After several years of accelerated growth, the U.S. market is feeling the effects of market saturation and smartphone ownership that’s lasting longer than once expected, Ramon Llamas, an analyst IDC, said in an updated forecast.
IDC’s five-year forecast issued for October significantly undercuts its April forecast, dropping expectations for U.S. smartphone and feature phone shipments by manufacturers to retailers. IDC now expects 1.7 million fewer phones shipped in 2104 than it had expected in April; it predicts 174 million phones will ship this year, with that figure declining gradually to 169 million in 2018.
Smartphone shipments alone will grow just slightly through 2018 in the U.S., but about 5% less than earlier expected, rising from 150 million in 2014 to 160.5 million in 2018. Feature phones shipments have dropped off faster than earlier expected.
Llamas said the signs of decline started in late 2011, prompting carriers in the past year to try to get customers to replace phones more often with easy trade-in plans and relaxed contracts.
It’s too soon to say what effect the early trade-in plans will have on the market, Llamas said. The life of an average smartphone still lasts about two years, but that could be changing.
Paying on installment plans “could really change the market,” Llamas said in an interview. “But if people pay off their devices and then realize they don’t have to pay the carrier as much [at the end of the payoff period] and only pay for wireless service, they might just hold onto their phones. I think people will hold onto their phones as long as they can after they are paid off. If this plays out and they hold on and don’t update, we’ll see flattening of sales volumes year after year, or even declines, all in the name of saving money.”
Realizing what’s happening in the U.S. and among other major economies, both Apple and Samsung have concentrated heavily on selling their new smartphones in China and other areas where smartphone sales are still strong.
The company is expected to make more job cuts this month, including from other locations in the U.S., further lowering the ranks of its 33,000-person work force. Since January, the company has cut its ranks by about 5,000, from 38,000.
The latest headquarters cuts were in IT and portfolio management and Sprint’s network, technology and product areas, according to a statement by spokesperson Roni Singleton. Some employees will work their last day on Nov. 7 and others will finish Nov. 14.
“Sprint is focused on competing aggressively in the marketplace,” Singleton said. “We want our customers to pay less for a better value on a new networks. As part of this plan, we have to more closely align our cost structure with that of our competitors.”
CEO Marcelo Claure signaled there would be job cuts in August shortly after taking on his new role. Claure also inaugurated a round of pricing reductions.
Even so, analysts expect the company to lose more subscribers and fall into fourth place among the nation’s top carriers, behind T-Mobile.
An earnings call is expected in late October, although the date hasn’t been scheduled, Singleton said.
Sprint’s more than 5,000 job cuts in 2014 put it behind Cisco, with 6,000 job cuts (8%) announced for the year and Microsoft, with 18,000 job cuts (14%) planned for the year.
Nosey Google has updated its search engine algorithms in an attempt to restrict piracy web sites appearing high in its search rankings.
The update will mean piracy sites are less likely to appear when people search for music, films and other copyrighted content.
The decision to roll out the search changes was announced in a refreshed version of a How Google Fights Piracy report, which was originally published in September 2013.
However, this year’s updated report features a couple of developments, including changes to ad formats and an improved DMCA demotion search signal.
The move is likely to be a result of criticism received from the entertainment industry, which has argued that illegal sites should be “demoted” in search results because they enable people to find sites to download media illegally.
The biggest change in the Google search update will be new ad formats in search results on queries related to music and movies that help people find legitimate sources of media.
For example, for the relatively small number of queries for movies that include terms like ‘download’, ‘free’, or ‘watch’, Google has instead begun listing legal services such as Spotify and Netflix in a box at the top of the search results.
“We’re also testing other ways of pointing people to legitimate sources of music and movies, including in the right-hand panel on the results page,” Google added.
“These results show in the US only, but we plan to continue investing in this area and to expand it internationally.”
An improved DMCA demotion signal in Google search is also being rolled out as part of the refresh, which down-ranks sites for which Google has received a large number of valid DMCA notices.
“We’ve now refined the signal in ways we expect to visibly affect the rankings of some of the most notorious sites. This update will roll out globally starting next week,” Google said, adding that it will also be removing more terms from autocomplete, based on DMCA removal notices.
