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Ittiam Launches Multimedia Chip For Digital Devices.
1 March 2004
Financial Express
The Financial Times Limited.
Ittiam, the Bangalore-based DSP (digital signal processing) chip company, has just started to license its latest product - a digital media chip, which can form the base of products in the digital consumer goods market. It has already sold 15 licenses to OEMs in Taiwan, Korea, US, Europe and Japan. The third major product family launch from the company, the new chip is what CEO Srini Rajam calls a "Swiss army knife." "Our customers can pick and choose any of them in any combination," he said. This makes the chip a mass consumption product, which increases its potential to bring in revenues. Being a product company, Ittiam's revenues come in from two streams. One is the sale of its technology (or licenses sold) to OEMs; the other is the royalty on the sale of the each unit of each product developed by the OEM. The new chip offers three functions - recording, playing and storage on three media - video, audio and image. Various combinations of these can result in different digital devices.
Ittiam's customers - mainly OEM of digital devices - have already come up with products such as a digital camera and a handheld personal video for inflight viewing. Using Ittiam's new chip, one customer has been manufacturing and selling personal videos for less than half the price in the market. "The customer sells at around $400 per unit, as against $1000 per unit using other technologies," said Mr Rajam. Moreover, the Ittiam chip also makes it possible for the device to run for eight hours at a stretch. "No other product can run for this long," Mr Rajam said. Almost three year-old, Ittiam is just about starting to see revenues coming in from royalties. Around 98 per cent revenues this year would still be from license fees, Mr Rajam said. At the end of four years, royalties ouwld account for 10-20 per cent revenues, and 30-40 at the end of five years, he said. Mobile phone companies are also interested in the new multimedia chip, he said. Today's video capability on mobiles is still rudimentary with low frame rates and resolution. The chip offers video frame rates of 24 frames per sec, which can significantly increase video quality. The automobile industry is also looking at video devices for the passengers in premium cars. Mr Rajam sees potential for the chip in the home entertainment segment too. The privately-held company, which is expected to share its revenues for the first time in April this year, plans to increase headcount from the current 100 to 150 by the end of the year. Product companies typically work in small groups and in the next three years, the headcount is targeted to grow to 250-300 people.
IFE service options....
Mark Pilling
1 March 2004
Airline Business
Low-fare carriers in both North America and Europe are adopting a wider variety of service options to ensure their product stands out from the crowd
According to airline folk wisdom, the low-cost carriers have all based themselves on a single model. The undoubted grandfather of the concept and drafter of the blueprint is Southwest Airlines. The Dallas-based carrier set the pattern for high aircraft utilisation, a single aircraft fleet, simplified boarding procedures and reduced on-board product. It also has features common among North American low-fare carriers but largely absent in Europe, such as offering connecting flights.
More recently, direct booking over the internet has been added to the standard package for the new carriers. Interestingly, however, Southwest lags the industry in this field. Compared with 74% at JetBlue Airways, Southwest has only 55% of its tickets booked over the internet, and relies heavily on call centre and traditional agency distribution (agencies accounted for 20% of sales in 2002). Neither of these US carriers however comes close to the highest European levels of internet booking penetration, which are around 94% at both easyJet and Ryanair (see table page 60).
The new model blueprint has frayed at the edges as newer carriers in North America and Europe have adopted differing business philosophies. Some use more than one type of aircraft. Some choose to operate mainly from primary airports rather than the secondary airports favoured by carriers keen to make the quickest possible turnrounds and reduce their airport costs. Seat assignment, rather than "first come first seated" boarding, has made its way into some new carrier offerings on both sides of the Atlantic.
Additional products
In new carrier products, there is no simple "one size fits all" pattern. Product simplicity was thought to be a major driving feature of the new model carriers, but in reality there are now many variations. North American carriers have led the way in offering additional product features to their customers, with an array of extras which might surprise European low-fare travellers.
Every North American carrier has some form of frequent flyer programme (FFP), and some of the new carriers even have partnership links with legacy carrier FFPs (see Special Report, page 50). Many of the new carriers offer automated check-in on the web or via kiosks at airports and some form of complimentary food and drink, varying from Southwest's snack packs and peanuts to Frontier's hot bagel and cream cheese breakfast. Increasingly, they also offer sophisticated in-flight entertainment (IFE), led by JetBlue's satellite LiveTV.
New carriers continue to sign up for enhanced entertainment products that put them ahead of legacy carriers, such as the recent agreement by AirTran Airways to put XM Satellite Radio audio on all its aircraft and Canada's WestJet Airlines putting LiveTV video on new Boeing 737-700s.
Some North American new model carriers have even introduced the classic feature of full-service short-haul carriers, by having two cabins on board. Spirit Airlines, for example, although primarily serving leisure traffic, introduced a premium cabin in 2002 and ATAAirlines said it will install a business-class section on its 737 and 757 fleet by November. Elsewhere, America West Airlines, while transforming its operations to become a low-cost carrier, has retained airport lounges at its two primary airports as well as two classes of service.
Larger carriers have not sat idly by. In the past, when US majors set up low-cost operations to compete against the new entrants, their product offerings were also relatively basic. Now, the majors are following the trend. Their latest market entrants, Song and Ted, both have enhanced product offerings such as satellite audio and video entertainment and easy, automated check-in. Competition may be driven hard by price, but new and old carriers alike are prepared to invest in product to keep ahead of rivals.
By comparison, three of Europe's low-frills carriers - easyJet, Ryanair and Virgin Express - appear to offer only the most basic product; none offer complimentary food or drinks, premium cabins, an FFP programme or any form of automated check-in. Differentiation on-board comes mainly through higher quality food for sale in-flight or through seat pre-booking - an innovation which originated in North America and has been taken up by Virgin Express.
The accent for European new carrier competition has instead been largely on lower fares. Yet product differentiators are emerging, as they have done on the other side of the Atlantic.
At the most fundamental level, the choice of airport is a primary product differentiator for travellers and airlines. Ryanair is recognised for using mainly secondary airports rather than major ones, placing many little-known European cities on the airline map. EasyJet, on the other hand, uses several primary airports. So, while Ryanair flies to Beauvais, Girona and Prestwick, easyJet serves Paris Charles de Gaulle and Orly, Barcelona and Glasgow, aiming to attract passengers who prefer airports closer to the cities they serve and which usually have better surface transport links.
The choice of airport is also a major factor in the success of some of the newer European carriers. In the UK, the trend is towards more low-fare flights from regional airports, bringing scheduled service closer to where travellers live and work. There are currently at least 10 low-fare carrier bases at UK regional airports.
Charter carriers were the original European low-cost airlines. They too are playing a part in the pattern of product differentiation. Some have entered the scheduled market with full-service product features such as IFE, and complimentary hot meals on holiday routes at moderate fares. Air Berlin is using this approach combined with penetration of regional airports in its home country to bring higher product standards on both holiday and business routes. In a further break from the European blueprint, Air Berlin also operates a connecting hub at Palma in Spain.
The development of product differentiation among new carriers in the USA is therefore catching on in Europe, particularly for longer low-fare flights from northern Europe to Italy and Spain, though so far usually in a different form. Parallels elsewhere suggest the trend towards differentiation could continue.
Competitive network
In the hospitality industry, which like commercial aviation is a competitive network business, major hotel chains have built their portfolios of product offerings over the years. One chain can now offer a range of choice from budget motels through three-star city hotels to luxury properties, with more than one type of property in the same city. Customers are happy to pay for differing standards of hotel room and service according to their budgets or type of trip.
In the air, long-haul carriers set the airline trend towards product differentiation by introducing "mid- classes", starting with EVA's Evergreen Deluxe class in 1991, followed by Virgin Atlantic Airways in 1992 and BA's World Traveller Plus in 2000. US carrier moves in recent years to add more legroom for frequent and high-yield economy class travellers are also aimed at product differentiation.
Although the need for a wide range of on-board service may be less on short-haul than on long-haul flights, the evidence is that passengers want to have some choice, even if they are not willing to pay a large premium for product extras. The gradual demise of long-haul first class suggests, however, that customers are more prepared to pay for reasonably priced middle ground improvements than for extravagance.
If product differentiation is here to stay, it must bring commercial benefits to carriers. Early attempts among the new model carriers appear to have been unsuccessful, with Debonair and BA's Go both failing to turn product extras into long-term profitability.
Unit revenues
In fact, the North American evidence for driving higher revenue through product differentiation is mixed. GCW's research suggests that unit revenue can be higher for new carriers that offer a differentiated product. The table shows easyJet, Frontier and America West all achieving higher unit revenues than their peers for the passenger hauls involved. On the other hand, JetBlue - with its much-admired branding and in-flight entertainment - does not appear to derive greater unit revenues than rivals, relying instead on low unit costs on its longer sectors to achieve success.
But some of the added-service carriers also carry higher cost burdens. In easyJet's case, unit costs are as much as 50% higher than Ryanair's, even though its sector lengths are 10% greater. Frontier has until now had relatively little low-fare carrier competition at its Denver base, so it is perhaps unsurprising that its unit costs are 11% higher than Southwest's - even though its average stage lengths are nearly 50% greater than those of the low-cost patriarch.
A more important driver for product differentiation among Europe's new carriers may be the reaction of major carriers. BA for one has spent heavily on marketing the extras that its passengers can expect, even when they are paying a fare which may at times be as low as that available on newer competitors.
BA and easyJet currently operate side by side from London Gatwick to 11 destinations, so passengers have a clear choice between the two products. The outcome of this confrontation is not easy to predict, however, as BA's product offering comes at a unit cost that may not be able to stay the course against easyJet's comparatively lower costs.
As the Gatwick example shows, Europe's new carriers have to consider whether their products need to have added features to maintain competitive advantage as well as an edge on cost. In Asia, although the low-cost phenomenon is only in its infancy, product differentiation will also have a part to play. The existing major carriers in the region insist they will maintain competitive advantage through comparatively low unit costs from operating widebody aircraft; and superior on-board product and airport service, which they maintain passengers demand on the longer stage lengths encountered in the region. New low-fare carriers may therefore have to look at competing with legacy carriers on product as well as price.
Australia's Virgin Blue has already taken a step in this direction by offering pay-as-you-go airport lounges and the ability to pre-book exit- and front-row seats with greater legroom for an extra charge. Future new Asian carriers may have to add further product features to compete successfully in the region against entrenched full-service carriers.
There is one further product differentiator which matters to full-service and low-fare carriers alike - punctuality is always an important factor for travellers, particularly those on business.
Punctuality matters
Many of the new carriers seek to distinguish themselves through their on-time performance. The record bears this out. In September 2003, four of the top five carriers in North America for on-time arrivals were new carriers, led by WestJet of Canada with JetBlue, Southwest and ATA not far behind.
