August 2012

Half of All Mobile Phones Will Be Smartphones by 2013, Two Years Earlier Than Forecast

A new report from IHS says that smartphones will account for half the market in 2013, two years earlier than the firm had earlier predicted.

The research firm breaks phones into three categories: Smartphones, feature phones and basic, low-cost phones. Smartphones will already be more plentiful than feature phones this year, IHS says, though they won’t quite pass the 50 percent threshold. That’s up from just 35 percent of the worldwide market last year. By 2016, smartphones will account for more than two-thirds of mobile phone shipments, IHS predicts. The most basic phones will account for just 4 percent of the market by then, with feature phones representing 28 percent of shipments.

Convention coverage is a no-win situation for broadcasters

There was a time when the broadcast networks provided nonstop prime-time coverage of the conventions. Now, an hour a night is about all the networks can stomach. There was also a time when the conventions provided a lot of excitement and real news. Now the conventions are little more than infomercials for their own parties and vicious attacks on the rival party. There is a lot of preaching to the converted and few surprises.

Ironically, it was television coverage from the broadcast networks that played a key role in turning the conventions into snooze fests. Battles on the convention floor, real debates over platforms and the choice of a running mate were fine when there were only print and radio reporters around. Video changed everything. Both parties soon recognized it wasn't in their interest to let anyone see how the sausage got made. For the networks, that lack of action meant fewer viewers, which made the millions of dollars needed to cover conventions harder to justify. It is not as if the fact that the broadcast networks are mailing in their coverage means that there is nowhere else to turn for viewers. Cable channels -- CNN, Fox News, MSNBC, C-SPAN, Bloomberg and even little Current TV -- will be providing heavy-duty coverage. There is also no shortage of convention coverage on the Web for all those cord-cutters out there. Broadcasters could use their digital channels to carry more convention coverage so those few people who don't have a pay-TV service are not shut out. That would be a money-loser, but it would also remove some of the criticism about their blase attitude toward the conventions.

Pity Google? Patent case loss to Apple could spell relief in antitrust probe, analyst says

Pity Google? One upside for the Android software maker in Apple’s patent victory over partner Samsung is how that decision could spill over to a federal antitrust investigation into Google, according to one analyst.

Google is being investigated by the Federal Trade Commission over broad antitrust claims, including the company’s potential to lock down its search and other applications on smartphones that run its Android operating system. The firm is negotiating with European regulators on ways to change its practices in search to make the market more competitive. Now that a jury determined Apple indeed has exclusive rights to some key technologies on the smartphone, the FTC may rethink its position on Google’s dominance in mobile search — a part of the agency’s investigation.

Google girds for battle in wake of Apple's legal victory

Google bought ailing mobile device maker Motorola Mobility this year to stockpile patents for the war that was heating up with rival Apple. But those patents may not be much help in defending challenges to its Android mobile operating system in the wake of Apple's sweeping courtroom victory last week over Samsung.

Experts said that Google probably would unsheathe the 17,000 patents it picked up in the $12.5-billion acquisition of Motorola Mobility but that Google still would be outmatched. "In theory, the Motorola patents do matter because they give Google some leverage against Apple," UCLA law professor Douglas Lichtman said. But even so, he said, it's "not an even fight." "Motorola was not Apple's complete peer before its acquisition, and so owning Motorola does not make Google a complete peer today," Lichtman said.

Blame a dysfunctional patent system for Apple vs. Samsung verdict

[Commentary] Whether you think that Apple is already too big for its britches or that Samsung deserved to get slammed for $1 billion by a Silicon Valley jury last week for infringing on the iPhone design, there's no doubt where the blame for this corporate firefight lies. The guilty party is the U.S. Patent Office. Actually, that's a bit unfair. The Patent and Trademark Office, as it's formally known, is understaffed and underfunded and not especially up to the task of judging increasingly complex patent applications. But the real problem is in the law, which utterly has failed to keep up with realities of technology and the marketplace.

