Business Tech

And you thought computer chips were pervasive now.

In conjunction with a conference in Europe this week, Xerox has announced a new ink technology for printing electronic circuitry on everything from clothes to roll-up computer displays.

Xerox's process uses ink containing silver metal that can be used to wire up processing circuitry. It works on surfaces such as plastic that earlier have shown an inconvenient tendency to melt under the high temperature of liquid silver; Xerox's process works with an ink compound with a much lower temperature, the company said.

Xerox's process can print fine details of electronic circuitry on flexible plastic.

(Credit: Xerox)

"We've found the silver bullet that could make things like electronic clothing and inexpensive games a reality today. This breakthrough means the industry now has the capability to print electronics on a wider range of materials and at a lower cost," said Paul Smith, laboratory manager, Xerox Research Centre of Canada, in a statement. Smith is discussing the technology at the Printed Electronics Europe conference in Dresden, Germany.

So what might use it? Inexpensive e-book readers with flexible plastic displays, for one. Radio-frequency ID (RFID) tags, for another. Or smart pill dispensers that can help keep you taking your medicine at the appropriate pace.

The technology uses conventional inkjet printing methods, and though Xerox has used it with conventional desktop printers, the company expects that it would use continuous-feed printers that print on rolls rather than sheets of material. It doesn't require the super-clean environments needed for conventional silicon chip manufacturing.

The Xerox process actually requires printing three layers on a substrate: a semiconductor, a conductor and a dielectric. The silver ink is the layer that conducts electricity.

The silver ink technology now is available for testing by outside parties, and manufacturing the materials at production volumes isn't far off.

The electronics industry is still hurting, but better times could be here before you know it.

Research firm Gartner says it has spotted a recovery already percolating for the sectors including PCs and mobile phones, with a sustained recovery pattern likely to take shape in 2010. What's holding back the optimism for a faster rebound this year, according to Gartner, is continuing uncertainty about the economy as a whole and, more specifically, about the effectiveness of government stimulus plans, especially when the stimulus runs out.

Gartner's forecast on the electronics industry was compiled for a report called "Signs of Improvement for End-User Electronics Recovery," published in late September.

"Almost all sectors of the electronic equipment market have now hit bottom and await signs of 'first growth' in comparison with the same quarter last year," Klaus Rinnen, managing vice president at Gartner's semiconductor manufacturing group, said in a statement. "The first signs of growth will be led by seasonal buying patterns in the PC market during the third quarter of 2009, although other major sectors will not begin to show first growth, year-on-year, until 2010."

Gartner has revised its forecasts for recovery in each of the electronic segments it tracks. Its latest findings:

PCs: After bottoming out in the first quarter of 2009, the PC sector should enjoy a sustainable recovery in the third quarter of 2010. Computer sales will continue to be constrained by slow growth in IT spending, but consumer demand has held up better than expected and is likely continue to rise. Gartner has revised its forecast for PC sales upward, anticipating good performance in the U.S. and China.

Cell phones: The mobile phone sector also hit a low in 2009's first quarter but should be the first area to show sustainable growth by the first quarter of next year. Thanks to the popularity of smartphones and to demand in emerging markets, especially China, Gartner expects mobile phone production to sink only 8 percent in 2009, 4 percentage points less than it predicted in May.

Consumer electronics: Though consumers have scooped up LCD TVs and Blu-ray players, overall sales in most areas of consumer electronics were flat or down throughout 2009. Gartner sees the market in a state of limbo right now, expecting little growth until the second quarter of next year. Beyond that, the segment is unlikely to return to pre-recession levels until the first quarter of 2011.

"Although the first signs of recovery are starting to appear for the electronics industry," Rinnen said in the statement, "the damage from the current industry recession will be felt for a long time."

It's not really a secret that Sony is in trouble. But the consumer electronics company is taking some calculated steps to change its fortunes.

On Friday, Sony announced it has hired longtime IBM executive George Bailey as chief transformation officer. He will report to Sony CEO Howard Stringer beginning June 1 as head of the Transformation Management Office and consult with two main company divisions: Consumer Products and Devices and Networked Products and Services.

George Bailey

(Credit: IBM)

Bailey served for five years as the global managing partner of IBM's electronics industry consulting practice. His new title at Sony--though grand--describes exactly what Bailey has been known for in his career: fixing the way consumer electronics makers approach the business and help them make money--he even wrote a book about it.

Someone who can transform or kick-start Sony's global business is something the company desperately needs. Stringer has been saying for years he will reinvigorate Sony and figure out a way to get the many different parts scattered around the world to be more tightly integrated. But the results have been dismal: On Thursday, Sony reported its first annual loss in 14 years, to the tune of $1 billion.

Stringer has reshuffled some executives between its Japanese headquarters and its U.S. electronics division and most recently set out a manifesto of sorts for his company during his keynote speech at the Consumer Electronics Show. In it he said they needed to be focusing on the creation of better networked devices with long-term value and that embrace open standards and green materials.