In Europe, Ryanair also trumpets its on-time performance, claiming that last year 91% of its flights arrived on time, compared with 76% for easyJet. Virgin Express also advertises a high level of punctuality, claiming that in August and September 2003 it beat Ryanair's on-time performance. High levels of punctuality like these distinguish the Ryanair and Virgin Express product not only from new carrier competitors but also from full-service rivals.
As product extras become part of the new carriers' armouries in Europe, the market may see more low-fare airline efforts concentrated on flights from regional airports, FFPs and check-in automation. But the two most fundamental product points for the new carriers everywhere are likely to remain their low fares and their ability to operate reliably and punctually. n
Song IFE fit progress
4 March 2004
Airclaims Airline News
Song, Delta Air Lines' low-fare carrier, announced on 1 March that 75 percent of its fleet has been outfitted with in-flight entertainment systems and that it is on schedule to complete the entire fleet by 31 March.
The system will eventually provide live, satellite television, video on demand pay-per-view movie programming, MP3 audio programming and interactive video games at each seatback.
Since October 2003, Song has been phasing the new technology into its fleet of 36 Boeing 757 aircraft at the rate of one plane every four to seven days.
In April, Song will begin installation of server technology to its aircraft, which is planned to be installed throughout the existing fleet by December 2004, to provide a broader array of services, including video on demand pay-per-view movie, digitally-streamed MP3 programming that allows customers to create individual play lists during their flights, interactive iXplor moving map with zoom capabilities and points of interest information and connecting gate information broadcast directly to personal in-seat video monitors.
The Wall Street Journal Europe..Digeplayer
PERSONAL JOURNAL --- Good News for Travelers in 2004: Shorter Lines, More Perks
By Kortney Stringer
27 February 2004
The Wall Street Journal Europe
THE BOTTOM LINE for travelers? Fewer and shorter lines. Travelers are being promised shorter, speedier security lines at airports, as well as shorter check-in lines for air travel, car rental and hotels. Meanwhile, travel companies are looking more to online bookings as a cheaper, speedier and powerful alternative to travel agents and calls to airline reservation centers.
Barring another terrorist attack, the travel industry's rebound should accelerate this year as more travelers enjoy continued low prices. Airlines are bringing in more capacity by adding more flights and planes, which will keep prices low. Hotels still haven't topped 60% occupancy, on average, and are expected to be offering bargains. Here's a look at some specific trends.
TIME TO GET GOING
The travel industry is expected to continue its recovery this year. Overall traveler spending by domestic and international visitors in the U.S. is forecast to rise 4.4% in 2004 to $568 billion (453.83 billion euros), according to the Travel Industry Association of America, a trade group based in Washington. Still, travel spending isn't expected to exceed the record levels of 2000 until next year.
As terrorism fears recede and the economy improves, travelers are expected to fly more and take longer trips. Already, some travel agents report that travelers are becoming more adventurous. Marva Donavan, president of Dolphin Travel in Grand Rapids, Michigan, says she has noticed a pickup in international travel for the summer. Terrorism fear remains, Ms. Donavan adds, but, "I think we've lived with it for so long now that people are traveling" again.
SECURITY: LESS BUT MORE
Airport security will single out fewer travelers for intensive searches, or so the U.S. government says. The Transportation Security Administration is to begin using a system that should result in fewer people being selected for additional screening.
During the first quarter, the agency responsible for the security at the U.S.'s airports will begin testing its Capps II system. The current system checks for basic passenger information -- including names, phone numbers, and whether a passenger paid for a flight with cash or is flying one way -- to flag large numbers of travelers for additional screening at security checkpoints. The information is then checked against various databases before generating a score indicating whether the traveler poses a security risk. Capps II now adds another identifier, a birth date, which should help narrow the list.
When the TSA proposed the new system, critics -- which included major airlines -- feared possible civil-rights violations given the original plan to track passengers' personal information. But the system has since been tweaked. For instance, the new system won't check passengers' credit or health records, as previously proposed, but it will check their names against watch lists of known terrorists and people with arrest warrants outstanding for violent crimes.
Under the new system, the TSA says, the vast majority of passengers will be identified as "low risk." Fewer than 5% should be flagged as "elevated," or "unknown," and subjected to further inspection, the TSA says, down sharply from the current 15%. The TSA expects the new system to be rolled out to all U.S. airports by the summer.
CLICKING ON TO BETTER DEALS
U.S. travelers will continue to flock online.
Leisure and business travelers alike are expected to drive U.S. online travel revenue to $51 billion in 2004, up 19% from last year, according to projections from market-research firm Jupiter Research, Darien, Connecticut. By 2008, U.S. online travel bookings are expected to account for 30% of all travel purchased, says Jupiter, up from just 16% in 2002.
Airlines, hotels and online travel agencies will make an aggressive push to boost customers' comfort with their services by making online bookings easier and faster. Travelers should expect more virtual tours of hotel rooms and cruise ships, for example.
Suppliers and online agencies also will offer added perks for online bookers -- such as frequent-flier miles or special discounts -- in the hopes of luring more traffic to their sites.
In addition, more employers are expected to mandate online booking for business travelers to save money by reducing fees paid to travel agencies. More corporate travel could also be shifted to online travel agencies from traditional agencies. In October, McDonald's Corp. was the first major company to make such a move when it shifted travel planning for its U.S. employees to Orbitz Inc.'s business-travel product from Carlson Wagonlit, a corporate travel management company.
Analysts say growth in online bookings this year will be driven by so-called dynamic packaging, which allows travelers to cobble together their own airfare and hotel and sometimes rental car at one price -- often lower than buying the components separately. The lower price is available, in part, because suppliers will offer deeper-than-usual discounts if they know the depth of the markdowns will be masked from consumers within a package deal. Dynamic packaging was introduced last year by the three largest online travel agencies: Expedia, a unit of InterActive Corp.; Sabre Holdings Corp.'s Travelocity; and Orbitz, which is about two-thirds owned by a handful of major airlines that founded the site.
BYPASSING THE COUNTER
Long lines at the check-in counter will quickly become a thing of the past, thanks to automated check-in kiosks.
Major airlines now offer ATM-like kiosks at many airports where travelers can check in, pick their seats and even sign up to fly standby on another flight. In 2002, Delta Air Lines began allowing passengers at some airports to check in using telephones located near the counters, and last year the airline installed the phones at check-in counters at most major airports and even at some gates. With the check-in phones, passengers can speak with a customer-service representative to check in for a flight. They then stand in a much shorter line to get a boarding pass. Passengers checking luggage still need to interact with someone at the airline counter.
Some airports are testing generic kiosks that allow passengers to check in and print a boarding pass no matter which airline they are flying. Passengers with luggage can check in at the kiosks, but they still need to drop off the luggage at the airline counter.
Some hotels, including Hyatt Corp., have begun allowing guests in hotels in the U.S. and Canada to call a toll-free number to check in to their rooms. But travelers still have to stop at the counter to get room keys.
MORE ROOM FOR YOUR MONEY
As travelers return, hotel-room rates will stay low and perks will be plentiful.
According to the American Hotel & Lodging Association, occupancy rebounded slightly to between 59.5% and 59.6% in 2003 from a 31-year low of 59.2% in 2002. The rebound is expected to continue in 2004 and 2005, with occupancy topping 61%. Occupancy for upscale hotels, including resorts, is expected to rise to 73% this year from 71% in 2003.
The average room rate is expected to increase 2.2% for 2004 -- though that is still considered low -- while the revenue per available room, or the average money generated per occupied room, is expected to grow 5.8%.
And as travelers check in, they will be find a few extra goodies. Westin Hotels, a part of Starwood Hotels & Resorts Worldwide Inc., installed state-of-the-art fitness rooms last year in all 77 of its U.S. hotels. Most of Marriott International Inc.'s midprice, limited-services hotel chains -- Courtyard, Residence Inn, TownePlace Suites and SpringHill Suites -- have begun offering free high-speed Internet service. In a few Hiltons, customers can now book a room that is fully outfitted with fitness equipment.
WOOING THE HIGH-PRICE FLIERS
The biggest airlines, still struggling to lure travelers back from low-fare carriers, are expected to try even harder this year to win back some high-paying customers and to sell more full-fare tickets.
Some airlines, including Delta, Continental Airlines and British Airways, have slashed rewards for frequent fliers with discount tickets. But they are piling on the perks for full-fare passengers.
For instance, Continental has begun giving full-fare passengers elite-level frequent-flier status for the day in most domestic markets, including possible first-class upgrades and priority baggage tags for quick baggage service. The carrier also guarantees full-fare travelers an aisle or window seat, or it gives the customer 1,000 frequent-flier miles.
AMR Corp.'s American Airlines offers bonus frequent-flier miles for those flying full-fare. Last year, UAL Corp.'s United Airlines began offering free first-class upgrades to elite-level frequent fliers who buy full-fare coach tickets.
NO FREE LUNCH
Airplane food will continue to make a comeback, but the airlines aren't expected to dish out much free fare.
Major airlines took away free food service on many domestic flights after racking up billions of dollars in losses following the Sept. 11, 2001, terrorist attacks. Now as airlines regain their footing, they will be looking for ways to offer passengers the food they crave -- for a price.
Last year, United Airlines began selling food on 190 of its flights, and US Airways began selling food to coach passengers on all domestic flights over 1,100 kilometers. Delta plans to expand its meals-for-sale program to 244 flights by spring, up from 44 in February. And Song, Delta's new low-fare carrier, started selling food such as Pizzeria Uno pies when it launched in April. Northwest Airlines also is testing food sales.
American Airlines concluded that selling food onboard would be more complicated and expensive than its traditional food service, and so is testing selling packaged food offerings from such restaurants as T.G.I. Friday's at small kiosks located outside the airline's gates. Passengers purchase and pick up the food before the flight and take it onboard.
BIG GROWTH FROM SMALL GUYS
(MORE)
Low-cost carriers, which now represent about a quarter of the U.S. airline industry, will grow to represent about 35% in the next three years, some industry observers believe. In fact, some predict that within two to three years, Southwest Airlines, the grandfather of the discount sector, could be No. 1 among U.S. airlines in passengers carried.
The discount carriers will continue to look for growth in large cities where they can stimulate air traffic with low fares and grab market share from the major carriers. AirTran Airways, a unit of AirTran Holdings Inc., last summer ordered more than 100 Boeing Co. jets. The carrier says it will use most of the new planes to "connect the dots" in its route map, or start service between cities it already serves, begin service in new cities and offer more frequent flights.
Over the next few years, low-cost carriers also may begin to enter smaller cities such as Providence, Rhode Island. JetBlue Airways, the carrier with a TV at every seat, recently ordered 100-seat Embraer jets, which industry observers predict will be used to fly to smaller cities and to boost the number of flights it operates between cities it already serves.
