The business and culture of our digital lives,
from the L.A. Times

Category: David Sarno

Broadcom fourth-quarter profit, revenue top analysts' forecasts

Broadcom earnings top analysts' expectations

Apple Inc. sold 37 million iPhones and 15 million iPads during its record holiday quarter. Those are also happy numbers for Irvine-based Broadcom Corp., which makes microchips for the popular Apple devices and many others.

Broadcom reported a better-than-expected fourth quarter Tuesday, beating Wall Street estimates for quarterly revenue and earnings per share despite enduring profit and sales declines from the same period a year earlier.

The company's stock rose 1.98%, or $0.68, to $35.02 in after-hours trading following its earnings announcement. Since Jan. 1, the company's stock has risen 17.44%, a welcome jump after a rough 2011 that saw that company's stock drop 33%, from $43 to $29.

The market for semiconductor chips was bumpy in 2011, and Broadcom saw declining consumer interest in digital television sets, one of the products for which it makes microchips. The industry has also been recovering from major flooding in Thailand that led to a shortage of hard disk drives used by many computing devices.

Still, the company's leadership is optimistic, projecting revenue for the current quarter of between $1.7 billion and $1.8 billion, above the $1.73 billion analysts expect.

"Broadcom delivered solid results in 2011, as we gained significant market share, secured record design wins across our businesses, and delivered record revenue and cash flow from operations," Scott McGregor, Broadcom's chief executive, said in a statement. "We will remain focused on product innovation and engineering execution that position us to grow faster than the industry."

Broadcom has about 20 lines of business, making communications chips for smartphones, tablets, televisions, set-top boxes and large-scale Internet servers. To stay competitive in the fast-moving electronics business, the company often buys smaller firms to acquire their chip design technology and know-how, and wraps the new teams into its main design business to work alongside other engineers from around the globe. It has acquired 46 companies since its founding in 1991.

The company reported $1.82 billion in revenue for the quarter, higher than the Wall Street consensus of $1.8 billion but a 6.4% decrease from the same period a year earlier. Its adjusted earnings per share were 68 cents -- Wall Street expected 65 cents -- a 25% decline from the fourth quarter of 2010.

[Correction, 4:55 p.m., An earlier version of this post said Broadcom saw declining user interest in set-top boxes.  The company mentioned a slide in the demand for its digital televisions as a reason for revenue decline, not set-top boxes.]


Apple Store in New York's Grand Central Terminal

Apple iPad 3: Launching in February, March, or later?

Apple hires John Browett, of UK's Dixons, to head retail business

-- David Sarno

Photo: A Broadcom mobile multimedia circuit board in 2010. Credit: Mark Boster/Los Angeles Times

Apple hires John Browett, of UK's Dixons, to head retail business

BrowettFor Apple Inc.'s newly appointed head of retail, the Genius Bar is high.

The company said on Tuesday it had hired John Browett, chief executive of European technology retailer Dixons, to head Apple's global fleet of 361 stores, starting in April.  Apple's fast-growing chain of stores pulled in $6.1 billion in sales last quarter, a nearly 60% jump over the same period a year ago, and accounting for 13% of the company's revenue.

Apple stores are known for their clean, spacious look, attractive architecture, and attentive customer service members.  The company also has a penchant for opening the stores in marquee locations, including New York's Grand Central Station, which took the wraps off of an Apple store in December.

Meanwhile Dixons stores, like the PC World pictured here, are reminiscent of U.S. chains Best Buy and Fry's Electronics; lots of square footage, row upon row of shelves packed with products and, frequently, bright primary color schemes. (At Best Buy, the employees are known as "Blue Shirts.")

The apparent gap between that aesthetic and the minimalist, elegant look and feel of Apple stores led some observers to wonder whether Browett's approach might clash with Apple's. 

But Tim Cook, Apple's chief executive and Browett's new boss, wasn't worried.

“Our retail stores are all about customer service, and John shares that commitment like no one else we’ve met,” Cook said in a statement.

Browett replaces Ron Johnson, who built Apple's retail chain into what it is today, and who left last June to become chief executive of J.C. Penney, and who is trying to simplify the way the old-line department chain works (among the strategies for its 1,100 stores: fewer coupons, fewer sales and lower overall prices). 