Bailey has a simpler approach. In his book, "Irresistible! Markets, Models and Meta-Value in Consumer Electronics," he says the key to successful electronics companies involves shepherding innovation and giving customers what they want, from the packaging to advertising.

He has in the past praised Apple's approach to both the computer and consumer electronics markets, and specifically compared it to Sony's. It's a pretty easy bet that Bailey will be pointing out these differences to Sony and trying to steer the Japanese giant toward mimicking some of Cupertino's best practices.

With billions in stimulus dollars available to help doctors and hospitals digitize their health records, it stands to reason that tech companies want to make spending that money as easy as possible.

Several of the players--Allscripts, Cisco, Citrix, Dell, Intel, Intuit, Microsoft, and Nuance Communications--have teamed up in an alliance aimed at educating doctors on the many tools available to help set up electronic health records.

The EHR Stimulus Alliance is pulling out all the stops, with a road tour, Webcasts, telephone hotline, and other tools all aimed at demystifying the technology and showing case studies of where it has worked.

President Obama's stimulus package provides on the order of $20 billion for health care technology, with the central focus being nudging hospitals and doctors to move their records from manila folders to computers. Even with the money, though, it's seen as a daunting task.

"The EHR Stimulus Alliance is a unified movement toward turning the national dialogue surrounding the EHR transition into action," Nuance Healthcare President John Shagoury said in a statement. "Each of the partners involved has unique solutions that are crucial to EHR implementation. In our case, because most doctors speak at least three times faster than they type, speech recognition technology helps increase the meaningful use and efficiency of EHRs by decreasing physician reliance on the keyboard and mouse."

The alliance hopes to reach half a million doctors with its message.

Although the alliance represents a number of the big names in tech, there are a lot of other players in the electronic health records business, including Cerner, General Electric, eClinicalWorks, McKesson, and NextGen, as well as start-ups such as Medsphere. Other tech players also pushing hard for their piece of the industry include IBM and storage giant EMC.

Though presumed to be dead since it went bankrupt more than a year ago, CompUSA is showing signs of life.

As Wired noted in a post Thursday, there are 30 new retail outlets bearing the CompUSA name in the U.S. that are trying a new retail strategy that includes computers available for customers to do price matching on the Web sites of CompUSA's competitors.

Gilbert Fiorentino, chief executive of the Technology Products Group at Systemax, the company that bought CompUSA, told Wired: "We have invented this idea of retail 2.0...Every screen in every CompUSA store is now connected to the Internet and making buying a richer experience for customers."

While it's unclear whether it's going to be successful, it can't be any worse than its previous strategy, which found the once venerable electronics retailer in bankruptcyin December 2007.

At the time, the company was struggling with competition from rivals Best Buy and Circuit City, but Circuit City met a similar fate right before last year's big holiday shopping season and was forced to file for bankruptcy protection. (Earlier this year, the retailer shut its doors.) Circuit City's fall was due to pressure from online retail outlets like Amazon.com and NewEgg.com, but also the sudden economic collapse and resulting credit crunch. Don't look for Circuit City 2.0 though. It's clear to most retailers, including apparently CompUSA, that the future of retail electronics is focused in the direction of the Web.

Best Buy's fourth quarter was better than anticipated even though profits were down from a year ago amid an economic downturn. The company also noted that the quarter ended stronger than it began, indicating that consumer spending stabilized. And the Circuit City liquidation certainly didn't hurt Best Buy's cause.

The company reported net income of $570 million, or $1.35 a share, on revenue of $14.7 billion. In the same quarter a year a year ago, Best Buy reported net income of $737 million, or $1.71 a share, on revenue of $13.4 billion. Excluding restructuring charges, Best Buy reported earnings of $1.61 a share, well ahead of Thomson Reuters estimates of $1.40.

Same store sales, however, fell 4.8 percent in the quarter, which ended Feb. 28. Best Buy had cut its outlook, revised it, and restructured to prepare for the downturn. The company said it cut its inventory more than it had expected and faced product shortages late in the quarter.

For fiscal 2009, Best Buy reported earnings of $2.39 a share, down from $3.12 a share in fiscal 2008. Fiscal 2009 revenue was $45 billion, up from 13 percent a year ago. For the year ahead, Best Buy projects earnings of $2.50 to $2.90 a share on revenue of $46.5 billion to $48.5 billion. The company also projects same store sales to be flat to down 5 percent for the year. Analysts were expecting earnings of $2.45 a share.

In a statement, Best Buy executives portrayed the year ahead as one focused on cost-cutting and a rocky economy. However, the company should benefit from the liquidation of Circuit City. A negative factor is likely to be increased competition from Wal-Mart, which is increasingly focused on electronics. Best Buy estimated that its market share improved to almost 22 percent.

