Apple profits for hardware will drop but software sales and market share will climb
Last year when the first generation iPhone was announced by Apple, the bill of materials for the device was estimated to be in the area of $170. According to recent analysis the new iPhone 3G could be costing Apple significantly less to make than the original iPhone.
According to teardown analysis from Portelligent Inc., the new iPhone 3G could have a bill of materials as low as $100. This reduction in the cost to build the device takes into account the increased prices for the addition of a 3G chipset and a GPS chip.
“Gen2 iPhone pricing is aggressive enough that it made me think Apple's really taking the gloves off on this one," noted Portelligent president David Carey. "They are probably not as worried about iPhone hardware profits as they are about getting a piece of the action on service revenues and getting more Macs in homes and offices all around the globe.”
This aggressive pricing is taking some money out of Apple’s coffers on hardware sales. However, Apple will likely make up the losses on hardware sales in revenues for software sold via the App Store. DailyTech reported that the App Store could be a billion dollar business for Apple by 2009.
Will Strauss from Forward Concepts told EETimes that he believes the iPhone 3G is using an Infineon baseband and RF transceiver along with a Samsung applications processor. Samsung launched a handset with these same parts recently and pointed out that the cost of the Infineon chips were about 20% less than similar chips from Qualcomm.
According to Carey, the addition of the HSPDA chipset adds $15 and the addition of the GPS chip adds another $5. Those additional costs are offset in part by the reduced memory pricing compared to last year. These cost figures, of course, don't take into account development, marketing, and software costs.
6/19/08
Apple iPhone 3G May Only Cost $100 to Make
Palm Expects to Ship 2 Million Centro Smartphones
Palm hopes to keep seeing its Centro smartphones fly off store shelves
Palm Inc. may be stuck in a rut and facing difficult financial times, but it hopes selling 2 million units of the Centro smartphone in 2008 will help turn things around.
At least 1 million units have been shipped so far in the United States since the phone's launch in mid-October. The Centro is Palm's fastest selling smartphone in company history.
Palm's recent announcement that the phone is now available for Verizon Wireless will help the company ship even more units of the phone. Consumers can now purchase and use a Centro on the Verizon Wireless, AT&T and Sprint Nextel phone networks.
Verizon customers can purchase the phone for $99.99 after a $70 MIR and two-year customer agreement or extension with Verizon.
Centro features a QWERTY keyboard, Bluetooth, digital camera, 64MB internal memory, and runs on Palm OS 5.4.9.
The phone is considered a smaller, easier to use Palm Treo smartphone, but it has some drawbacks. While it allows its users to e-mail, browse the internet, text and picture message, there isn't a built-in instant message program available.
The Centro's success can be attributed to new smartphone users, Palm indicated in a press release. The Apple iPhone 3G may have gotten a price cut, but the Centro remains cheap and easy to use, and Palm expects it will continue to draw in new smart phone owners.
Understanding its using an aging operating system and internet browser unlikely to please experienced smart phone owners, Palm is working on a new OS that should be available in 2009. The team of developers will be responsible solely for creating a new interactive platform aimed directly towards higher-end, more experienced phone users.
According to IDC, Palm increased its market share 5 percent, and now controls 13 percent of the global smartphone market.
Microsoft Announces NavReady Embedded Operating System for PNDs
NavReady is Microsoft's first category specific operating system
Microsoft announced a new embedded Windows operating system this week called NavReady. Microsoft says that NavReady is the first category-specific operating system it has released.
Some key features of NavReady are a small footprint that uses a componentized technology that allows the OS to be incorporated into CE 5.0 designs easily. The OS is designed to run on an ARM processor and it supports a 32-bit native real-time unified kernel.
Microsoft says that NavReady will help manufacturers build portable navigation devices (PNDs) with a highly connected design. The OS supports Bluetooth for rich hands-free usage, managed dial-up networking services and other Bluetooth features.
One key component is Live Search for devices that helps perform search quires to find points of interest. Desktop pass-though is also featured and allows the PND to establish connections to online services and the Internet when the device is connected to a Windows-based PC that has ActiveSync/WDMC installed along with an internet connection. PNDs using the NavReady OS can also act as SideShow display for Vista computers.
The internet connectivity of the new OS allows for use of MSN Direct for updates on traffic, gas prices and more. PC World reports that Mio Technology has already announced it will use the Windows Embedded NavReady 2009 operating system in its next line of Mio GPS devices.
XM, Sirius Merger Gets FCC Chairman Kevin Martin's Approval
Final vote on the merger could come at any time
FCC Chairman Kevin Martin has recommended that the merger between Sirius and XM be approved according to the Associated Press. To get Martin’s approval, provisions were added to the merger deal that would turn over a portion of the available bandwidth from the satellite providers to noncommercial and minority programming.
The provisions for turning over portions of the satellite bandwidth require the two companies to donate 8% of their satellite capacity to noncommercial and minority broadcasts. That available bandwidth equates to about 12 channels each from Sirius and XM for a total of 24 channels.
Other provisions from Martin to his approval include an open radio agreement that would promote competition among manufacturers of satellite radios and a three year price freeze on all packages and an a la cart option to be available within three months of the close of the deal.
The AP quotes Martin from a statement, “As I've indicated before, this is an unusual situation. I am recommending that with the voluntary commitments they (the companies) have offered, on balance, this transaction would be in the public interest.”
Despite Martin’s approval the final vote to approve the merger is yet to happen and the other four commissioners could still say no to the merger. There is no clear indication on how the other commissioners feel on the merger at this time.
The approval of the merger has been long sought by Sirius and XM. The merger was approved by the U.S. Justice Department in March. When Sirius and XM first announced they intended to merge their two companies the deal was worth in the area of $13 billion.
The final vote on the merger could come any time after Martin’s recommendation is given to his fellow commissioners.
Phoenix Gets Some Dirt on Mars
After a short sticky situation, Phoenix returns some images to Earth.
After successfully reaching Mars at the end of a nine and a half month jaunt through interplanetary space, the Phoenix Lander landed safely on the surface and began broadcasting data back to Earth. Phoenix's well known mission is to study the Martian surface and air, scanning it for traces of life and help to discover how a planet once thought to be at least partially covered with water became an icy desert.
To examine the rust-colored soil, Phoenix uses a robotic arm which wields a small backhoe type bucket to scoop up soil and bring it to the various instruments aboard the lander. Presently, the probe has gathered at least one sample which has been imaged by its Optical Microscope instrument.
The soil sample surprised Phoenix mission crew, being somewhat more clumpy and sticky than was theorized. However, the particles that were imaged by the microscope were successfully deposited upon a custom silicone substrate. The substrate contains several different strips with different sizes and patterns of pegs and holes machined into them. The various patterns are designed to help capture and hold different sizes of particles for imaging not only by the Optical Microscope, but by Phoenix's onboard Atomic Force Microscope.
The images show various types of particles, most notably large particles of dark glassy appearance, probably volcanic in origin, and smaller particles which are more similar to the dust that swirls endlessly in the Martian atmosphere. Also in the mix are at least four different types of minerals.
No reports of life are flooding in from the Phoenix control center. Though the lander has been on Mars for nearly 20 days, data from the instruments is just starting to be collected and analyzed. It may be weeks or months before a sample of ice, what the mission planners are most enthusiastically seeking, is collected for analysis.
Mars may have an active, though slow climate. It may have once teemed with primordial life in liquid water. With any luck and a little work, thanks to the Phoenix lander, we may soon have answers to these unknowns.
