Microsoft just announced its long-awaited move into the mobile phone hardware space: the software giant will acquire most of Nokia’s devices and services business for €3.79 billion ($5 billion), along with a license to Nokia’s patents for a further €1.65 billion ($2.2 billion), in a cash transaction expected to close in the first quarter of 2014. The €5.44 billion ($7.2 billion) deal is one of Microsoft’s largest to date, though, notably, it comes at a lower price than what Microsoft paid for Skype in 2011.
The move combines Windows Phone 8 with its most successful licensee and expands Microsoft’s first-party hardware efforts from Xbox, Surface, and accessories to mobile phones. 32,000 employees will make the jump from Nokia to Microsoft, including Nokia executives like CEO Stephen Elop, Jo Harlow, Juha Putkiranta, Timo Toikkanen, and Chris Weber.
For Nokia CEO Stephen Elop, the deal means a return to Microsoft, where he will lead an expanded Devices team, which, Microsoft CEO Steve Ballmer wrote in an email, “includes all of our current Devices and Studios work and most of the teams coming over from Nokia.” The acquisition follows Nokia’s strategic partnership with Microsoft in February 2011 and Microsoft’s new aim of becoming a “devices and services company.” It also feeds speculation that Elop may succeed Ballmer as CEO of Microsoft.
Microsoft will acquire both Nokia’s Lumia smartphone business and its low-end lines, such as the S40-powered Asha phones, which Microsoft plans to use as an “on-ramp to Windows Phone” in developing markets. That means besides flagship Windows Phones like the 41-megapixel Lumia 1020, Microsoft will be selling a good number of phones at price points cheaper than that of an Xbox wireless controller and running non-Microsoft OSes– interesting and unfamiliar terrain for the company.
Microsoft’s slide deck on the strategic rationale for the deal (also embedded below) gives a sense of the company’s approach: by licensing the Windows Phone OS to OEMs, Microsoft only makes about $10 per phone (plus revenue from its app store and other services); as both the OS and phone manufacturer, it would make over $40 per unit. That’s more like the margins Apple enjoys, but Microsoft would ideally like a combination of its own devices and OEM licensees, to cover as many market segments as possible– and therein lies perhaps the biggest motive for acquiring Nokia: the risk that someone else could snap up the device maker and jeopardize Microsoft’s presence in the mobile industry:
We will continue to support iPhone and Android/Galaxy phones with our services, but we cannot risk having Google or Apple foreclose app innovation, integration, distribution or economics.
Like the Skype acquisition in 2011, this deal will be financed using Microsoft’s overseas cash reserves, which helps the company avoid paying taxes to repatriate the cash to the United States. Perhaps more interestingly, the slides reveal that Microsoft aims to triple its mobile market share by 2018, hitting 15 percent globally.
Nokia will refocus on its remaining businesses: network infrastructure and services, mapping and location services, and technology development. Microsoft will license Nokia’s portfolio of 30,000 patents for use across all its products, for 10 years, with an option to extend perpetually. It will also license Nokia’s HERE mapping services for 4 years, for use on its own products and for its business customers via syndication on the Windows Azure cloud platform.
Branding is a potentially interesting point– Microsoft will own the Lumia and Asha brands, and will gain a 10-year license to use the Nokia brand on non-smartphones, suggesting a transition over to the Microsoft brand for smartphones. Nokia is also rumored to be entering the tablet market with a 10″ Windows RT offering this fall, which would mean that come 2014, Microsoft would have two first-party tablet lines in the 10″ space– Surface and the Nokia tablets.
By acquiring Nokia’s devices business, Microsoft is taking a big leap into the cutthroat world of mobile phones, with a degree of end-to-end vertical device and service integration unseen beyond Apple and Google. A close parallel is perhaps Motorola, which sold its consumer devices division to Google to enable the latter’s entry into the first-party smartphone space, but Nokia is a much more significant global phone player than Motorola was, has a more valuable patent portfolio, and in spaces like mapping services, competes with Google in its own right.
