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Microsoft Announces Its Own iPod Competitor

2006-07-25T04:39:00.000-07:00

Microsoft officially confirmed on Friday that it is working on a music and entertainment "project" dubbed Zune, which will include hardware and software products that offer users on-the-go access to music and entertainment.

"Under the Zune brand, we will deliver a family of hardware and software products, the first of which will be available this year," said Chris Stephenson, general manager of marketing for Microsoft, in a prepared statement. "We see a great opportunity to bring together technology and community to allow consumers to explore and discover music together."

Although Microsoft declined to comment on specific details for its Zune brand, a spokesperson confirmed that the first products will begin shipping by the end of 2006.

"This is a radical departure for Microsoft," said Michael Gartenberg, vice president and research director for JupiterResearch. "It's a change in their business model and for the first time will put them in direct competition with partners that license technology from them." "The strategy that Microsoft is taking is pretty interesting," said Rob Enderle, principal personal technology analyst at Enderle Group. "

This is Microsoft moving against [companies like] Apple where they are strong and hitting hard where [those companies] are weak, in areas like partnership and breadth of offering…Right now Microsoft is the only one offering something this comprehensive and they've got their fingers in so many other areas that they can move in areas that others cannot."

Companies like Apple and Creative Technology, which makes the Zen Vision player, will likely encounter some digital opposition in the multimedia arena as Microsoft begins its initial foray into portable music and entertainment. Apple's iPod, however, currently holds over 50 percent of the digital media player market, according to research firm NPD. "At this point, Apple will probably not be affected too much in the short-term because Microsoft's short-term growth is likely to come from non-iPod users," Gartenberg said. "For companies like Creative and iRiver, the big problem last week was how to compete with Apple. This week it's how to compete with Microsoft as well."

In addition to vying for market share from well-established competitors, Microsoft faces additional challenges in the digital-entertainment market, according to JupiterResearch. Among the key challenges for the Redmond-based powerhouse are; creating a technically competent challenger, creating a lifestyle device, and creating an [all-encompassing] platform. "Microsoft is providing one thing that other companies couldn't provide, which is a peer-to-peer (P2P) solution," Enderle said. "Zune is designed as a P2P service so you can share music with friends through the Internet or by beaming music to other users via WiFi."According to Enderle Group, Microsoft may, however, face potential pitfalls in actually executing the roll-out of its portable media player.

"Having said all that, Microsoft still has to execute the project and they've had some issues with that in the past," Enderle said. "However, the Zune team is one of the stronger teams that Microsoft has put together, so they may be able to pull it off."Microsoft expects to deliver wireless capabilities, among other features, as a potential differentiator to help drive its branded device within the Apple-dominated market.

"When it comes to consumer electronics, the difference between success and failure is measured in millimeters, so we'll have to wait and see how Microsoft delivers," Gartenberg said. "Apple is not standing still either; they were expecting this to happen. There are all sorts of interesting rumors flying around about Apple devices and it's been a while since the last refresh of the iPod line. It's getting closer and closer to the crucial holiday season, so stay tuned."

Although Microsoft will not announce specific pricing details until closer to the product launch date, Enderle Group says consumers can expect to see "penetration pricing.""This is Microsoft going after a market space that is already held by a dominant vendor so you can expect pricing to be fairly aggressive in the front-end, much like you saw with Xbox," Enderle said. By Bary Alyssa Johnson, PC Magazine

AMD to Buy Chip-Maker ATI for $5.4B

2006-07-24T06:12:00.000-07:00

Advanced Micro Devices Inc. said Monday it will pay $5.4 billion to acquire top graphics chip maker ATI Technologies Inc., as Intel Corp.'s biggest rival in the market for personal-computer microprocessors attempts to expand its product portfolio.
The AMD-ATI marriage could shift the balance of power in the chip industry in significant ways. AMD's product portfolio which has remained limited to the microprocessors that act as a PC's main calculating engine would balloon overnight, as it folds in two major new chip categories.

