Wedbush Securities analyst Michael Pachter spoke at the Game Monetization USA Summit in San Francisco, and once again made some bold predictions about the future of the game industry. He pulled no punches as he evaluated the current state of affairs in the business, and he had some hard advice for a number of companies.
Pachter noted that more people are playing games on more devices than ever before, but he doesn’t think the console market will be growing. “I don’t think you’re ever going to see 500 million consoles out there,” Pachter said. For lifetime sales, Pachter expects the Wii U will ultimately sell 30 million “or fewer” units, the PS4 will sell 100 to 120 million units, and the Xbox One will sell 90 to 110 million units.
“The reason Sony beats Microsoft is solely the price,” Pachter noted. “Microsoft loses the next generation unless they cut price. If Microsoft drops its price to $399, I expect the sales to be equal to the PS4.”
The lifetime sales Pachter predicts compare to current sales of the PS3 and the Xbox 360 at about 80 million units apiece, but it’s far below some estimates of hundreds of millions of next-gen consoles. “I don’t know where they get those numbers,” Pachter said. He feels that at several hundred dollars, with games costing $60 or more, consoles are just too pricey to ever sell hundreds of millions of units.
The Wii U’s performance so far Pachter characterized as “underwhelming,” but noted it’s possible “but unlikely” that exciting new titles will reinvigorate growth. He believes that Nintendo is missing a huge opportunity to bring new gamers into their brands: Nintendo should put old GameBoy Advance content on phones and tablets for free, and charge $3 to $5 for more recent titles from the DS. Pachter feels this would generate enormous revenue for Nintendo and bring millions of new fans into their brands, and give them a strong way to sell newer titles on the 3DS and Wii U that use those brands.
“I don’t know why Iwata is still employed,” Pachter said, given that he refuses to take advantage of this opportunity while the handheld market continues to shrink and the Wii U has failed so far to catch on in a big way.
Pachter is more positive on the PlayStation 4 – “Sony thrives, Nintendo doesn’t” – saying it’s impressive as a game playing device. “The graphics are phenomenal, and the huge RAM makes future innovation likely,” Pachter pointed out. He noted that the multimedia features remain unclear, but the CPU power of the PS4 allows the potential for huge improvement in the future. As for the Xbox One, Pachter noted it’s impressive as a multimedia device, and the added features of Kinect and Skype give it additional value. “We’re sticking with our prediction of a built-in TV tuner” for the Xbox One, Pachter said, which would simplify the ability of the Xbox One to control your television viewing.
“The next generation of consoles is probably the last,” Pachter said. “We expect frequent model updates instead of new consoles.” Moreover, there’s going to be renewed interest in the PC, he predicted. “I think the PC is going to make a comeback, the PC will be the hub of all this stuff,” he stated. He feels Smart TVs are a dumb idea, noting that you don’t have a smart monitor connected to your computer. He envisions there will be a number of screens around the home, perhaps controlled by a tablet, being driven by a supercomputer in your pocket that we call a smartphone.
The Wii U gets a new system update from Nintendo. While details are a bit vague on what all the new system updates actually does, Nintendo says it “improves overall system stability” and also includes minor adjustments “to enhance the user experience”.
The update comes ahead of a planned Nintendo update for the 3DS that is scheduled to arrive next month. The 3DS update will bring the Miiverse to the 3DS as well as adds the ability to combine eShop balances on both the 3DS and Wii U systems. In addition it will add Network IDs to the 3DS to access the eShop. Apparently 3DS owners will not have to take advantage of using a NNID to combine their eShop purchases and will still be allowed to download software from the eShop without a NNID.
Rumors suggest that another system update for the Wii U is just around the corner, but will likely not arrive till early next year, unless Nintendo has a reason to release it sooner. On the software front, the Wii U is still struggling, but the recent sales boost has helped, but Nintendo needs strong sales for the Wii U this holiday season in order to help get published and developers re-engaged in developing for the console. Whispers suggest that Nintendo expects supplies of the Wii U to be plentiful this holiday season and does not foresee shortages like what has plagued the Wii consoles of the past. The problem is however that the lack of software will likely keep many buyers away.