In a blog post, Microsoft EVP, Operating Systems, Terry Myerson, wrote that Microsoft will continue to collaborate with its other OEM partners for Windows Phone, such as HTC, Huawei, and Samsung, treating them in the same way it treats its own hardware teams. Microsoft will likely integrate some of Nokia’s customization, like its HERE Maps suite, into the core Windows Phone OS to bolster all OEMs on its platform. Myerson even cited a song lyric to allay any concern its OEM partners might have: “I don’t shine if you don’t shine.”
Will the Nokia acquisition help Microsoft finally beat back iOS and Android domination of the global smartphone market? Only time can tell, but a great deal rests on Microsoft’s ability to integrate its vertical stack of services into high-quality device offerings. Rapid execution will be key– and that’s something Nokia’s done a much better job of than Microsoft over the last two years in the smartphone space.
Read on after the break for Microsoft’s strategic rationale presentation and press release.
See below the break for photos from our trip to the 2013 New York International Auto Show:
Typing eight characters crashes nearly every app in Mac OS X Mountain Lion – even the Crash Reporter
A pretty embarrassing bug has surfaced in Apple’s latest version of Mac OS X, 10.8.2 Mountain Lion: typing “File:///” (without quotes) into nearly any app’s text fields causes the app to crash.
A report filed on Open Radar, the open-source community bug tracker for Apple products, details the problem, which appears to be related to OS X’s data detectors (which recognize dates, locations, and contact information in text fields).
The bug has been reproduced in TextEdit, Finder (in the search box), Spotlight search (temporarily knocks out menu bar), Safari (in address bar), iTunes (search box), Reminders (search box), Mail.app, Messages.app, and other apps, along with the Console.
Amusingly, the Crash Reporter itself crashes after an app crashes due to the bug.
Most concerning is that in some cases you can even cause other people’s Macs to crash– even reading a message containing “File:///” in Mail.app or Messages.app will crash the apps. Retweeting a tweet with “File:///” in it will crash most OS X Twitter clients and, for instance, typing it into 37Signals’ popular Campfire service will crash Flint, an OS X Campfire client.
The few apps that don’t use the OS’ built-in data detectors (like BBedit) seem to be fine.
Some users have encountered apps that continuously crash, likely because they restore with the “File:///” text still in them from before. For now, the temporary fix is to disable the feature by going to System Preferences -> Language & Text and unchecking both “Correct spelling automatically” and “Use symbol and text substitution.” This seems to work for most apps.
The bug does not affect older versions of OS X, like Snow Leopard and Lion.
One user jokingly tied the bug to Apple’s famous “reality distortion field“:
This is actually a feature. It allows you to shut down all applications before shutting down your Mac.
Source: Open Radar
Philips Electronics announced today that it is exiting the consumer electronics industry, capping over 80 years in the space. The Dutch firm was among the last large European consumer electronics manufacturers, after Siemens and Alcatel-Lucent made similar exits, and will now focus on its medical imaging and lighting businesses.
Philips found itself unable to compete effectively against Samsung, Sony, Apple, and the like, and will sell the remaining parts of its consumer electronics business to Japan’s Funai Electric Co. for an almost nominal price of $201.8 million. Philips had been trying to cut its losses in consumer electronics for a few years, shuttering its mobile phone division and handing over its North American television business to Funai in 2008. Funai will continue to sell audio, video, multimedia, and accessories under the Philips brand name going forward.
The Dutch firm was the world’s largest radio supplier before World War II, and its subsequent inventions included the audio cassette (1963), video cassette recorder (1972), and compact disc (1983). For many years, however, Philips has had trouble translating its R&D prowess into consumer sales successes. In the ’70s and 80s, the company lost the famous video cassette wars, as its VCR and Video 2000 standards fell to the Japanese standards of Betamax and VHS, which in turn fought to the death until VHS prevailed.