Markham, Ontario-based ATI, which makes chipsets and graphics chips for PCs, also makes a host of semiconductors for consumer products, such high definition TVs and cell phones.
The new offerings would broaden AMD's package of products as it takes on Intel, the world's biggest chip maker that has long supplied a wider portfolio. In addition to supplying microprocessors, Intel, the world's biggest chip maker, sells so-called chipsets, which connect a microprocessor to a PC's other core components. It also sells graphics chips, which power images rendered by computer games and internet video.
Under terms approved unanimously by both companies' boards of directors, Sunnyvale, Calif.-based AMD will pay $4.2 billion in cash and 57 million AMD shares to acquire all of ATI's outstanding stock, according to a news release.

Based on AMD's closing share price of $18.21 on Friday, the deal valued ATI's shares at $20.47, a premium of almost 24 percent compared with ATI's Friday's closing price of $16.56 on the Nasdaq Stock Market. ATI shares surged almost 17 percent to $19.32 in pre-market trading after the news. AMD shares fell more than 6 percent to $17.10.

AMD, which has been shelling out billions to add factory capacity so it can better compete with Intel Corp., will pay for the acquisition with the help of a $2.5 billion loan from Morgan Stanley.
AMD expects the deal to contribute "slightly" to earnings next year and add "meaningfully" to profit by 2008. The purchase will save the combined company about $75 million by the end of 2007. By DAN GOODIN, AP Technology Writer

Zidane and Materazzi fined and banned by FIFA

2006-07-20T20:20:00.000-07:00

Former France captain Zinedine Zidane and Italy defender Marco Materazzi were both fined and banned by FIFA on Thursday after the head-butting incident that marred the World Cup final on July 9.
Zidane, who has retired as a player, was fined 7,500 Swiss francs ($6,014) and handed a three-match ban by FIFA's Disciplinary Committee following his red card for head-butting Materazzi. As he is no longer a player, he has agreed to undertake three days of community service on FIFA's behalf instead.
The Italian defender, who has admitted insulting Zidane, provoking the Frenchman's head-butt, was handed a two-match ban and fined 5,000 Swiss francs ($4,010).
The bans apply to international competitive matches, even though it is a symbolic ban for Zidane who has confirmed he has no intention of reversing his decision to quit the game.
FIFA said in a statement: "Zinedine Zidane has also agreed to do community service work with children and youngsters. As Zidane has now retired from international football, the committee took note of Zidane's pledge to do three days of community service work with children and youngsters as part of FIFA's humanitarian activities.
"In their statements, both players stressed that Materazzi's comments had been defamatory but not of a racist nature.
"During the course of their hearings both players also apologized to FIFA for their inappropriate behavior and expressed their regret at the incident."
Zidane head-butted Materazzi in the chest during the closing stages of the July 9 final in Berlin, which Italy subsequently won on penalties. By Mark Ledsom, Reuters