The low-cost model has appeal world-wide. Ireland's Ryanair Holdings PLC and Britain's easyJet PLC have succeeded in taking a page from Southwest. And this year, a number of low-fare airlines, such as Air Polonia in Poland and Wizz Air in Hungary, will pop up in Eastern Europe. Several also are planning to launch in Southeast Asia this year.
Trying to defend their turf, the major airlines are jumping into the discount-carrier fray. Delta and United Airlines both have launched low-fare carriers. And the industry's largest carrier, American Airlines, says it is considering doing the same. Delta's Song and United's Ted are risky strategies. Ronald Kuhlmann, vice president of Unisys R2A Transportation Management Consultants, says the experiments do nothing to cut the high costs in the airlines' main business.
LET US ENTERTAIN YOU
If you can forget the hunger pangs and security hassles, flying may be more fun.
Denver-based Frontier, a 10-year-old low-cost carrier, offers TV on some planes for $5. America West Airlines is considering TV as well. And even low-fare king Southwest Airlines is weighing in-flight entertainment, even though it hasn't specified exactly what that would be. JetBlue already offers free live satellite TV.
Meanwhile, the largest carriers are testing the use of such technology on their smaller upstarts. Delta's Song service promises a video monitor on each seat by early this year, and UAL's new upstart, Ted, will also offer audio and video programming.
Alaska Airlines, a unit of Alaska Air Group, recently rolled out the movie- and music-playing digEplayer on some transcontinental flights. Alaska Air distributes the units free in first class, and makes 30 or so available for rent in coach for $1 to $8 depending on whether they are reserved in advance.
Other airlines are trying to woo business travelers by allowing them to stay connected while in flight. For $30 to $35 a flight, Scandinavian Airlines System last year began offering high-speed Internet access aboard some long-haul flights, letting passengers surf the Web or send e-mail. SAS signed a contract with Boeing to install its wireless broadband service, Connexion, aboard two planes in February. The rest of the airline's long-haul fleet will be equipped in 2005. Other carriers are also introducing the service.
United Airlines now is offering two-way e-mail capability aboard all its flights within the U.S. It allows users to check weather, news and stock listings, play games and use the messaging services for $5.99 a flight.
---
Nicole Harris, Melanie Trottman and Meera Louis contributed to this article.
e.Digital Corporation and TGE Group Announce Licensing
Felt like posting something other than F10. I believe we were told there will be 1 million products with edig inside this year based on this agreement.
2 February 2004
Market News Publishing
2004 Market News Publishing Inc. All Rights Reserved
E DIGITAL CORP - e.Digital Corporation and TGE Group Announce Licensing Agreement e.Digital to Develop Several Digital Audio Products for TGE Group and Their Global Customer Base.
e.Digital Corporation announced that it has entered into a royalty bearing license agreement with Tai Guen Enterprise Co. LTD (TGE Group). Under the licensing agreement, e.Digital will develop several audio products based on its proprietary MicroOS(TM)-enabled Personal Audio technology platform for international original equipment and design manufacturing, branding, and distribution by TGE Group and its global customer base.
TGE Group, an Asian-based multi-billion dollar OEM/ODM, is a leading global supplier of fully featured, cost-effective consumer electronic products and technology. The audio products being developed by e.Digital for TGE Group and their customers will include a variety of high capacity, cost-effective disk drive storage solutions including the Cornice Storage Element.
"e.Digital is achieving growing industry recognition through our highly flexible MicroOS-based technology platforms," said Fred Falk, e.Digital's president and CEO. "We are very happy to be partnering with one of the world's largest original equipment and design manufacturers of portable digital audio products. We look forward to a mutually beneficial and profitable relationship."
"TGE Group is committed to providing our global customers quality, cutting-edge audio products at competitive prices," commented Meson Lee, IA Division General Manager of TGE Group. "e.Digital's dynamic personal digital audio platform enables us to offer new lines of audio products featuring the latest in high capacity storage solutions."
About e.Digital Corporation
e.Digital Corporation partners with leading original equipment manufacturers (OEMs) licensing, designing and providing manufacturing services for OEM-branded digital video, digital audio and wireless products based on the Company's proprietary MicroOS(TM)-enabled technology platforms. e.Digital specializes in the delivery and management of open and secure digital content through it's Personal Video, Personal Audio, Automotive, and Wireless technology platforms. e.Digital's services include the licensing of the Company's MicroOS(TM), custom software and hardware development, industrial design, and manufacturing services through the Company's manufacturing partners. For more information about e.Digital and its technology platforms, please visit the company website at www.edigital.com.
About TGE Group
Tai Guen Enterprise Co. Ltd., (TGE Group) is a Taiwanese capital, China based company specializing in high-tech OEM/ODM business, developing and manufacturing an extensive range of consumer electronics, computer peripheral and information application products. TGE Group also has grown with the development of the Internet and with the need for timely and effective network security and communications technology. TGE Group has a strong market share in China as well as an extensive international network of distributors. TGE Group exports to over 10 countries with 40% of its business in international markets and 60% in China. TGE Group recorded revenue of 2 billion dollars in fiscal year 2002. For more information about TGE Group, please visit the company website at www.tgegroup.com.
TRAVEL SAVVY ALASKA HEADS TO O'HARE
JANET FILIPS - Special Writer, The Oregonian
15 February 2004
The Oregonian
SUNRISE
2004 Bell & Howell Information and Learning Company.
Alaska heads to O'Hare
Alaska Airlines starts direct flights April 26 from Seattle to the Windy City, with twice-daily service. To celebrate the new nonstop, Alaska is offering a $198 roundtrip fare from Portland to Chicago, through Seattle (plus facility charges and some taxes), April 26-May 26. If you fly straight from Seattle, the introductory fare is $158 roundtrip, plus taxes and fees. Service will be on Boeing 737s. Currently, Alaska flies to Chicago only from Anchorage.
You need to plan ahead to nab this special. Tickets must be purchased at least 21 days before departure, and some seats are already selling out. Travel must be completed by May 26. Additionally, you may fly to 68 cities beyond Chicago through Alaska's code-share partnership with American Airlines. Perk: All Chicago flights will feature Alaska's new digEplayer in-flight entertainment system that offers a choice of films and TV shows.
Digeplayer mentioned in WSJ...Trends (A Special Report): Travel --- Clicks, Perks and Cheap Cruises
By Kortney Stringer
9 February 2004
The Wall Street Journal
R3
2004, Dow Jones & Company, Inc.)
THE BOTTOM LINE for travelers? Fewer and shorter lines.
Travelers are being promised shorter, speedier security lines at airports, as well as shorter check-in lines for air travel, car rental and hotels. Meanwhile, travel companies are looking more to online bookings as a cheaper, speedier and powerful alternative to travel agents and calls to airline reservation centers.
Barring another terrorist attack, the travel industry's rebound should accelerate this year as more travelers enjoy continued cheap prices. Airlines are bringing in more capacity by adding more flights and planes, which will keep prices low. Hotels still haven't topped 60% occupancy, on average, and are expected to be offering bargains. New ships that are ready to set sail and added berths will keep prices for cruises low.
Here's a look at some specific trends.
1. TIME TO GET GOING
The travel industry is expected to continue its recovery this year. Overall traveler spending by domestic and international visitors is forecast to rise 4.4% in 2004 to $568 billion, according to the Travel Industry Association of America, a trade group based in Washington. Still, travel spending isn't expected to exceed the record levels of 2000 until next year, when spending is forecast to reach $594 billion.
Domestic leisure travel remains a bright spot. The Travel Industry Association says leisure-travel volume will grow 3.2% this year, up from a 2.8% annual increase last year. As terrorism fears recede and the economy improves, travelers are expected to fly more and take longer trips.
Already, some travel agents report that travelers are becoming more adventurous. Marva Donavan, president of Dolphin Travel in Grand Rapids, Mich., says she has noticed a pickup in international travel for the summer. Terrorism fear remains, Ms. Donavan adds, but, "I think we've lived with it for so long now that people are traveling" again.
2. SECURITY: LESS BUT MORE
Airport security will single out fewer travelers for intensive searches, or so the government says. The Transportation Security Administration is to begin using a system that should result in fewer people being selected for additional screening.
During the first quarter, the agency responsible for the security at the nation's airports will begin testing its Capps II system. The current system checks for basic passenger information -- including names, phone numbers, and whether a passenger paid for a flight with cash or is flying one way -- to flag large numbers of travelers for additional screening at security checkpoints. The information is then checked against various databases before generating a score indicating whether the traveler poses a security risk. Capps II now adds another identifier, a birth date, which should help narrow the list.
When the TSA proposed the new system, critics -- which included major airlines -- feared possible civil-rights violations given the original plan to track passengers' personal information. But the system has since been tweaked. For instance, the new system won't check passengers' credit or health records, as previously proposed, but it will check their names against watch lists of known terrorists and people with arrest warrants outstanding for violent crimes.
Under the new system, the TSA says, the vast majority of passengers will be identified as "low-risk." Fewer than 5% should be flagged as "elevated," or "unknown," and subjected to further inspection, the TSA says, down sharply from the current 15%. Those identified as high-risk will face "appropriate action" by law-enforcement authorities, the Department of Homeland Security has said. The TSA expects the new system to be rolled out to all airports by the summer.
3. CLICKING ON TO BETTER DEALS
U.S. travelers will continue to flock online.
Leisure and business travelers alike are expected to drive U.S. online travel revenue to $51 billion in 2004, up 19% from last year, according to projections from market-research firm Jupiter Research, Darien, Conn. By 2008, U.S. online travel bookings are expected to account for 30% of all travel purchased, says Jupiter, up from just 16% in 2002.
Airlines, hotels and online travel agencies will make an aggressive push to boost customers' comfort with their services by making online bookings easier and faster. Travelers should expect more virtual tours of hotel rooms and cruise ships, for example.
Suppliers and online agencies also will offer added perks for online bookers -- such as frequent-flier miles or special discounts -- in the hopes of luring more traffic to their sites.
In addition, more employers are expected to mandate online booking for business travelers in order to save money by reducing fees paid to travel agencies. More corporate travel could also be shifted to online travel agencies from traditional agencies. In October, McDonald's Corp. was the first major company to make such a move when it shifted travel planning for its U.S. employees to Orbitz Inc.'s business-travel product from Carlson Wagonlit, a corporate travel management company.
Analysts say growth in online bookings this year will be driven by so-called dynamic packaging, which allows travelers to cobble together their own airfare and hotel and sometimes rental car at one price -- often lower than buying the components separately. The lower price is available, in part, because suppliers will offer deeper-than-usual discounts if they know the depth of the markdowns will be masked from consumers within a package deal. Dynamic packaging was introduced last year by the three largest online travel agencies: Expedia, a unit of InterActive Corp.; Sabre Holdings Corp.'s Travelocity; and Orbitz, which is about two-thirds owned by a handful of major airlines that founded the site.
