LAS VEGAS--When Acer and Asus first started pushing Netbooks, it was all about flash memory. But now, a majority of the small, Atom-powered notebooks have hard drives. And Bill Watkins, chief executive of hard drive market leader Seagate, likes it that way.
Seagate CEO Bill Watkins at CES 2009.
(Credit: Erica Ogg/CNET)When the two Taiwanese Netbook makers first talked with Seagate about the category, they told Watkins they didn't need storage for their tiny Atom-powered, Linux-based Netbooks since they'd be used only for surfing the Web and all data would be stored in the cloud.
Just two years later it's a totally different story. Besides more customers preferring Windows XP, Seagate says probably one in four Netbooks now have solid-state drives, and the rest are good old-fashioned mechanical drives.
"For us, it's a big win, since we can sell a lot of drives then," Watkins said in an interview here at CES. "Everyone tries to low-end storage, but they can't get away with it."
Not that he thinks the Netbook is all that great an idea for PC makers. Most of them dismiss the idea that Netbooks will cannibalize traditional notebooks, as Dell did earlier Friday at its press event. At that, Watkins scoffs. "It's a low-end notebook. And it's just chewing into the $800 notebook market," he said.
Seagate's chief is known for being rather frank in his opinions, and his take on this year's CES was no different.
Regarding the much-buzzed about Palm Pre, Watkins says the company nailed it. "It's a better iPhone. It's taking the things the iPhone doesn't do well and improving them," he said, like a physical keyboard instead of a virtual one.
And a trend he likes is pico projectors. Not for the actual gadgets themselves, but the idea that people are finding ways to get content off their devices in new ways. The form factor itself isn't ideal.
"Why would you want to carry an extra device around?" he asks. "Once they're integrated into devices, (pico projectors) will be cool. That's the next step of taking content off devices and finding different ways to enjoy it."
Seagate is here at the gadget extravaganza to push its consumer-oriented storage solutions, like the FreeAgent HD Theater device that allows media stored on an external drive to be connected by dock to both PC and TV.
Consumer storage is one of the only areas that's growing for Seagate. The PC ecosystem has been battered by the troubled global economy--the industry is expected to see negative unit growth in 2009, a first since the tech bubble burst in 2001.
As for Seagate, hard drive shipments were lower in December 2008 than September 2008, the first time ever, said Brian Dexheimer, the company's chief sales and marketing officer. But consumer storage devices like the FreeAgent drives have been the one bright spot, with sales rising 15 percent on the year.
The company, he said, is preparing for a "very conservative outlook" this year.
LAS VEGAS--If you haven't noticed, Toshiba doesn't offer a Netbook for the U.S. market.
Yes, that's right Toshiba--whose name is practically synonymous with laptops--is still undecided about committing to one of the hottest mobile PC markets in the U.S., according to Toshiba officials at the Consumer Electronics Show in Las Vegas on Thursday.
The Japanese company did launch the NB100 Netbook in December, but it is not marketed in the U.S., according to a Toshiba representative, speaking at CES.
Toshiba NB100 Netbook is marketed in Latin America
(Credit: Brooke Crothers)This highlights the Netbook quandary some of the largest mobile computer markers are facing. Throw Sony into the we don't-offer-a-Netbook-either category. This week Sony launched the pricey Vaio Lifestyle PC that it is very careful to bill as the "world's lightest 8-inch notebook." It costs a cool $900--which does tend to disqualify it as Netbook since Netbooks are, by definition, inexpensive (typically under $400 and only occasionally venturing into $600 or $700 territory when, for example, a 3G Wireless Wide Area Network, or WWAN, option is added.)
Listening to a Toshiba representative at CES, the company seems genuinely perplexed by the Netbook category. Where is the real value-add? What if Netbooks begin eating into its notebook line?
On the latter point, Toshiba, like Sony and Apple, may also be worried about getting consumers hooked on low-cost laptops.
