Sony CEO Warns of $2.9 Billion Loss

First appeared in Reuters

Ailing Japanese electronics giant Sony Corp warned it was heading for a bigger-than-expected $2.9 billion annual loss, presenting a daunting task for incoming CEO Kazuo Hirai, who vowed to move quickly to turn things around.

Overtaken by more innovative rivals such as Apple Inc and Samsung Electronics over the past decade, Sony posted a $2.1 billion net loss for October-December, normally a strong quarter boosted by year-end holiday sales, as it battled a strong yen, flooding in Thailand that ruptured supply chains, and a weak economy.

It also took a one-off charge for exiting a flat panel joint venture with Samsung, and said sales dropped 17 percent to 1.82 trillion yen.

The forecast for a 220 billion yen ($2.9 billion) net loss for the year to March, Sony's fourth straight year of red ink, was close to double what the market had expected, and revealed the task ahead for Hirai, who replaces Howard Stringer as CEO in April.

Hirai, a 51-year old Sony veteran known for reviving the PlayStation gaming operations through aggressive cost-cutting, said he would not hesitate to scale back or withdraw from businesses if they were not competitive.

"I have a very strong sense of crisis about the environment surrounding us," Hirai told a news conference. "We cannot be afraid to make painful choices for the future of Sony. Our rivals and the operating environment won't wait for us."

There is unlikely to be a honeymoon period for Hirai, who is under immediate pressure to sort out the ailing TV business after it fell behind South Korean rivals such as Samsung in a market where prices are tumbling.

Above all, Hirai will strive to recapture the innovative flair that led Sony to come up with the Walkman personal music-player in the 1980s and the PlayStation in the 1990s, and regain ground lost since then to Apple and Samsung whose iPhones, iPads and Galaxy gadgets are snapped up by consumers.

Some analysts believe Hirai -- 51, tall, urbane and a fluent English speaker -- can rekindle the flame, saying he has a good grasp of the overall business and is likely to know how to break down its silos and integrate its divisions.

Others are less optimistic about his chances.

"It won't be easy for Sony to regain its lost ground under new leadership, as its overall competitiveness has sharply weakened," said Kim Young-Chan, analyst at Shinhan Investment Corp in Seoul.

"It's got structural problems that will take years to fix.

"It's not just Sony, but Japanese IT firms have similar problems. They are failing to innovate and produce industry-leading products in almost every major area - from TVs to displays, tablets and smartphones."

Hisashi Kuroda, general manager of equity investment at Meiji Yasuda Asset Management in Tokyo said Sony had to take tough decisions.

"Unless they do radical reforms, like the ones that would put everything completely upside down, Sony may not be able even to make profits."

PAINFUL DECISIONS

A chief concept in Hirai's strategy hinges on merging Sony's robust roster of entertainment properties - including singers Kelly Clarkson and Michael Jackson, and the "Spider-Man" and "Men in Black" film franchises - with its Vaio, Bravia and other electronics brands, in an effort to boost sales.

He said the TV business would be crucial to this "convergence" strategy, brushing aside suggestions it may need to pull out of the market even with the business set to lose 220-230 billion yen this financial year.

"There's still a chance in home electronics and I don't think Sony should quit TV's, but unfortunately I can imagine the day may come when they will pull the plug on the business," said a former engineer and executive at Sony.

"This is because when you keep making losses and you have no fresh ideas, that becomes the easy choice."

Chief Financial Officer Masaru Kato said Sony aimed to halve losses on flat TVs in the next financial year from April, when as a company it hopes to make an operating profit of about 200 billion yen.

Hirai singled out medical as a potential core business for the future, but he declined to comment on any possible investment in troubled endoscope maker Olympus Corp.

TROUBLED LEGACY

Welsh-born Stringer, a former journalist who ran U.S. broadcaster CBS, was brought in as a rare foreign CEO in Japan to shake things up, but many analysts see his major achievement as cost-cutting.

Sony's shares have lost nearly two-thirds of their value since Stringer, who turns 70 this month, took the helm as CEO and chairman in 2005.

Stringer sold off TV factories in Spain, Slovakia and Mexico and outsourced more than half of its production to other companies, including Hon Hai Precision Industry, the contract electronics maker whose key customer is Apple.

Recently, Sony exited an LCD panel venture with Samsung, enabling it to obtain screens for its TVs more cheaply. It also agreed to buy out Ericsson's half of their smartphone venture for $1.5 billion to shore up its position in a market where Apple and Samsung have become leaders.

Hirai was effectively anointed as Stringer's successor last March when he was promoted to head Sony's consumer products and services businesses, which produce the bulk of Sony's $85 billion in annual sales.

"They've been grooming him for a while," said Dan Ernst, Hudson Square analyst. "I think he will carry on the plan for Sony - as difficult as it is."

The last year has been brutal for many Japanese companies, hit by a strong yen that hurt exports, and two natural disasters - the March earthquake in Japan and the Thai floods.

Stringer said those disasters and the Lehman shock of 2008 had hit Sony hard and masked much of the progress made during his watch.

"If we hadn't reformed Sony as we did, can you imagine where we would be today," Stringer said. "I rest my case."

($1=76.13 yen)

Sony Enhances PlayStation to Take On Nintendo's Wii

The Wall Street Journal

 

If you're still just pressing buttons to play video games, now you have another reason to get up off the couch and really get into the action of a video game.

This week, Sony's PlayStation 3 continues the motion sensor video-gaming trend with its PlayStation Move (us.playstation.com). Move comes in a $100 bundle for people who already own the PlayStation 3, or $400 for the system and the bundle.

Nintendo helped spark this trend in 2006 with its Wii, a video-game console, which is played using remotes with built-in motion sensors. The Wii inspired all sorts of people to play video games—including some who never played one before—because its remotes weren't intimidating and worked with gestures familiar to people, like swinging a tennis racket or rolling a bowling ball.

Sony's PlayStation move takes this concept a step further. Its Move motion controller remote has three built-in sensors and a sphere on one end, making it look a bit like a microphone. The sphere's position can be tracked in 3-D space by a camera called the PlayStation Eye, which plugs into the PlayStation 3 and sits atop your TV. This camera lets the PlayStation know how you're moving the controller and where you're holding it. Instead of a camera, the Wii uses a sensor bar that emits infrared signals detected by the Wii remote.

Sony claims these enhancements give PlayStation Move precision and accuracy, and for the most part, I found this to be true. I especially liked when virtual images of the equipment I was "using" appeared on the TV screen, which made it seem like I was actually holding a bat, sword or tennis racket. I was so engaged with the on-screen images, I almost forgot I had a controller in my hand.

My experiences with the Nintendo Wii, which costs $200 less than the PlayStation Move and PlayStation 3 combined, have always been enjoyable. I've found many of the Wii's games to be approachable for almost anyone. Nintendo helped its cause a year ago when it brought out the Wii MotionPlus—a small accessory that plugs into the Wii remote to give its gestures added sensitivity; in my tests, it worked well. The Wii's action will be enough for some not-so-serious video-game players not willing to pay more for another console.

The PlayStation Move will get some competition in November when Microsoft releases Kinect for the Xbox 360. This video-game console tracks body movements but doesn't require a remote control. Instead, gestures like hand waves work to control games, making one's entire body a sort of remote control.

I'm not a serious gamer. As always, this column is written for mainstream consumers and I tested PlayStation Move with those people in mind. I played games like table tennis and disc golf from the Sports Champions game that comes with the PlayStation Move bundle, as well as downloadable titles like a precision block-building game called Tumble.

I also played EyePet, a game that involves taking care of a creature by washing it, dressing it in stylish costumes and playing with it.

In games like Tumble, I found that the PlayStation Move motion-control remote generated precise movements such as the ability to tilt a cube exactly the way I wanted to get it to stand on a stack of five blocks—or in one case, accidentally cause the stack to crash to the ground. Likewise, while I played table tennis, I quickly figured out how a slight flick of my wrist could generate more spin on the ball in a way that felt more realistic than with the Nintendo Wii.

