Commissioner Jessica Rosenworcel called on the agency to “seize this opportunity” and act on a year-old proposal to make an additional 195MHz of spectrum in the 5GHz band available for Wi-Fi. The FCC now allows wireless devices to operate in 555 megahertz of spectrum in the 5GHz band, but the agency has set limits on how some of that spectrum can be used.
With some analysts estimating that 50 percent to 70 percent of mobile phone traffic is now offloaded onto Wi-Fi networks, the longtime Wi-Fi band at 2.4GHz is “getting mighty crowded,” Rosenworcel said during a speech before WifiForward, a new group set up to push for more unlicensed Wi-Fi spectrum. Members of the group include Google, Microsoft, Best Buy and Comcast.
“Let’s start by leaving behind the tired notion that we face a choice between licensed and unlicensed airwaves, because good spectrum policy requires both,” she said. “Moreover, I think this kind of division is a simplistic relic from the past. ”
Some mobile carriers and congressional Republicans have questioned whether the FCC should carve out unlicensed spectrum in lower bands coveted by the carriers, but carriers don’t see a licensed use for the 5GHz band. Satellite firm Globalstar uses part of the 5GHz band, however, and has raised interference concerns about new Wi-Fi services there.
Cisco Systems predicts that by 2017, a majority of the Internet’s traffic will be carried on Wi-Fi. About 90 percent of the tablets now sold in the U.S. have Wi-Fi-only connections, added Raul Katz, director of business strategy research at the Columbia Institute for Tele-Information. Counting several factors, including the cost for mobile infrastructure that would be needed without Wi-Fi, the annual value of Wi-Fi to the U.S. economy is about US$220 billion, Katz said at the WifiForward event.
In addition, part of the 5GHz band is targeted for use by smart automobile technologies, and the Intelligent Transportation Society of America and other auto groups have also backed opening that part of the band to Wi-Fi. The FCC may act on part of the 5GHz band as soon as its March 31 meeting.
Parts of the 5GHz band present a “terrific near-term opportunity” to add Wi-Fi spectrum, Rosenworcel said. “We should move beyond old dichotomies that pit licensed versus unlicensed spectrum,” she said. “Because across the board we need to choose efficiency over inefficiency and speed over congestion. Because we can take steps that inspire innovation and meet the growing demand for wireless services — or we will fall behind.”
Rosenworcel also called on the FCC to consider opening up parts of lower bands to unlicensed Wi-Fi, including parts of the 600MHz band now controlled by U.S. television stations. That spectrum, eyed by carriers as some of the best available for mobile broadband service, is scheduled to be auctioned by the FCC in mid-2015.
The deal would mirror a first-of-its kind agreement that Disney and satellite rival Dish Network Corp announced earlier this week.
The Internet rights being discussed are part of a large-scale programming agreement that would replace a deal between the companies that expires in late December. Disney and Dish are in negotiations but the timing of the new deal could be not be learned.
“The deal and terms are not unexpected as the Dish contract was the most recent in the Disney timeline to expire,” DirecTV spokesman Darris Gringeri said on Wednesday. “The DirecTV contract is up next and we’re in the process of working with Disney on a similar long-term agreement of our own.”
A Disney spokesman declined to comment.
A new pact could give both Disney and DirecTV, the No. 1 satellite operator, an additional revenue source as consumers gravitate toward online video services such as Netflix Inc and watch more television online.
The agreement between Dish and Disney marked the first time that a U.S. pay TV operator has been given the flexibility to offer its content over the Web through smartphones, tablets and computers outside of a pay TV subscription.
In that agreement, Disney allows for Dish to stream linear and on-demand content from ABC broadcast stations as well as cable channels, ABC Family, Disney Channel, ESPN and ESPN2. Dish has not revealed plans for its streaming service.
DirecTV, which has 20.3 million subscribers, is expected to secure better rates on programming than Dish, which has 14.1 million subscribers, because of its size. Both companies have complained about the rising cost of programming and have been involved in high-profile blackouts over the past few years.
DirecTV Chief Executive Mike White has previously said the company is working on an “over-the-top” video package to suit niche audiences featuring Hispanic or kids programming, but has not yet given details on that offering.
Worldwide sales of tablets to end users totaled 195.4 million units, fueled by sales of low-end, smaller screen devices, and purchases by first time buyers, the company reported.
Android has become the biggest tablet operating system with 62% of the market. In 2012, Google’s OS trailed Apple’s iOS by a margin of about 8 million tablets, but by the end of last year had turned that into a 50 million-unit lead.
The Android camp led by Samsung sold almost 121 million tablets, for a 61.9% share, compared to 53.3 million units and a 45.8% share in 2012. Apple’s tablet sales increased from 61.5 to 70.4 million units, but because the overall market grew faster, the company’s share dropped from 52.8% to 36%.
Microsoft’s Windows tablet sales improved but the share remained small at 2.1%, with shipments growing from 1.2 million to 4 million units. To compete, Microsoft needs to create a more compelling ecosystem for consumers as well as developers across all mobile devices, Gartner said.