(Note: The Toshiba NB100 is marketed in Latin America, according to the representative.)
LAS VEGAS--It was fitting that in a city created as an elaborate fantasy world that a knight would get up on stage and tell us how to save the princess.
Sony's Howard Stringer takes the stage at CES Thursday for a keynote address.
(Credit: Corinne Schulze/CNET Networks)In this case, the knight is Sir Howard Stringer, CEO of Sony (and Knight Bachelor, a title awarded by the queen of England), and the princess is the consumer electronics industry. And according to Stringer, one of the keys to slaying the monster of the recession is the convergence of networked entertainment and technology.
In his keynote address on the opening day of CES here, besides pushing various Sony products like OLED TVs, Blu-ray players, and PlayStation 3, Stringer outlined a series of principles he says will be necessary to create consumer experiences that, if followed, will sustain the consumer electronics industry. The industry is expected to see negative growth for the first time in seven years.
"I can promise you the consumer electronics industry will ultimately prevail," Stringer told the large crowd gathered in the Venetian Hotel ballroom Thursday. "Because everyone is still innovating."
The principles, or "seven imperatives" are fairly broad: Embrace the convergence of IT, CE, and entertainment. Focus on adding value with customer service. Make products that do more than one thing. Support open technologies. Embrace social networking and user-created content. Make products whose value builds on each other. Go green.
Clearly, it was not only directed outwardly at the rest of the industry, but is intended as a new mission statement for his own company. Some of those goals--open technologies, products that interact with those from other manufacturers--aren't things Sony is known for in the industry. But Stringer said he "intend(s) to make this the total Sony experience."
One of Stringer's "seven imperatives" for sustaining the consumer electronics industry.
(Credit: Corinne Schulze/CNET Networks)To demonstrate, he brought a parade of celebrities and industry leaders onto the stage to demonstrate Sony's reach into film, music, television, gaming, sports, and, of course, technology, including several new products the company is cooking up in its R&D department.
First up was actor Tom Hanks, star of a new Sony movie (Angles & Demons) who singlehandedly stole the show, mocking the scripted lines Sony had written for him detailing how much he loved the company's products. "They write the lies, I tell the truth," Hanks joked to loud laughs from the audience.
Hanks provided much of the entertainment at the morning's event with similar off-the-cuff jabs at Sony. It was welcome, as most of Sony's most interesting announcements actually occurred the previous afternoon at its annual pre-CES press conference.
But Stringer did reserve a couple of nifty products to announce, like its new Wi-Fi-enabled Cybershot digital camera, which allows users to upload pictures directly to the Web. Stringer said there would be a lot more where this came from. The company's goal is that by 2011, 90 percent of its product categories will connect wirelessly to the Internet and to each other.
Tom Hanks, next to Stringer, stole the show. Click on image for more photos.
(Credit: Corinne Schulze/CNET Networks)He also showed some concept products his engineers are working on, like the Wi-Fi clock radio. Partnering with Chumby, the maker of the too-cute-for-its-own-good hackable Wi-Fi gadget, Sony is working on a more elegant take on the idea, but keeping Chumby's open platform for which anyone can develop a widget.
Sony's been pushing Blu-ray for home video for a while, but it's also moving to promote 3D for movie theaters. Stringer brought out Pixar's John Lasseter and DreamWorks Animation's Jeffrey Katzenberg to try to hype the two entertainment formats. There are three competing 3D technologies right now, and it appears based on the demonstration Thursday that Sony is partnering with RealD.
But the march of famous personalities didn't stop there: Kaz Hirai, CEO of Sony Computer Entertainment of America, baseball hall of famer Reggie Jackson--Sony is providing all the tech in the new Yankee Stadium--Oprah health guru Dr. Mehmet Oz, and finally Sony Ericsson-sponsored Usher, who sang one song to close the speech.
Sony's hurting right now, and many of the tasks Stringer laid out would call for Sony to change some of its most ingrained policies. It remains to be seen if these "imperatives" will still be an imperative after the world economy eventually recovers.