I was impressed by the detailed animation and scenes in the PlayStation Move games that I played. In disc golf, for example, I played against three opponents who each had their own set of unique celebration flips or dances. And the golf courses in the game showed trees and water hazards that looked pretty realistic. A special bird's eye view followed my disc's trajectory from the second I flicked the wrist holding my motion controller until it landed.

EyePet is especially fun—and not just for kids. I named my EyePet "Domino" and taught it to jump through a hoop that virtually appeared on-screen at the end of my remote. I gave Domino a "checkup" by turning the motion controller into an X-ray-like device. This told me his brain needed a boost of creativity but his heart was happy.

There are currently 15 games that will work with PlayStation Move and a spokesman for Sony says 15 additional games will be available by the holiday season. The average price for these games is $40, though downloadable games cost less, including the $10 Tumble.

The $100 PlayStation Move bundle has the motion controller, PlayStation Eye camera and a game called Sports Champions, which includes disc golf, gladiator dual, archery, beach volleyball, bocce and table tennis.

The PlayStation Eye camera can track four controllers at once, though some games—like Start the Party—are designed to let people pass their controllers from one person to the next. Other webcams can't be substituted for the PlayStation Eye to use with the PlayStation 3.

A $20 shooting attachment fits over the controller and makes it look and act like a handgun. This can be used in first-person shooter games like Killzone 3, due out in February, as well as in arcade shooter types of games like The Shoot, available in October. (I didn't get these games in time to test them.)

If you already own a PlayStation 3, you'll enjoy the added precision and fun that the $100 PlayStation Move bundle offers. But for casual gamers who don't want to spend so much, the less expensive Nintendo's Wii will probably suffice.

Apple Eats Into Nintendo, Sony Sales as the IPhone Plays to Gamers

Bloomberg

 

When Max Batch wants to play a video game, he turns to his Apple Inc. iPhone.

The 22-year-old German has shunned hand-held consoles such as Sony Corp.’s PSP and Nintendo Co.’s DS, joining a growing number of people who use their smartphones for online and other games, eroding sales of the dedicated handsets.

“It’s not worth having a hand-held,” said Batch, who spends about 2 euros a month on mobile-phone games and tried out Sony’s Playstation Portable at the Gamescom fair in Cologne, Germany, last month. “I have an iPhone and when I want to play, I download something from the app store.”

With more processing power and better graphics than their predecessors, smartphones are eating into the market dominated by Nintendo and Sony. Shipments of game-capable mobile phones are set to rise 11.4 percent to 1.27 billion this year, researcher iSuppli said last month, while those of video-game consoles may be little changed at 52.3 million and portable units may drop 2.5 percent to 38.9 million.

“With casual gaming dominating the market, the iPhone is starting to give the traditional hand-held DS and PSP models a run for their money and will likely continue into the future,” iSuppli researcher Pamela Tufegdzic said. Revenue from hand-held gaming units is estimated to be little changed between $5 billion and $6 billion this year, iSuppli said.

IPad Threat

Apple’s iPad is another threat. With the success of the tablet computer prompting companies such as Toshiba Corp., Samsung Electronics Co. and Research In Motion Ltd. to develop similar devices, console makers may be set for more competition.

“There’s certainly increased competition between the hand- held platforms and the mobile devices,” John Schappert, chief operating officer of Electronic Arts Inc., said in an interview. “I think there’s going to be incredible growth happening on the iPad and the iPhone and the Android devices.” Android is Google Inc.’s operating platform.

The multi-purpose capabilities of mobile phones are making them the platform of choice for young gamers.

“In some countries the first digital entertainment device that people there might touch is a mobile phone rather than a PC,” Chris Lewis, vice president of Microsoft Corp.’s EMEA Interactive Entertainment Business, said in an interview.

Windows Phones

Microsoft, the maker of the best-selling Xbox360 console, doesn’t have a dedicated hand-held device. It now wants to attract players on the move with games on phones that use its Windows Phone 7 operating system.

The boom in mobile-phones games is prompting software makers to adopt existing games to the new market segment.

Some games, such as “Max and the Magic Marker” from the Danish studio Press Play ApS have their roots in the console and hand-held market and will now be available on the Windows 7 Phone, Matt Booty, general manager of Microsoft’s mobile game studios, said in an interview.

“A lot of children have hand-me-down phones as opposed to having dedicated portables like the DS or the PSP,” Booty said. “We definitely see that as a potential target market where we would like to compete.”

Microsoft has announced 50 games titles that will be available when Windows Phone 7, scheduled for release in October, becomes available.

Game Center

Apple, based in Cupertino, California, has shipped more than 120 million devices that run its iOS operating system, including the iPhone, iPad and iPod Touch. The company earlier this month added a Game Center feature to the operating system that offers multiplayer games.

Mobile phones on which users can potentially play games made up 93 percent of all games hardware in 2009, while consoles accounted for 3 percent, according to iSuppli. Still, hand-helds had a 67.1 percent share of the worldwide games software market in 2009 with the rest for mobile phones.

Hand-helds still have the advantage of buttons and specific gaming capabilities, while smartphone games are usually played with less accurate touchscreen controls, executives at the console makers say.

Comparing smartphones to hand-helds “is like comparing apples with oranges” and the current development of handset sales isn’t connected to the rise of smartphones, said Bernd Fakesch, Nintendo’s general manager in Germany. “It has to do with the Nintendo DS having reached a market penetration that has never been seen before for any console.”

‘World of Games’

DS hardware sales fell 47 percent to 3.15 million players in the three months ended June 30, while software sales dropped 23 percent to 22.4 million units, Nintendo said July 30. Mobile game consoles accounted for 27 percent of revenue last year, making them the company’s biggest sales generator.

“The hand-helds will continue to be successful if they bring something different and more interesting for gamers,” said Yves Guillemot, chief executive officer of Ubisoft Entertainment, Europe’s biggest video-game producer.

Brian Farrell, CEO of wrestling video games publisher THQ Inc., said a good example is Nintendo’s 3-D version of the DS hand-held, which has a 3-D screen that doesn’t require users to wear special glasses.

Some executives say the discussion about whether mobile phones and tablet computers will usurp traditional gaming consoles and hand-helds is misleading, as phone games may help to expand the total computer-games market.

“If even a small percentage of the casual gamers say that this is something I really like and enjoy, some may go out and buy a PlayStation 3,” said Kazuo Hirai, president of Sony’s Networked Products & Services Group. Mobile-phone games may be a “good way to get people into the world of games.”

Sony Develops Single Cable to Transmit Data and Power

International Business Times

Sony has announced the development of a single cable interface which would replace close to 22 cables used in smartphones to transmit power and data, said a statement.

The new development of transmitting both power and data over a single copper cable would replace the complicated set of ribbons used to connect a handset display to the body of a device.

The single cable interface will allow clamshell mobile model makers greater flexibility in design.

Traditionally separate wires are dedicated to carry audio, video, control signals and power. Sony's technology allows both power and data to carry on the same cable and also makes transmission faster at 940 Mbps.

"Sony's newly-developed 'single wire interface technology' has achieved bi-directional transmission of several kinds of signals, including video, audio and control signals, by using time division duplex and multiplex," said a statement by the company.

In addition, the DC power is supplied on the same signal cable using Sony's unique encoding technology with DC balance that "enables both DC power supply and high speed data to be transmitted within a limited frequency bandwidth."

With a current surge in the features an average smartphone carries and the high resolution displays it uses, resulted in a glut of cables to accommodate the flow of data and additional power. The bundle of cables took more space and made bending a cluster of wires more difficult, thus limiting designing.

Sony's technology will help designers incorporate greater flexibility, with the freed space which cables would otherwise consume. Also for after sales service it would provide a less complicated platform - sans the bundle of wires.

The inside of mobile will be aesthetically more refined to complement its exterior now.

Sony has not announced any new models built around this development but plans to implement the technology by licensing the IP to ROHM Co., Ltd., which has a track record in peripheral technologies.

Sony, Panasonic TVs Star in Price Battle in China Showrooms

Bloomberg

 

Sony Corp.’s and Panasonic Corp.’s ambitions for higher earnings this year depend on convincing Yin Weiguang, a retired construction worker in Beijing, that he chose the wrong television.