Chip Designer Mediatek has unveiled the first octa-core system on chip (SoC) for mobile devices.
The MT6592 is an ARM based processor capable of running all eight cores at up to 2Ghz and offers a scheduling algorithm to ensure that all eight cores are being managed effectively to control power draw and temperature.
The chip uses its Heterogeneous Computing (HC) architecture to act as foreman, distributing tasks to the best processor for the job, covering CPU, GPU, DSP, and multiple connectivity, multimedia, camera and display engines, including navigation, and sensor cores.
The chip is equipped with Mediatek Clearmotion for automatic upscaling of standard 24/30 frames per second video to high-quality 60fps video. Also onboard is support for 802.11n WiFi, Miracast, Bluetooth, GPS and FM tuner functions. It is also capable of running Ultra HD H.264 and new video standards including H.265 and VP9.
Mediatek Smartphone Business Unit general manager Jeffrey Ju enthused, “The MT6592 delivers longer battery life, low-latency response times and the best possible mobile multimedia experience. Being the first to market with this advanced eight-core SOC is testament to the industry-leading position of Mediatek.”
The prospect of octa-core mobile devices could have huge ramifications for the buying public. Although most everyday web surfers will probably not notice the difference, gamers and multimedia users are likely to find that the next generation of gadgets that have octa-core processors offer an experience on a par with their desktop cousins.
The MT6592 is expected to appear in Android 4.4 Kitkat devices in early 2014, though as yet no manufacturers have announced that they will be using it in their products.
IBM is suing microblogging website Twitter over software patents.
Software patents, for the uninitiated, keep lawyers in sportscars and snakeskin shoes. It seems that there isn’t a firm in the information technology industry that isn’t suing or being sued by some other company about some element of intellectual property, and IBM is suing Twitter in the run up to its target’s initial public offering (IPO).
IBM is asserting its rights over US Patent No. 6,957,224, Efficient retrieval of uniform resource locators; US Patent No. 7,072,849, Method for presenting advertising in an interactive service; and US Patent No. 7,099,862, Programmatic discovery of common contacts.
In its most recent filing to the SEC Twitter revealed the IBM lawsuit and its thoughts about it. This is just one of several patent cases that the firm said it is facing, it suggested that it might decide that settling is the smartest move.
“Some of our competitors have substantially greater resources than we do and are able to sustain the costs of complex intellectual property litigation to a greater degree and for longer periods of time than we could,” it said.
“The outcome of any litigation is inherently uncertain, and there can be no assurances that favorable final outcomes will be obtained in all cases. In addition, plaintiffs may seek, and we may become subject to, preliminary or provisional rulings in the course of any such litigation, including potential preliminary injunctions requiring us to cease some or all of our operations. We may decide to settle such lawsuits and disputes on terms that are unfavorable to us.”
Twitter’s response to IBM was that it might be able to challenge IBM’s assertions, but then again, maybe not. It said, “Based upon our preliminary review of these patents, we believe we have meritorious defenses to IBM’s allegations, although there can be no assurance that we will be successful in defending against these allegations or reaching a business resolution that is satisfactory to us.”
We have asked both IBM and Twitter for comment.
Huawei has pushed LG into fourth place in the global smartphone market, bagging the number three spot for the first time.
That’s according to third quarter figures from research firm Strategy Analytics, which saw Huawei leapfrog LG into third place between July and October this year.
According to the numbers, Huawei’s smartphone shipments grew 67 percent annually to 12.7 million units in the third quarter, which saw the Chinese telecommunications equipment firm capturing five percent of the global smartphone market. Strategy Analytics credits this growth to devices including the Huawei Ascend P6 and strong growth in its home country of China, with its position described as “less robust” in the US and Europe.
