Apple’s iPhone or compensate for diving sales of its own old smartphones. Apple reported earlier this week sales of 37 million iPhones for the December quarter. Nokia has sold over 1 million Windows “Lumia” smartphones since its launch in mid-November. Nokia said it expected its phone business’ underlying earnings to be around breakeven in the first quarter, well below analysts’ forecasts, with sales falling more than usual in the seasonally weaker quarter.
Motorola Mobility posted a quarterly loss after it warned earlier this month that it was having a tough time competing in the smartphone market amid intense competition from rivals such as the Apple iPhone. The company, which is seeking approval to be bought by Google, reported a net loss of $80 million or 27 cents per share compared with a profit of $80 million or 27 cents per share in the same quarter the year before. Revenue rose slightly to $3.436 billion from $3.425 billion in the year ago quarter.
Nintendo posted a sharp drop in quarterly profit and forecast a bigger-than-expected full-year loss, as it battles a strong yen and its games devices lose ground to gadgets such as Apple’s iPhone. Nintendo now expects an annual operating loss of 45 billion yen ($575 million), dwarfing expectations of a 4.2 billion yen loss, based on the average of 21 analyst forecasts.
“To say that (the days of consoles) are over is likely an overstatement, but social network and Internet delivered games are growing and structurally changing the future of the industry, which is a strong wind against Nintendo,” said Shigeo Sugawara, at Sompo Japan Nipponkoa Asset Management.
Nokia’s Weber devises U.S. plan of attack
If Nokia’s big challenge this year is getting back in with US consumers and operators, it should be a busy 2012 for Chris Weber.
Weber – who heads the Finnish company’s business here – took a moment with us at the Consumer Electronics Show in Las Vegas to lay out some of his plans a day after AT&T announced it would sell Nokia’s Lumia 900, and a day before the Lumia 710 goes on sale at T-Mobile USA.
Weber told Reuters that he has to first find a way to convince enough consumers to at least try out Nokia’s Windows Phone-based devices, to at least give them a chance.
Tech wrap: Nokia throne in Samsung’s sights
Samsung CEO Choi Gee-sung told reporters in Las Vegas the company overtook Nokia in handset revenue terms in its latest reported quarter and was confident of topping the Finnish group in shipments this year. Samsung’s bullish forecast is in line with some analysts, including Royal Bank of Scotland, but on average analysts have expected Nokia to keep its lead on the market. According to the latest polls by Reuters, Nokia was expected to sell 418 million phones in 2011, versus Samsung’s 320 million, the gap narrowing this year to 388 million versus 359 million.
Google made changes to its search engine, combining content posted by users of Google’s social network Google+ and pic sharing site Picassa with regular search results. Links shared by a Google+ user’s connections are given more weight and will show up in Web search results with a person icon beside them, VentureBeat’s Jolie ‘Odell writes. The changes increase Google+’s prominence online, which is lagging behind Facebook in total number of users.
Sony’s videogaming business, led by its just-launched handheld “Vita”, will prove pivotal in returning the company to profitability, Kazuo Hirai, the executive pegged to succeed Howard Stringer as president, said.
Tech wrap: Huawei takes slimmest smartphone crown
Huawei, China’s largest maker of telecommunications gear, unveiled the “Ascend” smartphone, touting it as the slimmest on the market as it moves to boost its share on the global consumer market. Huawei unveiled the Ascend smartphones – available in black, white and pink – at the Consumer Electronics Show in Las Vegas. The 6.68-mm thin phone will be available in April 2012 in markets from North America, Europe to Asia and will cost roughly $400, but the final price has not been set, the company said.
AT&T announced plans to launch seven new smartphones and a tablet computer early this year for a new wireless network it is building. The product line-up will include a phone with a 16 megapixel camera from HTC using Microsoft software along with Microsoft-based smartphone from Nokia. AT&T said it will also sell three new high-speed smartphones from Samsung as well as a high-speed phone from Sony and Pantech. In an unusual pricing move, AT&T also announced that it would sell Pantech Element, a waterproof tablet based on Google Android software with a smartphone, the Pantech Burst, for a combined price of $249.
Olympus sued its current president and three ex-directors for several million dollars in compensation, sources told Reuters, as the company seeks to draw a line under one of the nation’s worst accounting scandals. The company filed suit against its president, Shuichi Takayama, with the Tokyo district court on Sunday, along with three former executives identified by investigators as having engineered or helped cover up a $1.7 billion fraud at the firm, the sources said.