Browett will move in the other direction, from a chain of 1,200 stores that operate across Europe and sell products from hundreds of manufacturers, to a network of smaller storefronts that sell a relative handful of products, nearly all of them from Apple.

Apple executives are likely betting that Browett's knack for retail isn't reflected by Dixons stock performance. The company's stock prices have dropped more than 90% during Browett's tenure, which began in 2007.


Apple iPad 3: Launching in February, March, or later?

Apple Store in New York's Grand Central Terminal

J.C. Penney gets $1-billion boost after picking Apple exec as CEO

-- David Sarno

Photo: John Browett will take on his new job at Apple as senior vice president of retail in April.  Credit: Associated Press

Demand for iPhones in China could skyrocket, analyst says

Cleanup of Apple store in Beijing after riots related to iPhone 4S launch

What do tenacious chief executives dream about during their four nightly hours of fitful sleep?

How about a world in which hundreds of millions of people desperately want to buy your product -- so much so that riots break out in long lines while they wait in front of your stores. Meanwhile, although you're already the world leader when it comes to high-speed, high-efficiency manufacturing, your legions of factories simply cannot churn out enough iPhones to satisfy demand.

Oops, I let the cat out of the bag there. Because yes, there's a good chance Apple Inc. Chief Executive Tim Cook is having a version of this very dream -- a kind of nightmare of success in which you fear that a huge opportunity right under your nose is simply too huge to take advantage of.

For some context, Apple sold 72 million iPhones in its fiscal 2011, a staggering number that required all the muscle of the world's most valuable technology company, as well as a network of Asian factories pumping out the devices at a breakneck pace. The sales came from more than 100 countries.

Now Chinese consumers may want to buy nearly that many iPhones all by themselves.

That may well happen, says Morgan Stanley analyst Katy Huberty, who in a note to investors guessed that Apple may soon be selling 57 million iPhones annually in China, capturing 60% of the projected market for smartphone buyers there. That would be a sixfold increase from the 10 million iPhones Chinese consumers bought in 2011. 

The pent-up demand for the iPhone in China is hard to overestimate. The nation's leading carrier, China Mobile, has 650 million mobile subscribers, according to Huberty (compared with about 200 million for second-place China Unicom, which offers the iPhone). China Mobile does not technically support the iPhone because its network isn't compatible. But that hasn't stopped 10 million of its customers from finding ways to use the device anyway.

Starting this year, China Mobile may flip on its next generation 4G mobile network. If analysts are correct, that upgrade might prove beneficial for the iPhone 5. The next version of the device, which observers guess may hit stores in the summer, is likely to work on the faster 4G networks.

That day may well bring "double happiness" to the folks in Cupertino, Calif.


China's iPhone mob tops list of consumers going crazy

Apple halts iPhone 4S release in China stores after near-riot

iPhone 4S goes to China; Siri to start speaking Chinese in 2012

-- David Sarno

Photo: Workers clean the windows of an Apple store in Beijing this month. Customers who had waited overnight for the launch of the iPhone 4S turned angry and pelted the flagship store with eggs after it failed to open. Credit: ChinaFotoPress / Getty Images

IPad down to 58% of tablet sales as Android catches up


When asked if the emergence of new, lower-cost tablets was affecting the success of the iPad this week, Apple Inc. Chief Executive Tim Cook said he wasn't seeing it.

"I looked at the data, particularly in the U.S., on a weekly basis after Amazon launched the Kindle Fire, and I wouldn't -- in my view there wasn't an obvious effect on the numbers plus or minus," Cook said.

But one clear minus was Apple's declining share of the growing tablet market. Despite gang-buster sales last quarter, the iPad has lost more than 10 percentage points of market share to rival Android tablets since the fourth quarter of 2010, according to a new report from research firm Strategy Analytics.

The iPad dropped to 57.6% of the tablets sold during the most recent fourth quarter, from 68.2% a year earlier, while Android rose to 39.1% from 29.0% a year ago, the report said. While Apple shipped 15.4 million iPads during the quarter, Android makers shipped 10.5 million tablets, more than tripling the 3.1 million they shipped a year earlier.

The Android surge was led primarily by tablets from Amazon and Samsung, according to Strategy Analytics' Neil Mawston.

"Android is so far proving relatively popular with tablet manufacturers despite nagging concerns about fragmentation of Android’s operating system, user-interface and app store ecosystem,” Mawston wrote in a release attached to the report.