4. BYPASSING THE COUNTER
Long lines at the check-in counter will quickly become a thing of the past, thanks to automated check-in kiosks.
Major airlines now offer ATM-like kiosks at many airports where travelers can check in, pick their seats and even sign up to fly standby on another flight. In 2002, Delta Air Lines began allowing passengers at some airports to check in using telephones located near the counters, and last year the airline installed the phones at check-in counters at most major airports and even at some gates. With the check-in phones, passengers can speak with a customer-service representative to check in for a flight. They then stand in a much shorter line to get a boarding pass. Passengers checking luggage still need to interact with someone at the airline counter.
Some airports are testing generic kiosks that allow passengers to check in and print a boarding pass no matter which airline they are flying. Passengers with luggage can check in at the kiosks, but they still need to drop off the luggage at the airline counter.
Some hotels, including Hyatt Corp., have begun allowing guests in hotels in the U.S. and Canada to call a toll-free number to check in to their rooms. But travelers still have to stop at the counter to get room keys.
5. MORE ROOM FOR YOUR MONEY
As travelers return, hotel-room rates will stay low and perks will be plentiful.
Occupancy rebounded slightly to between 59.5% and 59.6% in 2003, according to the American Hotel & Lodging Association. That's up from 2002, when occupancy rates fell to an average of 59.2%, the lowest rate in 31 years. And the rebound is expected to continue in 2004 and 2005, with occupancy topping 61%. Occupancy for upscale hotels, including resorts, is expected to rise to 73% this year from 71% in 2003.
The average room rate is expected to increase 2.2% for 2004 -- though that's still considered low -- while the revenue per available room, or the average money generated per occupied room, is expected to grow 5.8%.
And as travelers check in, they will be find a few extra goodies. Westin Hotels, a part of Starwood Hotels & Resorts Worldwide Inc., installed state-of-the-art fitness rooms last year in all 77 of its U.S. hotels. Most of Marriott International Inc.'s midpriced, limited-services hotel chains -- Courtyard, Residence Inn, TownePlace Suites and SpringHill Suites -- have begun offering free high-speed Internet service. In a few Hiltons, customers can now book a room that's fully outfitted with fitness equipment.
6. WOOING THE HIGH-PRICED FLIERS
The biggest airlines, still struggling to lure travelers back from low-fare carriers, are expected to try even harder this year to win back some high-paying customers and to sell more full-fare tickets.
Some airlines, including Delta, Continental Airlines and British Airways, have slashed rewards for frequent fliers with discount tickets. But they are piling on the perks for full-fare passengers.
For instance, Continental has begun giving full-fare passengers elite-level frequent-flier status for the day in most domestic markets, including possible first-class upgrades and priority baggage tags for quick baggage service. The carrier also guarantees full-fare travelers an aisle or window seat, or it gives the customer 1,000 frequent-flier miles.
AMR Corp.'s American Airlines offers bonus frequent-flier miles for those flying on full-fare tickets. Last year, UAL Corp.'s United Airlines began offering free first-class upgrades to elite-level frequent fliers who buy full-fare coach tickets.
7. NO FREE LUNCH
Airplane food will continue to make a comeback, but the airlines aren't expected to dish out much free fare.
Major airlines took away free food service on many domestic flights after racking up billions of dollars in losses following the Sept. 11, 2001, terrorist attacks. Now as airlines regain their footing, they will be looking for ways to offer passengers the food they crave -- for a price.
(MORE)
Last year, United Airlines began selling food on 190 of its flights, and US Airways began selling food to coach passengers on all domestic flights over 700 miles. Delta plans to expand its meals-for-sale program to 244 flights by spring, up from 44 in February. And Song, Delta's new and much-watched low-fare carrier, started selling food such as Pizzeria Uno pies when it launched in April. Northwest Airlines also is experimenting with food sales.
American Airlines is doing something a little different. After concluding that selling food would be more complicated and expensive than its traditional food service, the carrier decided to test selling packaged food offerings from such restaurants as T.G.I Friday's at small kiosks located outside the airline's gates. Passengers purchase and pick up the food before the flight and take in onboard.
8. CRUISING ON THE CHEAP
Lots of new ships will give travelers more reasons to cruise.
The cruise-line industry has introduced 62 new cruise ships since 2000. Last year alone, the luxury lines added more than 4,000 berths, up nearly 50% from the amount they added in 2002, according to the Seatrade Cruise Review, an industry publication.
Now, a glut of cruise ships ordered during the booming 1990s are just coming into service. The trade group says its 21 members, which account for 95% of the cruise business marketed out of the U.S., will introduce 12 new cruise ships in 2004. In April alone, six new ships are scheduled to debut. Carnival Corp. will roll out two new ships, while Carnival PLC, formerly P&O Princess, will introduce three new ships this year.
With all those boats on the water, luxury cruises are expected to be priced within a range the average Joes can afford. Even pricier cruises, those that typically offer butler services and caviar, should continue to be cheaper for some destinations.
9. BIG GROWTH FROM THE SMALL GUYS
Low-cost carriers, which now represent about a quarter of the U.S. airline industry, will grow to represent about 35% of the domestic market in the next three years, some industry observers believe. In fact, some predict that Southwest Airlines, the grandfather of the discount-airline sector, could become the largest U.S. airline in terms of passengers carried within two to three years.
The discount carriers will continue to look for growth in large cities where they can stimulate air traffic with low fares and grab market share from the major carriers. AirTran Airways, a unit of AirTran Holdings Inc., last summer ordered more than 100 Boeing Co. jets. The carrier says it will use most of the new planes to "connect the dots" in its route map, or start service between cities it already serves, begin service in new cities and offer more frequent flights.
Over the next few years, low-cost carriers also may begin to enter smaller cities such as Providence, R.I. JetBlue Airways, the carrier with a TV at every seat, recently ordered 100-seat Embraer jets, which industry observers predict will be used to fly to smaller cities and to boost the number of flights it operates between cities it already serves.
The low-cost model is appealing world-wide. Ireland's Ryanair Holdings PLC and Britain's easyJet PLC have succeeded in taking a page from Southwest Airlines. And this year, a number of low-fare airlines, such as Air Polonia in Poland and Wizz Air in Hungary, will pop up in Eastern Europe. Several budget airlines also are planning to launch in Southeast Asia this year.
Trying to defend their turf, the major airlines are jumping into the discount-carrier fray. Delta and United Airlines both have launched low-fare carriers. And the industry's largest carrier, American Airlines, says it is considering doing the same. Delta's Song and United's Ted are risky strategies. Ronald Kuhlmann, vice president of Unisys R2A Transportation Management Consultants, says the experiments do nothing to cut the high costs in the airlines' main business.
10. LET US ENTERTAIN YOU
If you can forget the hunger pangs and security hassles, flying may be more fun.
Denver-based Frontier, a 10-year-old low-cost carrier, offers TV on some planes for $5. America West Airlines is considering TV as well. And even low-fare king Southwest Airlines is weighing in-flight entertainment, even though it hasn't specified exactly what that would be. JetBlue already offers free live satellite TV.
Meanwhile, the largest carriers are testing the use of such technology on their smaller upstarts. Delta's Song service promises a video monitor on each seat by early this year, and UAL's new upstart, Ted, will also offer audio and video programming.
Alaska Airlines, a unit of Alaska Air Group, recently rolled out the movie- and music-playing digEplayer on some transcontinental flights. Alaska Air distributes the units free in first class, and makes 30 or so available for rent in coach for $1 to $8 depending on whether they are reserved in advance.
Other airlines are trying to woo business travelers by allowing them to stay connected while in flight. For $30 to $35 a flight, Scandinavian Airlines System last year began offering high-speed Internet access aboard some long-haul flights, letting passengers surf the Web or send e-mail. SAS signed a contract with Boeing to install its wireless broadband service, Connexion, aboard two planes in February. The rest of the airline's long-haul fleet will be equipped in 2005. Other carriers are also introducing the service.
United Airlines now is offering two-way e-mail capability aboard all its domestic flights. It allows users to check weather, news and stock listings, play games and use the messaging services for $5.99 a flight.
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Call for contributions; Standard methodology for the delivery of digital content for airline inflight entertainment
12 February 2004
M2 Presswire
2004 M2 Communications, Ltd. All Rights Reserved.
McLEAN, VIRGINIA, USA: The World Airline Entertainment Association (WAEA) has issued a "Call for Contributions" leading to the development of a secure and cost-effective specification for the delivery of digital (audio/video/multimedia) content from the content supplier through post-production, content integration, and the content loading process to digital fileservers onboard aircraft. The resulting methodology will help minimize production costs and potential piracy risks, as the airline inflight entertainment (IFE) industry migrates from analog to interactive digital media/multimedia and from physical to network delivery.
All interested parties-especially commercial airlines, post-production facilities, content providers, audio/video electronics manufacturers, interactive media creators, and digital media standards groups-are invited to submit their opinions and recommendations on the following elements:
- Codecs and compression technologies with capability of supporting interactive multimedia.
- Data interchange languages and metadata solutions.
- Content security and Digital Rights Management (DRM) technologies, specifically including encryption and Key Management.
- Content integration
- Content loading
- Supply chain delivery path, specifically including data transport from the airport to the aircraft by wired and wireless means.
- Digital Asset Management (DAM) technologies and methodologies relevant to the above.
- Supply chain automation and integration standards, procedures, and methodologies with the ability to improve cost-effectiveness and efficiencies of the above.
The full-text "Call for Contributions" is available via the WAEA Website at www.waea.org/tech/working_groups/Digital-Content-Mgt/CFC-DCMWG.doc. Submissions may be sent to jmolumby@waea.org and will be accepted through the second quarter of 2004. The DCMWG expects to issue an initial draft Standard by the end of 2004.
Contributions will be reviewed by the Digital Content Management Working Group (DCMWG) of the WAEA Technology Committee. The DCMWG Steering Committee includes representatives from the following companies: Airshow, Cinea, Crest National Digital Media Complex, Digital Content Services, Global Aviation, IMDC, IMS Consultants, Rockwell Collins, the Salter Group, TEAC America, Inc., Twentieth Century Fox, and Virgin Atlantic Airways. For a complete list of WAEA Members, visit www.waea.org/about/member_list.htm.
Founded in 1979 as a nonprofit organization, the WAEA is the official worldwide network representing over 75 airlines and over 200 airline suppliers committed to excellence in inflight entertainment and communications and the continual improvement of the airline passenger environment.
For more information on the WAEA and the airline inflight entertainment industry, visit the "Press" section of the WAEA website at www.waea.org.
NEW GADGETS: Smart Samsung, Gateway mention
2 February 2004
The Nation (Thailand)
2004 Nation Multimedia Group Public Co., Ltd
Samsung has come out with its first Microsoft Windows mobile-based smartphone, the i600 ? an integrated device that combines Verizon Wireless? NationalAccess service with Microsoft?s comprehensive Windows Mobile software that offers Pocket Outlook, Pocket Internet Explorer, MSN Messenger, Microsoft Windows Media Player and ActiveSync.