“Our consumer lifestyle business was margin dilutive to the group,” said Frans van Houten, Philips’ CEO, “so it was time to decide to move away from consumer electronics. Since we have online entertainment, people do not buy Blu-ray and DVD players anymore,” Mr. Van Houten said.
Philips will now focus on products like hospital MRI scanners and LED light bulbs. It will continue to make some consumer products, though, like coffeemakers and electric shavers.
Consumer electronics currently contributes a quarter of Philips’ revenues, with healthcare and lighting split at roughly 40:30. Van Houten said that Philips is becoming more efficient, and is now introducing new products to market 40% more quickly than before. Evidently not fast enough for consumer electronics, though.
New benchmark results suggest Intel may have a bright future in smartphones after all– and the first phone to show that is, appropriately, named YOLO. (though sadly it’s spelled “Yolo,” not “#YOLO”)
Low-end Android handsets in developing markets sell in the $70-200 range (without carrier subsidies). They’re typically equipped with processors from Chinese manufacturers like MediaTek, Allwinner, or Rockchip — often with anemic ARM11 performance in tow. Buyers wanting a smooth Android experience have to step up to more expensive phones.
Into this void stepped Intel, which announced its new Atom Z2420 processor at CES a few weeks ago. Formerly codenamed “Lexington,” the mobile platform features a single-core 1.2 GHz CPU with HyperThreading (a lower-clocked version of the 1.6 GHz Z2460 Medfield / Penwell chip in the Xolo X900), PowerVR SGX540 graphics, Intel XMM 6265 HSPA+ 3G radio (a variant of the XMM 6260 adding dual-SIM support– important for developing markets), MicroSD support, FM radio, and even Intel’s Wireless Display (WiDi) technology, which can stream 1080p HD video to Wifi-connected TVs. The chip supports up to 1.3 MP front and 5 MP rear cameras and can record and play back 1080p video.
As with Intel’s first smartphone processor, the new Lexington platform was accompanied by a “shipping quality” reference smartphone (“FFRD,” or Form Factor Reference Design) to help manufacturers get off the ground with its chip. Safaricom of Kenya and Lava Mobile of India are bringing variants of this design to market, as is Acer.
Today we have the first benchmark results from the Safaricom phone, dubbed “Yolo,” and they’re quite surprising. The 3.5″ HVGA (320×480) phone includes 512MB RAM, 4GB storage, 5 MP rear camera (no flash), MicroSD slot, and Android 4.0.4, and sells for 10,999 KES ($126).
Juuchini put the Yolo up against Samsung’s flagship Android phone, the Galaxy S III GT-I9300, packing an Eynos 4412 processor (quad-core 1.4 GHz ARM Cortex A9 with Mali-400MP graphics) and 1GB of RAM. As the results show, Intel’s phone comes pretty close to matching the almost 5x more expensive S III:
Antutu Benchmark (higher = better)
Vellamo (HTML 5)
Samsung Galaxy S III (GT-i9300)
Samsung Exynos 4412, quad-core ARM Cortex A9 @ 1.4 GHz, 1 GB RAM, 1280×720 resolution
Intel Safaricom Yolo
Intel Atom Z2420, single-core Atom @ 1.2 GHz with HyperThreading, 512 MB RAM, 480×320 resolution
Note: some versions of the Galaxy S3 (e.g. most of the U.S. versions) have a dual-core Qualcomm Snapdragon S4 processor instead of the quad-core Exynos and will thus produce different benchmark results.
See here for a review of the Yolo. The phone will hit India shortly as the Lava Xolo X500, retailing for Rs. 8,999 ($167).
Intel doesn’t appear to be targeting the U.S. market with this, which is unfortunate, as we think a Yolo with a higher-resolution (e.g. 800×480) screen could do well as an entry-level smartphone (think free-on-contract). And maybe it’d sell even better if branded “#YOLO.”
Still, the Lexington platform’s performance in such a low-priced handset bodes well for Intel’s future in the smartphone industry.
The 2013 Dodge Dart is aimed at young buyers, many of whom may not have enough money to buy one. The fix? Crowdfund it.