Apple’s strong fourth quarter helped it maintain the top position among the manufacturers. Samsung, ranked in second place, had the biggest growth of the worldwide tablet vendors, at 336 %. The expansion and improvement of its Galaxy tablet portfolio, together with a lot of marketing, helped Samsung shrink the gap with Apple.
Samsung sold 37.4 million tablets for a 19.1% slice of the market.
The rest of the top 5 was made up of Asus, Amazon.com and Lenovo. Of those three companies, Lenovo did particularly well with tablet sales growing by 198% to 6.5 million units, or a 3.3% market share. The company’s success was due to a combination of new tablet models launched during the second half of last year, and sales of its Yoga model and its Windows tablets doing particularly well, Gartner said.
However, Lenovo is still behind Asus, with 11 million units sold, and Amazon, with 9.4 million. Asus’ market share grew from 5.4% to 5.6%, while Amazon’s share declined from 6.6% to 4.8%.
As the tablet market becomes even more competitive, this year it will be critical for vendors to improve user experience, technology and ecosystem value beyond just hardware and cost, Gartner said.
Qualcomm Executive Vice President Murthy Renduchintala has announced the first 20nm chip from Qualcomm. It is not a processor though – it’s the Gobi 9×35 4th generation LTE modem. It is sampling right now and there should be customers who will announce the designs on it shortly.
The SVP has also confirmed that SoC parts will soon to move to 20nm and when asked whether TSMC has capacity and is ready for mature production of 20nm his answer was positive. He actually said to expect a 20nm SoC real soon, but he didn’t get into any details.
The Cat 6 300 Mbps modem in 20nm obviously needs much less power and it will improve battery life on LTE devices. We can see this product as very interesting option for many high-end phones. Modems are easier and less complex to make compared to SoCs and this is why Qualcomm traditionally moves the LTE modem to a new processor node first. The company then follows up with a SoC that is much more complex to manufacture.
With every shrink of the processor node, power goes down significantly and this is what high-end application processors are all about. At 28nm chipmakers are already pushing the envelope with big A15-class parts and the move to 20nm can’t come soon enough.
Announced at Mobile World Congress in Barcelona, the $349 tablet has a 10-inch screen and a snappy Qualcomm 400 Snapdragon processor. The screen displays images at a 1920 x 1200 pixel resolution, setting it apart from the previous Yoga 10 tablet, which was criticized for its poor performance and low-resolution screen.
But the company has retained some of the key features from the original Yoga 10. The Yoga Tablet 10 HD+ has a cylindrical battery that the company claims gives the device 18 hours of battery life, and a kickstand that allows the tablet to stand upright at 30-degree to 80-degree angles.
Other features in the tablet include an 8-megapixel rear camera, a front camera, micro-USB port, Wi-Fi and Bluetooth. The tablet has the Android 4.3 OS.
The Qualcomm Snapdragon chip is able to render full high-definition video, which should give the tablet competitive multimedia performance.
The tablet will be packaged with apps from Lenovo to easily share files, sync contacts and protect the device from malware. The software belongs to Lenovo’s newly announced Do-it software apps package.
The Yoga Tablet 10 HD+ will be available in April, the company said.
Intel’s NUC is about to get its biggest overhaul yet later this year. The tiny barebones should get Broadwell-based Core i3 and Core i5 processors, but that’s not all.
It appears that Intel is planning to introduce completely redesigned boxes with plenty of new features. Codenamed Rock Canyon, the new NUC kits will feature miniHDMI and miniDP video outputs, allowing triple display support and 4K/UHD support.
In the storage department, Intel went for a standard 2.5-inch bay backed by an M.2 SSD. This means users will be able to use a small SSD as a system drive along with cheap mechanical storage. On the other hand, the M.2 form factor is anything but popular at this point. All new NUCs will feature USB 3.0 and in terms of connectivity they’ll have built-in WiFi and Bluetooth, IR sensor for HTPC remote controls and replaceable lids with NFC and Wireless Charging.
That’s not all though. Rock Canyon is the mainstream kit, but another one is on the way. Maple Canyon is a “professional” unit and it features Intel vPro technology and TPM hardware, but it does not have an IR sensor or lids with wireless charging.
So, while Broadwell probably won’t appear in the form of socketed desktop CPUs, you’ll still be able to buy a Broadwell desktop, albeit a NUC.
LinkedIn launched Intro last October, as part of a larger push into becoming a “mobile first” company. The service was made for the iPhone, and was designed to grab LinkedIn profile information and insert it into emails received on phones. The service displayed that information to the recipient from the email’s sender if the sender was also on LinkedIn.
Intro was meant to add more professional context to email and draw more users to LinkedIn.
But it quickly sparked questions from security experts, who were concerned about the way the service routed emails through LinkedIn’s servers. The security consulting firm Bishop Fox said that the service essentially amounted to a “man-in-the-middle attack,” and that it was only a matter of time before someone used it to launch a phishing attack.
LinkedIn, in its announcement Friday of Intro’s closure, did not say anything about security. The decision was about “focus,” LinkedIn said. “We are making large, long-term investments on a few big bets, and in order to ensure their success, we need to concentrate on fewer things,” wrote Deep Nishar, senior VP of products and user experience.