It also features an SDI/O expansion slot for memory expansion, as well as to add those additional applications.
The i600?s single inbox allows customers to view all incoming e-mail, voice mail, and text messages at a glance. The phone features an advanced 65,000-colour display that provides a bright viewpoint for multimedia, games, websites and e-mails.
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Small ?n? powerful
Sony?s DSC-T1 is a high-end camera that fits in your back pocket. It features a resolution of 5.1 megapixels, 3X optical zoom, and a 2.5-inch LCD monitor, all in a package the size of a credit card.
The T1 even packs extra features you would normally expect on a camera twice its size, such as a high-quality Carl Zeiss Vario-Tessar Lens, Sony?s high-speed Real Image processor, and five-area multi-point focus. It is even able to capture full screen VGA video at 30 frames per second.
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Plug-in fun
The Archos Gmini 120 is the first modular MP3 and WMA player, meaning you can customise your device with plug-ins ? audio recorder/voice recorder, photo wallet and FM remote control.
It features a 20GB hard drive, so you can store up to 300 hours of MP3 music. And the MusicMatch Plus software is included for downloading files via a USB 2.0. The Gmini 120 measures 11.5x7.9x2.5 centimetres, while weighing just 244 grams.
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Music Gateway
Gateway?s Jukebox Player DMP-X20 lets you carry an entire collection of great music wherever you go. Its 20GB storage capacity is capable of holding 500 CDs or up to 5,000 MP13 or 8,000 WMA songs.
The new music jukebox is thin and light and can be taken virtually anywhere (weighing only 218 grams). And while the size is small, the sound quality is great by delivering clean, crisp high-fidelity sound that will impress the most discerning music aficionado.
The X20 plays MP3, WMA and audible files. It also comes with an FM receiver with 12 easy-to-programme pre-sets.
Digital Way and Next Way contracts
19 January 2004
The Electronic Times (Korea)
2004 Electronic Times Internet Co., Ltd. All right reserved
Two leading MP3 player makers, Digital Way and Next Way, have clinched contracts with major distributors and IT firms in the United States to supply MP3 players in large volume this year.
Digital Way ( http://www.digitalway.co.kr) said on January 18 it sealed a contract with Best Buy to supply its MP3 players, including HDD-installed and flash memory-based gadgets, in value of 35 million dollars, starting in February this year.
The MP3 player maker also said that it was in talks with other large distributors such as CompUSA, Amazon, Goodguys, and Futureshop to supply its products worth a total of 15 million dollars. These export deals were made at 2004 Winter CES held in Las Vegas early this month.
"It is quite encouraging to export MP3 players with our own brand instead of supplying on original equipment manufacturing (OEM) basis," said Wu Jung-ku, CEO of Digital Way, hinting his strong desire for augmenting its presence in the U.S. market.
Next Way ( http://www.nextway.co.kr) signed contracts with four large distributors in the United States including TDK and Lexar to supply 1.5 million units of MP3 players a year. In addition, the company will also provide NEC Europe with new MP3 player models including a 1-inch HDD-installed gear.
"Based on the beachhead in the United States, we will expand our client base to leading IT and distribution firms such as Fuji Film, HP, Gateway, IBM and Best Buy," said Beom Jae-ryong, CEO of Next Way.
Gateway ad in Atlanta Journal Constitution,eom.
Japan Fujitsu Ten To Sell AVN Car Navigation Systems in USA
12 January 2004
Japanese News Digest
Japanese car audio equipment manufacturer Fujitsu Ten Ltd will start selling as of February 2004 its car audio-visual navigation (AVN) systems in the United States, targeting 1,000 units in monthly sales, the company said on January 10, 2004.
The system, which includes CD and DVD decks, will be available in the specialty stores and car dealerships in the United States, and will be developed and manufactured in Japan. Fujitsu Ten is currently holding a 1.0 pct of the U.S. car navigation system market and expects to augment its share to 5.0 pct by 2007.
Considered to be a pioneer in the car navigation system development, Fujitsu Ten plans to launch sales of its car AVN systems also in China in mid-January 2004. [Editor's note: Fujitsu Ten plans to generate car navigation system sales of 20 bln Japanese yen ($187.2 mln/146.1 mln euro) in China in 2007, holding a 20 pct of the local market.]
Fujitsu Ten, established in October 1972, is headquartered in Kobe, western Japan and currently employs 2,766. The company has a paid-up capital of 5.3 bln yen ($49.6 mln/38.7 mln euro) and operates eight branch offices and three domestic plants, as well as plants in the United States, Mexico, Thailand, China and the Philippines, and has representatives in the U.S. state of California, Germany, Australia, Singapore, China and the Philippines.
www.fujitsu-ten.co.jp,www.kobe-np.co.jp
Hard-Drive Based Car Audio Enters the Mainstream
9 January 2004
Market Wire
Honda, Nissan, Audi, Volkswagen, Sony, Rockford, Pioneer, Alpine, Fujitsu Ten, Clarion, Kenwood and PhatNoise(R) Adopt Gracenote Technology in Hard-Disk-Drive Devices
LAS VEGAS, NV -- (MARKET WIRE) -- 09-01-2004 -- International CES -- Gracenote®, the worldwide leader in information services for digital music and media, announced that Gracenote Music Management System 2.0 will be used in hard-drive based audio devices from leading automakers and aftermarket car audio manufacturers representing major global markets. These devices offer consumers the ability to store their entire music collection in their cars, and give music fans unprecedented access and control of their music while driving. Gracenote Music Management System® is a groundbreaking digital music platform that provides advanced functionality for device manufacturers needing to create the next generation of music devices. The foundation of the suite is music identification provided by Gracenote's industry standard CDDB® music database and Gracenote MusicID(SM) for song-level and waveform identification; once files have been correctly identified, Gracenote Clean(SM) automatically sorts and re-tags all the digital files in a person's collection, turning them into fully functional, digital music libraries; finally, Gracenote Playlist(SM) enables automatic and dynamic playlists at a touch of button, and Gracenote Link(SM) adds related music content and album art for an enriched listening experience.
Each of the following car audio applications have adopted The Gracenote Music Management System to provide distinct and unique offerings for listeners: Honda has announced that it will offer the first OEM car audio/navigation devices for its new Honda Civic models in Japan; Rockford corporation's OmniFi for the car is an upgraded version of its award-winning digital media streamer using Wi-Fi connectivity; PhatNoise® PhatBox® is the newest edition of its award-winning removable hard-disk-drive car audio system, which has already been adopted by Audi, Volkswagen and Kenwood; Clarion's AddZest Car Navi system will provide a hard drive based car audio and navigation device for Nissan cars. Fujitsu-Ten's Eclipse will provide the first English language hard-drive car navigation system with a complete music jukebox; Additionally, Sony, Panasonic and Mitsubishi have previously adopted Gracenote's digital music information services into car stereo and car audio devices.
"People enjoy most of their music in cars and driving is the perfect time to utilize automatic playlists at a touch of a button," stated Tom O'Mara, Managing Director for Rockford Corporation's OmniFi. "We want to make listening to music in cars so compelling and fun that people never want to get out of their cars -- and Gracenote's technology is helping us to meet that end-goal."
"The hard-drive car audio market is one of the fastest growing segments of our business; almost half a million units were sold last year and we expect that number to grow to well over 1 million by 2005," stated Craig Palmer, president and CEO for Gracenote. "Consumers are recognizing real values offered by these systems, such as instant access to their music and ease-of-use, and that's starting to drive mass adoption in the mainstream market."
Gracenote Music Management System 2.0 for car audio enables car audio device makers to make music listening easier and more fun. An entire library of music can be instantly accessible, sorted and recognized; instant playlists based on genres or seed songs can be created with a touch of button allowing many hours of sequential driving music. Notably, cars that provide these devices will likely be safer due to fewer driving distractions.
JetBlue To Add XM Radio, Fox; AirTran Plans First IFE System
Steven Lott
9 January 2004
Aviation Daily
2004 McGraw-Hill, Inc.
JetBlue and AirTran, two of the fastest-growing, low-fare carriers that have remained profitable, this week, as expected, unveiled plans to further raise the bar in U.S. domestic inflight entertainment with the addition of satellite radio and pay-per-view movies.
JetBlue in 2000 was the first to offer 24 channels of live DirecTV programming, and now will add to its lineup thanks to deals with XM Satellite Radio and Fox parent News Corp. (DAILY, Jan. 7). Under the agreements, JetBlue will add up to 100 channels of digital satellite radio and movie channels, featuring 20th Century Fox movies and episodes of Fox's TV series "The Simpsons." The carrier plans to introduce the system fleet-wide on its Airbus A320s this fall and on its new fleet of Embraer 190s as they enter next year.
Also under the agreement, the airline will add pay-per-view movies. The digital video system will let passengers pay by credit card from their seat. JetBlue's wholly owned subsidiary will install the onboard systems that will deliver the XM Satellite Radio and digital video services. Once the systems are installed, CEO David Neeleman claims JetBlue will offer an "unequaled choice of inflight entertainment."
The airline plans to begin testing the new Fox inflight service in the spring, with the expectation of launching it across its fleet in the fall. During the testing period, the Fox inflight service will present classic Fox films on selected flights, free of charge to passengers. Once testing is completed, the system will be offered for an unspecified fee, to be announced later, and will feature first-run Fox movies and other programming.
AirTran, like competitor Southwest, has had no inflight entertainment up to this point but has been evaluating systems. The airline Wednesday inked a deal with XM Satellite Radio to offer up to 100 audio channels. The service will be free for all passengers. Each one of the airline's Boeing 717s and 737s will be equipped to offer the new service at every seat, and the airline will begin installation in the summer, with all aircraft completed by yearend.
A pair of AirTran's business class seats outfitted with the XM Satellite Radio was on display this week at the Las Vegas Consumer Electronics Show. -SL
Sirius Satellite Radio plans to begin offering 3-4 channels of video programming next year with an emphasis on children's content, executives told a Consumer Electronics Show (CES) news conference in Las Vegas last week.
The announcement of plans to add video next year was one of a multitude of disclosures in a marathon session with reporters and analysts in which CEO Joseph Clayton trumpeted the company's progress in 2003 and promised more advances in 2004 and beyond. He said Sirius finished 2003 with 261,061 subscribers, which he said had exceeded Wall St.'s most recent estimates. In a veiled reference to the fact that rival XM Satellite Radio had finished the year with significantly more subscribers (it announced at a separate Las Vegas news conference it had exceeded 1,360,000), Clayton said "for those of you who believe we're not in the game," his company's final 2003 tally represented an eightfold increase over a year ago. He said Wall St.'s consensus forecast was that Sirius could achieve more than 860,000 subscribers by the end of 2004.
