By Lorien Crow | Sat Jan 28, 2012 1:07 pm |
Apple retained its dominance over the U.S. smartphone market, boasting strong fourth quarter profits, while Google upset government regulators, consumers and social networking sites with big policy changes.
News Under the Sun is a weekly column rounding up all the events in the mobile industry. Want the news but don't want it every day? Subscribe to our weekly Facebook or Twitter page.
Apple Stays Strong, Continues Legal Battles with SamsungApple profits surged last quarter with the release of the iPhone 4S and continued demand for the iPad 2, and the company's momentum shows no sign of slowing. However, the competition is ramping up, and Apple will have to stay one step ahead to maintain dominance. Apple and five of its publishing partners face increased scrutiny over their pricing system for e-books, which lawyers claim resulted in elevated prices for consumers. The U.S. Justice Department and the European Union Commission are also investigating the matter on suspicion the agency pricing model violates antitrust laws. A new book title shares highly guarded secrets about Apple's design, development and marketing strategies. "Inside Apple: How America's Most Admired-and Secretive-Company Really Works," by Adam Lashinsky, portrays a company devoted to every last detail and the loyal consumers that flock to their products because of it. In legal news, a Dutch court dismissed Apple's request for a ban on the Samsung Galaxy Tab. Apple claims the tablet infringes on its patented designs, but the high court ruled Samsung's tablet differs significantly enough from the iPad that the two can share the market. Apple is spending hundreds of millions of dollars on patent lawsuits throughout the globe, many against Samsung and HTC. Increasingly, courts are siding with the opposition, calling Cupertino's aggressive legal tactics into question. Meanwhile, Apple CEO Tim Cook defended the company against allegations of poor working conditions in its manufacturing plants. The New York Times called conditions "unsafe," but Cook disagreed, saying such allegations are "patently false and offensive to us."
Google's New Privacy Policy Draws Scrutiny, ConcernApple isn't the only company waging patent battles, however. Motorola filed a patent infringement suit against Apple, meaning Google, which is in the process of acquiring Motorola, will directly engage in a massive legal battle with the iPhone maker. Google announced Tuesday it plans to roll out a new privacy policy March 1, combining information it collects about each user of its sites and services into a single profile. Once users agree to one of Google's service policies, their permissions are saved for other Google-based web features. Google says the policy change will make things simpler for consumers, but the revamped agreement sparked privacy concerns from lawmakers who say users should be able to opt out of data collection. Google has until February 16 to respond, but said on its blog it is not collecting any more data than before. The Mountain View, Calif.-based company also added a Public Alerts feature to Google Maps. The service notifies users in the event of a natural disaster or other emergency, and directs them to local hospitals and shelters. The service could prove vital to travelers unfamiliar with emergency services in the areas they're visiting.
Motorola Preps for Google MergerMeanwhile, Motorola suffered heavy profit losses due to consumer uncertainty and increased legal costs over its proposed merger with Google. The partnership, expected to be completed in early 2012, will be profitable for both companies, however, and Motorola is likely to recoup any revenue it lost in the process.
RIM Looks Forward with New CEOResearch In Motion's longtime co-CEO's stepped down late Sunday after a dramatically difficult year for the BlackBerry maker. Mike Lazaridis and Jim Balsillie faced mounting pressure from frustrated shareholders and investors to step down, and while the two men say that had no bearing on their decision, the company is looking to new leadership for a much-needed turnaround. Newly appointed CEO Thorsten Heins said he plans to stay the course set by his predecessors, but bring new focus to RIM's marketing strategies and product turnaround time. Heins, who joined RIM in 2007, faces an uphill battle to repair the company's reputation, but he remains optimistic.
AT&T Gives Away Spectrum, Blames FCC for LossesAT&T will transfer $1 billion in spectrum to T-Mobile as part of a $3 billion "breakup" bundle in the wake of the failed merger between the two carriers. T-Mobile lost thousands of customers while government regulators pondered the proposed acquisition, and AT&T's generous compensation will help the smaller carrier increase its broadband network to lure back customers. AT&T also posted hefty fourth-quarter losses in the wake of the failed merger, largely due to the breakup fee. However, the carrier is focusing its energies on expanding its 4G network and promoting its new line of Nokia Windows phones. The Dallas, Texas-based company blames the FCC, which failed to support the scrapped T-Mobile merger, for its significant loss of profit and spectrum. Last week, AT&T raised its data fees for consumers, and maintains that the FCC is at fault.
Verizon Sees Profit Loss, Makes Room for 4G PhonesVerizon also experienced diminishing profits last quarter, spurred mostly by increased expenses associated with the launch of the iPhone 4S and the carrier's expanding LTE network. Still, the Basking Ridge, N.J.-based carrier signed 1.2 million new users, and remains the number one provider in the U.S. To make way for new hardware to accommodate its high-speed network, Verizon offered the HTC Thunderbolt for free with a two-year contract until yesterday. The Thunderbolt, launched last March, was Verizon's first-ever 4G LTE handset, but the company wants to stay ahead of competitors and focus on its newest offerings moving forward.