Intro will be shut down as of March 7, LinkedIn said. The company did not say what it would be doing with Intro users’ email data that it might have stored on its servers. LinkedIn did not immediately respond to a request for comment.
Upon receiving word of LinkedIn’s announcement, Bishop Fox said that it was unlikely that LinkedIn shut down the service for security reasons alone. “Tech products come and go these days and many have short lifespans,” said Vincent Liu, a partner at the firm, via email.
“But this app exemplifies why it’s important to pay attention to privacy and security when installing features, whether short lived or not, on your mobile devices,” he said.
LinkedIn also said it would be shutting down some other services. Slidecast, which let people upload digital presentations with audio, is going away as of April 30. Support for the LinkedIn iPad app on iOS versions older than 6.0 will also be eliminated as of Feb. 18, the company said.
Samsung also revealed that all four of its new tablets will uses its somewhat controversial custom interface Magazine UX, a display mode that loads the screen with tiles that show information from different apps. Analysts expected Samsung to downplay the Magazine UX, as a way of staying closer to true Android from Google.
Prices will start at $399.99 for the 16GB Galaxy Tab Pro 8.4. The Tab Pro 10.1 is priced at $499.99 for 16 GB and the Galaxy Note Pro 12.2 will cost $749.99 for 32 GB and $849.99 for 64 GB. Samsung said the fourth tablet recently announced at International CES, the Galaxy Tab Pro 12.2, also running KitKat, won’t be available until March.
The models that go on sale Feb. 13 will be Wi-Fi-only, but Samsung also said that Verizon Wireless will be the first to offer a 4G LTE version of the Note Pro 12.2 later this quarter. Samsung posted more information about pre-orders on its website. The Note Pro and Tab Pro tablets come in black or white.
Samsung advertised the four models as ideal for use at work or play. Both 12.2 models (with 12.2-in. displays) as well as the Tab Pro 10.1 (with a 10.1-in. Display) come with virtual keyboards that mimic the size and appearance of a physical keyboard for faster typing. Both 12.2 models also have 2560 x 1600 LCD displays, making them the first with such high resolution. Both also allow users to view up to four applications at once for better multitasking.
The Note Pro 12.2 also has a Samsung S Pen, a digital pen for handwriting to text, and functions called Air Command and Pen Window for quicker access to apps and information.
All the new tablets will run Magazine UX, a new custom user interface that runs in the home screen layout and that Samsung says will bring users’ their favorite and most-frequented content, such as apps,email and games “to the forefront, offering direct access to content with a single touch.”
Some analysts said Samsung might drop or de-emphasize the Magazine UX in upcoming products in favor of the standard Android UI after recent negotiations between the two companies. after reports of recent negotiations between Samsung and Google were believed to result in future Samsung products with the same look as standard Android backed by Google.
The Galaxy Tab Pro 8.4 (with an 8.4-in. display) runs a Snapdragon 800 2.3 GHz quad-core processor, which makes it “built to handle high-powered games and video,” Samsung said.
With the range of Android tablets Samsung has already shipped to market and the latest round of new tablets, it is no wonder that Samsung is the largest Android tablet maker. IDC said Samsung shipped 14.5 million tablets in the fourth quarter of 2013, grabbing an 18.8% market share, second only to Apple’s 33.8% share in shipping 26 million iPads running iOS.
The next biggest tablet maker is Amazon.com, shipping 5.8 million Android core tablets for its Kindle Fire line and making up 7.6% of the market. After Amazon, Asus shipped 3.9 million Android or Windows 8 tablets for 5.1% of the market, while Lenovo shipped 3.4 million tablets running Android or Windows 8 for 4.4% of the market.
Nintendo has issued a detailed and far-reaching response to the pervasive concerns about its future as a business.
In a meeting with investors, Nintendo president Satoru Iwata outlined the company’s strategy in both the short-term and as far ahead as 2016. From changing the fortunes of the Wii U to evolving the way we think about game consoles as a concept, Nintendo displayed striking candour in its attempt to allay the criticisms it has received since it drastically reduced its sales forecasts earlier this month.
However, Iwata was clear about one thing from the outset: regardless of what followed, there are certain aspects of Nintendo’s business that will not change, namely the frequently proposed idea that it should take its IP stable to new platforms.
“Dedicated video game platforms which integrate hardware and software will remain our core business,” he said. “Naturally, we are moving ahead with research and development efforts for future hardware as we have done before, and we are not planning to give up our own hardware systems and shift our axis toward other platforms.
“Dedicated video game platforms which integrate hardware and software will remain our core business… We are not planning to give up our own hardware systems and shift our axis toward other platforms”
“From a medium- to long-term standpoint…we don’t believe that following trends will lead to a positive outcome for Nintendo as an entertainment company. Instead, we should continue to make our best efforts to seek a blue ocean with no rivals and create a new market with innovative offerings.”
Here are the key points from Iwata’s presentation
The Wii U is Nintendo’s top priority
It is no secret that Nintendo has struggled to repeat the success of the Wii with the Wii U, but Iwata reassured investors that it has no intention of abandoning its ailing console. The possibility of a further reduction in price was ruled out immediately, with Iwata instead emphasising the company’s ongoing failure to adequately demonstrate the value of the GamePad controller, and to distinguish the console from its hugely popular predecessor.