“I don’t really care about fancy features,” said Yin, 55, who paid 2,799 yuan ($413) for a 32-inch set made by Skyworth Digital Holdings Ltd. “I just use it for basic entertainment: watching news, weather forecast and TV series.”

Sony and Panasonic, the world’s two largest makers of consumer electronics and Sony camera batteries, are slashing some TV prices by a third in China after being outsold six-to-one by Shenzhen-based Skyworth. Sony aims to double TV shipments in China this fiscal year, and Panasonic expects 50 percent growth in the world’s second- largest market for flat-panel TVs.

“The price battle in China will likely intensify as local manufacturers, South Korean makers and Japanese companies all fight for market share,” said Yoji Takeda, who heads the Asian equity management team at RBC Investment (Asia) Ltd., which oversees $1.1 billion. “Prices will probably continue falling with increased market supply during the second half.”

In December, Sony offered a 32-inch set for 3,000 yuan, or 33 percent off the previous price for that size, targeting customers in regional cities and rural districts, said Yuki Shima, a spokeswoman for the Tokyo-based company. To help cut costs, Sony has increased outsourcing of TV production to Foxconn Technology Group, the world’s largest contract manufacturer of electronics.

50 Percent Cut

Panasonic, the world’s biggest maker of plasma TVs, may cut prices of some models in China as much as 50 percent this year, Hitoshi Otsuki, senior managing director of the Osaka-based company’s overseas operations, said in an interview last week.

“The market is totally different from the U.S. and others,” Otsuki said. “In China, domestic manufacturers are very powerful, especially in low-end products. The smaller sets are the fastest-growing area and the most difficult for us.”

Sony slipped 0.7 percent to close at 2,681 yen in Tokyo, narrowing its gain this year to 0.4 percent. Panasonic fell 1.2 percent, extending its loss in 2010 to 17 percent. Skyworth Digital dropped 0.4 percent at the midday break on the Hong Kong Stock Exchange.

Biggest Flat-Panel Market

Sales of liquid-crystal-display TVs in China will rise 15 percent to 45.5 million next year and overtake North America shipments, according to DisplaySearch estimates. China will become the biggest flat-panel TV market, including plasma sets, in 2012, according to the Austin, Texas-based researcher.

Skyworth is the market leader in China with a 15 percent share, followed by domestic rivals Hisense Electric Co. and TCL Corp., according to AVC Consulting in Beijing.

Japan’s Sharp Corp. was the top non-Chinese vendor with 4.9 percent, followed by Samsung Electronics Co. and LG Electronics Inc. of Seoul. Sony and Panasonic, the maker of Viera-brand TVs, each had 2.4 percent.

“Sony has started to take more serious action in China,” Shima said, citing the introduction of the lower-priced model in December. “We need to become sensitive about changes on products and business models for China.”

A price war may reverse the optimism sparked last month after the Japanese companies increased profit forecasts, said Yuuki Sakurai, chief executive officer of Tokyo-based Fukoku Capital Management Inc. Sony and Panasonic on July 29 cited better-than-expected sales of flat-panel TVs for raising their full-year projections, sending shares of both companies higher in Tokyo trading the following day.

Sony estimates 60 percent growth in worldwide TV sales by volume and Panasonic 35 percent.

“There’s no way Sony and Panasonic can compete with Chinese producers in terms of prices,” Sakurai said. “Even the South Koreans are struggling. Chinese consumers aren’t very keen on top-quality products.”

Samsung, the world’s largest TV maker, said last month that falling set prices may erode profitability this quarter. The company intends to keep prices above those of Chinese producers.

“We will stick to a strategy that will make people aware of our premium image,” said Chenny Kim, a spokeswoman at Suwon, South Korea-based Samsung. “We won’t compete with local companies in pricing.”

Skyworth’s annual shipments in China rose 12 percent to 7 million units in the fiscal year ended March 31 from a year earlier, the company said April 19. Revenue from the business increased 55 percent.

Competition, What Competition?

Skyworth, whose shares trade in Hong Kong and Frankfurt, isn’t concerned about international competitors, said Shen Jian, a spokesman. Brands from abroad account for about a quarter of the TVs sold in China, according to DisplaySearch.

“Domestic branded TVs are cheap and durable,” said Yin, who receives a monthly pension of about 4,000 yuan.

A 40-inch, international-brand TV sold for an average of about $902 in the second quarter, or about 33 percent more than Chinese marques, according to DisplaySearch.

“Our advantage is we are a local brand,” Shen said. “We don’t worry about the competition at all.”

Still, the price cuts may be helping overseas companies make inroads. Chinese producers’ combined market share fell to 76 percent in the first quarter from 83 percent the previous three-month period, according to Hisakazu Torii, a Tokyo-based analyst at DisplaySearch.

Value For Money

Liu Lin, 29, said non-Chinese TVs are worth the extra cost.

“The quality of Sony’s picture is really good,” said Liu, who bought a Sony 46-inch Bravia set for 5,999 yuan, or more than half her monthly pay. “Quality and price are of the same importance in buying a TV set.”

Japanese TV makers also face the hurdle of a stronger currency that’s giving them less room to cut prices than South Korean rivals. The yen has gained about 7.4 percent against the yuan this year, while the Korean won has weakened 1.2 percent.

They may get a boost from the falling prices of flat panels and used monitors, typically the costliest TV component. LG Display Co., the world’s second-largest LCD maker, last month forecast that panel prices would decline an unspecified amount through August.

“Price is my top concern given I’m not that well-paid,” said Pan Ying, who earns about 5,000 yuan monthly at a Beijing health-care company. “I’ll consider a foreign brand if the price is good.”

Do 3G Handheld Game Consoles Have a Shot?

PC World

In theory, a handheld gaming device with 3G connectivity seems like a great idea, which is probably why Japanese wireless carrier NTT DoCoMo is pitching the concept to console makers. In practice, it's a stretch.

NTT DoCoMo won't say which companies are part of the conversation, but Nintendo and Sony seem like obvious participants. Maybe Microsoft or some lesser-known party is involved. In any case, NTT DoCoMo hopes game console makers will embed 3G capabilities in their devices, or at least offer Mi-Fi-like routers to create local wireless connections, the Wall Street Journal reports.

The report mentions how Amazon struck a deal (with Sprint, and then AT&T) to build data coverage into e-reader price tags, yet I'm surprised that neither NTT DoCoMo nor the story itself mention how much more data a 3G game console would require. An e-book contains text. A downloadable game contains audio and video as well. Online, multiplayer gaming would be demanding. My knowledge of the wireless market in Japan is slim to none, but in the United States, no carrier would agree to serve 3G coverage to game consoles without a monthly charge or a huge up-front price.

Therein lies the dilemma for future game consoles. As gaming becomes more popular on multi-purpose devices -- not just phones, but 3G-enabled tablets -- dedicated consoles will look outdated without constant online connectivity. Still, it'll be tough for people to justify another monthly bill just for portable gaming.

For the sake of not being a total naysayer, here's one way out: I'm dreaming of a day when you can buy a whole mess of data and apply it to a range of devices, from phones to tablets to -- yup -- game consoles. Carriers are still stuck on a per-device mentality, but maybe that'll change as they move away from unlimited data. If that happens, I really do hope handheld game devices can be part of the shift.

Sony Recalls Vaio Laptops

CBC News

Sony has ordered the recall of two models of the VAIO laptop computer because of an overheating problem that could cause burns to the user.

The Canadian recall involves nearly 14,000 F11 and CW2 series computers sold between January and June 2010.

In the United States Sony recalled 233,000 of the laptops last week after receiving 30 reports of the computers overheating and causing damage to keyboards and casings. There were no reports of injuries.

No similar incidents have been reported in Canada.

Microsoft's Online Xbox Games to Pass $1 Billion Sales Mark for First Time

Bloomberg

 

Microsoft Corp.’s Xbox Live online video-game service probably broke the $1 billion revenue mark for the first time in the year that just ended, helped by sales of movies, avatar accessories and extra game levels.

Microsoft says about half the service’s 25 million users paid an annual fee to play games online like “Call of Duty: Modern Warfare 2” in the year ended June 30. That would be about $600 million. Sales of products like movie and TV show downloads topped subscription revenue for the first time, Dennis Durkin, Xbox’s chief operating officer, said in an e-mail.