LG, which slipped into fourth place, grew 71 percent annually, but sold fewer phones than rival Huawei, with 12 million units shipped in the third quarter.
You probably won’t be surprised to hear that Samsung placed highest on the list, retaining its spot as the number one global smartphone maker. The firm saw 55 percent growth year on year, and shipped 88.4 million smartphones during the third quarter, pushing Samsung to a record profit of $9.56bn.
This also saw Samsung take a 35 percent share of the global smartphone market, and according to Strategy Analytics this was thanks to the popularity of the Samsung Galaxy Note 3 smartphone.
It seems Apple has got a bit of catching up to do, with the research firm noting that Samsung sold two smartphones to every one iPhone sold. Still, Apple sold a record 33.8 million iPhones during the third quarter, and Strategy Analytics expects this number to grow thanks to the recently launched iPhone 5S.
The research firm said, “Apple’s global smartphone marketshare has dipped noticeably from 16 percent to 13 percent during the past year. Nonetheless, we expect Apple to rebound sharply and regain share in the upcoming fourth quarter of 2013 due to high demand for its new iPhone 5s model.”
PCs are becoming increasingly integrated, with SoC parts, quasi-tablet form factors, AIOs and a bunch of other trends conceived to reduce the fat. While PCs are becoming more like smartphones, Motorola thinks we need smartphones that will allow us to mix and replace components.
Project Ara is the name of project, led by Motorola’s Advanced Technology and Projects Group, effectively Motrola’s equivalent of Lockheed’s Skunk Works. Motorola says it wants to do for hardware what Android did for software, but instead of creating a software ecosystem, it hopes to foster development of a third-party hardware ecosystem.
We must admit the first designs look rather impressive, although we’re not sure we’ll see Ara phones anytime soon. It also raises questions about cost and software compatibility – building a completely modular phone sounds rather expensive.
However, it also sounds insanely cool. Many users are still lamenting the lack of user-replaceable batteries and microSD slots on new smartphones, yet Ara could allow users to change practically everything. Motorola says users could swap out the screen, install an extra battery, keyboard, camera or just about anything else you can imagine.
Ara consists of an endoskeleton, which holds everything in place, and a range of replaceable modules. Here’s the kicker – although a completely modular phone could be pricey, it could also have a much longer product cycle, as it could easily be upgraded or repaired. Instead of buying a new phone, users could just upgrade their SoC, camera, or any other component – they could also reuse older modules with a new endoskeleton.
Best of all, it looks rather fun. It reminds us of the good old days, when every PC had a discrete sound card, modem, LAN card, but I guess we’re just old, nostalgic hacks.
However, turning the concept into reality won’t be easy and it will be pricey, although the phrase “shut up and take my money” comes to mind.
MediaTek raised quite a few eyebrows earlier this year when it announced it would build the world’s first proper ARM octa-core, not a big.LITTLE design. The MT6592 has now popped up on a Chinese site, with the first Antutu results.
It scored 25,496, which places it behind the 1.7GHz Snapdragon in the HTC One, but it’s still a lot faster than the Nexus 4’s Qualcomm APQ8064, although throttling may have something to do with that. The score seems too high, but not long after the results emerged, a number of mobile sites started talking about disappointing results, claiming that MediaTek’s octa-core was somehow supposed to end up on a par with Samsung’s latest Exynos 5 big.LITTLE chip and the Qualcomm 800.
This of course is utter rubbish and FUD of the highest order.
The 28nm MT6592 is indeed an octa-core, but it has eight A7 cores, not a combo of A15 and A7 cores. The A7 is about one fifth of the die area of an A15 and according to ARM it consumes one quarter to one fifth of the power, making such comparisons asinine. In other words, MediaTek’s octa-core should end up a lot smaller and cheaper than a quad A15, maybe even a quad A12. That is why we find the 25,496 result hard to believe – it should be less, not more. For example, the Tegra 4 on Shield hits about 36,000, yet it’s a much bigger chip, on a device with more RAM.
