Booming Apple Is World's Largest Semiconductor Buyer

Soaring sales of Apple's mobile devices have made it the world's largest buyer of semiconductors, iSuppli says. Apple spent $17.5 billion on semiconductors last year, $2.4 billion more than Hewlett-Packard, which remained focused on PCs. Apple is expected to sell 70 to 80 percent of all tablets this year as its iPad ecosystem captures buyers.

Apple surpassed Hewlett-Packard in 2010 to become the world's largest buyer of semiconductors among original equipment manufacturers, according to a new report from IHS iSuppli. Driven by booming demand for the company's iconicmobile

 devices, Apple spent $17.5 billion on semiconductors last year -- up 79.6 percent from 2009 and $2.4 billion higher than what HP paid for semiconductors in 2010.

What's more, iSuppli forecasts that Apple will continue to extend its expenditure lead this year by spending $22.4 billion on semiconductors, while HP and Samsung Electronics are expected to spend $14.8 billion and $14.3 billion, respectively.

Apple's iPhone and iPad  products "consume enormous quantities of NAND flash memory, which is also found in the Apple iPod," said iSuppli analyst Wenlie Ye. "Because of this, Apple in 2010 was the world's No. 1 purchaser of NAND flash."

High Mobile Growth Rates

A major factor behind Apple's growing semiconductor expenditures is the high growth rates for mobile devices such as smartphones and web tablets in comparison with growth rates for the desktop  PC , notebook  and server products sold by HP. According to Ye, 82 percent of HP's semiconductor spending during 2010 was dedicated to those three PC segments.

IDC expects global  PC shipments to rise just 4.2 percent this year because of heightened consumer interest in media tablets as well as rising global economic concerns. Still, the firm's analysts see microprocessor shipments in the PC market's mobile, desktop and x86 segments growing 10.3 percent this year. "Generally, the demand environment  for the second half of this year looks decent," said IDC Director of Semiconductors Shane Rau.

When it comes to robust growth, however, the tablet  andsmartphone  markets clearly offer gadget makers the best revenue opportunities. IDC predicts tablet shipments will achieve a growth rate of nearly 350 percent this year.

A total of 44.6 million media tablets are projected to ship this year, with Apple expected to maintain a 70 to 80 percent market share . Furthermore, IDC forecasts that global smartphone shipments will grow 55 percent year over year to 472 million this year, with shipments expected to nearly double by the end of 2015.

"The smartphone floodgates are open wide [with] the growth trend particularly pronounced in emerging markets where adoption is still in its early days," said IDC Senior Research Analyst Kevin Restivo. "As a result, the growth in regions such as Asia/Pacific and Latin America will be dramatic over the coming years."

Ecosystem Benefits

Apple's robust device  and media ecosystem -- which connects every Apple mobile product through iOS and iTunes -- is a major advantage, Ye observed. As a result, users of the Apple ecosystem derive  more value from each additional Apple device they buy, and have little interest in leaving the Apple realm, Ye wrote in a report released Wednesday.

"In other words, through a common ecosystem, Apple leverages each device to sell other devices," Ye observed. "Rising device sales to consumers then lead to increased semiconductor purchasing by Apple."

HP and other computer  makers don't yet have any comparable ecosystems, which means PC buyers have no vested interest in sticking with the same brand when buying a newmachine . However, HP intends to create one by leveraging webOS -- the mobile platform it acquired from Palm last year. Slated to power  HP's forthcoming Touchpad tablet, webOS will also eventually run side-by-side with Windows on the new PCs and notebooks that HP expects to release in the years ahead.

मंगलवार, जून 14, 2011 by rahul thakur · 0

Apple Surpasses HP as Largest Buyer of Chips

Spurred by the success of the iPhone and iPad, Apple is now the No. 1 buyer of chips, including the central processor that acts as the brains of the device, radio chips that let devices talk to cell towers and the audio chip that converts the owner's voice into a stream of data. HP, Samsung and Dell followed Apple in the chip-buying list.Driven by the success of the iPhone and iPad , Apple Inc. has become the world's largest buyer of chips for computers and phones, a research firm said Wednesday.
Apple bought $17.5 billion worth of chips last year, surpassing computer maker Hewlett-Packard Co. as the largest consumer, IHS iSuppli said. That was an increase of 80 percent from the year before, reflecting Apple's continuing sales surge.

An iPhone contains about $80 worth of chips, according to iSuppli. The chips include the central processor that acts as the brains of the device , radio chips that let it talk to cell towers and the audio chip that converts the owner's voice into a stream of data .

The finding that Apple is the No. 1 buyer cements its standing as a company that has the clout, and the cash, to buy chips and other crucial components such as touchscreens when other companies struggle because of supply constraints.