The remarks suggest the business generated more than $1.2 billion in sales last year, exceeding analysts’ estimates. Success in online gaming is crucial for Microsoft because the other products in this unit include the barely profitable Xbox game console and mobile-phone software that’s losing ground to Apple Inc. and Google Inc.

“Xbox Live has helped sell a lot of consoles and created a lot of loyalty,” said Matt Rosoff, an analyst at Directions on Microsoft in Kirkland, Washington. “Everyone has been talking about Microsoft’s inability to innovate, but this is a pretty good example where they have innovated. They timed it just right with this one.”

Durkin declined to give more detailed results for the service, and Redmond, Washington-based Microsoft doesn’t break them out when it reports earnings. Sarah Friar, an analyst at Goldman Sachs Group Inc. in San Francisco, estimates Xbox Live had sales of $1.1 billion in the past fiscal year, up from $800 million a year earlier. Subscriptions for the premium service are $50 a year.

Rival PlayStation Network

Microsoft may have difficulty extending the popularity of Xbox Live to other consumer businesses like television software and portable music and video players, Rosoff said.

Sony Corp.’s rival PlayStation Network is starting a subscription offering, and Xbox Live also competes against Apple’s iTunes for music and TV show downloads. Microsoft said in May that Entertainment and Devices Division President Robbie Bach, who has overseen Xbox for a decade, will retire. J Allard, one of the earliest executives on the Xbox project, also left.

Friar estimates Xbox Live has gross margins, the percentage of sales remaining after deducting production costs, of about 65 percent. That’s buoyed results in the entertainment division, which has reported an annual profit only since 2008.

Microsoft will post operating income of $1.04 billion for the division in the year that ended June 30, projected Friar, who is based in San Francisco and recommends buying the shares. That’s more than six times the income in fiscal 2009. The company is due to report 2010 results July 22.

‘Launch, Sustain, Retain’

Xbox Live is helping Microsoft draw in additional revenue after gamers leave stores with games in hand, Durkin said.

“The old playbook of ‘launch and leave’ is a relic of the past,” Durkin said in an e-mail. “Today with Xbox live, it’s now about ‘launch, sustain, retain’ by continually adding new content that enhances the original experience.”

To boost future revenue, Xbox Live struck content deals with Walt Disney Co.’s ESPN and Activision Blizzard Inc. and introduced a family subscription that gives four memberships for the price of two. Its Kinect device, which lets users play games by movement rather than with a controller, will also fuel sales, Friar said. Microsoft probably can increase Xbox Live sales by a rate of “mid-teens to 20 percent” a year, she said.

Activision says Xbox Live is the only online gaming business -- except for Activision’s own personal-computer based “World of Warcraft” franchise -- that generates substantial money.

Revenue Sharing

“When it comes to online gaming, they’re the only significant alternative to us,” says Activision Chief Executive Officer Bobby Kotick, whose “Call of Duty” titles have 50 million registered online players.

Success may breed increased demands from content providers to share more revenue. Already Activision says it wants a cut of the take from subscriptions, not just the percentage it currently gets from its content sold through the service.

“We’re driving a lot of the subscription interest and certainly hours of game play,” Kotick said.

Microsoft rose 48 cents, or 2 percent, to $24.30 at 4 p.m. New York time in Nasdaq Stock Market trading. The stock has dropped 20 percent this year.

Microsoft’s decision to invest early on in a subscription service for online gaming is paying off, said Michael Pachter, an analyst at Wedbush Securities Inc. in Los Angeles, who covers the video-game industry. Xbox Live began in 2002.

Sony Plays Catch Up

Pachter estimates Microsoft sank about a billion dollars into the effort and didn’t break even until it released its second console in 2005. Still, the early start, combined with exclusive games, means Sony won’t catch up with its PlayStation Network, he said.

“I was skeptical in ‘02 -- I thought it was stupid,” Pachter said of Xbox Live. Now, the service is driving gamers to Microsoft. “If your friends are all playing on Xbox, you get an Xbox. If they’re all on Xbox Live, you get Xbox Live.”

Pachter estimates that Sony is losing money on PlayStation Network, which sells games and other content. Last month, Sony said it will add a premium service and charge $50 a year, matching the Xbox Live fee.

Some of Xbox’s success is due to the popularity of the alien-shooting “Halo” games, which are Xbox exclusives and top-sellers.

The “Halo” franchise “essentially invented” the market for multiplayer online games on consoles, Pachter said. There are 6 million people a month who play the game on Xbox Live, and Sony probably doesn’t have half as many people playing all of its exclusive online games combined, he said.

Microsoft is working to extend Xbox Live’s success to mobile phones. Its overhauled phone software, available later this year, will let customers play Xbox Live games and see users’ avatars, profiles and achievements.

The company needs to expand its success with Xbox Live to its other consumer businesses, Rosoff said.

“They need to take it more broadly,” he said. “It’s taken longer than I expected to do that.”

Sony's PlayStation Network Said to Be Near Deal for Hulu's Paid TV Service

Bloomberg

 

Sony Corp. is close to an agreement to carry a paid TV service from Hulu LLC, operator of the second-largest video website, on its PlayStation 3 game console, two people with knowledge of the talks said.

The partnership could be announced as soon as next week, according to the people, who asked not to be identified because the arrangement hasn’t been made public.

Access to video-game consoles would give Hulu’s planned pay service a bigger audience and more revenue by making its Internet programming more widely available on television sets. Hulu also is in talks with CBS Corp., Viacom Inc. and Time Warner Inc. to add their TV shows to the website’s subscription service, people with direct knowledge of the discussions said.

PlayStation 3 owners registered for the console’s free Web service, the PlayStation Network, would be able to subscribe to a Hulu service that provides on-demand access to current and past seasons of prime-time TV shows from NBC, Fox and ABC, the people said. Hulu also is in talks to put its $9.95 a month service on Microsoft Corp.’s Xbox, Reuters reported previously.

Patrick Seybold, a spokesman for Sony’s PlayStation Network in Foster City, California, declined to comment on a possible agreement, as did Christina Lee, a spokeswoman for closely held Hulu. Worldwide, the PlayStation Network has 50 million registered users, Seybold said in an e-mail.

Sony fell 1.2 percent to 2,462 yen as of 10:52 a.m. on the Tokyo Stock Exchange. The shares of the world’s third-largest TV maker have declined 7.8 percent this year.

Founders, Investors

Hulu, based in Los Angeles, was founded by General Electric Co.’s NBC Universal and News Corp.’s Fox. Walt Disney Co.’s ABC and private-equity firm Providence Equity Partners Inc. are also investors in the website.

The site, which now lets computer users watch shows for free and gets its revenue from advertising, is seeking to expand the ways users can view programming, as well as add new shows to attract paying subscribers. The company will need to renew program rights from owners including NBC at the end of 2011, according to Laura Martin, a Needham & Co. analyst. The network investors also offer shows on their own websites.

A subscription would put Hulu in more direct competition with Netflix Inc., which supplies online and mail-order access to movies and past-season TV shows starting at $8.99 a month. Netflix already provides its online movie service on consoles from Sony, Microsoft and Nintendo Co., as well as through Blu- Ray players and Roku Inc. devices that connect TVs to the Web.

Hulu Chief Executive Officer Jason Kilar has said his site’s ad-supported model is profitable on a cash-flow basis.

The website garnered $52.4 million in sales in February, with 72 percent going to the content owners, according to estimates from research firm SNL Kagan. That left Hulu with $14.7 million in revenue, $12.6 million in costs and a $2.04 million profit, SNL Kagan calculates.

Porn Stars in 3-D Lure Consumers to New Sony, Panasonic TVs

Bloomberg News

 

Porn star Mika Kayama is at the frontier of a push to develop videos and content in Japan that Sony Corp. and Panasonic Corp. need to lure customers for their new 3-D televisions.

Kayama and Yuma Asami, the top actresses of adult-movie maker S1 No.1Style, will star in the country’s first DVDs for the 3-D format TVs, providing content analyst Yuji Fujimori says can trigger the success of the new sets. Sales of adult videos in Japan were 108.6 billion yen ($1.2 billion) in 2009, according to Takashi Kadokura, an economist who runs Yokohama- based BRICs Research Institute. That represents about 30 percent of the overall video market in the nation, according to Kadokura.