The new measures might be welcomed by the entertainment industry, but are likely to encourage more people to use legal alternatives such as Spotify and Netflix, rather than buying more physical media.
Amazon, which had been in discussions with Simon & Schuster since July over pricing, confirmed the deal first reported by the Business Insider news blog that the two had reached an agreement.
Amazon had been locked in a months-long standoff with publisher Hachette Book Group, the fourth-largest U.S. book publisher owned by France’s Lagardere, over digital book pricing. That has led to numerous issues for authors.
Industry experts had expected other publishers eventually to be drawn into negotiations as well, as the Internet retailer tries to set new benchmarks for the e-book market.
Negotiations with Simon & Schuster took about three weeks and closed two months before Amazon’s contract expired, according to Business Insider.
Simon & Schuster made its original offer and an agreement was reached after a few changes by Amazon, the source told Business Insider.
Twitter Inc will allow users to play podcasts, music and other audio clips direct from their timelines, or message feeds, by using a new feature designed in partnership with Berlin-based audio-streaming service SoundCloud.
The online messaging service introduced what it dubbed “Audio Card,” through which users can listen to a variety of content whilst browsing their timelines.
For starters, Twitter has promised audio from SoundCloud’s partners, which include such diverse sources as NASA, the Washington Post, CNN, David Guetta, Coldplay and Warner Music.
But it’s trying to snag more content partners in future, Twitter said in a recent blog posting.
Twitter didn’t say how Audio Card might evolve, except to stress that it offers musicians a chance to post exclusive clips.
“Many more musical artists and creators will be able to share exclusive, in-the-moment audio to millions of listeners on Twitter,” the company added.
Twitter’s new feature comes after rivals from Apple Inc to Google Inc have jumped into the business of music-streaming, considered the fastest-growing segment of a music market dominated by iTunes.
Twitter had reportedly been in discussions to acquire audio-sharing website SoundCloud, which has been called the Youtube of music, as far back as June.
Although has not been publicly confirmed that Google’s latest Android 5.0 Lolipop will be coming to its Nvidia Shield tablet, Nvidia was pretty quiet about the Shield Portable handheld console, so we asked around. It appears that the update will indeed be coming to Shield Portable as well.
The first devices on the list to receive the Android 5.0 Lolipop update will be Google’s own Nexus devices, starting with the Nexus 4, Nexus 7 2012 and Nexus 10 as the oldest devices, followed by Google Play Edition devices and LTE-enabled products. Most smartphone and tablet manufacturers have also confirmed that the new Android 5.0 Lolipop will be coming to their recent devices.
One of the companies on the list is also Nvidia, which has announced that it “ultimate tablet for gamers” also known as the Nvidia Shield Tablet will be getting the Android 5.0 Lolipop update soon. The update for Shield Tablet does not come as a surprise considering that it is based on the speedy Tegra K1 32-bit chipset.
While it did not give out any details regarding Android 5.0 Lolipop update for the Shield Portable handheld console, we sent out a quick email to Nvidia and managed to confirm that the update will indeed be coming to the Shield Portable as well. Unfortunately, Nvidia did not give any precise date for this device either.
The firm claims that its IBM Internet of Things Foundation service “makes it possible for a developer to quickly and easily extend an internet-connected device such as a sensor or controller into the [IBM Bluemix] cloud”, and then “build an application [for] the device to collect the data and send real-time insights back to the developer’s business”.
IBM promotes its Bluemix cloud services as an open standards cloud platform for building, managing and running all types of applications for the web, mobile, big data and smart devices.
Big Blue says its Internet of Things Foundation service “delivers rapid access to, and provides valuable insights from, IoT device data coming from billions of internet-connected sensors and controllers”.
The firm cited IDC estimates that there are already nine billion IoT devices in the world, and that there will be as many as 28 billion IoT devices by 2020.
IBM foresees that by providing IoT devices connectivity in cloud services, “equipment and asset manufacturers can use IoT to provide remote service and monitoring to residential and commercial customers, oil and gas companies can remotely monitor and provide predictive maintenance to critical equipment, and logistics companies can track and monitor the condition of goods in transit”, as just some of the industrial, consumer services and financial applications of IoT-enabled systems.