LAS VEGAS--Before making the new inexpensive mini camcorder it unveiled at CES Wednesday, Sony tried to purchase the category leader, Pure Digital.
Sony Electronics President Stan Glasgow on Wednesday told CNET News that the vastly popular Flip Video camera made by Pure Digital came onto Sony's radar almost two years ago. Glasgow said he knew he wanted Sony to have a product in the category and talked to San Francisco-based Pure Digital about a possible acquisition six months ago.
Without saying how much Pure Digital was asking, Glasgow said it was much more than Sony wanted to pay. The two companies discussed several possible business scenarios, but none worked out.
And even before that, though the U.S. division of Sony really wanted an inexpensive mini camcorder for the U.S. market, the company's Japanese engineers didn't really see the utility of the product category.
Since neither scenario worked out, Sony, a leader in higher-end camera equipment, finally came out its own version of Pure Digital's Flip Mino camera, which uploads video directly to the Web via a USB port.
The Webbie does 1080p MPEG-4 video and shoots in 5 megapixels. The camera will be available in March for about $170.
Intel's fourth-quarter warning is not only bad news but bad timing. With the Consumer Electronics Show kicking off Thursday adorned by all those bright, shiny gadgets, Intel effectively said: gadgets maybe, but not so bright and shiny.
And for an Intel warning, this one was particularly dire. The biggest chip bellwether said it now expects only $8.2 billion in revenue for the quarter, a 23 percent drop from the year-earlier period, and 20 percent from the third quarter. And this comes after issuing a warning on November 12.
So what's happening? The clearest example of the gloom that has descended on the chip industry, and by extension computer and gadget makers, came relatively early from another chip bellwether, Taiwan Semiconductor Manufacturing Company -- the largest chip contract manufacturer, which supplies chips to all the first-tier electronics and computer makers. Back on October 30, TSMC issued a forecast that set the tone for the rest of the industry: CEO Rick Tsai said the supply chain -- the myriad of companies that order chips from TSMC -- was "reducing inventory very aggressively."
That supply chain, either directly or indirectly, is the computer and gadget makers of the world.
So going into CES, the picture is not pretty. "We just heard consumer electronics sales over the holidays were down 26 percent year to year," said Broadpoint AmTech analyst Doug Freedman. "You want to head into CES with a pall over it? There it is, right there."
And go the other way, up the supply chain -- the chip gear makers who supply production equipment to chip companies -- and things are even more bleak, with some gear makers saying they don't expect any orders at all in 2009 for certain categories of equipment. In December, Netherlands-based ASML CEO Eric Meurice said that "never before have we witnessed such a sharp and sudden fall-off in lithography system demand."
Other examples are almost too numerous to list: for starters, Toshiba and SanDisk slashing flash memory output 30 percent, Taiwan's memory chip industry on the verge of collapse, and Micron Technology posting a massive $706 million loss.
Yes, there's probably a silver lining in all of this, in that chipmakers and gadget suppliers have to cut the fat and become lean and mean, but where does it end?
And how will this downturn transform the computer industry? Looking at it through the prism of Netbooks -- which are expected to catch much of the limelight at CES -- may provide some insight. These cheap laptop computers are on fire, partially because they are compelling designs but mostly because of price. Good thing? Yeah, great for consumers and small businesses that are finally realizing they don't have to pay $2,000 for a small, lightweight ultraportable notebook. Or simply can't afford a $1,000 notebook.
But not so great for Intel, Apple, and others. "What is the most expensive laptop out there? The Apple (MacBook) Air," said Freedman. "That's a $1,500 or $2,000 machine. Now all of a sudden I'm giving you ultraportability for $500," he said, referring to the price of a Netbook.