“By looking at the current sales situation, I am aware that this is due to our lack of effort,” he said. “Our top priority task this year is to offer software titles that are made possible because of the GamePad… We have managed to offer several of such software titles for occasions when many people gather in one place to play, but we have not been able to offer a decisive software title that enriches the user’s gameplay experience when playing alone with the GamePad. This will be one of the top priorities of Mr. Miyamoto’s software development department this year.”
Iwata offered a strong first-step by setting an official May release date for the release of Mario Kart 8, but he also indicated that Nintendo’s development teams would focus on the GamePad’s near-field communication (NFC) function – the same basic technology as that used in lucrative franchises like Skylanders and Disney Infinity. Iwata promised more details of its plans for NFC at E3 in June.
The end of “device-based relationships”
While many have cited the Wii U as evidence of Nintendo’s failure to respond to the changes in the games industry since the launch of the Wii, Iwata stated that the company has already laid the foundations for a fundamental shift in the way it thinks about its products.
Before now, Nintendo had “device-based relationships” with its customers. This was mitigated somewhat by the strength of its software IP, but fundamentally the link with any given consumer followed the lifecycle of each piece of hardware. “We became disconnected with our consumers with the launch of each new device as we could only form device-based relationships,” he said.
However, the Wii U saw the introduction of “Nintendo Network IDs,” an attempt to create “account-based” customer relationships that could continue across different hardware platforms and generations. In the future, Iwata said, “connecting with our consumers through NNIDs will precisely be our new definition of a Nintendo platform.”
With this in mind, Iwata was able to put an end to the speculation around Nintendo’s strategy for smartphones and tablets. He made it quite clear that Nintendo has no plans to release its games on smart devices, but it does intend to use them as a way to communicate and build relationships with new audiences. Iwata offered few details of how the company intends to accomplish that goal, but he indicated that it would include a mobile app that leveraged Nintendo’s existing IP to raise awareness of its hardware and software.
“I have not given any restrictions to the development team, even not ruling out the possibility of making games or using our game characters. However, if you report that we will release Mario on smart devices, it would be a completely misleading statement. It is our intention to release some application on smart devices this year that is capable of attracting consumer attention and communicating the value of our entertainment offerings.”
Flexible pricing for existing and emerging markets
The existence of NNIDs and account-based relationships will also give Nintendo the ability to alter the way its products are sold. Iwata highlighted the company’s role in establishing the model of selling a console for several hundred dollars and individual games for fifty or sixty dollars, but Nintendo now recognises that this model is no longer viable in the long-term.
The first aspect of this that Nintendo intends to challenge is the fixed price-point of software. Iwata suggested a system where the price of a games could be tailored to individual customers based on their NNIDs: someone who purchased five games in a year might pay less and less for each one, for example, or there might be incentives tied to recommending a game to a friend.
“If we can achieve such a sales mechanism, we can expect to increase the number of players per title, and the players will play our games with more friends. This can help maintain the high usage ratio of a platform… Nintendo aims to work on this brand-new sales mechanism in the medium term, but we would like to start experimenting with Wii U at an early stage.”
“While we will continue to devote our energy to dedicated video game platforms, our first step into a new business area is the theme of ‘Health’”
This flexibility will also extend to emerging markets for gaming across the world. Nintendo is a globally recognised brand, but Iwata conceded that the price of its products has put them beyond the reach of people in certain countries. While Iwata didn’t mention any specific regions, he is likely referring to countries like Brazil and India, where the interest in gaming has increased in concert with the disposable income available to the population.
“To leverage Nintendo’s strength as an integrated hardware-software business, we will not rule out the idea of offering our own hardware for new markets. But for dramatic expansion of the consumer base there, we require a product family of hardware and software with an entirely different price structure from that of the developed markets.
“We aim to connect with consumers who do not own Nintendo’s video game systems yet, which will play an important role in cultivating new markets. Once we can establish such a connection with consumers in these nations, we will be able to use smart devices to share our information as well as important content distribution infrastructure. We plan to take significant steps toward such a new market approach in the year 2015.
Going beyond games
There may be no chance of playing Super Mario World on an iPad anytime soon, Iwata did state Nintendo’s interest in making money from its IP outside of first-party video games. Nintendo has always been very cautious of damaging its iconic characters through excessive merchandising and licensing, but one need only look at Rovio’s Angry Birds to see how much profitable such deals can be. Indeed, Iwata attributed the strength of Nintendo’s IP stable to that very reluctance, but, he said, “we are going to change our policy going forward.”
“To be more precise, we will actively expand our character licensing business, including proactively finding appropriate partners. In fact, we have been actively selling character merchandise for about a year in the U.S. Also, we will be flexible about forming licensing relationships in areas we did not license in the past, such as digital fields, provided we are not in direct competition and we can form win-win relationships.
“By moving forward with such activities globally, we aim to increase consumer exposure to Nintendo characters by making them appear in places other than on video game platforms.”
Nintendo’s new business idea: Health
Iwata closed the presentation with Nintendo’s planned entry into an entirely new area of business, one that will provide the “blue ocean” the company so desperately needs.