“Think of the IoT Foundation as an extremely fast on-ramp to the cloud for the millions of intelligent IoT devices that are now being shipped, and the billions already internet connected,” said IBM Internet of Things VP John R. Thompson.
IBM said it plans to enlist partners for its IoT efforts, which it expects will include ARM, B&B Electronics, Elecsys, Intel, Multi-Tech Systems and Texas Instruments. Along with these partners, it plans to develop a set of certified instructions, or “recipes” for connecting IoT devices, sensors and gateways.
IBM Bluemix cloud services are already available for developers worldwide, and the IBM Internet of Things Foundation will be available from 21 October. You will need an IBM account to participate, of course.
Yahoo Inc is expected today to reveal cost-cutting efforts and give details of how it is evaluating possible acquisitions as it faces mounting pressure from an activist investor, the Wall Street Journal reported, citing a person who was briefed on the plan.
Yahoo is considering purchasing one or more large technology startups with some of the $5.8 billion it made from the initial public offering of Alibaba Group Holding Ltd, the newspaper said.
Representatives at Yahoo did not immediately respond to an email seeking comment outside regular U.S. business hours.
Last month, activist investor Starboard Value LP publicly pressured Yahoo to cut what it referred to as a “bloated” cost structure.
Starboard, the second activist investor to target Yahoo in the last three years, also said the company should quickly “monetize” its Asian assets, which exceed the enterprise value of its actual business.
Earlier this month, Yahoo said it is reducing the size of its operations in Bangalore, India, the Internet company’s largest engineering facility outside its California headquarters. It is also closing its office in Jordan.
Yahoo is “streamlining” its operations in foreign offices, which might involve a combination of closing offices, cutting jobs and moving workers to its Sunnyvale, California, headquarters, the Journal said.
The credit-card company showed a prototype of the card in London on Friday along with Zwipe, the Norwegian company that developed the fingerprint recognition technology.
The contactless payment card has an integrated fingerprint sensor and a secure data store for the cardholder’s biometric data, which is held only on the card and not in an external database, the companies said.
The card also has an EMV chip, used in European payment cards instead of a magnetic stripe to increase payment security, and a MasterCard application to allow contactless payments.
The prototype shown Friday is thicker than regular payment cards to accommodate a battery. Zwipe said it plans to eliminate the battery by harvesting energy from contactless payment terminals and is working on a new model for release in 2015 that will be as thin as standard cards.
Thanks to its fingerprint authentication, the Zwipe card has no limit on contactless payments, said a company spokesman. Other contactless cards can only be used for payments of around €20 or €25, and some must be placed in a reader and a PIN entered once the transaction reaches a certain threshold.
Norwegian bank Sparebanken DIN has already tested the Zwipe card, and plans to offer biometric authentication and contactless communication for all its cards, the bank has said.
MasterCard wants cardholders to be able to identify themselves without having to use passwords or PINs. Biometric authentication can help with that, but achieving simplicity of use in a secure way is a challenge, it said.
Amazon.com Inc is add more territory to its online grocery delivery program to Brooklyn’s well-heeled Park Slope neighborhood, giving the No. 1 U.S. online retailer a foothold in one of the wealthiest and densest markets in the United States.
The AmazonFresh program, which offers same-day or next-day delivery on more than 500,000 items including fresh and frozen groceries, will soon expand to other areas in Brooklyn.
The move is part of Amazon’s slow build-out of its “Fresh” program, targeting one of the largest retail sectors yet to be upended by online commerce. Amazon declined to say if it will expand to Manhattan or other parts of the New York metro area.
“Currently, we are offering AmazonFresh in Brooklyn and will continue being thoughtful and methodical in our expansion,” an Amazon spokeswoman said in an e-mail.
Groceries have proven to be one of the toughest sectors for technology companies to manage, and Amazon faces competition from established companies like FreshDirect as well as fast-growing startups like Instacart.
But a successful foray in Park Slope could help Amazon cement customer loyalty and boost sales, especially among wealthy and middle-class families, analysts have said.