“Adult videos will likely be an incentive for consumers to buy a 3-D TV,” said Fujimori, at Barclays Capital in Tokyo. “It’s worth paying attention to the move because it’s lack of content that’s hindering expansion.”

Closely-held S1 No.1Style will offer “3D X Mika Kayama” on June 7 and “3D X Yuma Asami,” Japan’s first pornographic titles in the new format, on June 19 to coincide with the release of Sony’s 3-D Bravia models, with more titles to follow this year, according to the producer, who uses the professional name of Sakon.

Sales Motivation

“I want to try it out,” said Satoshi Miyazaki, 33, who pays about 2,000 yen a month to watch adult cable channels. “I need something dramatic to justify replacing my TV. This could be the motivation.”

Sony, the world’s third-largest TV maker, plans to offer 3- D Bravia TVs in Japan from June 10 and in the U.S. and Europe later this summer, according to Yuki Shima, a Tokyo-based spokeswoman. Panasonic became the first major TV maker to sell high-definition 3-D sets in the U.S. in March and in Japan in April. Sharp Corp. and Mitsubishi Electric Corp. have said they plan to sell similar products.

Sony’s Shima and Akira Kadota, a Panasonic spokesman, declined to comment on whether 3-D adult movies would boost sales of the new TVs.

Worldwide shipments of 3-D TVs are expected to be 4.2 million units this year and 12.9 million in 2011, according to California-based researcher iSuppli Corp. That compares with its projection of 170 million sets this year for all types of liquid-crystal-display TVs, the researcher said May 25.

‘Avatar’ Release

3-D movies, which first appeared in cinemas in the 1920s, gained a resurgence of popularity with the December release of News Corp.’s “Avatar,” the world’s top-grossing motion picture. Suwon, South Korea-based Samsung Electronics Co., the No. 1 TV maker globally, said last month it will work with “Avatar” director James Cameron to develop content to market its 3-D sets, which went on sale in the U.S. in March.

S1 No.1Style, which releases about 25 DVDs a month, is offering 3-D titles at the same price of 2,980 yen as 2-D ones, Sakon said. Soft on Demand Co., a Tokyo-based adult-film company, plans to sell two 3-D titles on June 25 and more later this year, according to Tsuyoshi Fujimoto, a spokesman.

Local TV station Sky Perfect JSAT Corp. will join BS Broadcasting Corp. and Jupiter Telecommunications Co. in airing 3-D programs on June 19, according to the companies. Three 3-D PlayStation 3 games will be available when Sony starts selling 3-D Bravias, said Shima.

Soccer World Cup

Sony’s not aware of any announcement of 3-D titles that will be available on June 10 to coincide with the release of its new Bravia TVs, Shima said. The company’s film unit will offer “Cloudy With a Chance of Meatballs” in 3-D Blu-ray in the summer, and the 2010 soccer World Cup games by the end of the year, she said.

Sony shares have risen 1.5 percent this year in Tokyo, while Panasonic has dropped 14 percent. Japan’s benchmark Nikkei 225 Stock Average has declined 8.9 percent this year.

The 3-D TVs may help stem a decline in sales of adult movies in Japan, which have dropped about 15 percent since their peak in 2006 because of a prolonged recession and competition from free online pornography, said BRICs Research’s Kadokura. “3-D technology is just what the porn industry needed,” he said.

S1 No.1Style spent three months making its first 3-D films, triple the time for a normal production, said 29-year-old Sakon.

Actors Moves

“It was a different filming experience using a new camera,” he said. “Actors needed to move more slowly, furniture had to be relocated and lighting rearranged to make it work. But it was worth it. We’ll make a profit out of this.”

Tokyo-based Sony, which projects sales from 3-D products excluding content will reach 1 trillion yen in the year to March 2013, plans to sell Vaio personal computers that can show 3-D images before the end of the year, the company said in January.

Toshiya Shimizu, a 28-year old Tokyo resident, said he may wait for the cheaper 3-D computer.

“I want to rent the DVD first to see how good the image is,” he said. “I’d like to watch Yuma Asami in 3-D.”

Sony's Countertop View of the Web

The Wall Street Journal

Every time a technology product breaks new ground, it has to answer the question on most consumers' minds: Do they really need this product? Most recently, Apple encountered this at the launch of the iPad, which confused some consumers who weren't sure how it would fit in with their cheap laptops and smartphones.

This week, I tested a product that represents Sony's attempt to wade into a new category: the $200 Dash (sony.com/dash). This gadget, labeled by the company as a Personal Internet Viewer, is like a digital photo frame on steroids. It's meant to run in the background of your life, cycling through on-screen data, slide-show style, while sitting on a kitchen counter, desk or nightstand.

The Dash's content includes more than 1,000 apps, the majority of which came out of Sony's partnership with Chumby Industries, maker of its own similar devices. These apps connect to the Internet via Wi-Fi and display frequently refreshed data like Facebook photos and statuses, tweets from Twitter.com, quiz-game questions, recipe tips, email snippets and news updates. The Dash can play videos from services like Netflix and Amazon's Video on Demand.

But aside from some faults, Sony's biggest challenge will be convincing people that they actually need a Dash. I used it for a week, both at my office desk and at home, and I'm not convinced I need to spend $200 to watch bursts of data appear onscreen like a slow stock ticker. I already use a smartphone, laptop or iPad to check things like social-network updates, news and email—and using these never requires waiting for the right information to cycle through a screen or an additional hp laptop battery. There were times when I glanced at my Dash in passing and read snippets of mildly entertaining information, but these moments were few and far between.

To me, the most interesting information to pass through the Dash is that which comes from personalized apps—those that the user sets up with credentials to access content aimed specifically at him or her, like messages in email and social networks. But if the Dash is set up in a kitchen, who in the family gets to set up their account on this gadget? And is all of that content acceptable for all family members to see and read in passing? I can't imagine teens wanting parents reading their content or vice versa.

Some people might like the Dash for its fancy alarm-clock capabilities. It shows weather and time information in a handsome display and can play specially chosen videos or podcasts when an alarm goes off. But smartphones like Motorola's Backflip display time and weather information in tabletop or docked mode.

The Dash has a bright, seven-inch touch screen and an accelerometer, so it can be used vertically or flipped around and laid flat, which is better for things like typing with an on-screen keyboard that appears for certain apps. It lacks a Web browser, word-processing program and a full email program. Accessories like keyboards and mouses can't be attached to the Dash.



Most Dash apps can be browsed directly from the Dash and added to the device, though users can load apps and adjust more app settings by going to the sony.com/mydash website, where the product must be registered, on their refurbished desktop computer. People also can use the website to set up their Amazon and Netflix accounts so videos can play on the Dash. Pandora accounts can be set up here, too, but the Pandora app never worked correctly on my Dash.

The Facebook app lets people read friends' status messages and comments about those status messages. They can touch an on-screen thumbs up icon to like someone's status, and can type their own comments about someone's status. The Twitter app let me write my own tweets, but I couldn't retweet or direct-message other users. A Sony representative said the Dash is intended to be more of a "glanceable" product with less interaction, but that doesn't explain why the Facebook app has interactive capabilities. The representative said they may consider improving the Twitter app in the future. Both Twitter and Facebook were slow to load on the screen, taking about four seconds each for content to appear.

Sony's representative said my office Wi-Fi could be to blame for the Dash's slow performance. The office Wi-Fi, however, isn't behind firewalls and never gives me trouble for other tests. A check of my home's Wi-Fi network showed I had a similar low 42% "link quality" on the Dash there. But my nearby MacBook and iPad showed full signal strength and worked perfectly.

The Dash has several geeky qualities. Setting it up to work with a password-protected Wi-Fi network prompts users to choose the correct key encoding—either HEX or ASCII—neither of which are familiar to most people and the Help button doesn't clarify matters. Apps with email envelope icons in them, like Martha Stewart's Everyday Food app, don't let users email content (in this case, a recipe) to friends. Instead, selecting this icon sends the recipe to the person's own email address—the one with which the device was registered—and the email says it's from "chumby." This name is completely confusing to people who know nothing about Chumby and its connection with Sony.