"Apple v. Samsung is just a proxy for everything else that's wrong with the patent system right now," says Julie Samuels, an attorney with the Electronic Frontier Foundation, which is campaigning to reform the system. The system's biggest problem is with software patents of the sort that underlie Apple's lawsuit against Samsung. Apple charged that Samsung infringed its patents on such software-based iPhone features as its tap-to-zoom function, while copying its devices' appearances to "confuse" shoppers.

3 reasons juries have no place in the patent system

The Apple-Samsung decision and award raises questions about the patent system and innovation — but also about why a jury was allowed to decide it in the first place. Judge Richard Posner and others argue that it’s time to end jury trials in patent cases. Here are three reasons Apple v Samsung should not have gone before a jury:

  • Jurors can be influenced by brand loyalty
  • Juries are too easily swayed by “he’s a copycat”
  • Jury trials over patents are a waste of money

Could Nokia be the surprise winner of Samsung v Apple?

Investors are pushing Nokia’s stock price up as they look for positive news out of the $1bn patent award that Apple has wrung from Samsung. Are they hoping for the impossible? Or is this a surprise inflexion point for the struggling Finnish handset maker?

ESPN shells out $5.6 billion to keep Major League Baseball

ESPN is doubling down on baseball. The Walt Disney-owned sports cable empire is poised to announce a new eight-year, $5.6-billion deal with Major League Baseball that is expected to more than double what it currently pays for games, people with knowledge of the detail said.

On an annual basis, ESPN will pay $700 million for baseball, compared with $350 million under its current deal, which expires at the end of next season. That agreement includes games on ESPN, radio telecasts, international rights and some digital rights. ESPN is also getting back into postseason baseball for the first time in several years as the pact gives it the rights to a wild-card game. ESPN, which carries baseball on Sunday, Monday and Wednesday, did not want to lose baseball to a rival such as the Comcast-owned NBC Sports Network, which is looking to add more big-ticket programming to boost ratings.

Apple, Google gear up for mobile-wallet war

Apple and Google appear to be headed toward a new fight, this one involving mobile wallets.

Earlier this week, pictures surfaced of a chip located toward the top of what appear to be parts for the next iPhone. Many believe this chip is for Near-Field Communication technology — or NFC — which allows phones to connect in close range using radio communications. An example of what NFC can be used for is mobile payments, which Google already does with its Google Wallet service. But the pictures of the purported iPhone chip has some people believing that Apple is preparing its own mobile payments system to compete against Google Wallet.

Is the FCC serious about broadband deployment?

[Commentary] Rarely has an agency exhibited a greater degree of schizophrenia than the Federal Communications Commission did last week, when it issued its Eighth Broadband Progress Report (Broadband Report) and its Special Access Report and Order.

One decries the lack of broadband access for the 6 percent of the US population that lives in the most sparsely populated areas. The other encourages America’s largest enterprises to perpetuate their use of non-broadband networks throughout the US. On the one hand, in its Broadband Report, the FCC refuses to tell Congress that our country’s broadband deployment is reasonable and timely, despite access by 94 percent of Americans to high-speed broadband, defined as download at 4 megabit per second (Mbps) and upload at 1 Mbps (4/1) over wired networks. On the other hand, in its Special Access Order, the FCC suspends its rules governing pricing flexibility in the special-access market. This is a market that the FCC sizes at $12 billion, providing mostly 1.5 Mbps connections, mostly to large enterprises and government but also to some small businesses. How can America expect to deploy broadband at gigabit speeds throughout its vast expanse, if its largest businesses insist on using 1.5 megabit lines as the building blocks for their networks? The FCC is making heroic efforts to encourage the least educated, poorest, oldest American citizens to adopt broadband. Does it want to encourage our largest corporations to do so much less?

[Kovacs is a Visiting Senior Policy Scholar at Georgetown University’s Center for Business and Public Policy.]