The benchmarked chip ran at 1.7GHz, but MediaTek said the MT6592 should have no trouble hitting 2GHz, which could make it faster than a Snapdragon 600. What’s more, the tested device featured 1GB of RAM, 720p display and a Mali-450 GPU, so it is clearly not high-end.
However, the big problem for MediaTek’s curious new SoC is the sheer number of cores. Most apps simply can’t put them to good use and unless MediaTek has a clever trick up its sleeve, the chip might not be nearly as fast in real world applications. It does look promising in benchmarks, though.
The move will benefit Zuckerberg’s interests at two levels. With Facebook keenly emphasising its mobile credentials, the Onavo service could persuade doubters that it’s time to give the service a go.
Meanwhile his Internet.org initiative plans to bring internet connectivity to the parts that other means just can’t reach. Compression technology might make Facebook a viable option in parts of the developing world where data is an expensive luxury, while for the rest of us the prospect of lower roaming charges might be enticing.
As well as being a new subsidiary of Facebook, Onavo will become a satellite office for Facebook in Tel Aviv, the first time it has had a direct presence in Israel. So far there’s no information on how much money has changed hands, but figures of between $100m and $200m have been mentioned.
In a blog post, Onavo said, “We’re excited to join their team, and hope to play a critical role in reaching one of Internet.org’s most significant goals – using data more efficiently, so that more people around the world can connect and share.
“When the transaction closes, we plan to continue running the Onavo mobile utility apps as a standalone brand. As always, we remain committed to the privacy of people who use our application and that commitment will not change.”
However, we might speculate that the technology involved could also be integrated into mobile Facebook apps to make them more data efficient, luring more people to share their lives as they live them.
On Wednesday the financial research company PrivCo released a report that, by using deduction, came to the conclusion that Twitter, at one point, was shooting for an IPO date of Nov. 15.
PrivCo’s analyst was based on an earlier version of Twitter’s public S-1 filing with the Securities and Exchange Commission, recently made public. In it, the social network said that the deadline for employees to sell restricted stock to cover tax obligations was Feb. 15, 2014. Because this lock-up period is typically 90 days after an IPO, that means Twitter was planning to go public on Nov. 15, PrivCo said.
By giving the Feb. 15 lock-up date in that previous document, “Twitter’s IPO advisors slipped up,” PrivCo said.
PrivCo’s analysis was based on an earlier draft of Twitter’s IPO filing, so the company may very well have adjusted its timeline for going public since then. The social network could not be immediately reached to comment on PrivCo’s report.
Twitter’s documents for its highly anticipated IPO became public last week. In them, the company said it would be listing on the Nasdaq Global Select Market or the New York Stock Exchange under the symbol “TWTR,” but it did not say when it would be making its initial public offering.
PrivCo’s analysis does jive with some other reports saying that Twitter is shooting to begin trading before Thanksgiving.
Twitter’s initial filing was submitted confidentially to the SEC under the JOBS (Jumpstart Our Business Startups) Act so it could prepare its paperwork out of the public eye. The company said via tweet on Sept. 12 that it had filed plans for an IPO, but the actual paperwork was likely submitted much earlier than that.
BlackBerry Ltd, on the block as its smartphone business struggles, is engaged in discussions with Cisco Systems, Google Inc and SAP about selling them all or parts of itself, several sources close to the matter said.
Such a deal would be an alternative to the preliminary agreement reached weeks ago with a group, led by BlackBerry’s biggest shareholder, Fairfax Financial Holdings, to take the company private for about $4.7 billion, a bid which has faced some skepticism because of financing questions.
The company, based in Waterloo, Ontario, has requested preliminary expressions of interest from potential strategic buyers, which also include Intel Corp and Asian companies LG and Samsung, by early next week.
It is unclear which parties will bid, if any. But the potential technology buyers have been especially interested in BlackBerry’s secure server network and patent portfolio, although doubts about the assets’ value remain an issue, the sources said.
Google, Intel, Cisco, LG and SAP declined to comment. Samsung was not immediately available for comment.