As for plans to add video next year, Senior Vp-Product Development Larry Pesce said work conducted jointly with Delphi represented an "exponential" advance from demonstrations at the CES a year ago, when Sirius showcased animation footage using a Windows Media 9 PC. By comparison, he said, Sirius was running a 20-min. loop of animation content contributed by Disney and other studios for in- vehicle demonstrations being run in real time during the show through the streets of Las Vegas. Responding to a reporter's question, Clayton said Sirius hadn't finalized its pricing strategy on video channels to be offered beginning next year, but the service could command a few dollars' premium over the basic $12.95 monthly subscription fee.
Other developments: (1) Sirius used CES to demonstrate multichannel surround capabilities for the first time, saying it had opted for using the Dolby Pro Logic II codec as a means of assuring the best backward compatibility with existing receivers. (2) Alpine joined the roster of aftermarket receiver suppliers and was praised by Sirius as a market leader. (3) Sirius planned to run ads in Feb. in all media promoting the availability of free 3-month subscriptions to buyers of plug-&-play receivers who opt for a one-year contract.
CES Notebook... E.digital mentioned
12 January 2004
Satellite Week
Volume 26; Issue 2
2004 Warren Publishing, Inc. All Rights Reserved.
A new "infotainment" system showcased at CES in Las Vegas last week by e.Digital and Eclipse has an audio write- back feature that will capture and replay satellite radio -- in addition to AM, FM, CD and MP3 formats -- carried within the previous 5 minutes. The system -- designed and developed by e.Digital, "with specifications provided by Eclipse" -- uses e.Digital's proprietary MicroOS technology, it said. The HD 1213 plays multiple digital audio formats, including MP3, WMA and WAV, and serves as a device for the mass storage and transfer of multiple file formats. The HD 1213 is compatible with all Eclipse head unit models currently available, the companies said. They said Eclipse was accepting presale orders during the show, but pricing wasn't available.
From Warren's...E.DIGITAL DROPS BRANDED PRODUCTS, PURSUES OEM
2 January 2004
Warren's Consumer Electronics Daily
Volume 4; Issue 1
2004 Warren Publishing, Inc. All Rights Reserved.
E.Digital has scrapped its branded Odyssey digital audio players as it embarks on an OEM-focused strategy that's forecast to boost revenue to $1.5-$2 million in the 4th quarter ending March 31 from $700,000 the previous quarter. E.Digital unveiled the Odyssey 1000 digital audio platform last Jan. featuring its MicroOS technology, 1.8" hard drive and 2.5" LCD. The company has tentative licensing agreements with several companies including "a major consumer" brand that's expected to introduce product in late spring, CEO Fred Falk told analysts in a conference call.
E.Digital was founded as Norris Communications in 1988 and was among the early purveyors of handheld storage devices with its Flashback digital voice recorder. It embarked on its retail strategy in 2001 with the Treo and Odyssey series of hard drive and flash-based digital audio players. The company began, however, to move away from retail in late 2002 as it prepared to introduce the Odyssey 1000 platform. The Odyssey personal digital jukebox was available in 15 GB ($299) and 40 GB ($399) configurations and sold through retail and e.Digital's Web site. E.Digital signed an agreement in Sept. licensing its Odyssey platform to an Asian OEM manufacturer, but the decision to halt retail sales of branded products was made "independently" of that, a spokeswoman said. E.Digital move was partly prompted by the introduction of OEM branded product based on its platform, she said. The spokeswoman declined to identify the OEM customer. But sources said Gateway introduced and sold online the DMP-X20 jukebox player with a 20 GB hard drive ($299) last fall based on e.Digital's technology. The Gateway device used Hitachi's 1.8" hard drive. The first revenue from that pact with Asian OEM is expected in the fiscal 4th quarter, company officials said.
Among other tentative licensing agreements e.Digital has struck is one for a personal video player that will feature a 7" LCD and ship next fall and a flash-based digital audio player based on the MicroOS, Falk said. The latter will contain a 1" hard drive with a 1.5 GB capacity that was developed by Cornice. The drive, rather than being removable, is designed to sit directly on a motherboard, which cuts costs. E.Digital has been working with Cornice "several months," Falk said. While Taiwanese manufacturer Digitalway and Softeq Development Corp. had earlier signed licensing pacts, neither is involved in the new agreements, a spokeswoman said. Softeq is developing a MicroOS-based digital audio product for HP that the latter expects to sell to one of its customers, e.Digital has said. In total, the licensing agreements are expected to produce annual revenue from "several hundred thousand dollars to several millions," Falk said.
Also on the horizon are the first shipments of a car audio "infotainment" system based on e.Digital's MicroOS that will be marketed by Eclipse by Fujitsu Ten. E.Digital signed a licensing agreement with Eclipse in March 2002 and production started last fall, Falk said. Revenue from sales of the Eclipse product is expected to book in the 4th fiscal quarter. The agreement yielded an initial $30,000 in the fiscal year ended March 31, according to SEC documents.
To raise funds for continued product development, eDigital registered with the SEC to sell 23.8 million shares as part of Series D and E private placements of preferred stock made in Dec. 2002 and Nov. 2003, respectively. About 12.8 million shares were issued to noteholders in the conversion of $2 million in promissory notes. The sale of 10.9 million shares of Series E preferred stock yielded proceeds of $1.2 million for e.Digital. The largest holder of Series D preferred stock is the Jerry Polis Family Trust with 8.8 million shares; Basso Equity Opportunity Holding Fund had 1.6 million shares of Series E.
Meanwhile, Apple Computer declined to comment on Internet rumors it would introduce a $99 iPod digital audio player at MacWorld Expo, San Francisco, next week. Such a product would pit iPod against digital audio players marketed by Creative, Dell and D&M Holdings' Rio, among others. Apple, which introduced the iPod in Oct. 2001 with a 5 GB capacity, has occupied the higher end of market with models containing 10-40 GB capacities and $299-$499 pricing. Reports also have suggested Apple may be weighing introduction of so-called mini-iPods with new color or replaceable skins. Apple also is said to be considering a version of an iPod that would be capable of displaying video. Another possible scenario has Apple introducing an iPod based on Toshiba's new 0.85" hard drive that's expected to be formally unveiled at CES next week. Toshiba is a key supplier of hard drives for the iPod, including the 1.8" version that helped launch the product.
Several hundred thousand to several million.
Sorry for the extra hundred....wishful thinking/hearing on my part.
Webcast Script: Current Business and New Business w/correct $$
This is Fred's speech except for the S3 discussion and Q&A.
Now I would like to update you on current business and discuss new business developments:
As we mentioned at the annual meetings through one of our Asian manufacturing partners, production on the Eclipse by Fujitsu-ten (EF10) products have begun. Since our meeting, EF10 successfully showcased their branded product based on our MicroOS powered automotive infotainment platform, to their distribution organization.
Because of the enthusiastic response EF10 is seeking to pre-sell the entire opening order as well as place follow on orders. We expect announcements providing further details regarding deliveries, product launch, and follow on orders in 2004…early 2004
The next business developments have occurred since our meeting and are all agreements in principal pending final approval. At this time we are confident that all of these agreements will be executed and we would like to share with you today some early details of these important business building developments
The first of our new business developments, involves a major consumer brand combining our Micros powered personal audio and personal video platform utilizing a derivative of our O1K form factor. The expected consumer release date is late spring 2004 at which time the OEM and specifications of the device are scheduled to be revealed
Another agreement calls for an OEM branded consumer version of our personal video platform featuring a 7” LCD screen. This new video product is expected to reach consumers in early Fall 2004 through a major OEM’s retail and e-tail sites.
The branding OEM and device specification are scheduled to be revealed upon the consumer launch of the product.
We are pleased to announce today that we have reached a licensing agreement in principal with the world’s largest OEM supplier of flashed based MP3 players.
This Asian OEM supplies products to many of the worlds leading consumer brands. Under the agreement this Asian OEM will mfg consumer branded products based on our MicroOS enabled personal audio platform for their customers. This agreement is similar in scope to the licensing agreement we announced on 9/16/03 with another major Asian based OEM although it is more encompassing by calling for the incorporation of eDigital’s MicroOS based technology with 1.8” hard disk drive and Cornice storage elements.
The Cornice storage element is a patent pending high capacity, low cost durable storage solution sizeable enough to hold a significant amount of audio visual content while remaining small enough to fit inside a pocket size device. The Cornice SE delivers the speed and capacity of small disk drives, the low battery usage of solid state storage media such as flash and extreme durability all at the lowest cost in the industry
We have also reached a separate agreement in principal with an existing OEM partner on a cornice based version of our personal audio platform. Their eDigital powered branded product is scheduled to be unveiled at the upcoming CES .
We expect further announcements regarding both of these pending agreements, relationships and products in early January.
We have been working with Cornice for several months on these and further pending business opportunities. As I stated at the annual meeting the lion’s share of the development work for our MicroOS based technology platforms is complete and each new project undertaken now requires fewer development hours thereby reducing costs and speeding OEM branded products to market resulting in expected increasing revenues and further business.
Revenue and royalty potential on devices produced under each current agreement as well as under each of the pending agreements we have discussed today is expected to range from several hundred thousand to several million dollars annually based on the degrees of consumer acceptance of these eDigital powered OEM branded products.
As we stated in our meeting earlier this month, in most cases it will be 3 – 6 months after OEM branded devices are launched to consumers until we can begin releasing the cumulative dollar amounts of the revenues and/or royalties being realized as well as forecasts expected cumulative revenues based on the ongoing performance of the products.
The 2004 CES will be held 1/8 – 1/11 in LV because we have a full schedule of meetings with current and potential OEM customers and partners we will not be hosting our own booth. We are please to report that branded, derivative products from some of our proprietary technology platforms are scheduled to be displayed in the TI booth as well as in other booths at the show.
We are working with OEM customers and partners on joint PR’s scheduled to be release in early Jan to coincide w/CES. We are also scheduling press and media opportunities for some of these new business developments highlighting our MicroOS powered technology platforms.
We are also pleased to report that since the SHM we have made more progress on a proposed licensing agreement involving our core MicroOS technology as well as with 2 major OEM’s seeking to converge elements of 2 or more of our technology platforms into differentiated branded products.
We also expect further IFE related agreements to be finalized during the next 2 months. Beyond these we are working on other business opportunities each in varying stages of development. We look forward to providing further details in upcoming corporate announcements regarding all of our current and pending business
During the annual meeting I emphasized that we are only pursuing new business with home run potential as well as a path for future product generations and further devices based on technology platforms. All of the developments we have discussed today meet these criteria. We expect most if not all of the revenue for the deliver of the EF10 products as well as the first royalties expected from the Asian OEM under the 9/16/03 licensing agreement will be accounted for next quarter. Accordingly we anticipate our revenue for this quarter ending 12/31/03 will be approx. 700K. We expect revenue next quarter in the 1.5 – 2.0 million dollar range based upon the delivery of the EF10 units, first royalties from the Asian OEM under their customers branded jukebox and further income from our personal video and personal audio platform.