On Sunday, Chrysler will launch the Dodge Dart Registry with a TV ad (video below) during the NFL NFC championship. Powered by crowdfunding site RocketHub, the program lets buyers register to have friends and family donate towards their Dart purchase. Contributors can sponsor individual parts, so dad can pitch in for the engine and grandma for the steering wheel.
Dodge’s marketing for the Dart has centered on its “New Rules” slogan. ”Now, ‘New Rules’ transcends not only how we design, build and market a car, but redefines how consumers can purchase a new vehicle by mobilizing friends and family to help,” said Oliver Francois, Chief Marketing Officer at Chrysler.
Even if the program doesn’t upend the auto industry’s purchasing model or motivate hordes of people to start buying their family members Darts, Dodge’s main goal is get a social media and brand image boost among a generation that’s used to funding things on Kickstarter.
See Dodge’s TV ad for the Registry after the break.
Nissan’s been working hard to cut costs on its Leaf EV, and now consumers will see some of the benefits. With U.S. production of the revised 2013 Leaf ramping up, Nissan has announced a major price cut — the base price is down by $6,400 to $28,800 ($21,300 after the $7,500 federal EV tax credit). That makes the Leaf the cheapest 5-seat EV sold in America (the Smart Electric Drive is cheaper, at $25,000, but it’s a 2-seater).
Nissan’s Smyrna, Tennessee factory builds the 2013 Leaf on the same line as the gas-powered Altima and Maxima sedans, and nearby plants produce both the Leaf’s motor and the lithium-ion cells for its battery pack. Nissan can produce 150,000 Leafs and 200,000 batteries annually in Tennessee.
“With nearly 50,000 Leafs on the road globally, we are the leaders in zero emissions vehicles and our class-leading product just got better,” said Billy Hayes, Global Vice President of Leaf sales for Nissan. “From the very outset, Nissan has continuously advanced and refined the affordable zero emissions vehicle ownership experience. Now customers won’t have to pay a premium for owning a green car that’s really fun to drive, and that’s exciting.”
Nissan says the 2013 Leaf will have slightly more driving range than the 2012 model, due to better aerodynamics (drag coefficient cut from 0.29 to 0.28), regenerative braking, and energy management. New options include 6.6 kW charger, leather seats, black upholstery, two new exterior colors, new alloy wheels, longer sun visors, and a leather-wrapped steering wheel. The trip computer, which used to only show a bar graph for battery charge, now also gives a state-of-charge percentage. The charging port door up front is now lighted and lockable, and Nissan has added a driver-selectable “B” driving mode to that increases regenerative braking.
The 2013 model retains the same powertrain: an 80 kW (107 HP), 187 lb-ft motor driving the front wheels. The battery pack remains at 24 kWh, but the onboard charger has been moved from the trunk area to the hood, getting rid of a hump in the rear cargo floor.
The new base-model LEAF S ($28,800 MSRP) has an 3.6 kW onboard charger, push button Start, Bluetooth phone system, power door locks, CD/MP3 player, and a 12V power outlet. No cruise control, though.
The LEAF SV ($31,820) adds cruise control, a 6.6 kW onboard charger, more efficient heating system, better sound system, 7″ LCD screen, GPS navigation system with CARWINGS telematics, and 16″ aluminum alloy wheels. The 2013 SV is $3,380 cheaper than the 2012 model.
The top-end LEAF SL ($34,840) gets standard LED headlights, a 480V DC fast charge port, photovoltaic solar panel rear spoiler, leather seats, and redesigned 17″ alloy wheels — for $2,410 less than the 2012 SL.
The SV and SL get an optional AroundView monitor system, which uses cameras around the car to create a top-down view of the car’s surroundings, and a 7-speaker energy-efficient audio system from Bose.
Nissan will also continue its incentivized lease offers on the 2013 Leaf, starting with a three-year lease at $199 per month.