“While we will continue to devote our energy to dedicated video game platforms, what I see as our first step into a new business area in our endeavour to improve [quality of life] is the theme of “Health.” Of course, defining a new entertainment business that seeks to improve [quality of life] creates various possibilities for the future such as “learning” and “lifestyle,” but it is our intention to take “health” as our first step.”
Again, exact details of what this focus on health will entail were not provided, but Iwata described the concept as “an integrated hardware-software platform business” that will use the company’s experience making products like Wii Fit, Brain Age and the Touch Generations series as a springboard for a more pervasive and persistent initiative.
“We will be able to provide feedback to our consumers on a continual basis, and our approach will be to redefine the notion of health-consciousness, and eventually increase the fit population… I feel that not only can this [quality of life]-improving platform utilise our know-how and experience about video game platforms, but also we can expect it to interact with games and create a synergistic effect.
“While we feel that this is going to take two to three years after its launch, we expect the [quality of life]-improving platform to provide us with new themes which we can then turn into games that operate on our future video game platforms, too. Once we have established such a cycle, we will see continuous positive interactions between the two platforms that enable us to make unique propositions.”
Iwata promised to announce more details this year, and confirmed that the new business will officially launch during the fiscal year ending March 2016.
Nintendo blew it. That much is clear, and even Satoru Iwata doesn’t debate it – Nintendo blew it. The financials could be much worse, but the unit sales? Way, way below targets, and in the case of Wii U, way below sustainability. Nintendo blew it! Shout it from the rooftops, if you can find space on a rooftop next to all the people who are already shouting it, with altogether too much peculiar jubilance in their snide, told-you-so voices.
Nintendo blew it. Blew what, though? That’s a tougher question. The company’s year has been a lot more complex than anyone is giving it credit for. In 2013, Nintendo was proud owner of the best-selling console in every major territory worldwide, and launched an enviable range of first-party software titles that sold over a million copies each – more than any other publisher out there. The company retained its crown as the biggest platform holder and the biggest software publisher in the business.
Yet, Nintendo blew it, because it also had a platform that utterly under-performed even the most conservative of estimates – a console that, on its current trajectory, is set to undershoot the low bar set by the GameCube and become the firm’s worst performing home console ever. Moreover, Nintendo blew it in a subtle but crucially important way – with startling incompetence for a company of its size, the firm predicted sales figures for both the 3DS and the Wii U which were absolutely ludicrous and then failed to revise them as the year carried on, meaning that even the solidly performing 3DS has undershot its targets, while the Wii U looks even worse than it ought to (which is pretty bad to begin with).
“Nintendo’s stock didn’t tumble too badly after it revised its guidance, largely since nobody with a clue actually thought the firm was going to hit its targets anyway”
This latter aspect has made the coverage of Nintendo’s situation even more negative than it would already have been (and there are plenty of people waiting to pile onto the company at the slightest provocation), since it covers up the success of the 3DS and its software line-up – seriously, 3DS has had an amazing year for software and is now set up with a library that effectively secures the console’s future – in a heavy smearing of corporate incompetence. It has also, understandably, deeply annoyed shareholders, because they rely on companies making accurate predictions to figure out whether or not to pick up stock in a firm. That said, Nintendo’s stock didn’t tumble too badly after it revised its guidance, largely since nobody with a clue actually thought the firm was going to hit its targets anyway. Incidentally, the company’s stock price is about 50% higher today than it was 12 months ago, in line with the rise in the Nikkei 225 index – which means that Japanese investors, at least, are rating the company as broadly neutral rather than actually negative.
Still, Nintendo blew it, and that means lots of people are making angry noises. Iwata must go, say some; Nintendo must exit hardware, say others; time for Mario on smartphones, say still others. The owners of all of those voices are going to be disappointed – not least, I believe, because very few of them actually understand Nintendo as a company or the Japanese corporate environment in which it operates. They don’t understand that activist shareholders don’t mean a tuppenny damn to a company whose shares are largely held by a combination of the founding family, the senior staff and (more significantly still) the complex web of interrelated share- and debt-holdings that connects Nintendo with Japanese banks and other corporations, none of whom have the slightest concern in being “activist” except in the most extreme of circumstances. An earnings miss? Pah! Japanese corporations routinely missed annual earnings every year for decades after the Asian Financial Crisis of the early 1990s, but shareholder pressure to change top management never materialised then, and it won’t materialise now. Iwata is secure until he does something sufficiently wrong to have a taint of scandal around it, and that’s deeply unlikely to happen.