Sony is planning to fix a few flaws of the Dash and add more functions, including a way to jump directly to an app rather than cycling through the entire list of apps, through an over-the-air software update at the end of May. This fix also will enable the Dash's USB port to play photos and music on the device. It currently isn't functional.

Even if all bugs are fixed on the Sony Dash, I still have trouble seeing how this type of product would be worth $200 for most average users, given the way they already use other devices.

The PS3 Problem: How Sony Got Scooped by its own Customers

PC World

When a problem was discovered in Sony's PS3 consoles, the company's official response was lacking.  

You know things are bad when Sony tells Playstation 3 owners not to turn on their consoles for fear of data loss, but they're even worse when the warning comes 16 hours, and an entire night, after the company first acknowledged problems with the Playstation Network.

Yesterday, Sony announced that PS3 consoles, with the exception of the new PS3 Slim, were unable to connect with the Playstation Network because of a bug in the system's clock. What's worse is that simply turning on the consoles can cause "errors in some functionality, such as recording obtained trophies, and not being able to restore certain data." As such, Sony advised staying away from the PS3 -- unless you've got a Slim -- until they can fix the problem, hopefully within 24 hours.

As with any tech service outage, it's appropriate to look at whether the official response was adequate. In this case, Sony's clearly was not.

Information moves astoundingly fast in the gaming world. I first got wind of the problem at around 4 p.m. PST, reading a Twitter update from Game Informer's Philip Kollar. His PS3 Trophy information was gone, and he couldn't play any games. That was two hours before Sony itself acknowledged the problem and said it was looking into it.

Before long, Sony's customers blew the story open. Reports of internal clock issues were everywhere, mainly stemming from the popular gaming forum NeoGAF. By midnight, one user had posted a detailed FAQ on who was affected, what to do and what's at risk by turning on your console.

That's exactly what Sony should've done. Instead, the company sat on the issue until Monday morning, when spokesman Patrick Seybold posted a sterile message explaining the errors. The warning to PS3 Fat owners was buried in his blog post. That was the last we heard from Sony. Among the perfectly valid questions that were unanswered: How will a fix will be delivered to people who can't go online? What other data is at risk of being lost? Will people get their trophies back?

Kotaku's reporting that consoles are now coming back to life (but no word from Sony, mind you). Sony still has some explaining to do, and gamers deserve an apology not just for the outage itself, but for being kept in the dark.

Update: Sony's made it official that service is back, that a non-existent leap year was to blame, and that the problem resolved itself once system clocks hit March 1.

The Big Guide to Little Netbooks

Fox News / Harry McCracken

I'm a netbook fan -- and I have plenty of company. Their affordable portability makes them a pleasure, whether you're kicking back on the sofa or heading out of town on vacation. Here are few questions to ask before you buy (or don't buy) one.

When showing off new netbooks -- those low-cost, undersized laptops -- otherwise exuberant corporate executives start knocking their own products. Netbooks are cramped and underpowered, they argue. Yes, the very netbooks they sell.

Why the lack of love for this wildly popular class of computer? In part, it's about profit -- or lack thereof. Most netbooks cost between $230 and $400, so it's hard for PC makers to make a buck selling them. But in the insanely competitive PC market, no major manufacturer is willing to ignore netbooks. They take a deep breath, grumble, and then offer them anyway.

(Okay, one big name has steered clear of netbooks. That would be Apple, who thinks you should buy an iPad instead, starting later this month.)

PC companies may accentuate the negative when it comes to netbooks, but I'm a fan -- and I have plenty of company. Their affordable portability makes them a pleasure, whether you're kicking back on the sofa or heading out of town on vacation. When I fly, I find 15" laptops virtually unusable in most coach sections; a netbook, however, fits just fine even if the traveler in front of me reclines all the way.

If your main system is a desktops or big-screen laptop, a netbook can be a worthwhile second computer, as long as you understand their pros, their cons, and the differences between similar-looking models. Here are few questions to ask before you buy (or don't buy) one.

What are you going to do with your laptop? Netbooks may be basic, but you hardly need a supercomputer to browse the Web, do e-mail, balance your checkbook, and run an office suite. On the other hand, their processors and graphics capabilities are too wimpy for serious 3D gaming. And their screens are too dinky for some high-end applications. (I installed Adobe Photoshop on an Asus Eee PC and couldn't even see the bottom part of its user interface.)

Bottom line: The more casual and Web-centric your computing activities, the better a netbook will handle them.

Are you just looking to save money? Even if you've got a netbook-sized budget, you don't need to settle for a netbook-sized computer. As I write this, BestBuy.com has six full-sized laptops under $400. They're econoboxes, without the cutting-edge technologies and sophisticated engineering of costlier models. But with their roomy screens (mostly 15.6") and built-in DVD burners, they make much more sense as a primary computer than any netbook does.

How are the screen and keyboard? Some of the first netbooks had displays under 9" in size, which was enough to leave almost anyone squinting. Today, most have 10.1" screens -- small, but not unbearably so. Screen resolution still varies; a netbook with a screen that packs an unusually large number of pixels, such as the 1,366-by-768 model on Sony's VAIO W, can show more of a Web page, word-processing document, or photo with less scrolling.

In a perfect world, netbooks with more spacious screens would be commonplace, but they remain rare beasts. HP's Mini 311 (with an 11.6" display) and Lenovo's IdeaPad S12 (12") are standouts.

Keyboard quality is inextricably related to screen size, since the display's dimensions determine the case width. Even the nicest 10.1" netbooks can't quite accommodate a full-sized keyboard; some do come close, however, such as Toshiba's comfy NB305. The best way to gauge keyboards is to trust your fingers -- if possible, try out a netbook in person before plunking down your money.

What's the difference between a cheap netbook and a not-so-cheap netbook? Lower-cost models are more compromised than their pricier competitors: They tend to have creakier processors and graphics, clunkier keyboards, slower networking, and lower-resolution screens. They also have three-cell batteries vs. the six-cell models with higher-end netbooks, which saves on weight but also slashes the number of hours you can go completely mobile before you have to plug in.

The slickest netbooks, such as Nokia's aluminum-clad Booklet 3G, sell for $500 and above. But if you can set aside $350 or so, you won't lack for solid choices.

What version of Windows do you get? Many netbooks still come loaded with Windows XP. It's the world's most familiar operating system, but it's also less modern, secure, and pleasant than Windows 7. Others come with Windows 7 Starter Edition, a stripped-down version that won't even let you change the desktop wallpaper. The best, most full-featured option -- usually found on models that cost a little more -- is Windows 7 Home Premium.

Are you willing to do some upgrades? Netbooks usually include 1GB of RAM, which is on the tight side, especially if you want to run a bunch of programs at once without overtaxing the system. So I recommend investing about $40 and a few minutes of your time to buy and install a 2GB memory module. You might also want to invest $80 or so in a portable external DVD burner, a handy add-on for installing software and backing up data.

Maybe you want something a little beefier? When PC manufacturers explain to me that netbooks are too dinky and sluggish, they usually follow up by saying that consumers would be better off buying a "thin and light" notebook with a larger screen and a more potent processor. Which conveniently ignores the fact that most of these machines cost much more than typical netbooks. Still, if your budget permits, I'd recommend looking at these systems too. In fact, I own and like a $675 Asus UL30A-X5, which I bought to replace an Asus Eee PC netbook. (The latter laptop is still in use, too -- my fiancée adopted it.)

As I said about the great "PC or Mac?" question, the best thing about Windows PCs is that they come in an array of shapes, sizes, and price points. Netbooks don't have to be all-purpose powerhouses -- they just need to be the right computers for some of the people some of the time. If you've got one, I'd love to to hear your real-world report.

Product Review: Sony's 'Daily Edition' E-Reader

The Wall Street Journal

Sony, the Japanese electronics giant, was a pioneer in the current wave of electronic book readers, introducing its first Sony Reader model back in 2006. But, it has been overtaken by Amazon.com, whose Kindle e-book reader, introduced in 2007, has become almost synonymous with the category. Now, Sony is out with a much-improved model that could make it more competitive.