The new prices mean that the most expensive 2013 Leaf (SL, $34,840) is now cheaper than the cheapest 2012 model was (SV, $35,200)– and in California, which adds its own $2,500 EV tax credit on top of the $7,500 federal credit, the base Leaf S will cost just $18,800.
The 2013 Leaf should hit dealers by early February.
Mercedes-Benz just unveiled its new “four-door coupe,” the 2014 CLA-Class. If the car’s baby-CLS looks are anything to go by, BMW’s 1-Series may have to watch its back.
The new compact sports sedan is based on the latest A-Class hatchback and shares the smaller car’s sleek styling and complex surfaces. Most impressive of all is the CLA’s drag coefficient (Cd) of just 0.23 (0.22 for the CLA 180 BlueEFFICIENCY edition for other markets), which makes the CLA the most aerodynamic car in production (the only car with a lower Cd was GM’s 1990s electric car, the EV1, at 0.195). To achieve this, Mercedes engineers focused on underbody paneling, side-view mirrors, and aerodynamic wheels.
Mercedes will equip the CLA with a variety of engines: the CLA 180 gets a 1.6L I4 engine good for 122 HP / 147 lb-ft and 0-62 mph in 9.3 sec. The CLA 250 packs a 2.0L engine, 211 HP / 258 lb-ft, and 0-62 mph in 6.7 sec. For diesel fans, the CLA 220 CDI gets a 2.2L block that puts out 170 HP, pushing the car to 62 mph in 8.2 seconds. Transission options will be a seven-speed dual-clutch automatic and a 6-speed manual. Mercedes will probably bring only the CLA 250 to America, with the automatic in tow.
Of course, the company’s in-house tuner, AMG, is working on a hopped-up version. The CLA45 AMG packs a turbocharged version of the 2.0L I4, producing over 350 HP / 295 lb-ft. That’s a lot of muscle for such a small car.
Inside the cockpit, you’ll find Mercedes’ latest COMAND infotainment system, which includes Garmin-powered navigation with real-time traffic and Google Street View imagery, internet radio, Facebook / Twitter support, real-time location sharing, and for iPhone users, Siri integration. Among the options are ambient fiber-optic lighting and a large panoramic sunroof. The car gets an array of hand-me-down safety features from the E-Class, such as drowsiness detection and radar-based collision prevention with adaptive brake assist.
Slotting in under the C-Class, the CLA is on track to hit U.S. dealers later this year, starting at around $30,000.
Star Wars fans may be dismayed to hear that the U.S. will not be building a Death Star after all. The White House finally responded to a petition with nearly 35,000 signatures calling for a Death Star to be built for a “strong national defense” and job creation.
On Friday evening, the Obama administration announced that it had decided against building the spacecraft. Paul Shawcross, head of the Science and Space Branch of the Office of Management and Budget, outlined why:
- The Death Star could cost more than $850,000,000,000,000,000 to build, which might increase the deficit a bit
- The Obama administration does not support blowing up planets
- The Death Star has a fundamental flaw that can be exploited by a one-man starship
While a Dark Side spacecraft may be a few years away, Shawcross reminded readers of the U.S. participation in the International Space Station.
Read on after the break for the full White House response.
Just hours after settling the FTC’s antitrust investigation of its business practices, Google has blocked all Windows Phones from accessing its Google Maps mobile site. The move represents the latest move in an escalating war between Google and Microsoft.
Navigating to maps.google.com on any Windows Phone 7 or 8 handset now redirects to Google’s homepage:
Google issued a response claiming that WP devices wouldn’t work because the Google Maps mobile site was only “optimized” for the WebKit browser engine used by Chrome and Safari, and not Internet Explorer [note: Gizmodo's assertion that the Google Maps mobile site has never worked on WP7/8 is incorrect]:
The mobile web version of Google Maps is optimized for WebKit browsers such as Chrome and Safari. However, since Internet Explorer is not a WebKit browser, Windows Phone devices are not able to access Google Maps for the mobile web.
This response is, however, problematic at best. Read on after the break to see why.