We will continue to provide further business and revenue guidance in accordance with the info we receive from our OEM customers and partners. We’ve made good progress in our business and technology in 2003 and we are committed to making 2004 the best year ever for eDigital and for you our shareholders. We wish you and your loved ones all the best this holiday season and we wish all of us a prosperous 2004.
Webcast Script: Current Business and New Business
This is Fred's speech except for the S3 discussion and Q&A.
Now I would like to update you on current business and discuss new business developments:
As we mentioned at the annual meetings through one of our Asian manufacturing partners, production on the Eclipse by Fujitsu-ten (EF10) products have begun. Since our meeting, EF10 successfully showcased their branded product based on our MicroOS powered automotive infotainment platform, to their distribution organization.
Because of the enthusiastic response EF10 is seeking to pre-sell the entire opening order as well as place follow on orders. We expect announcements providing further details regarding deliveries, product launch, and follow on orders in 2004…early 2004
The next business developments have occurred since our meeting and are all agreements in principal pending final approval. At this time we are confident that all of these agreements will be executed and we would like to share with you today some early details of these important business building developments
The first of our new business developments, involves a major consumer brand combining our Micros powered personal audio and personal video platform utilizing a derivative of our O1K form factor. The expected consumer release date is late spring 2004 at which time the OEM and specifications of the device are scheduled to be revealed
Another agreement calls for an OEM branded consumer version of our personal video platform featuring a 7” LCD screen. This new video product is expected to reach consumers in early Fall 2004 through a major OEM’s retail and e-tail sites.
The branding OEM and device specification are scheduled to be revealed upon the consumer launch of the product.
We are pleased to announce today that we have reached a licensing agreement in principal with the world’s largest OEM supplier of flashed based MP3 players.
This Asian OEM supplies products to many of the worlds leading consumer brands. Under the agreement this Asian OEM will mfg consumer branded products based on our MicroOS enabled personal audio platform for their customers. This agreement is similar in scope to the licensing agreement we announced on 9/16/03 with another major Asian based OEM although it is more encompassing by calling for the incorporation of eDigital’s MicroOS based technology with 1.8” hard disk drive and Cornice storage elements.
The Cornice storage element is a patent pending high capacity, low cost durable storage solution sizeable enough to hold a significant amount of audio visual content while remaining small enough to fit inside a pocket size device. The Cornice SE delivers the speed and capacity of small disk drives, the low battery usage of solid state storage media such as flash and extreme durability all at the lowest cost in the industry
We have also reached a separate agreement in principal with an existing OEM partner on a cornice based version of our personal audio platform. Their eDigital powered branded product is scheduled to be unveiled at the upcoming CES .
We expect further announcements regarding both of these pending agreements, relationships and products in early January.
We have been working with Cornice for several months on these and further pending business opportunities. As I stated at the annual meeting the lion’s share of the development work for our MicroOS based technology platforms is complete and each new project undertaken now requires fewer development hours thereby reducing costs and speeding OEM branded products to market resulting in expected increasing revenues and further business.
Revenue and royalty potential on devices produced under each current agreement as well as under each of the pending agreements we have discussed today is expected to range from several hundred thousand to several hundred million dollars annually based on the degrees of consumer acceptance of these eDigital powered OEM branded products.
As we stated in our meeting earlier this month, in most cases it will be 3 – 6 months after OEM branded devices are launched to consumers until we can begin releasing the cumulative dollar amounts of the revenues and/or royalties being realized as well as forecasts expected cumulative revenues based on the ongoing performance of the products.
The 2004 CES will be held 1/8 – 1/11 in LV because we have a full schedule of meetings with current and potential OEM customers and partners we will not be hosting our own booth. We are please to report that branded, derivative products from some of our proprietary technology platforms are scheduled to be displayed in the TI booth as well as in other booths at the show.
We are working with OEM customers and partners on joint PR’s scheduled to be release in early Jan to coincide w/CES. We are also scheduling press and media opportunities for some of these new business developments highlighting our MicroOS powered technology platforms.
We are also pleased to report that since the SHM we have made more progress on a proposed licensing agreement involving our core MicroOS technology as well as with 2 major OEM’s seeking to converge elements of 2 or more of our technology platforms into differentiated branded products.
We also expect further IFE related agreements to be finalized during the next 2 months. Beyond these we are working on other business opportunities each in varying stages of development. We look forward to providing further details in upcoming corporate announcements regarding all of our current and pending business
During the annual meeting I emphasized that we are only pursuing new business with home run potential as well as a path for future product generations and further devices based on technology platforms. All of the developments we have discussed today meet these criteria. We expect most if not all of the revenue for the deliver of the EF10 products as well as the first royalties expected from the Asian OEM under the 9/16/03 licensing agreement will be accounted for next quarter. Accordingly we anticipate our revenue for this quarter ending 12/31/03 will be approx. 700K. We expect revenue next quarter in the 1.5 – 2.0 million dollar range based upon the delivery of the EF10 units, first royalties from the Asian OEM under their customers branded jukebox and further income from our personal video and personal audio platform.
We will continue to provide further business and revenue guidance in accordance with the info we receive from our OEM customers and partners. We’ve made good progress in our business and technology in 2003 and we are committed to making 2004 the best year ever for eDigital and for you our shareholders. We wish you and your loved ones all the best this holiday season and we wish all of us a prosperous 2004.
OT: The value of patents...Philips hits 100,000 patents, licence income rises.
By Lucas van Grinsven, European Technology Correspondent
16 December 2003
Reuters News
EINDHOVEN, Netherlands, Dec 16 (Reuters) - Dutch Philips Electronics (PHG.AS) (PHG.N) said on Tuesday it now holds 100,000 patents after trebling its number of inventions to 3,000 a year, putting it on a par with major rivals such as IBM (IBM.N). "For the last two years Philips has been the number one company in patent applications with the World Intellectual Property Organisation," Philips said in a statement.
By selling the right to use its innovations, Philips squeezes hundreds of millions of euros a year from its portfolio of intellectual property.
The 100,000 patents refer to the number of patents currently in portfolio, and exclude the number of expired patents.
The company's stock was down 1.4 percent in opening trade in an overall lower European equity market.
Licence revenues have increased by some 10 percent a year since Philips made this a priority in the mid 1990s. It aims to continue to grow at that pace, Ruud Peters, chief executive of the company's intellectual property and standards unit, told Reuters in an interview.
Europe's largest maker of consumer electronics and lighting, which invented the compact cassette in the 1960s and the compact disc in the 1980s with Sony (6758.T), chose to exploit its inventions when it realised it should compete in technology and marketing, leaving production to low-cost Asian manufacturers.
"Everyone talks about the knowledge economy, and this is what it's all about. It's about research and getting returns on it," Peters said. Philips invests about three billion euros ($3.67 billion) in research and development every year.
The company broke with the past when it registered inventions solely to prevent rivals from copying its products. Instead, Peters now employs a marketing and sales organisation to license patents to as many companies as possible.
This has helped to set world standards for DVD and recordable CDs in which it holds key patents - Philips receives over one dollar for every DVD player that is produced. Philips is not alone. Income from licences has become a booming business. All companies together earned an estimated $100 billion in licence income in the year 2000, compared with just $15 billion in 1990, Philips said.
OT:DVD blue on the horizon
GREG THOM
17 December 2003
Herald-Sun
JUST when you were getting up to speed on the battle over DVD recording formats, another war is looming.
The body responsible for endorsing recording formats, the DVD Forum, has backed next-generation blue-laser technology from Toshiba and NEC over that proposed by a rival consortium of the biggest electronics makers, including Sony, Matsushita and Philips.
Blue-laser DVD players are set to replace the current generation of red-laser DVD players in a few years.
A blue-laser disc can store up to three hours of high-definition video, about about five times more information than red-laser discs.
DVD Forum's decision to back Toshiba/NEC HD DVD technology doesn't mean the battle to standardise DVD recording formats -- or end consumer confusion -- is over.
Despite the DVD Forum's backing of the DVD-RW standard over rival DVD+RW recordable technology developed by Sony and Philips, the latter has grabbed a large chunk of the DVD recordable market.
The latest development comes as Philips recently announced it had achieved the fastest DVD+R recording speed in the world.
The system is able to record 16 times faster than the normal playing speed of video DVDs. It is capable of burning a write-once DVD+R at maximum capacity in under six minutes.
Philips says the achievement may be the high-water mark of DVD recording because it comes close to the maximum speed that still allows discs to rotate safely.
Personal media player platform adds photos -- PortalPlayer chip, firmware designed to enable next generation of portable music
Junko Yoshida
15 December 2003
Electronic Engineering Times
Paris - PortalPlayer Inc. is about to launch a personal media player platform, composed of a new chip and firmware, designed to help system companies develop portable entertainment devices for consumers who feel naked leaving the house without several thousand digital songs and snapshots tucked into their jeans.
Personal mobile entertainment devices based on a low-cost micro hard drive are a top priority for virtually every consumer and computer company, analysts said, even though the category is still largely undefined. "Every major PC and CE vendor I deal with views this type of device as in essence becoming the 'Video Walkman' of the future," said Tim Bajarin, president of Creative Strategies (Campbell, Calif.).
PortalPlayer (Santa Clara, Calif.) will unveil its Photo Edition platform at the Consumer Electronics Show in Las Vegas next month. Comprising a system-on-chip (SoC) that integrates two ARM cores and a firmware stack that includes a real-time operating system, the platform is designed to add digital photo archiving and synchronizing capabilities to MP3 players.
PortalPlayer says it has already lined up three Taiwanese manufacturers-LiteOn, Tatung and Wistron-as customers, and Aeronix (Melbourne, Fla.) as an authorized design partner.
The platform makes it possible to build "an entertainment device enabling you to carry with you all of your personal content," said Gary Johnson, PortalPlayer's president and chief executive officer. As shown by the popularity of devices such as Apple's iPOD, Johnson said, "consumers aren't leaving media behind."
Thanks to its early lead in the hard-drive-based MP3 player market, PortalPlayer dominates the music jukebox market and claims that its chips and firmware drive 80 percent of the systems on the market. Its solution is used in models built by Alpine, Apple, Bang & Olufsen, Philips, RCA, Rio, Samsung and Yamaha. PortalPlayer now hopes to expand its base by marrying an MP3 player with a screen and adding the imaging component.