Nokia Bouncing Back with Windows PhonesNokia shipped more than one million Lumia handsets last year, analysts estimate, signaling early success for the company's critical Microsoft partnership. Nokia is the top mobile phone maker in the world by volume, but struggled in recent years against the growing popularity of Apple and Android phones. Strong sales numbers bode well for the company, meaning it could be headed for a true turnaround. The Finnish phone maker will reportedly offer the Lumia 900 for $100 when the phone launches in the U.S. this spring, at least half the price of other high-end smartphone. The move attempts to lure customers to the fledgling Windows operating system, and could prove a strong draw for consumers. Nokia posted a 23 percent decrease in smartphone sales last quarter despite the Lumia's rampant success abroad, but CEO Stephen Elop says is still in the transitional process and expects to boost its profits in 2012.
Microsoft Ditches Point System, Tests KinectMicrosoft is abandoning its digital points system and uniting its app and gaming platforms ahead of the release of the Nokia Lumia. Unifying its method for purchasing digital content will make it easier for customers to download apps across multiple devices, presenting a more synchronized experience. Microsoft is also testing laptops with built-in Kinect technology, hinting at the company's potential plans for the Windows 8 platform.
Samsung Profits Clouded by Patent BattlesSamsung set a $42 billion sales record last quarter, but the good news is overshadowed by its costly patent battles with Apple. The South Korean phone maker also has an uneasy relationship with Google, and with the search giant's impending acquisition of Motorola, Samsung is nervously diversifying its offerings to protect itself.
HP Cautiously Releases WebOSHewlett-Packard announced it will release WebOS to the open-source community gradually over the next several months to sidestep potential patent problems. First up is Enyo 2.0, a developer's tool used for writing apps, as the tech giant cautiously proceeds with the ambitious project.
HTC Teams Up with IBMHTC is working with IBM, running IBM business apps with a focus on security on its phones and tablets. The business sector, once dominated by RIM's BlackBerry, is increasingly divided among Android and Apple devices. The IBM brand, with its strong corporate affiliations and secure history, could prove attractive to frustrated former enterprise customers.
PayPal Debuts Mobile Payment SystemEBay-owned PayPal rolled out its mobile payment system in U.S. stores this week, allowing users to make payments without sharing financial information. In-store customers give retailers their mobile number and PIN to pay with their PayPal account, removing the need to carry around a bank card.
FBI Mines Social Media, President Obama Chats on Google+The U.S. Supreme Court ruled unanimously that police must get a search warrant before using GPS technology to track criminal suspects, saying such maneuvers violate privacy protection provided by the Constitution's Fourth Amendment. State governments are struggling to balance the needs of law enforcement with individual rights, and the recent ruling makes a strong statement that could finally set a precedent. Meanwhile, the Federal Bureau of Investigation announced plans to regularly scan social networking sites for possible domestic and global threats. The FBI's plans raise concerns over privacy and free speech rights, but social networking sites will have no choice but to comply with the government regulations. The U.S. government is increasingly concerned about cyber attacks, and Republican presidential candidate Newt Gingrich agrees, saying he believes cyber-espionage should be considered an act of war. Gingrich says he would take a tougher stance on cyber-terrorism, and that current laws are not enough to prevent a major attack from happening. President Obama integrated tech into his own campaign, hosting a Google+ hangout following his State of the Union address Tuesday night. Obama answered questions from citizens via video chat, attempting to prove his strong connection with the younger, tech-savvy generation, a coveted voting block for the upcoming presidential election. Abroad, the European Union issued new data-protection rules on January 25, amid concerns over how corporations handle Internet users' personal data. The new guidelines, which must be approved by several European governments including France and Germany, greatly impact tech titans like Google and Facebook.
Facebook, Twitter Team Up Against Google, Facebook Preps for IPOFacebook and Twitter engineers tweaked Google's new algorithm, which prioritizes content published on Google+, with a "bookmarklet" called "Don't Be Evil." The change enables users to include information from their own sites, not just Google+, in search results, signaling the other social networks are ready to stand up against the internet search giant. Facebook is a giant in its own right, adding $15.3 billion in value to the European economy last year alone, mostly through ad revenue. Thousands of companies make Facebook apps to connect with their consumers, and when the social networking site unveils its IPO later this year, those numbers are likely to increase. Popular mobile game Angry Birds will make its debut on Facebook this Valentine's Day, as maker Rovio continues its quest to put the puzzle game on "every screen." Facebook will also gain millions of Angry Birds fans just in time for its IPO, which it continues to bolster with dozens of new apps and games.
Twitter Users Thwart McDonald's, Site Bows to Censorship PressureTwitter users capsized a recent McDonald's Twitter campaign, hijacking the fast food restaurants hashtag and relaying horror stories about the company's food. The move highlights the potential issues with social media campaigns, which users can corrupt if they so choose. Meanwhile, under mounting pressure, Twitter announced plans to withhold tweets that violate censorship laws in specific countries, but vowed transparency about its actions. It plans to clearly mark tweets that are withheld, and only restricted them within affected countries.
News Under the Sun is a weekly column rounding up all the events in the mobile industry. Want the news but don't want it every day? Subscribe to our weekly Facebook or Twitter page.
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