Exiting hardware? Absolutely no chance. Nintendo’s primary view of itself is as a toy company and its core business model is selling hardware (generally profitably) and then selling software that runs on that hardware (extremely profitably). The synergy between the company’s hardware side and its software side is legendary, as is the extent to which each Nintendo platform is designed with the requirements of planned first-party software in mind. For that reason alone, it’s likely that the Wii U will eventually have a clutch of startlingly excellent games, matching last year’s critically acclaimed Super Mario 3D World in quality – although whether that will actually do anything to resuscitate sales is another question entirely. The point is that this approach isn’t going to change; the inertia behind Nintendo as a hardware company is immense, and moreover, despite this year’s earnings miss, it’s largely working. Nintendo is, pretty much every year, the largest and most successful game software company in the world. Would it retain that crown on someone else’s hardware? If you rush to answer “yes!” to that question, either your crystal ball gazing skills are excellent or you haven’t thought about it hard enough; I don’t think there is a good answer to that question right now, and I know Nintendo will be eyeing Sega’s post-hardware decline and thinking about its own potential fortunes as one-among-many on a smartphone app store. Right now, Nintendo has around 40 million 3DS owners who are keenly anticipating future first-party releases from the company – keenly enough that they start to agitate and make noise if there’s ever a gap in the release schedule. Would that be true on iOS, or Android, or even on a competitor’s console platform?
“one of the company’s failings, in some regards, is that it still doesn’t really have a global outlook, with Nintendo of America and Nintendo Europe being rather stunted”
How about a limited engagement with smartphones, then, even if they wouldn’t make the leap entirely? That’s plausible. Nintendo’s primary point of reference for its product decisions is Japan – one of the company’s failings, in some regards, is that it still doesn’t really have a global outlook, with Nintendo of America and (even more so) Nintendo Europe being rather stunted local offshoots whose actual contribution to the firm’s planning and success is pretty obviously minimal. In Japan, smartphone games are a huge sector, and interestingly, there’s seemingly more of a market for premium-priced games than there is in the west, where free-to-play is increasingly the only show in town (although premium-priced games are carving out an interesting niche there too). There is, I believe, some potential for Nintendo to start putting Virtual Console titles on smartphones, perhaps initially through a tie-up with one of Japan’s carriers. However, I’d expect this roll-out to be slow and careful, with Nintendo incredibly mindful of the possibility of damaging its core brands by launching Mario or Zelda games tainted by emulation problems or crap touchscreen controls. Still – it could happen, and is by far the most likely of the “demands” being made of the firm to actually be met in some limited form.
If Iwata isn’t going to go (he’s not), Nintendo isn’t going to exit hardware (they’re not) and the company’s future isn’t on smartphones (it’s not, although some cautious toes in that water may be seen in time), then what is Nintendo’s reaction to its present situation going to be?
I’ve stated this before, but it bears repeating – Nintendo has incredibly, insanely deep pockets. The firm has set aside a vast war chest over the course of its successful years, and it can easily ride out even the complete failure of a console platform, supporting that platform sufficiently to satisfy consumers while quietly working on a replacement. That’s what Satoru Iwata told me Nintendo would do if the Wii failed completely – they’d make something else and try that instead – and I see no reason why that logic would have changed. If anything, the firm’s financial position is even stronger now than it was then.
What will Nintendo make? There’s a lot of speculation around that, but most of it is evolutionary. A faster, more powerful DS / 3DS style handheld. A Nintendo tablet, capable of handheld gaming and being hooked up to a TV. A full-spec next-gen console built to rival the PS4. All of these are options for the company – the tablet computer one is even an interesting one, combining as it does the handheld market (which Nintendo always dominates) with the home console market (where it’s hit and miss). However, they all miss the crucial ingredient which Nintendo actually requires to bring itself back to success – surprise.
“Nintendo needs the element of surprise. It surprised the hell out of everyone with the DS, it surprised everyone with the Wii”
Nintendo needs the element of surprise. It surprised the hell out of everyone with the DS, a daft, stupid idea for a handheld console that everyone expected to be trounced by the much more comprehensible PSP. It surprised everyone with the Wii, a weird, tiny, underpowered system with a controller that looked nothing like we expected – so odd that it led me to rather bluntly ask Iwata what he planned to do if everyone hated it and the system flopped, hence his comment above. The DS is the best-selling console in history (or at least, tied for that honour with the PS2); the Wii trounced the Xbox 360 and PS3 in the last generation of hardware. Nintendo does exceptionally well when it surprises people. It creates a clear gap between itself and the competition and makes “the Nintendo Difference” into more than just a silly slogan. Even those who own a more “mainstream” console end up wanting a Nintendo one too, because it’s so interesting and different, while those from outside the core gamer market find themselves intrigued by the very peculiarity and curiosity of the devices and their software.
3DS and Wii U fail the surprise test. They’re practically indistinguishable from their predecessors, both in appearance and in branding. 3DS suffered terribly from being mistaken for a new version of the original DS hardware; the Wii U, I suspect, is doing even worse, with many consumers not realising that it’s a new console entirely and not a new controller for the Wii. There’s been a disastrous failure of communication, branding and marketing, which has compounded the more basic error – assuming that the success of the Wii meant people wanted more of that kind of thing. Nintendo’s strength is providing people will surprises, things that look daft to begin with and then turn out to be precisely what we always wanted and never realised. If it’s to successfully come back from its present mess, it needs to do so by surprising us, not by following along the dull path analysts would now demand of it.
That, I earnestly hope, is what the company is working hard on in Kyoto right now. I don’t want Nintendo to abandon the Wii U, and I don’t think that will happen. The installed base is small, but big enough to be worth caring about, and the console still has the makings of a profitable platform, albeit a niche one. However, alongside continued support for the Wii U (and hopefully, a drastic change in marketing and branding), Nintendo is hopefully also working on something else; something more important and simply more Nintendo; its next big surprise.