The report also noted that global tablet shipments rose to 66.9 million units in 2011, nearly quadrupling the 18.6 million shipped in 2010.  Devices "shipped" are those that manufacturers sell to retailers, and do not always represent final consumer sales numbers, especially when tablet makers overestimate the demand for their products.  But Mawston said the tablet shipment numbers in this case were a fair representation of the number consumers bought.


Apple reports record sales of iPhones, iPads and Macs

Harvard study finds the iPad can be a pain in the neck

-- David Sarno

Image: Tim Perkins checks out the $199 tablet from at a Best Buy store in L.A. Credit: Lawrence K. Ho / Los Angeles Times

Tablet, e-reader ownership in U.S. jumps to 19% over the holidays


Remember when seeing an iPad on a bus, an airplane or the subway was a startling new experience?  Now you might be startled not to see one.

Over the holidays, so many people bought tablets for each other (and, presumably, themselves), that U.S. tablet ownership nearly doubled among adults, to 19% in January from 10% a month earlier.  The rate is growing quickly: In May 2010, shortly after the debut of the iPad, only about 3% of consumers over age 16 owned tablets, according to survey information from the Pew Internet & American Life Project.

The survey found a similar jump in e-reader ownership, as prices dropped below $100 for electronic book readers from Amazon and Barnes & Noble.  Nearly 20% of U.S. adults now own an e-reader, up from 10% in November.

Tablet and e-reader adoption continues to grow quickly just as sales of traditional personal computers slow and even decline.  In the U.S., PC sales last year had their worst year since 2001, dropping nearly 5% compared with 2010, according to research firm IDC.  Analysts and PC industry executives regularly cite the increasing popularity of tablets when talking about the slowing growth of the PC businesses.

According to the survey, tablet adoption is now the highest among wealthier and more educated buyers.  About 36% of those making more than $75,000 a year own a tablet computer, compared with about 16% of those making $30,000 to $50,000, although ownership rates in both groups appear to be growing quickly. The discrepancy is also substantial between college graduates, 31% of whom own tablets, and high school grads, at 15%.


Apple iPad 3: Launching in February, March, or later?

Apple's iBooks 2, iBooks Author: Bids to own publishing's future

Apple looms large over the Consumer Electronics Show, despite not showing up

-- David Sarno

Photo: Boxes of Kindle e-readers sit at an distribution center. Credit: Chris Ratcliffe / Bloomberg.

CES 2012: Samsung tablet + Kinect + motorized skateboard = wear a helmet

Move over Segway, and make room on the road for the Board of Awesomeness.

Chaotic Moon Labs' Kinect-controlled motorized skateboard zoomed through the Consumer Electronics Show in Las Vegas this week, showcasing a quirky mashup of technologies -- one that hopefully won't end with the rider getting a mashed-up head.

By attaching a Samsung tablet to the Kinect, the Austin, Texas-based software laboratory set out to "make Kinect do everything it's not supposed to do," which includes helping accelerate a skateboard and its rider to 32 mph.

VIDEOS: 2012 Consumer Electronics Show

It did it by creating an electric skateboard with the Kinect as a built-in gesture sensor, so the rider can accelerate by pushing his hands forward, and slow down by pulling them back  -- a little bit like skateboarding with an invisible steering wheel.

The board has giant all-terrain tires, as well as an 800-watt electric motor, so you could probably skateboard up San Francisco's Lombard Street if you needed to. (Note to readers: Don't.)

The brain of the conveyance is a Samsung tablet powered by the new Windows 8 operating system, which you better hope doesn't crash -- because if it does ...


4k TV sets make their debut, minus the hoopla

Samsung TVs add gesture, voice control; Sharp previews 8K

Ava robot, controlled by iPad, Kinect, roams CES with ease [Video]

-- David Sarno in Las Vegas

CES 2012 is a big draw even without eye-popping gadgets


At the Consumer Electronics Show in Las Vegas, it's something of a rebuilding year.  There have been no jaw-droppingly new consumer technologies unveiled, or obvious must-have new devices like in years past.

But that's not stopping near-record crowds from descending on Sin City, slurping up all its beer and bandwidth, and filling convention halls up and down The Strip.