Possible bidders are proceeding with caution given the uncertainty around BlackBerry, which last month reported a quarterly loss of nearly $1 billion after taking a writedown on unsold Z10 phones.
The value of BlackBerry’s patent portfolio and licensing agreements is likely to halve in the next 18 months, a company filing from this week shows, potentially limiting its attractiveness.
According to analysts, BlackBerry’s assets include a shrinking yet well-regarded services business that powers its security-focused messaging system, worth $3 billion to $4.5 billion; a collection of patents that could be worth $2 billion to $3 billion; and $3.1 billion in cash and investments.
Adding to the company’s woes, it’s likely to burn through almost $2 billion of its cash pile in the next year and a half, Bernstein analyst Pierre Ferragu wrote on Thursday after studying the filing.
Private equity firms that have showed interest in BlackBerry – which also include Cerberus Capital Management – have asked the company and its advisers to provide additional financial details about its various business segments, two of the sources said. That process could take another few weeks, as BlackBerry focuses on taking bids from industry peers, the sources said.
In August, the company said it was weighing its options, which could include an outright sale, after Reuters first reported BlackBerry’s board was warming up to the possibility of going private.
At that time, it formed a five-member special committee chaired by board director Timothy Dattels. Other members include Chairman Barbara Stymiest, Chief Executive Thorsten Heins, Richard Lynch and Bert Nordberg.
A spokesman for BlackBerry said in an emailed statement to Reuters: “The special committee, with the assistance of BlackBerry’s independent financial and legal advisors, is conducting a robust and thorough review of strategic alternatives.” He declined to provide further comment.
AT&T Inc plans to began increasing speeds for its Internet service in Austin, Texas, in December, to defend itself against a planned ultra high-speed Internet and television service to be launched by Google Inc in the same city next year.
Texas’ capital city, with a population of 840,000, has a reputation as a high-tech industry hub.
After Google said in April that it would bring a service of 1 gigabit-per-second to Austin users,AT&T followed with a promise to match the offer if it obtained the same regulatory terms granted to Google by local authorities.
AT&T said on Tuesday that it would start by offering a 300 megabits-per-second service in December, and that by mid-2014 the speed would increase to up to 1 gigabit per second. It said this would allow users to download an entire high-definition movie in less than 2 minutes.
The AT&T service promised for December is almost seven times faster than AT&T’s fastest existing home broadband offering.
Google had initially billed its first “Google Fiber” broadband offer, launched in Kansas City, Missouri, last year, as a test project to spur development of new Web services and technology.
But it has since suggested that high-speed Internet could be a viable business for the company, causing traditional broadband rivals such as AT&T to prepare a response.
AT&T’s chief executive, Randall Stephenson, told investors at a conference on September 24 that AT&T was working on the Austin project and that he expected the company to do “multiple markets like this over the next few years.”
AT&T said it will reach “tens of thousands of customer locations” in Austin and the surrounding areas this year with its new speeds and will expand to more neighborhoods in 2014.
Google’s Fiber service, which the company says provides Internet speeds 100 times faster than today’s average broadband service, will be available in Austin by mid-2014. Google began offering Fiber in Kansas City in late 2012 and will make the service available in Provo, Utah, by the end of this year.
The layoffs are part of rolling job cuts that have been ongoing for several weeks, the people told the paper.
“I can confirm a small number of employees were laid off today,” a company spokesman told the newspaper, without providing additional details.
BlackBerry, which has bled market share to rivals including Apple’s iPhone and phones using Google’s Android technology, said last month it was weighing its options, which could include an outright sale.
News of the layoffs was first reported by Canadian technology blog Cantech Letter.
BlackBerry could not immediately be reached for comment outside of regular U.S.business hours.
MoPub offers a hosted service that app publishers use to manage inventory from multiple sources — direct ads, house ads, ad networks and real-time bidding — all through a single product, Twitter said in a blog post Monday. Terms of the deal were not disclosed.