Tech wrap: Will switch to QNX save RIM?
Research In Motion has already doled out a big helping of bad news ahead of its financial results on Thursday, but surprises could still await investors hungry for details about what many see as a new, make-or-break BlackBerry.
Investors are desperate to know whether RIM will stand by its current timetable to switch its smartphones to the new QNX operating system by early next year. The transition is considered the Canadian company’s last, best chance to reverse its declining fortunes.
T-Mobile USA plans to market the Lumia 710 phone from Nokia to first-time smartphone buyers as the two companies push to recoup market share losses of recent years.
Tech wrap: AT&T, Sprint admit using monitoring software
Phone makers RIM and Nokia denied installing on their mobile devices an app which can monitor what users are doing without their knowledge or consent while carriers AT&T and Sprint admitted to using it. The companies responded after a security researcher demonstrated in online videos how the “Carrier IQ” software worked on Google’s Android operating system and said that phones running RIM’s BlackBerry platform and Nokia’s Symbian OS also had the software installed. AT&T and Sprint said they use “Carrier IQ” to monitor network quality.
Blackstone Group and Bain Capital are preparing a bid for all of Yahoo with Asian partners in a deal that could value the Internet company at about $25 billion, a source familiar with the matter said. The potential bid by the consortium, which would include China’s Alibaba and Japan’s Softbank, has not yet been finalized, the source and two other people familiar with the matter said. E-commerce giant Alibaba, whose primary interest is in buying back a 40 percent stake owned by Yahoo, is keeping its options open and said it has not decided whether to participate in a bid for all of Yahoo.
Apple’s iPhone edged past major news events, celebrities and pop stars as the top searched term on the Web in 2011, according to Yahoo. The media company said the smartphone proved more popular than reality television celebrity Kim Kardashian, pop star Katy Perry and singer and actress Jennifer Lopez, who placed in the top five. Casey Anthony, the woman acquitted of the murder of her young daughter after a highly publicized trial, was No. 2.
Tech wrap: Bargain hunting may hurt retailers
Broader bargain hunting driven by budgetary fears may depress overall holiday spending, mitigating any hefty gains retailers reaped from long lines of shoppers snaked around malls across the U.S.
While Black Friday has been the busiest day for years in terms of traffic at stores, it does not always mean that sales will soar for the season. Despite brisk sales right after Thanksgiving, total holiday season sales fell in both 2008 and 2009 when the recession took its hold on America’s wallets.
Shopper-related injuries were popular topics on social networks such as Twitter. A shopper at a Los Angeles-area Walmart used pepper spray on a throng of shoppers and there was a shooting in a Walmart parking lot in the Oakland area.
Earbuds from Finland: They light up your brain
Five years ago, Nokia engineer Antti Aunio was trying to brighten up his flat to deal with seasonal affective disorder, known as winter depression and a common problem in northern Finland with its dark and long winters.
His childhood friend Juuso Nissila, a scientist who had studied the impact of lights on animals, had another suggestion: instead of getting new lamps that promise to lighten your mood, why not make a device that sends light straight to your brain?
That’s how Aunio quit Nokia and joined Nissila in starting up Valkee, which now sells earplugs which send bright lights to the brain through ear canals.
Tech wrap: Companies continue patent buys
Tech giants continued attempts to shore up their patent portfolios continued on Wednesday, with InterDigital being targeted by Apple, Nokia and Qualcomm.
Bidders have been eager to get their hands on InterDigital”s 8,800 patents — including crucial 3G and 4G/LTE patents to strengthen operating software for smartphones.
Key potential bidder Google, who earlier this week acquired Motorola Mobility for $12.5 billion, has not formally withdrawn from the auction but it is unclear whether they will bid for the company.
Tech wrap: Google targets Apple with Motorola buy
Setting its sights on rival Apple, Google announced its biggest deal ever, a $12.5 billion cash acquisition of mobile phone maker Motorola Mobility.
Google’s biggest foray into hardware comes weeks after a failed attempt to buy patents from bankrupt Nortel, and gives it an intellectual property library in wireless telephony to wage war on Apple and Microsoft.
However, analysts agreed that that buy was more about the patents and less about the hardware.