Unlike the Kindle, Sony's readers weren't wireless and their owners couldn't download books or newspapers directly to the device, instead of via a computer. Now, that problem has finally been solved with Sony's new Reader Daily Edition, a handsome $400 wireless model that I've been testing.

The Daily Edition can be bought at Sony's stores; at its Web site, sonystyle.com; and at Best Buy's site, bestbuy.com. It was sold out for the holidays, but Sony says it expects new stock soon.

The Daily Edition isn't a mere clone of the Kindle. It has a different design philosophy and is stronger in some areas, weaker in others. In general, I enjoyed using it, once I mastered its user interface, which took several days. I especially liked the fact that it packs a larger screen into a comfortably small device, and mostly uses touch navigation instead of all physical controls. For instance, while the Sony does have a small page-turning button, you can more easily turn pages by just swiping your finger across the screen. It's also better at navigating digital newspapers, something I've never found very satisfying on the Kindle.

(Full disclosure: Sony has struck a special deal with Dow Jones, which owns The Wall Street Journal and this Web site. Under the deal, a special late-day edition of the Journal, containing updated news, will be available on the Daily Edition for an extra charge starting later in January.)



On the downside, the Daily Edition has three main flaws when compared with the Kindle. First, it's much more expensive—$400 versus just $259. Second, it has only about half of the commercial, copyrighted digital books that Amazon does—around 200,000 versus the Kindle's roughly 400,000. Sony also throws in a million out-of-copyright, old books, for a total of 1.2 million.

But many of these added million titles are obscure and of little interest to mainstream consumers. The Reader also has just eight newspapers, versus 92 for the Kindle, though Sony says 10 more are coming soon.

Third, the technology that makes the screen touch sensitive also dims it a bit, so the Daily Edition's screen is darker than the Kindle's. (Both are unlit monochrome screens with gray-scale graphics.) I found the Sony screen adequate, but it's tougher to read in lower light.

The Daily Edition is a slender device with a black metal body that contrasts sharply with the wider, white plastic body of the Kindle. While both products use the same basic screen technology, and the same screen width, the Daily Edition's screen is longer; it measures 7 inches versus 6 inches for the Kindle. In my tests, I found this a big advantage, because, when both devices were set for roughly comparable text sizes, the Sony could hold more text on a page, cutting down on the need for page turns, which interrupt reading.

In addition, the Daily Edition is narrower than the Kindle, because the borders around the screen are thinner, since they don't have to accommodate the Kindle's various large buttons or physical keyboard. (You can enter text for notes or searches on the Daily Edition using a stylus for handwriting or a virtual onscreen keyboard.) This longer, narrower shape gives the new Sony a nice feel in the hand.

I also preferred the Sony's method for presenting newspapers, which allowed more headlines to be viewed at once and required fewer steps to navigate through the paper.

The Sony also claims more battery life with wireless turned off, comes with a cover included—an extra-cost item on the Kindle—and can handle more book formats, including the free digital books offered by public libraries. Built-in memory is the same, but the Daily Edition's can be expanded while the Kindle's can't.

Like the Kindle, the new Sony also allows you to drag songs, pictures and some personal documents onto the device from your computer. I did this with no problems.

The Daily Edition has companion software for buying, reading and storing books on both PCs and Macs. But it has no app for a smart phone, and doesn't synchronize your last-read place in your book among the reader and the computer.

Also, I found the Daily Edition required a harder learning process than the Kindle. First, it takes awhile to get the hang of the touch gestures, partly because they require much more pressure than on, say, an iPhone. Second, using touch to bring up features and menus can be a mystery until you consult the manual. For instance, it took days to discover that you could set a bookmark by double-tapping on the upper right corner.

But, all in all, despite its higher price, the Daily Edition is a big leap for Sony and adds another good choice for consumers.

The Year In Laptops: 2009

cNet

2009 was a bumper year in the laptop arena. Instead of the usual and expected platform refreshes, we saw some pretty interesting designs and changes in the competitive notebook market. For one, well-known Alienware gaming machines have started appearing in Asia, years after being bought over by Dell. Other surprises include the appearance of CULV thin-and-lights that brought together the portability of a MacBook Air with the affordability of a budget machine. Without further ado, here's are a list of laptops that deserve special mention for changing, if not breaking, the frontiers of portable computing.

Alienware enters Asia
Alienware has been around a long time as a US-only premium gaming brand. Despite being bought over by Dell in 2006, it took three years before Asia had a taste of its notebooks which almost rival the performance of a gaming desktop. The first model to grace our shores was the Alienware M17x, which offered some of the most powerful Intel processors along with its dual graphics card setup. A smaller sibling, the Alienware M15x made an appearance recently and surprised us with an affordable price tag for the basic configuration.

But, in this case, great computing power requires an equally impressive shoulder strength, as both Alienware laptops make a mockery of the term portable. Still, it beats having to lug a desktop CPU and monitor to a LAN party any day.

Samsung returns to Asia
Despite an initial rollout that included the ground-breaking Q30 model, the Korean chaebol's premium laptops simply could not compete with the low-cost machines churned out by the likes of Dell and Acer and had to bow out of the Asia market in 2007. After licking its chops for two years, Samsung returned with a vengeance in 2009 with a small but impressive range. Not only are the price now within mortal reach, the company even upped the ante by using LED-backlit screens on the affordable R series models. The Samsung N310 Netbook was also different from its competitors, with a design that grabs attention without looking too toy like.

Dell launches Adamo series

We should have seen the writing on the wall. When Dell started to add more premium machines such as the Studio, Studio XPS and XPS series, we should have suspected that the Round Rock company has its sights on the premium market. Its first high-end fashion portable, the Adamo, created a stir with its unibody design and sky-high S$4,499 (US$3,312.40) price tag, making it more expensive than the MacBook Air. These are definitely NOT low cost Dell laptops. The timing was also rather unfortunate, as it was launched in the middle of the economic recession.

The following model, the Dell Adamo XPS, entered the world during the financial recovery phase and was helped along by a more realistic S$3,299 (US$2,428.90) price tag. The heat-sensing switch to open the laptop, exceptional thinness and unique design makes a bold statement as well. Though it's still not a laptop for the rank-and-file, the Adamo series has certainly elevated Dell's design team to the level of premium brands such as Apple and Sony.

Sony gets ridiculously thin with Vaio P and X series
Choosing a Vaio laptop is not just about specifications. The Japanese maker has a reputation of producing beautiful machines that stand out from the crowd and, almost every year, create laptops that push the boundaries of notebook design. 2009 was an exceptional year for low cost Sony laptops as it produced not one, but two models that redefined the term sleek.

Despite its Atom internals, the Sony Vaio VGN-P15G was emphatically not a Netbook. Even though it had an unusually wide screen, the chassis was formulated to fit a keyboard which was actually usable. But what captured the public's eye was its unbelievably slim profile, which was carried over to the Sony Vaio X series. The latter has a larger 11-inch display with a more conventional footprint. The Vaio X was so slim that the company had to redesign the Ethernet port to fit the chassis.

Though both notebooks are certainly more expensive than your average Atom-based machine, they pushed the frontiers of portability and made impossibly thin, possible.

Apple laptops wave goodbye to replaceable batteries
It all started with the MacBook Air. Possibly the first laptop to sport a unibody body, the manufacturing process allows for a slim yet strong shell which was not possible with traditional methods. Apple then continued the trend by switching its MacBook Pro series to the unibody bandwagon and, with the latest version of the Apple MacBook White that sports a unibody plastic chassis, the transition was completed.

But there was one trade-off. The unibody design precludes user-replaceable batteries, which means consumers will have to send the machine to the service center if the power cells require replacement. This also means no more carrying extra cells when traveling on long-haul flights or remote locations. On the plus side, the internal batteries have significantly longer uptimes and no doubt consumers will continue to seek out low cost Apple MacBooks. So are unibody designs the way of the future, or a fad like the FireWire standard? Only time will tell.