The top 10 to 20 percent of wealthiest Americans spend between 3 and 4 times more on food than the average American family, according to Bill Bishop, chief architect at Brick Meets Click, a consulting firm focused on retail technology.
“They are the sweetest of shoppers so anybody who attracts that business is taking the cream of the market,” Bishop said.
Amazon could also use its Fresh program to experiment with its own delivery service, analysts have said.
The latest version of the cloud computing stack contains 342 new features, 3,219 bug fixes, almost 500,000 lines of modified documentation and a new Architecture Design Guide.
1,419 unique contributors including representatives from 133 companies made it all happen over six months.
Last month it was revealed that HP had overtaken Red Hat in terms of overall contributions to Juno, and is closing in on Red Hat’s overall lead.
However, Red Hat has shifted focus more towards the cloud market in recent strategy announcements, so that lead could widen again.
The new version adds storage policies, data processing provisioning for Hadoop and Spark and takes the initial steps towards being a platform for Network Function Virtualisation (NFV) in a future release, meaning that it would be capable of managing a number of functions currently fulfilled by expensive software.
Other new features include Nova Compute, a rescue mode improvement with the option to boot from alternative images via locally attached disks, update scheduling and internationalisation updates.
For networking, the Neutron module includes IPv6 and third-party driver testing, plug-ins, and migration support from Nova to Neutron.
The Keystone identity service allows users to share credentials for private and public OpenStack clouds.
The Heat engine, which manages orchestration, includes advanced rollback options in the event of failed deployment and the option for administrators to delegate creation of resources to non-admins.
The Horizon Dashboard now offers Hadoop deployment in a few clicks, enabling rapidly scalable data processing with custom parameters.
Finally, the Trove database allows users to manage relational database servcies in the OpenStack environment.
Of course, OpenStack waits for no-one. With this release safely out, work now begins on the next version, codenamed Kilo, which is due in April 2015.
U.S. Federal Communications Commissioner Jessica Rosenworcel, on Friday, stated that U.S. regulators will look “to infinity and beyond” to harness new technology that can help build a new generation of mobile wireless connections.
The FCC on Friday voted unanimously to open a so-called “notice of inquiry” into what it and the industry can do to turn a new swath of very high-frequency airwaves, previously deemed unusable for mobile networks, into mobile-friendly frequencies.
The FCC’s examination would serve as a regulatory backdrop for research into the next generation of wireless technology, sometimes referred to as 5G and which may allow wireless connections to carry a thousand times more traffic.
“Today we’re stepping in front of the power curve,” FCC Chairman Tom Wheeler said on Friday at the meeting.
In question are frequencies above 24 gigahertz (GHz), sometimes called millimeter waves, that have previously been deemed technically unweildy for mobile connections, though have the potential to carry large amounts of data and give the promise of lightning-fast speeds.
Millimeter waves work best over short distances and have required a direct line-of-sight connection to a receiver. They are now largely used for point-to-point microwave connections.
The FCC said it will study what technologies could help get around the technological and practical obstacles and what kind of regulatory regime could help a variety of technologies to flourish on those airwaves, including the potential for services other than mobile.
The U.S. wireless industry continues to work on deploying the 4G connections, though some equipment manufacturers, such as Samsung are already testing data transmission on the higher frequencies.
Gartner and IDC both recently dramatically lowered their tablet shipment and sales estimates for 2014 and coming years, citing primarily the longer-than-expected time customers keep their existing tablets. (That phenomenon is called the “refresh rate.”)
Gartner said it had originally expected 13% tablet sales growth for the year globally; it has now lowered that growth rate to 11%. IDC’s forecast change was even more dire: In June, it predicted shipment growth this year would be 12.1%, but in September it cut that number to 6.5%.
In the U.S., things are worse, because more than half of households have a tablet and may hold onto it for more than three years, well beyond analysts’ earlier expectations.
IDC said in its latest update that tablet growth in the U.S. this year will be just 1.5%, and will slow to 0.4% in 2015. After that, it expects negative growth through 2018. Adding in 2-in-1 devices, such as a Surface Pro with a keyboard, the situation in the U.S. improves, although overall growth for both tablets and 2-in-1′s will still only reach 3.8% in 2014, and just 0.4% by 2018, IDC said.