Netflix Inc gained more than 2.3 million U.S. subscribers in the fourth quarter, sending its shares up 17 percent in after-hours trading, and said it was testing different pricing plans for its monthly TV and movie streaming service.
The world’s largest video streaming company on Wednesday reported net income of $48 million for the quarter, up from $8 million a year ago. Earnings-per-share were 79 cents, Netflix said in a statement, beating the 66 cents average forecast of analysts surveyed by Thomson Reuters I/B/E/S.
The strong U.S. subscriber growth, a closely watched barometer of company performance, came in at the top end of Netflix’s forecast range. Netflix also signed up 1.74 million new customers in foreign markets, bringing its worldwide total to 44.4 million.
Answering critics who question how big Netflix could grow, the company said it expected to add more U.S. subscribers in the first quarter of 2014 than in the year-ago period.
“We expect this momentum to continue in Q1 with net additions of 2.25 million to exceed the prior year by about 11 percent,” the company said in its quarterly letter to shareholders.
Netflix shares, one of the highest-flying stocks of 2013, jumped more than 17 percent in after-hours trading to $391.77, eclipsing the all-time intraday trading high of $389.16 the stock hit in October.
In its shareholder letter, Netflix noted it had been testing variations of its $8 monthly charge “at various price points.” The company also said it “eventually” hopes to offer three pricing options “to fit everyone’s taste.”
Existing members would receive “generous grandfathering of their existing plans and prices,” the letter added.
In an interview, Netflix CEO Reed Hastings said it “could take longer than a year” for the company to set new prices.
“It just depends on when we feel comfortable we’ve got something that feels really fair and appropriate to consumers,” he said.
Netflix suffered from a consumer backlash and stock plunge after it announced an unpopular price increase in July 2011.
Hastings discounted a recent U.S. court ruling on “net neutrality” that some analysts said might lead broadband providers to charge the company for quick delivery of its video content, possibly inflating costs for the company.
“Our economic interests are pretty aligned,” he said. Broadband providers want to sell higher-priced service with faster speeds and need content for it from services like Netflix that work well with faster speeds, Hastings explained.
The CEO said he would like to reach a deal with a U.S. cable operator to have Netflix accessed from their set-top boxes.
“People will use Netflix anyway and I’d think (cable operators) would rather have them use it on their boxes rather than on Roku or some other box,” Hastings said.
Netflix is investing in original programming, such as the “House of Cards,” and “Orange is the New Black” series to attract and keep subscribers. If faces competition from online video players like Amazon.com Inc and Hulu, as well as on-demand content from cable operators.
But the company reported shrinking losses in international markets.
“The international losses are going to subside and therefore show the strength of the overall streaming business,” said FBN Securities analyst Shebly Seyrafi, who rates Netflix an “outperform.”
The company projected it will add 1.6 million customers in foreign markets from January through March.
It said it plans a “substantial European expansion” later this year, but did not disclose the markets it is looking at. The company currently operates in Canada, Latin America and seven European countries.
The idea is still at a very early stage, and it might not go ahead, the newspaper said, without disclosing its source.
Amazon is one of several companies that already offers on-demand movies and TV shows, but live TV would put it squarely in competition with existing cable and satellite TV providers.
Some of those providers already offer live TV over the Internet, but only as an extension of an existing pay TV subscription.
After news, music and video rentals, live TV is seen by many as the next big area that will be disrupted by the Internet. Amazon’s moves could be part of industrywide posturing in preparation for that.
The report came on the same day Verizon Communications, a major broadband Internet provider, said it is buying OnCue, a cloud TV service developed by Intel.
Sony recently said it would begin offering live television through a video service to be delivered through Sony PlayStation and connected TVs later this year, although offered no other details.
Over-the-air broadcasters are also moving toward the Internet. But in a twist on services offered in other countries, some local TV stations require a cable or satellite TV subscription in order to access live streaming programming over the Internet, despite it being broadcast free of charge over local airwaves.
One company that is attempting to break up this model, Aereo, has found itself targeted by lawsuits. Aereo receives and relays local TV broadcasts to subscribers over the Internet without the approval of the broadcasters. Aereo says it doesn’t need their approval, but TV stations disagree. That battle is heading to the U.S. Supreme Court.
The Wall Street Journal report noted the difficulty Amazon might face in getting access to content, especially if media conglomerates want to avoid upsetting major cable and satellite providers.
For all of the different brands familiar to consumers, today’s pay TV market is dominated by a handful of large companies that own many of the channels.
General Electric, for example, owns the NBC and Telemundo over-the-air networks, cable channels including CNBC, NBC Sports Network, USA Network and SyFy, cable TV and Internet operator Comcast, and a third of online streaming service Hulu.
Amazon did not immediately comment on the Wall Street Journal report. In a statement late Tuesday to the newspaper, it said it was not planning to license television channels or offer a pay-TV service. The company said it continued to build selection for Prime Instant Video and create original shows at Amazon Studios.
Nintendo reportedly is looking to mobile devices to save its struggling business, after it admitted last week that the Wii U isn’t selling.