ThinkPad goes dual-screen
There are some who feel that a 12-inch display is all they need, while others who think that even a 18.6-inch desktop replacement is still not big enough. Lenovo ThinkPads are legendary when it comes to toughness and reliability, but one rarely sees cutting-edge design for this range. When the Chinese maker showed off the ThinkPad W700ds, it broke new ground as the first to supplement its main 17.1-inch LCD with a slide-out 10.6-inch panel. The secondary display can be used for easy access to emails and IM chat windows while doing real work on the larger screen. Though this is unlikely to start a trend, this ThinkPad is one which we will not forget anytime soon.

CULV laptops breaks through price barriers
Netbooks were hot in 2008, but consumers soon found that the underpowered Atom processor was simply too limited even for Web surfing, especially when visiting Flash heavy sites. To bridge the gap between low-cost minilaptops and full-fledged notebooks, the Intel Consumer Ultra-Low Voltage (CULV) processor was born.

Priced lower than Intel's full-powered chips, the first CULV machines like the Acer Aspire Timeline 3810T and MSI X-Slim X340 were certainly costlier than Netbooks, but were several hundred dollars cheaper than traditional ultraportables. This new range of machines were not only sleek and sexy, the low power consumption of the platform and LED-backlit screens allowed for impressive battery lives. It's a pity that the optical drive was sacrificed in the process, but some vendors have overcome that obstacle by bundling external optical drives.

Later in the year, a new line of ultrathins came into the picture. While the first wave of CULV laptops sit squarely in the thin-and-light and midsized categories, the Acer Aspire AS1410, Dell Inspiron 11z and Gateway EC series sport 11.6-inch displays and are about as portable as similarly-size Netbooks. Though the battery life is significantly shorter, these new ultrathins give minilaptops a run for their money as they cost only a little more but offer much faster performance.

Will 2010 see even more upheavals in the laptop market considering this was a bumper year for the mobile computing industry? We'll leave that thought for another article.

Notebooks Getting Slimmer And Stronger

From Mobile Computing News

Companies like Sony and Apple are engaged in manufacturing world class laptops that can easily replace a desktop PC. These laptops are manufactured using quality assured raw material and cutting edge technology that ensures a hassle free long functioning life. These laptops have high functional speeds and can be used for things normally reserved to desktop PCs, such as gaming. The notebooks and gaming laptops are fitted with various other features as well which makes it one of the most demanded notebooks all around the world.

Some of the best laptops that can replace desktop PCs include the Sony Vaio VGN-NW11Z/T, Sony Vaio VGN-NW11S/S and Apple MacBook Pro (MB991B/A). The Sony Vaio VGN-NW11Z/T is a very advanced laptop fitted with the kind of specs normally found in a desktop PC. These include a fast 2100 Mhz Intel Core 2 Duo T6500 processor, as well as a decent 4GB of RAM, which is expandable to 8GB. Additionally the hard disk memory of the device is around 500 GB so that you can efficiently store all types of audio, video and other documents. It is also fitted with an ATI Mobility Radeon HD4570 graphics card that allows you to play all sorts of PC games.

On the other hand the Apple MacBook Pro (MB991B/A) provides a clock speed of 2,530 Mhz. The 4096 MB of RAM further enhances the speed of the laptop. The hard disk memory of the laptop is around 250 GB so that you can store whatever you want. The above mentioned are some of the best laptops available in the market.

Sony And Google Drop The Slam-Dunk On Amazon

As Originally Posted to BusinessWeek.com

Amazon (AMZN) Chief Executive Jeff Bezos won't tell you how many Kindles he's sold, but he's happy to share the number of e-book titles available on the device: 250,000, at last count.

With one fell swoop, a rival has made that library look small. On Mar. 19, Sony (SNE) announced the addition of 500,000 titles to the collection of 100,000 e-books currently available to Sony Reader devices. Sony is giving away the books through a partnership with Google (GOOG), which has already scanned and stored some 7 million books for its Google Book Search project. Neither partner disclosed details of the arrangement, but Google says that more of the public domain titles it has scanned will be available to Sony Readers in the future.

In theory, the availability of more books from Sony could take momentum away from Amazon, which has benefited from buzz around its Kindle 2 reader in recent months. "Part of Amazon's shtick about the value of [the Kindle] is the size of their library," says Michael Norris, an analyst at media researcher Simba Information. Many of Sony's free titles cost money on the Kindle. Kenneth Grahame's children's classic, The Wind in the Willows, will set the buyer back $2.39, for instance.

Sony Focused on Devices

But more than anything, the partnership underscores a key distinction between the Sony and Amazon strategies that in the long run could work to Amazon's advantage. Amazon, which recently began selling e-books to users of devices other than the Kindle, including Apple's (AAPL) iPhone, has shown it's as interested in selling digital books as it is in selling machines.

Meantime, by loading its reader with free books, Sony may be more focused on devices. "Amazon's business is selling books, and Sony's business is selling hardware," says Gartner Group's (ITT) Van Baker. The company has sold more than 400,000 Sony Readers, which now cost between $300 and $350. Amazon hasn’t disclosed the number of Kindle devices it has sold, which cost $359, but Citigroup (C) analyst Mark Mahaney estimated that the company had sold 500,000 by the end of 2008.

For starters, the Amazon approach may appeal to people who are interested in newer, more expensive books, such as New York Times bestsellers, Baker says. At $10 bucks a pop through Amazon, books add up. Sure, Sony lures e-reader buyers with free books, but at some stage, sales of digital books will outweigh the revenue generated through the sale of a machine.

Missing: A Wireless Store

And even though free books enhance the appeal of the Sony Reader, its hardware still lacks one feature that's been most important to Kindle's success: a wireless store. Unlike Kindle owners, who can download books to their device wherever they are, Sony Reader users must plug into their computers. "We will launch a wireless reader," says Steve Haber, president of Sony's digital reading division, though he doesn't specify when.

Sony could see an unintended effect of releasing so many free books on its platform: downward pressure on demand for its paid books. "If you're selling a book for $9.99 and it's going to be on a virtual shelf with half a million books that are available for free, questions about value come into play," Simba's Norris says.

Sony's approach has some advantages. The company has adopted a standard for e-books called ePub that essentially means Sony e-books can be read on other devices that use that same standard. Amazon's books have to be read on devices it has approved. "Sony's ePub announcement was a terrific way for them to show that they're willing to support more open formats than Amazon is," says Joe Wikert, general manager at technology researcher O'Reilly.

Still, Amazon isn't likely to sit on the sidelines while Sony scores points with readers.

Sony And Comcast To Unleash New Kind Of Retail Experience In Philadelphia

Originally Posted at Cnet

Amid the recession and layoffs, there are some glimpses of employment hope and opportunities to help you make informed decisions on what technology to spend money next.

Sony Electronics and Comcast announced Sunday that they have partnered to open a unique retail experience in Philadelphia. The store is named Sony Style Comcast Labs and will serve as a place where consumers could learn about emerging technologies and experience new digital devices.

The co-branded retail store and technology lab, which opens to the public Monday, March 16, will showcase the latest innovative products and services from both companies and preview future Comcast technology, products, and services.

Examples of future technologies that Comcast unveiled to Philadelphia consumers for the first time include "The Future of High-Speed Internet" and "The Future of Home Phone Service."

The former offers the experience of Internet surfing and downloading at 100Mbps, about 20 times faster than regular existing cable connection. To put this in perspective, at this speed you can use up Comcast's 250GB ration in about 40 hours.

The latter, on the other hand, shows of what you can do with the future enhanced cordless telephones. Obviously, they can do a lot more than just placing calls; they also handle e-mails, IM, text messaging, and access to Yellow Pages.

As for Sony, the new Sony Style Comcast Labs feature the best of Sony's electronics. Sony's current showcase include Bravia HD LCD televisions, Vaio PCs, dSLR and Cyber-shot digital cameras, Handycam camcorders, and PSP and PlayStation 3 game consoles. Emerging technologies such as Organic Light Emitting Diode TVs are also shown.

Comcast will also showcase all of its products and services from voice to video and Internet, and it will demonstrate how they work together seamlessly for the consumer.

The Sony Style Comcast Labs is located at the base of the Comcast Center, just a few blocks away from the Chocolate Works Philadelphia Apartments.