An often irreverent look at this week's other news ...
Elop Misquoted: Bing Maps Aren't Being Renamed or Rebranded
A blogger interview with Nokia CEO Stephen Elop is being widely misquoted, unless I'm missing something, with many now claiming that Microsoft is going to rename or rebrand its Bing Maps to Nokia Maps. That's not what he said, however. In an interview with a blogger from Pocket Lint (?), Elop said that "you'll starting seeing the word 'Nokia' on a map that you get from Microsoft properties over a period of time," which tells me only that the word Nokia will appear on a map—and possibly only on Windows Phones—not that Bing Maps is being rebranded. "[Microsoft is] placing a bet on our location-based platform: mapping, navigation, and so forth," he added. Right, as previously announced. So it makes sense that Microsoft would integrate Nokia Maps stuff into its Bing Maps functionality on Windows Phone. But I'm not seeing any note about rebranding or renaming in this interview. Just that Nokia technologies are going to be added to the Bing back end. Which is bolstered by this statement: "In the time ahead, what you will see is, across all the Microsoft properties including Bing maps, more and more work will be done by Nokia," Elop added. This isn't news, folks. When Microsoft announced its partnership with Nokia, it said it would be doing exactly this kind of thing, and that some Nokia technologies would make their way to all Windows Phone handsets—not just those sold by Nokia. Moving on.
Microsoft Quarterly Earnings Update: The Sort-Of Fall of Windows
With Windows revenues down 6 percent year over year—see my related story, Microsoft Earnings: Record Overall Revenues, But Slight Dip in Windows, for the shockingly non-dramatic recap—reporters and bloggers alike are racing to write the obituary for Windows, which (I'd remind everyone) is still selling more than 20 million units every single month. But there are some real concerns here, I'd say. First, the overall PC industry sales actually contracted a bit in the fourth quarter by about 3 percent, year over year, thanks to slow consumer PC sales. That said, business PC sales were actually up, somewhat taking up the consumer slack. But the big news, perhaps, is that the Windows business just fell to Microsoft's third most lucrative money maker, behind Office and now Windows Server. That's right, folks: Not only is Office outperforming Windows financially (which has been the case for some time), now even Server is doing better. And not just "better," but $2-billion-in-revenues-for-a-single-quarter better. Much better. Yikes.
Microsoft Quarterly Earnings Update: Explanations or Excuses?
With Microsoft's Windows business doing its version of failing—again, this thing is a money machine that just generated almost $5 billion in revenues over three short months—those who write about such things are scurrying around looking for explanations for the slack. Often cited, since Microsoft was the first to bring it up, is last year's Thailand floods, which took down most of the world's hard drive factories for weeks, crimping the supply chain. But that seems more of an excuse than an explanation to me: It's not as if people are waiting on PCs they ordered; they simply ordered fewer computers. Then there's the Windows 8 elephant in the room, with the theory that consumers are simply waiting on The Next Big Thing. That, too, is ludicrous. And while I'm sure people will flock to beautiful Windows 8-based tablets and convertible laptops later in the year, no one spent the end of 2011 waiting on a product whose release date is very much still up in the air. The third most cited explanation—and the one I find most believable—is that many consumers simply don't need the power or complexity of a PC and are looking at the increasingly affordable and diverse markets for smartphones and/or tablets instead. And the evidence that this is true lies in the PC world's alternative to such devices: Netbook sales plummeted in the quarter to account for just 2 percent of all PCs sold in that time frame; a year ago, when the iPad was the only viable tablet, netbooks accounted for over 8 percent of all PCs sold. That's a decline of 6 percentage points, or exactly the decline in Windows revenues in the comparable time periods. Coincidence? Well, yes. But I think that's what we're looking at: The computing world is changing, and the version of Windows Microsoft is currently selling isn't adapted to that change.
Quarterly Earnings Update: Intel
Even more so than Microsoft, Intel's earnings are tightly tied to the relative success or failure of the PC market, which is its bread and butter. However, Intel this week announced its most recent quarterly and annual earnings, and the news was all good. For the quarter ending December 31, Intel earned net income of $4.3 billion on revenues of $13.9 billion, capping off a record year in which the company earned $54 billion in annual revenue, a bump of 24 percent year over year. Not bad for a year in which the PC market was, at best, standing still or rising just slightly overall. How does Intel do it? Well, one clue might come from that netbook note above. With consumers buying fewer low-cost netbooks as a percentage of the overall base, that means they're spending more money on higher-end PCs that include higher-end and thus more expensive Intel chips. In fact, just listening to Intel, you'd think this was the greatest year on record, which of course it was—for Intel. "2011 was a year of records, milestones, and breakthroughs," CEO Paul Otellini said. Well, there you go.