MoPub’s clients include WordPress, Songza, OpenTable, Flixster and Scopely, according to MoPub’s own website.
Twitter said the acquisition will help it address two big trends: consumers’ shift to mobile and industry’s shift to programmatic buying.
With a possible IPO looming, Twitter is under pressure to make more money at a time when users are migrating away from the desktop and spending more time on smartphones and tablets.
It cited an opportunity to “extend many types of native advertising across the mobile ecosystem through the MoPub exchange.”
The technology will also allow Twitter to build real-time bidding into its ad platform, “so our advertisers can more easily automate and scale their buys,” Kevin Weil, VP of product for revenue at Twitter, said in the post.
Google operates a similar ad exchange with DoubleClick, which it acquired in 2007.
Gartner analyst Brian Blau said MoPub’s technology could help Twitter serve ads to more consumers outside of Twitter.com and the company’s own mobile app. It will also help Twitter compete against ad networks like DoubleClick, Millennial and Flurry, he said.
MoPub serves billions of mobile ads worldwide every month, MoPub CEO Jim Payne said in the company’s own blog post.
“Twitter will invest in our core business,” he said, and MoPub will continue to build tools publishers need to run their mobile advertising business.
Bethesda’s Pete Hines had some choice words regarding Nintendo’s third-party strategy, suggesting that the time for getting better software support for the Wii U may have already passed.
In an interview with Game Trailers’ Bonus Round, Bethesda’s vice president of PR and marketing underlined the company’s commitment to making its games available on every platform – as long as those platforms don’t require compromise on the original vision.
As far as Bethesda’s games are concerned, that has led to their absence on Nintendo hardware despite their huge popularity. And Hines intimated that the situation is representative of Nintendo’s approach to third-party developers as a whole.
“The time for convincing publishers and developers to support Wii U has long past. The box is out,” Hine said, while sitting on a panel that also included Borderlands 2 lead writer Anthony Burch.
Hines pointed to Sony and Microsoft’s diligent and long-running efforts to communicate with third parties during the hardware design process as a better strategy for most developers.
“It’s not that every time we met with them we got all the answers we wanted, but they involved us very early on, and talking to folks like Bethesda and Gearbox, they say ‘here’s what we’re doing, here’s what we’re planning, here’s how we think it’s going to work’ to hear what we thought – from our tech guys and from an experience standpoint.
“You have to spend an unbelievable amount of time upfront doing that. If you’re just going, ‘we’re going to make a box and this is how it works and you should make games for it.’ Well, no. No is my answer. I’m going to focus on other ones that better support what it is we’re trying to do.”
This adds colour to comments Hines made in an earlier interview, where he stated that the Wii U was, “not on [Bethesda's] radar.” Nintendo is now attempting to address the Wii U’s less than admirable position by cutting $50 off its price.
Three HTC Corp design executives were arrested on suspicion of illegally sharing trade secrets, sending the Taiwanese smartphone maker’s shares tumbling as its troubles deepened amid a wave of senior staff departures and disappointing sales.
Taipei prosecutors confirmed that HTC vice president of product design Thomas Chien, research and development director Wu Chien-Hung and senior manager of design and innovation Justin Huang were arrested on Friday.
Chien and Chien-Hung remain in custody, while Huang was released on bail, prosecutors office spokesman Mou Hsin Huang said.
The executives were also accused of making false commission fee claims totaling around T$10 million ($334,200). No further details about the allegations were immediately available.
The arrests came in response to a complaint filed by HTC last month accusing the executives of leaking trade secrets.
HTC declined to comment except to say the investigation had no impact on its operations. Chien and Chien-Hung could not be reached and Huang was not immediately available to comment.
Media reports citing the police said the executives were planning to use stolen new interface technology to set up a new mobile design company aiming at Chinese vendors.
Rocked by internal feuding and executive exits, and positioned at the high end of a smartphone market that is close to saturation, HTC has seen its market share slump to below 5 percent from around a quarter five years ago.