In this sense, over-priced notebooks could be seen as roughly equivalent to large SUVs -- overkill. Just as General Motors must wean itself off lumbering SUVs, so may Intel, Hewlett-Packard, Sony, Toshiba, et al., be forced, to some extent, to wean themselves off high-profit notebook computers. After all, what took Sony so long to bring out a Netbook? And why don't we see an Apple Netbook? It's not a stretch to say that those companies don't like the idea of selling a lot of inexpensive computers.
At CES, companies will be hawking flashy gadgets, as always, and maybe attendees can suspend disbelief for a few days blinded by the glare of the gadgets. But that's really just lipstick on a pig.
Updated on December 18 at 3:25 p.m. with pricing information.
Toshiba said Wednesday that it will showcase a 512GB solid-state drive at the Consumer Electronics Show next month and begin shipments in the second quarter of 2009.
Toshiba 512GB solid-state drive rivals hard disks in capacity
(Credit: Toshiba)To date, this would be one of the largest-capacity solid-state drives for use in laptops and come close to matching the size of mobile hard-disk drives.
Samsung has begun mass production of a 256GB SSD and Micron Technology is readying a 256GB drive that will ship in March.
Toshiba said it is releasing a broad family of "fast read/write SSDs" based on 43-nanometer Multi-Level Cell (MLC) NAND flash technology that will be showcased at CES. MLC technology allows solid-state drive makers to deliver higher capacity drives at lower prices.
In addition to the 2.5-inch 512GB drive, the new series of Toshiba drives also includes capacities of 64GB, 128GB, and 256GB, offered in 1.8-inch or 2.5-inch drive enclosures or as SSD Flash Modules, the company said in a statement.
Samples of the new drives will be available in the first quarter of 2009, with mass production slated for the second quarter, in the April to June time frame, according to the company.
Pricing in sample quantities ranges from $220 for the 64GB drive to $1,652 for the 512GB drive, Toshiba said.
The drives achieve a maximum sequential read speed of 240MB per second (MBps) and maximum sequential write speed of 200MBps. This is roughly the same read-write speeds offered by Samsung on its 256GB SSD.
Toshiba said it sees SSDs growing to approximately 25 percent of the notebook market by 2012.
The Consumer Electronics Show has become a mammoth event every January in Las Vegas, but the down economy is paring it back as Cisco Systems, Yahoo, and other companies scale back their presence.
CES remains a useful way for technology companies to meet with retailers, press, and the media. But for some in the current economic climate, it's not useful enough to pay $35 per square foot for a sprawling booth on the Las Vegas Convention Center's cavernous interior.
"This was to have been Cisco's first time as a formal exhibitor," said spokesman Jim Brady. "Given (Cisco's) focus on reducing costs, the company has decided to scale down its participation in CES in Las Vegas in January 2009." Instead, the networking giant is sticking with a more modest space rented at the Venetian Hotel supplemented with videoconferencing technology.
Cisco isn't the only one to scale back. Also on the list are Yahoo, Seagate, Logitech, and Belkin, company representatives confirmed. Philips won't have a space on the CES show floor, either, though Funai, which has taken over manufacturing and selling TVs under the Philips brand in the United States, will pick up some of the slack.
The Consumer Electronics Association, which runs the show, said the show will be the third largest in terms of floor space, shrinking from its size the peak years of 2007 and 2008.
"The economy is causing some companies that may have had booths to say, 'Maybe we want to be in a meeting room instead,'" said association spokeswoman Tara Dunion. Despite it, the total number of exhibitors is level from 2008's show at about 2,700. "We're also seeing companies on the show floor for first time," including Verizon Wireless, T-Mobile, Iomega, and Mattel, she said.
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And there's a silver lining, too. "Vegas hotel rates are coming down because tourism travel to Vegas is slower than it's been in years. That provides an opportunity for business professionals," she said.
Incentives to show
But the organizers are working hard to keep the show as lively as possible. One promotion is aimed at technology buyers--the middlemen who buy all those TVs, gadgets, cameras, and other devices before selling them to ordinary folks.
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