Quarterly Earnings Update: Google Misses Mark
Google reported earnings of $2.7 billion on revenues of $8.13 billion for its fiscal fourth quarter, which in this case lines up neatly with the fourth calendar quarter of 2011. But since analysts were expecting better results—more to the tune of $8.4 billion in revenues—the quarter was declared a disaster and Google shares plummeted all the way down to $583, which is apparently a disaster as well. Google expressed no concern for either finding, with CEO Larry Page apparently considering some mostly unknown law of physics while tapping his fingers together like a Bond villain and deigning to entertain press inquiries for a fleeting moment. But really, the best thing I read about this event comes from Fort Pitt Capital analyst Kim Forrest, who said, "Google got hit with the ugly stick. You've got to ask yourself, 'Where is the money going? What are they spending it on?'" To which I'd say, every company on Earth would like to get hit with that stick right now, if possible.
Apple's Textbook Initiative Comes with Both Lock-In and Vig
I wrote up some preliminary thoughts about Apple's educational announcements this week, but as time has gone on, and more details have emerged, we're seeing the ugly side of a company that far too many people are far too uncritical of. First, Apple is indeed seeking to replace paper textbooks with far more expensive and environmentally unfriendly iPads—a fairly obvious point and strategy. But what the company didn't reveal at its staged event in New York this week was that eTextBooks created for its proprietary and exclusionary iBooks platform cannot be ported to other digital textbook platforms; they're locked into Apple's iBooks contractually (i.e,. legally) and can only be sold through Apple's service. And that means that, yes, Apple will also get a 30 percent cut on any textbook that's sold through iBooks. So, not only is Apple shutting out the non-Apple world here, it's getting a big chunk of the pie too. But hey, when Apple announced that the tool to make these locked-down textbooks was free, the totally oblivious and Apple-centric press in attendance actually applauded. And that, folks, shows you how dumb we all are. It's just embarrassing.
Samsung Loses Patent Battle Against Apple in Germany
A court in Germany has ruled against Samsung in yet another mobile industry patent battle, this one against Apple, though it only concerns one of 13 patents in contention. Samsung, which surpassed Apple in 2011 to become the world's top maker of smartphones, claims that Apple is infringing on three technologies covered by 13 different patents, and has responded to Apple's similar threats by trying to get Apple mobile devices banned in several countries around the world. The German court will rule on Samsung's remaining patent claims separately next week and then in March. And you gotta know I just can't wait. Cough.
Judge Limits Apple Patent Dispute with Motorola
Except, of course, that this mobile industry patent stuff isn't going away anytime soon. In a separate case, a US judge invalidated two Motorola patents and acquitted Apple of infringing on a third, seriously narrowing the legal battle between the two companies in that one jurisdiction. But the court also struck down an Apple patent, which the judge describes as "too vague," a description I suspect could be applied to about 99 percent of the patents awarded to these mobile companies. So. Where are we in this case? I honestly don't know. And I'm not sure whether I even care anymore.
Twitter Buys Summify
As if Twitter weren't concise enough, what with its 140-character limit and a hashtag syntax that only a programmer could love, the sort-of social networking service this week announced that it was buying Summify. What's Summify, you ask? (As did I.) It's a service that provides an automated, contextual summary of a hyperlink before you travel to the link in question. So now when you're looking at those curiously truncated URLs that Twitter and its partners generate, you can find out what's at the link's destination without even going there, further streamlining—and, yes, dumbening—your online experience. I mean, why even read?
Listen to Paul. No, Really Listen. Or Watch. Or Both!
This week, Andrew Zarian and I recorded the latest episode of the What The Tech podcast on Tuesday, and Mary Jo Foley, Leo Laporte, and I recorded the latest episode of the Windows Weekly podcast on Thursday, which is a cute way of saying everything was back to the normal day and time. As always, these episodes should be available now or soon, generally in both audio in video formats, on the web, and via iTunes, the Zune Marketplace, and wherever else quality podcasts are found.
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