Dollar Weakens as Fed's Minutes Likely to Show Rates Near Peak

2006-07-19T20:57:00.000-07:00

The dollar weakened for a second day on speculation minutes of the Federal Reserve's last meeting released today will show policy makers considered stopping a two-year campaign of interest-rate increases.
Ending the policy of raising borrowing costs may dull the appeal of U.S. assets compared with those of Europe and Japan, where central banks are lifting rates. The dollar yesterday fell the most in three weeks against the euro and dropped versus the yen after Chairman Ben S. Bernanke in testimony to Congress signaled the Fed was wary of pushing rates too high.
``The dollar has peaked out, buffeted by dwindling expectations of further Fed rate increases,'' said Yuji Kameoka, a senior economist and currency analyst at Daiwa Institute of Research, a unit of Daiwa Securities Group Inc., Japan's second- largest brokerage. ``The minutes may reaffirm the Fed is concerned about an economic slowdown caused by higher rates.''
The dollar dropped to $1.2611 per euro at 11 a.m. in Tokyo from $1.2587 in late New York yesterday. It fell to 116.72 yen from 116.89. The dollar today declined against 14 of the 16 major currencies tracked by Bloomberg. It may fall to 113 yen and $1.28 versus the euro this month, Kameoka said.
The Fed has lifted its overnight lending rate between banks 17 straight times to 5.25 percent to limit inflation. The minutes will reveal policy makers' deliberations at their last meeting on June 29.
`Future Effects'
In the text of testimony to Congress in Washington yesterday, Bernanke said the central bank must be wary of taking borrowing costs too far and ``account of the possible future effects of previous policy actions.'' He said the economy is ``in a period of transition'' as consumer spending slackens, though he doesn't foresee a recession.
Kansas City Fed President Thomas Hoenig in a speech yesterday to a business group in Omaha, termed the Fed's current target rate ``somewhat restrictive.''
Interest-rate futures suggest a 65 percent chance the Fed will boost the rate a quarter-point to 5.5 percent on Aug. 8. The odds were 85 percent before Bernanke's comments.
``It does really suggest we're off the 25 basis-point hike per meeting'' pace, said Greg Gibbs, senior currency strategist at ABN Amro Holding NV in Sydney. ``The currency is trading off the back of the interest-rate differentials. We'll see the dollar weaken a bit.''
Middle East Conflict
Gains in the euro may be limited by escalating military tension in the Middle East, said Nobuaki Tani, a senior currency dealer in Tokyo at Resona Bank Ltd., a unit of Japan's fourth- largest lender by assets.
Israeli soldiers yesterday fought Hezbollah forces within southern Lebanon for the first time since the conflict began July 12, as the U.S. and Israel resisted diplomatic efforts to halt the hostilities. Israeli officials said the threat from Hezbollah dictated more military action.
``Europe is geographically close to the Mideast conflict,'' Tani said. ``This concern will continue to weigh on the euro, supporting dollar-denominated assets'' as a safe haven.
The euro may move between $1.2550 and $1.2650 against the dollar today, Tani said.
The euro also may be supported by speculation the European Central Bank will raise interest rates faster than the Fed.
Producer prices in Germany, Europe's largest economy, rose 6.1 percent from a year earlier, the Federal Statistics Office said yesterday, fueling expectations the ECB will step up rate increases. A gain of 5.9 percent was forecast, according to a Bloomberg survey.
`Speed Up'
The yield on the benchmark German two-year bond, among the most sensitive securities to interest-rate expectations, yesterday hit the highest in a week.
The ECB has raised rates three times since December, last lifting its refinancing rate to 2.75 percent on June 8.
``There are expectations the ECB will speed up the pace of raising rates this year,'' said Masafumi Yamamoto, a strategist at Nikko Citigroup Ltd. and a former Bank of Japan currency trader. ``They have raised rates once every three months, but they may do so every two months after a rate hike in August. This is supportive for the euro,'' which may rise to $1.27 versus the dollar this month.
The ECB will lift its benchmark to 3 percent on Aug. 3, according to all but one of the 22 economists surveyed by Bloomberg. By Bloomberg