“Tablet penetration is high in the U.S. — over half of all households have at least one — which leads to slow growth…,” Mikako Kitagawa, an analyst at Gartner, said in an interview. “A smartphone is a must-have item, but a tablet is not. You can do the same things on a laptop as you do with a tablet, and these are all inter-related.”
Tablets are a “nice-to-have and not a must-have, because phones and PCs are enough to get by,” added Carolina Milanesi, chief of research at Kantar Worldpanel.
In a recent Kantar survey of 20,000 potential tablet buyers, only 13% said they definitely or probably would buy a tablet in the next year, while 54% said they would not, Milanesi said. Of those planning not to buy a tablet, 72% said they were happy with their current PC.
At IDC, analyst Tom Mainelli reported that the first half of 2014 saw tablet growth slow to 5.8% (from a growth rate of 88% in the first half of 2013). Mainelli said the meteoric pace of past years has slowed dramatically due to long device refresh cycles and pressure from sales of large phones, including the new iPhone 6 Plus. That phone has a 5.5-in. display, which is close to some smaller tablets with 7-in. displays.
A comprehensive security audit of its ads code was recently completed, but Facebook “would like to encourage additional scrutiny from whitehats to see what we may have missed,” wrote Collin Greene, a security engineer, in a blog post. “Whitehats” refers to ethical security researchers, as opposed to “blackhats” who take advantage of vulnerabilities.
According to bug bounty program guidelines, Facebook pays a minimum of $500 for a valid bug report. Until the end of the year, that has been increased to $1,000.
Greene wrote that the majority of reports it receives concern more common parts of Facebook’s code, but the company would like to encourage interest in ads “to better protect businesses.”
Facebook’s ad tools include the Ads Manager, the ads API (application programming interface) and Analytics, which is also called Insights, Greene wrote. The company also wants close scrutiny of its back-end billing code.
“There is a lot of backend code to correctly target, deliver, bill and measure ads,” Greene wrote. “This code isn’t directly reachable via the website, but of the small number of issues that have been found in these areas, they are relatively high impact.”
Greene wrote that Facebook typically sees bugs such as incorrect permission checks, insufficient rate-limiting, edge-case CSRF (cross-site request forgery) issues and problems with Flash in its ads code.
Juniper Research now estimates smartwatch shipments will hit 100 million by 2019. The firm expects several high-profile products to launch over the next year or so, helping boost mainstream awareness.
However, the figures are anything but encouraging.
The report, titled ‘Smart Watches: Market Dynamics, Vendor Strategies & Scenario Forecasts 2014-2019′, expects growth will decelerate from 2016 onwards. The first batch will ride the hype, but moving forward it won’t do much for mainstream adoption.
However, the forecast also examines the possibility of sustaining 2014-2015 growth in the long term.
If consumers discover a ‘key use case’ or cases for smartwatches, backed by more product releases on the back of higher demand, higher growth could be sustained. In plain English, if people actually find a use for smartwatches, they will see more growth.
Unfortunately the case is hard to make at this point. Smartwatches face a number of hardware limitations and software support is still limited, which means they are not very useful at the moment. Juniper expects more vendors to integrate GPS, NFC and other technologies, but the downside is that smartwatches are not expected to become very cheap. The firm estimates premium branding and high functionality to keep prices at $200+ until the end of the decade.
Europeans not too keen
One possible application that could generate more demand comes in the form of mobile payments. Apple Pay is coming to the Apple Watch, but the service will be limited to the US for quite a while and Apple won’t have an easy time launching it in other markets, where it enjoys a much lower market share.
The problem with mobile digital wallets is that they have not taken off yet. What’s more, new research indicates that Europeans are not sold on the idea of smartwatch wallets.
The survey, carried out by German market research firm GfK, found that just 20 percent of Germans and 27 percent of Britons are interested in contactless payments built into a watch. However, Chinese and American consumers are more open to the idea, with 40 and 54 percent saying they are interested.
Most consumers said they are interested in health applications and many said they would store identification data on their smartwatches.