Best Buy CFO Jim Muehlbauer said:

We expect consumer spending to remain challenging in fiscal 2010, and the complex mix of external factors that will influence their behavior makes forecasting the future increasingly difficult.

Best Buy's breakdown of sales showed a few interesting cross currents. For instance, consumer electronics sales fell 8.6 percent and entertainment software fell 11 percent. Home office equipment surged 8.1 percent in the fourth quarter and notebook PC sales showed small gains.

(Credit: Larry Dignan/ZDNet)

Taiwan's economic affairs minister has retreated from previous statements that suggested a merger of the country's ailing memory chipmakers was likely, saying it's "too complicated," according to reports.

Instead, Taiwan Memory Co., the new government-backed entity, will focus on acquiring technologies and tapping existing manufacturing plants in Taiwan, according to a Bloomberg report.

Economic affairs minister Yiin Chii-ming and John Hsuan, a former United Microelectronics Corp. executive who was appointed by the state to oversee the formation of Taiwan Memory, are also saying that the scale of the aid plans will be pared back, Bloomberg said. This is a departure from previous statements that suggested a massive consolidation of the six loss-ridden memory chipmakers was likely.

"It is wrong to assume we would take in these companies with all their debts and problems," Bloomberg reported, citing an interview with Chen Chao-yih, head of the economic ministry's industrial development bureau. The six companies have combined debt of about $11 billion.

Taiwan's memory chipmakers lost a combined $12.5 billion in 2007 and 2008, highlighting the dire straits--including bankruptcies, widespread plant closings, and layoffs--that the memory chip industry is in worldwide.

The six companies are: Nanya Technology, Inotera Memories, Powerchip Semiconductor, Rexchip Electronics, ProMOS Technologies, and Winbond Electronics.

Taiwan named a chip industry veteran to head a state-backed company that will merge six memory chipmakers, following pleas from domestic companies desperate for financial aid.

Previous reports had cited an approval for loans, but on Thursday the economic affairs ministry took this a step further and named former United Microelectronics Corp. executive John Hsuan to head a state-backed company, according to Bloomberg. Taiwan's government will hold less than a 50 percent stake.

Taiwan Memory Co. will be established within six months. It has not been decided yet what role Japan's Elpida Memory or U.S.-based Micron Technology would play, according to the report. One of these two memory chipmakers could either collaborate with the merged companies or become part of the new entity.

At stake is Taiwan's dynamic random access memory (DRAM) industry. DRAM is the main memory used in personal computers. While all memory chipmakers have been suffering, Taiwan's DRAM industry has been falling further and further behind market leaders Samsung and Micron and posting big losses.

The Taiwan-based companies are Nanya Technology, Inotera Memories, Powerchip Semiconductor, Rexchip Electronics, ProMOS Technologies, and Winbond Electronics.

The companies posted combined losses $12.5 billion in 2007 and 2008, Bloomberg said.

The Intel architecture is coming to smartphones.

LG Electronics and Intel are announcing a collaboration based on Intel's Moorestown silicon and the Linux Moblin v2.0 software platform at the Mobile World Congress in Barcelona on Monday. The future LG device--which is being described as a smartphone--is expected to be one of the first Moorestown designs to market.

Moorestown is the code name for the successor to Intel's current Atom processor.

"LG and Intel's common goal is to unleash rich Internet experiences across a range of mobile devices while delivering the functionality of today's high-end smartphones," the companies said in a statement.

The key to getting Intel chips that run all the most popular PC software into a phone is reducing the power consumption below the Atom chip used today in Netbooks, according to Ashok Kumar, an analyst at investment bank Collins Stewart. "If you look at the power consumption projectory, they dropped Atom to two watts and they expect to drop that (with Moorestown) by a factor of 10," Kumar said.

"That would squarely be in the power envelope of a smartphone," Kumar said. Intel mobile processors found in mainstream laptops have a thermal envelope of between 25 and 35 watts.

But whether Moorestown can actually achieve the energy frugality of silicon from longtime cell phone silicon suppliers like Qualcomm and Texas Instruments remains to be seen. Toshiba recently disclosed that its using Qualcomm's Snapdragon chip in a future phone and Qualcomm supplied the main processor in the first phone using Google's Android OS.

Moorestown will also be used in MIDs or mobile Internet devices. And it seems, at times, that the terms smartphone and MID are used almost interchangeably. "The MID segment will drive growth at LG Electronics. We chose Intel's next-generation Moorestown platform and Moblin-based OS to pursue this segment because of the high performance and Internet compatibility this brings to our service provider customers," Jung Jun Lee, executive vice president of LG Electronics, said in a statement.

Neither company gave a date for availability of the LG device, but it is expected to appear soon after Moorestown is available. Intel is saying that Moorestown will be available in 2009 or 2010, though the second half of 2009 appears increasingly likely.