On Thursday, Nintendo slashed its Wii U sales forecast, acknowledging that despite previously expecting to shift nine million units between April 2013 and March this year, it now expects sales of just 2.8 million. Nintendo’s 3DS console isn’t selling well either, leading the firm to admit that it expects to post a $240m annual loss.
These clearly are signs that Nintendo is losing its appeal in the gaming market, and although there are still many dedicated Wii U gamers out there, the firm is struggling to compete against the Sony Playstation 4 (PS4) and Microsoft Xbox One games consoles.
It seems that Nintendo is starting to realize this too, and it admitted over the weekend that it might look to mobiles and tablets to save the future of the company, following rumors that the firm may be planning its own Android tablet for educational use.
Although the company had previous said that you’re unlikely to ever see Mario Kart running on an iPhone, Nintendo president Satoru Itawa hinted that the firm’s stance on mobile devices has changed, with the company exploring the possibility of bringing its titles to smartphones and tablets.
“We are thinking about a new business structure. Given the expansion of smart devices, we are naturally studying how smart devices can be used to grow the game-player business,” Itawa said.
“The way people use their time, their lifestyles, who they are have changed. If we stay in one place, we will become outdated.”
However, Itawa admitted, “It’s not as simple as enabling Mario to move on a smartphone,” hinting that the firm will develop dedicated games for mobile devices, rather than porting those it already has.
By 2017, the same year that IDC forecasts digital PC/Mac revenues to reach $24 billion, the entire global games business could be worth more than $100 billion, according to the new Global Games Investment Review from Digi-Capital. The research firm says that mobile and online gaming is becoming such a huge force worldwide that it could grow at a compound annual growth rate of 23.6 percent, ultimately accounting for about 60 percent of software market share in 2017 while generating $60 billion of the predicted $100 billion for the overall industry.
While North America remains important, Digi-Capital expects Asia and Europe combined to represent about 80 percent of the mobile and online gaming sectors. Asia, in particular, continues to show its muscle when it comes to mobile and online gaming.
“Asia is becoming the biggest growth driver of economic value in mobile/online games, with the best games companies’ revenue growth and profit margins being the envy of foreign competitors,” said Tim Merel, managing director at Digi-Capital. “…9 of the top 10 games M&As of 2013 had Asian buyers, continuing the trend from 8 out of 10 in 2012. Global and pan-regional M&A deals were significant in 2013, and pan-regional relationships and profile remain critical for entrepreneurs selling via trade exits and for major corporate buying games companies. 13 out of 15 games IPOs in 2011-2013 were by Chinese, Japanese or South Korean companies, although there are also attractive IPO prospects in Western markets. Everyone is searching for the next Unicorn.”
The Asian gaming boom helped drive games M&A up 29 percent from 2012 to a record $5.6 billion in 2013, excluding $2.3 billion from the management-led portion of the Activision Blizzard/Vivendi spinout. The good news for companies seeking investments is that business seems to be on the rise, as investment levels rose back to 2010 levels, up 16 percent from 2012 to $1 billion – mobile, tech and gamification dominated investments in 2013.
While much of the industry is focused on mobile and online, consoles are making a recovery from their last few sluggish years. “The 8th generation console cycle is beginning to address the decline of recent years, but questions remain about potential new installed bases, transition from the 7th generation and mobile cannibalization,” Merel noted.
“Where 2013 was a year of transition, we anticipate 2014 to be a year of both growth and disruption for the games market.”
For more details, you can check out the full Digi-Capital report on the firm’s website.
Toshiba in the second quarter of this year will begin producing flash drives for smartphones and tablets that are substantially faster, smaller and more power-efficient than current NAND flash, the company said.
The flash drives are based on the next-generation mobile storage specification called Universal Flash Storage 2.0, which was finalized by JEDEC Solid State Technology Association in September last year. The first UFS drives will be targeted at high-end smartphones and tablets, which typically carry more storage capacity.
The drives transfer data at 600MB per second for each lane, which is double the bandwidth of the older UFS 1.1 specification, released in 2012. And for the first time, the new specification allows data transfers over two lanes, in effect quadrupling the data transfer rates compared to the older specification.
The UFS standard is designed for high-capacity flash drives for smartphones and tablets. UFS drives are viewed as the ultimate successor to drives based on the e-MMC standard, which are widely used in smartphones, tablets, printers, cameras, e-readers and other consumer electronics. Drives based on the e-MMC specification come in capacities ranging from 2GB to 128GB, and the latest specification, e-MMC 5.0, allows for data transfers as fast as 400MB per second.
Storage capacity on mobile devices is growing as users store more apps, data and video files locally. The UFS specification could help to prepare mobile devices for real-time playback of 4K video. UFS allows for simultaneous reading and writing from a host processor, while e-MMC is capable of only reading or writing data at a given time.
Other UFS supporters include top NAND flash companies Samsung and Micron. All the UFS supporters are making their own controllers, and Qualcomm will bring UFS 2.0 to its chips via Snapdragon 805, which supports 4K video. Qualcomm is showing off the Snapdragon 805 chip and related technologies at the International CES show in Las Vegas this week.