Discovery shuttle makes flawless landing

2006-07-17T23:39:00.000-07:00

With a fiery dive through Earth's atmosphere and a final plummet onto its home runway, shuttle Discovery and its six astronauts finished 13 days in orbit Monday and took a giant step toward resuming regular space flights.
Discovery swooped down through layers of overcast clouds, heralded by the shuttle's twin sonic booms, before commander Steve Lindsey took manual control, guiding the ship through a large, left-hand semi-circle before setting it down onto the 3-mile concrete strip at 9:14 a.m. "Welcome home, Discovery," astronaut Steve Frick radioed to the crew from Mission Control in Houston after the 100-ton spaceship had rolled to a stop.
"We're ready to go assemble station," Lindsey said in typical astronaut shorthand about the half-finished international space station following a walk-around of the shuttle as it sat on the runway. "We're ready to start flying shuttles on a more regular basis."
NASA is hoping to launch its next shuttle in just six weeks, with Atlantis set to take aloft a building block for the orbiting station as early as Aug. 27.
Sixteen flights in all are planned to finish the station before the shuttle program is to end in late 2010, plus a possible 17th flight to refurbish the orbiting Hubble Space Telescope. NASA administrator Michael Griffin acknowledged that, given the problems of recent years, the plan did not leave much room for mistakes.
"We don't have any slack. We have just enough shuttle flights left to do the job, so we can't afford to mess up," Griffin said, adding that the need to fly would not force hasty decisions. "We're not going to get overconfident. We're going to take them one flight at a time."
As is often the case with Kennedy Space Center launches and landings, weather was a concern early Monday. Flight controllers and astronauts flying a business jet modified to mimic the shuttle's handling characteristics monitored nearby rain showers, but decided at 7:56 a.m. that a thunderstorm 46 miles to the northeast did not present a problem.
With just 15 minutes to go before touchdown, though, flight controllers ordered Lindsey to approach the runway from the northwest, rather than the planned southeast, when a shower popped up to the south. The thicker cloud layers on the north side, though, meant Lindsey was not able to see the runway until he was only a minute away.
Flight rules prohibit landing if rain or thunderclouds are within 35 miles of the runway. Rain could destroy the shuttle's delicate heat-resistant tiles on its underside, and a lightning strike could cripple the craft.
But Lindsey said the shuttle's instrument landing systems were so accurate that when Discovery dropped out of the last cloud layer at 10,000 feet, the runway was "spot-on" lined up with the electronic overlay's depiction on his display. "It really wasn't a big deal," he said.
The landing process began just over an hour earlier, at 8:07, when astronauts fired Discovery's twin orbital maneuvering system engines as it sailed high over the southern Indian Ocean. That slowed the ship just enough to let the far side of its orbit dip down into Earth's atmosphere.
From there, Discovery's computers guided the ship across the Pacific, over Central America and Mexico's Yucatan Peninsula and finally over Southwest and Central Florida.
The ship flew nose upward for most of its return, generating the friction that would slow it from 17,300 miles per hour following the "de-orbit burn" to 225 mph at touchdown — which it did to the cheers of space center workers and astronauts' families assembled at the landing strip.
Griffin, who has occasionally been at odds with space program journalists, joked: "It's such a good day, not even a press conference can spoil it."
The successful flight caps 41 troubled months for the space agency that began when shuttle Columbia came apart during reentry in 2003 after a piece of insulating foam broke free of the external fuel tank and punched a hole in its left wing during launch.
A flight by Discovery last summer, designed to prove that NASA had solved its external tank problems, instead proved the opposite, when another large piece came off the tank, this time missing the right wing as it fell.
"Columbia's landing day was a horrible day. Today was a great day," said shuttle launch director Mike Leinbach.
Monday, with Discovery safely back home after a launch that saw dramatically fewer and smaller pieces of foam coming off a redesigned fuel tank, NASA pushed ahead with plans to launch shuttle Atlantis. The date will depend on space center workers making sufficient progress toward preparing Discovery for launch again, so it could serve as a rescue craft should Atlantis suffer damage during liftoff that makes a safe landing impossible.
That regimen, which NASA first used last summer, is to continue through Discovery's planned launch in December, after which NASA will start using a fuel tank that incorporates yet another redesign to remove 34 "ice-frost ramps" — blocks of foam that have a tendency to shed dangerously large pieces during launch.
NASA officials have been eager to resume regular shuttle flights so they can finish building the international space station before retiring the fleet in 2010.
It would be replaced with a craft that would avoid the foam problem by placing the crew capsule at the top of the rocket stack — like the early Mercury, Gemini and Apollo crafts — instead of beside the tank like the shuttle. By S.V. Date, Palm Beach Post Staff Writer

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2006-07-17T23:16:00.000-07:00

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