As an example, Apple said in January that it had spent $3.9 billion on long-term contracts to secure supplies for the next two years of a "very strategic" component it wouldn't name. Few other companies are able to commit that much money.

Last summer, high-tech manufacturers were scrambling to buy chips as sales started reviving after the recession and chip-makers had yet to ramp production back up. But Apple reported no chip supply problems; it blamed shortages of iPhones and iPads instead on limited assembly-line capacity.

IPhones and iPads use large amounts of expensive flash memory, accounting for much of Apple's chip consumption. Apple sold 48 million iPhones last year, up 89 percent from the previous year. Meanwhile, PC industry sales grew 14 percent, iSuppli said. IPads went on sale for the first time last year.

Samsung, Micron Technology Inc. and Intel Corp. are leading makers of flash memory.

The $17.5 billion figure means more than a third of Apple's "cost of revenue" -- expenditures excluding corporate overhead -- went toward chip purchases last year.

Samsung Electronics Co., which makes a wide variety of electronics, and PC maker Dell Inc. were the No. 3 and 4 chip buyers. No. 5 is Nokia Corp., the world's largest maker of phones. However, its output is dominated by cheap phones that don't use as many or as pricey chips as the iPhone.

ISuppli expects Apple to extend its lead this year by buying chips for $22.4 billion, compared with $14.8 billion at HP.

मंगलवार, जून 14, 2011 by rahul thakur · 0

China Editorial Blasts Google as a 'Political Tool'

Google's charge that China is hosting hackers has resulted in a Chinese newspaper charging that Google is trying to cause trouble between China and the U.S. Google said recent Gmail hacks originated from Jinan, China, which China denies. An analyst said Google is "playing with fire" and the repercussions could be severe.

The Chinese media isn't taking kindly to Google 's recent accusations. The People's Daily, a Community Party newspaper, published a front-page editorial in Monday's overseas edition flatly stating that Google "slandered" the nation last week.

"Google, What Do You

Want?" was the headline of the editorial that blasts Google for accusing China of hosting hackers who launched a phishing attack on Gmail users. The article argues that Google is making false claims to cause trouble between the U.S. and China.

News reports are publishing translations of the editorial that say Google tries "again and again to discredit China, and used public opinion to sing the China threat theory." The editorial also called Google a "political tool" that has "betrayed the spirit of the Internet."

Google Employees at Risk?.

The editorial follows last week's news that a spokesperson for China's Ministry of Foreign Affairs said the accusations are "unacceptable" and called them "a fabrication out of thin air." Google couldn't be reached for comment, but a spokesperson said Google is not backing down from its assessment of the phishing attack.

"We think users should be aware of the disturbing campaign we've uncovered to collect user passwords and monitor user e-mail," the Google spokesperson said in a published statement. "Our focus now is on protecting our users and making sure everyone knows how to stay safe online."

As Rob Enderle, principal analyst at the Enderle Group, sees it, not even a company as big as Google has the resources to go against a small country -- let alone one of the most powerful companies in the world.

"This puts Google employees in-country at risk  because if the country wants to respond with the full weight of the law behind it -- and remember that the government is the law -- some Google employees could find themselves incarcerated or worse," Enderle said. "So they have to be very careful here."

Enderle is reminded of Microsoft in its antitrust battles. Microsoft, he said, was absolutely convinced it was untouchable. The price to pay was heavy. For Google, it's not a Department of Justice battle, but the company could find itself locked out of China.

"For a company of Google's scale  and stature to be locked out of the fastest-growing market would be a serious blow to their global  aspirations," Enderle said. "Google is playing with fire here and they are way overmatched. They are being foolish and repeating a mistake that Microsoft has already made."

Last Wednesday, Google reported that its cloud -basedsecurity  and abuse detection systems discovered a campaign to collect user passwords, likely through phishing attacks. Google said the campaign appeared to originate from Jinan, China.

The target? The personal Gmail accounts of hundreds of users, including senior U.S. government officials; Chinese political activists; officials in several Asian countries, predominantly South Korea; military personnel; and journalists.

"The goal of this effort seems to have been to monitor the contents of these users' e-mails, with the perpetrators apparently using stolen passwords to change peoples' forwarding and delegation settings," Eric Grosse, engineering director of the Google Security Team, wrote in a blog post.

"Google detected and has disrupted this campaign to take users' passwords and monitor their e-mails," he wrote. "We have notified victims and secured their accounts. In addition, we have notified relevant government authorities."

In March, Google claimed China was blocking or interfering with Gmail accounts in China. Google accused the Chinese government of making it difficult for users there to access the web-based e-mail service . Google said it wasn't just a glitch like the one that took down thousands of Gmail accounts stateside earlier this month.

मंगलवार, जून 14, 2011 by rahul thakur · 0