The show's organizer, the Consumer Electronic Assn., has said that close to 150,000 attendants filled the city's hotel rooms this year, coming to check out exhibits from a record 3,100 companies.

The booths at the Las Vegas Convention Center on Tuesday, the show's official opening day, ranged from tiny stalls hung with bejeweled iPhone cases to city-block size mega-booths from global electronics makers, many paying millions to erect giant walls of high-definition screens that showcase their latest TV technology.

After attendants handed out 3D glasses at the booth of South Korea's LG Corp., a movie started on a massive IMAX-size screen showing a meteor shower shooting toward the audience.  More than a few "whoas" where audible from the crowd below.

At the Samsung booth, representatives gave demonstrations of the company's new Smart TVs, showing onlookers how to change channels or search the Web with simple voice commands,  or to "click" on-screen buttons and links with a hand gesture.  A model of the company's latest ultra-high-def TV hung on another wall, with pictures of waterfalls and forests that were so clear that one visitor said, "Wow, is that in 3D?" 

It wasn't.

And more laughs were had Monday night at Microsoft Corp.'s final keynote (the software giant has said it will no longer give the show's main speech, or maintain a booth at CES.)  The company did its best to mark the semi-somber occasion by hiring American Idol host Ryan Seacrest to be the master of ceremonies. 

Seacrest and Microsoft Chief Executive Steve Ballmer enjoyed some amusing back-and-forth banter, such as when Ballmer explained the new, tile-based look of Windows 8, which is called Metro and is an improvement on the company's earlier phone operating system.

"The Metro user interface -- you’ve seen it being pioneered in recent years, but now it’s all coming together."

"Why did you look at me funny when you said Metro?" Seacrest asked, feigning hurt feelings.

Ballmer laughed, and Seacrest said, "I guess I'm going to be your mascot now."

More stunts lay in store for the show, too -- on Thursday, ESPN will stage a live boxing match at the convention center that will be broadcast in 3D on the network.


$1,300 earphones -- how does that sound?

Lumia 900, Nokia's first 4G LTE Windows Phone, debuts

TVs go big, wide and ape at the Consumer Electronics Show

-- David Sarno

Image: Ryan Seacrest and Steve Ballmer at the Microsoft keynote at CES. Credit: David Sarno / Los Angeles Times

CES 2012: No-show Apple looms large at Las Vegas show


At the Consumer Electronics Show, models carried around wireless flat-screen TVs playing vivid nature films, executives waved next generation “magic” remote controls and audiences were treated to demonstrations of massive, wall-size TVs.
Also, Apple’s stock hit a record high.
Though the Cupertino, Calif., iPhone giant doesn’t attend the show, rumors are spreading that it has its own TV in the works, and analysts say established TV companies like Samsung Electronics, LG  and Sony are struggling to make their TVs more user-friendly and better able to find music, movies and online video from across the Internet.
“The TV hasn’t gone quite through the big revolutionary change that we’ve seen on those other screens,” said Shaw Wu, an analyst at Sterne Agee. “These other players are trying to jockey for position ahead of Apple.”
But with industry observers expecting an “iTV” from Apple that will turn the industry on its head, not all observers were impressed with the latest TV improvements.
“They’re just throwing spaghetti up against the wall right now,” said Peter Misek, an analyst at Jefferies & Co. “I think Apple’s going to force a big change in the industry  -- and it’s hard for the companies to respond when they don’t know what iTV looks like yet.”
At the CES on Monday, LG showed off its “Magic Remote,” a device with few buttons that resembles a Nintendo Wii controller –- enabling the viewer to point at and select different images and buttons on the screen.

Sharp’s Aquos Freestyle flat-screens get their signal wirelessly, and as the models demonstrated by parading them down the showroom runway, they are light enough to be carried around the home, whether to the balcony, the kitchen or the powder room.
Samsung showed off a new line of smarter televisions with a suite of games and Web applications built in.  The company, a major rival of Apple's in both the smartphone and tablet sectors, did hint at a gesture and voice control system for its upcoming TVs, but did not show those features in action. 
Vizio Inc. unveiled three new high-definition sets that feature Google TV, the search-giant’s TV navigation software that will also run on TVs from Samsung Electronics and LG, and which comes with dozens of built-in apps that users can use on-screen to fetch sports scores, watch movies and play games.
Meanwhile, Google has had trouble getting its Google TV software to take off.  Launched on a small number of devices last year, the product was coolly received by reviewers and failed to gain wide traction with consumers.

Logitech Inc., which made one of the original Google TV set-top boxes, discontinued the device in November, calling it a “big mistake.” 

Still, Google has recruited a new cast of the biggest TV makers -- Samsung, LG and Vizio -- to test the waters with a suite of Google–powered TV sets.

“The manufacturers have no choice but to turn to Google because there’s no one else,” Misek said.  But until Google can make its phones, tablets, and personal computers all talk to each other, the way Apple’s do,  Google and its TV partners “won’t be able to catch up.”


Vizio Tablet review

CES 2012: What it's got, what it doesn't

CES 2012: LG Spectrum phone has 4G speeds, HD display

-- David Sarno in Las Vegas

Photo: LG Electronics televisions on display at the annual Consumer Electronics Show. Credit: Frederic J. Brown / AFP/Getty Images

CES 2012: Tobii technology enables your eyes to control computers


When the iPad came out, the mouse -- long the king of all pointing devices -- was dethroned by the power of the tablet's touchscreen.

But if looks could kill, then the touchscreen may be the next victim in the pointer war.

Tobii Technology's "gaze interaction" system enables users to control their computer screens with their eyes, scrolling through Web pages and photo slide shows with mere glances, blowing up asteroids by staring at them and giving new meaning to the idea of looking something up.

The technology from the Swedish company is a descendant of a 2001 research project at Stockholm University, first conducted by Tobii's founders. But gaze interaction may soon be going mainstream.

In a display booth at the Consumer Electronics Show in Las Vegas, the company showed Tobii software hooked up to Microsoft's upcoming Windows 8 operating system. Booth-goers could sit in front of a screen and optically swipe through Windows screens, "thumb" through photographs, or go into a Word document and "click" on even the tiniest buttons (think the "B" button for bold) using just their peepers.

On another computer, a man played a game of the arcade classic Asteroids. But instead of rotating his gun turrets with a joystick or the keyboard, he simply looked at the asteroid he wanted to destroy, and a split second later it exploded into smithereens. It was a feat worthy of Superman and his laser-heat vision. In a manner of speaking.

Tobii says it wants to expand beyond consumer applications and use the eye-tracking technology for medical purposes, such as allowing technicians to use their eyes to move through photographs, scans or X-rays, potentially while using their hands to operate medical machinery, make notes or physically examine a patient.

When it comes to the way we interact with our computers, the Tobii software is definitely a peek into the future.


Consumer Electronics Show lacks the Next Big Thing

CES 2012: What's in our bags for the year's biggest gadget show

CES: Yet another rollout for digital mobile TV

-- David Sarno

iPhone 4S goes to China; Siri to start speaking Chinese in 2012

A Beijing couple check out an iPhone.

Siri, how do you say profit in Chinese?

One answer Apple's digital assistant might consider giving is: start selling the iPhone 4S in China. And starting on Jan. 13th, Apple will do just that.

The company said Wednesday that China will be among 22 countries that soon will get the newest iPhone, one of Apple's hottest-selling yet.  The iPhone now accounts for nearly half of Apple's annual revenue, and some analysts believe it earns the company more than 60% of its profits.

China is one of the world's largest mobile device markets, with close to a billion cellphone users by some estimates. Apple currently partners with China Unicom, one of the larger carriers with close to 200 million cellular subscribers.

Apple said Wednesday it had no current plans to announce a partnership with China Mobile, the country's largest carrier with more than 630 million subscribers (a user base that, somewhat amazingly, is more than twice the size of the U.S. population).  But for months now Apple has been rumored to be nailing down a deal with China Mobile, and millions of the carriers' customers are already using the iPhone by modifying the device to work on their network.

Will Siri actually be able to speak and understand Mandarin?  Eventually, yes.  An Apple spokesman said the company plans to add official language support in 2012 — and that will include Chinese.  But Siri won't yet be multilingual when the phone hits Chinese stores this month.


Orangutans go ape for iPads, gorillas not so much

Apple design master awarded British knighthood

Apple fined in Italy, accused of misleading warranties

— David Sarno

Photo: A couple look at an iPhone in Beijing in November.  Credit: Diego Azubel / EPA


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