Connected digital home
In CEO Johnson's view, portable media players could represent the most practical way to make the so-called connected digital home a reality. Microsoft Corp. has been promoting MediaCenter PCs in the living room to "capture" audio and video to store and play back later. Others including Intel Corp. see digital media adapters-personal video recorders, DVD recorders or other digital systems-sitting next to a TV and wirelessly connected to a PC elsewhere in the house, to download media for playback in the living room.
Personal media players, in contrast, save entertainment content in a device so portable that it can be accessed in the home, in a car or on the go. PortalPlayer claims that such a system will connect to PCs and home and car receivers today without interoperability complications.
It is still not clear whether such a system will be a runaway success on the mass market or just another peripheral gizmo for photo enthusiasts. "As a standalone device, a personal digital photo album would appeal to only a limited audience," said Avi Greengart, senior analyst, personal and wireless technology, at Jupiter Research (New York). "But personal music players are already a huge industry that's rapidly becoming digital with higher and higher storage densities, so adding photo functionality builds on that."
While some might argue that such a product represents overkill for consumers already toting phones, cameras and PDAs, Greengart disagreed. The assumption that people want to carry only one device "simply isn't true, according to our research," he said. "People are willing to carry multiple devices, and in many cases prefer the flexibility. Battery life and form factor are optimized, and you can choose to [carry] what you need that day."
Jupiter Research forecasts that U.S. shipments of MP3 players will almost double this year to more than 3.5 million units and will continue to grow almost 50 percent per year. Further, the research firm believes that, starting in 2004, demand for MP3 players with hard drives will outstrip demand for those with flash memory.
PortalPlayer has bet the farm on hard drives, convinced that the gap between flash-based portable media players and those built around hard drives will only widen as higher-resolution pictures become more prevalent. "Consumers find the utility value in hard drives because of their storage space," said Johnson.
Jupiter Research's Greengart noted that sales of high-end hard-disk-based devices are much better than many predicted. "People are clearly willing to spend a significant premium to take a lot of content with them rather than picking and choosing content, loading and unloading the player," he said.
As a host of new players, including some formidable silicon competitors such as Texas Instruments Inc., prepare for entry in 2004, the personal media market is expected to heat up. However, said Greengart, "Where PortalPlayer has really excelled is with firmware, software and DRM [digital rights management] enablement, which lets their customers choose exactly what level of differentiation they want to invest in, and still get to market quickly."
PortalPlayer's Personal Media Platform, Photo Edition, includes JPEG and motion JPEG playback capabilities with music soundtrack. The SoC integrated with dual ARM cores offers a total of 160 MHz in processing power, and supports TV out and color display. The SoC comes with various interfaces, including a USB 2.0 high-speed host and a device port with a USB On-the-Go supplement; a Firewire link layer and Ethernet support. It allows direct camera connectivity while automatically switching to support high-speed PC uploads and downloads. PortalPlayer claims fast data transfer rates, with ATA66 and dedicated DMA controllers allowing efficient data movement of 5-Mpixel images with MP3 and lossless audio files.
Perhaps most important, PortalPlayer will support next-generation DRM, required for music downloads. Thus far, "one device dedicated for one music service" was a standard model for most portable music players, said Michael Maia, vice president of sales and marketing at PortalPlayer. "But the new world order in 2004 is the emergence of products that can work with a multitude of music services, by supporting many DRM rules."
The extra Mips available on the dual ARM cores, with a road map to push processing power to 200 MHz later next year, will enable the PortalPlayer platform to adapt to the new model, he said.
Potential customers can "go soup-to-nuts with us," Maia said. Customers can buy just the SoC and design the rest of the system on their own, or use the platform's software development kit, which is licensed separately, for that purpose. The chip, being fabricated by LSI Logic Corp. using an 0.18-micron process, is priced at $19.50 in 10,000-piece quantities. The software development kit lets a portable device launch an application when connected, while it does tricks like adding music to slide shows or managing photos by editing, rotating and cropping, and red-eye correction. It also makes it possible to synch slide shows, photos and music.
Component suppliers include Toshiba, with an 1.8-inch drive, and Cornice, with a new 1-inch micro drive; Synaptics, a touchpad company, and Gracenote, a music ID service company. PortalPlayer has also partnered with an unnamed CMOS sensor company on a reference design for a Photo Edition platform-based CMOS camera capable of 2- to 3-Mpixel photos, with an additional capability to function as an audio player, Johnson said.
http://www.eet.com
Philips HDD100, Jan '04 Computer World
By David Ludlow.
1 January 2004
Personal Computer World
A serious competitor to Apple's Ipod.
Despite a number of hard disk MP3 players hitting the market recently, none of them have come close to toppling the Ipod from its throne. But with the HDD100, Philips looks like it could have a serious contender.
Similar in size and with a sleek black and silver finish, it's on a par with Apple's device in the looks department, and its 15GB capacity puts it in the same league.
The HDD100, however, is lot more PC friendly and even has a USB2 port on the top so it can be connected directly to a PC without a cradle. Windows automatically recognises it as a removable hard disk and MP3s can be dumped straight to the HDD100 without any software.
But if you fancy going the software route, Philips' Digital Music Manager is a good choice. It compares the contents of the HDD100 with the PC, and synchronises the two at the touch of a button. Alternatively, the optical input can be used to record music directly.
The player is just as simple to use. The intuitive interface reads ID3 tags so tracks can be found by title, artist, album or genre. To make scrolling through large numbers of tracks easier, Philips has its Superscroll function: hold down the up or down cursor key and the list starts skipping by letter not individual tracks. Our only problem is that the screen can be slow to update, which soon gets annoying.
With a full charge the HDD100 has enough juice for five hours of playback, which is good enough most journeys, although a little short for a long-haul flight. Sound quality, depending on the bit rate of the track, is pretty good, although the supplied headphones should be replaced for best results. Despite a few minor interface niggles Philips has created the first worthy competitor to the Ipod.
DETAILS
RRP £299 (£254.47 ex VAT)
BEST PRICE www.pcw.co.uk/bestprices
PRODUCT INFORMATION Philips 0870 900 9070 www.philips.co.uk
SPECIFICATIONS
15GB - USB2 - Stereo headphone jack - WMA and MP3 playback - 106 x 64 x 20 (h x w x d mm) - 167g
PROS Can be used as a recorder; good capacity
CONS Screen can be a little slow to update
VERDICT
The first serious competitor to the Ipod and a great MP3 player in its own right
PERFORMANCE ****
FEATURES ****
VALUE FOR MONEY ***
OVERALL ****.
http://vnu-pcw.pricerunner.com/sound-and-vision/personal-audio/mp3-players/172356/details
MP3 player growth rate at 50%....
Dinesh C. Sharma
9 December 2003
CNETNews.com
The demand for MP3 players in the United States is poised to grow at a steady rate of 50 percent a year through 2006, signaling better times for the digital music market, according to Jupiter Research.
Shipments of MP3 players should hit 3.5 million in 2003, almost double 2002 figures, Jupiter said in a report it issued Tuesday. It also said more than 26 million MP3 players will be in use by 2006. Starting in 2004, the demand for players with hard drives will surpass that of players with flash memory.
New music players and download services such as Apple's iPod and its iTunes store have "energized the music industry," Jupiter said.
The market researcher said a few more stores and services may soon add their names to a list that includes America Online, Musicmatch, Napster and RealNetworks. While Microsoft, Hewlett-Packard and Amazon.com will miss the winter shopping season, computer makers Dell and Gateway have already launched MP3 players, according to the report.
"MP3 players are not quite this season's DVD player, but portable music players, combined with online music stores and services, will be a strong holiday-shopping combination," David Card, Jupiter's research director, said in a statement.
EDIG listed as competitor in Phoenix profile.
Phoenix Technologies Ltd.
5 December 2003
Hoover's Company Profiles
Austin, Tx
OVERVIEW
Phoenix Technologies has risen from a humble, basic beginning. The company develops basic input/output systems (BIOS) - the software that loads a computer's operating system (OS) each time it is turned on. BIOS software also manages the settings and connections between the OS and basic hardware, such as the keyboard and monitor. Phoenix Technologies makes similar software for manufacturers of other computer peripherals and electronics, such as point-of-sale terminals, phones, and personal digital assistants. The company has more than 800 customers worldwide, including Dell, Fujitsu (18% of sales), Sony, and Samsung Electronics.
More than two-thirds of Phoenix Technologies' sales are in Asia. The company has expanded its diagnostic and imaging product lines through its acquisition of StorageSoft, Inc. At the same time, Phoenix has restructured and reduced its workforce.
FMR (Fidelity Investments) owns about 10% of Phoenix. U.S. Trust has a stake of about 6%.
HISTORY
Engineer Neil Colvin deciphered the basic software code used in IBM PCs and started his basement business in 1979. By the mid-1980s Phoenix Technologies' customers included top PC makers Data General (now part of EMC), Hewlett-Packard, and Tandy (now RadioShack Corporation). The company's 10th anniversary saw revenues of $53 million, but mismanagement and a failed diversification effort led to serious losses, a shareholder lawsuit (settled in 1991), and staff resignations (including Colvin's). The company sold its publishing and printer software operations in 1994 and the following year moved from Massachusetts to California, where its PC systems software division was located.
In 1996 chip making powerhouse Intel and Phoenix Technologies formed a seven-year technology licensing agreement that let Intel work with the company to develop one of the few basic input/output systems (BIOS) permanent software components Intel didn't already make. Also in 1996 Phoenix Technologies bought prepackaged circuit technology company Virtual Chips.
Motorola, Advanced Micro Devices, NCR Corporation, and several other manufacturers agreed to license Phoenix Technologies' software in 1997. In 1998 Phoenix Technologies bought Sand Microelectronics to increase its semiconductor base, and merged with fellow BIOS developer Award Software. The moves necessitated a restructuring that eliminated 5% of the workforce; declining PC prices also contributed to a drop in profits for fiscal 1998.
In 1999 the company sold its PC card software line, and named RSA Data Security executive Albert Sisto as CEO. Phoenix Technologies that year also launched its PhoenixNet unit (originally called ebetween) to develop embedded software used to deliver Internet services and content. In exchange for 20% of the unit, Phoenix Technologies acquired Internet company investment firm SOFTBANK's Marketing Solutions operations (electronic product registration services).
In 2000 Phoenix Technologies' inSilicon semiconductor intellectual property unit (formed in 1999 from the Virtual Chips and Sand Microelectronics acquisitions) was spun off in an IPO; Phoenix Technologies retained a stake of almost 75%. That year the company decided to build a research and development facility in China, strengthening its Asian presence.
In 2001 the company bought RAVISENT Technologies' e-Surfer browser and its line of information appliance reference designs and products. Later that year Phoenix Technologies cut 15% of its workforce. In 2002, the company sold its stake in inSilicon, which had decreased to 70%, to Synopsys.
Public
Fiscal Year-End: September
OFFICERS
Chairman, President, and CEO: Albert E. (Al) Sisto, age 53, $400,000 pay
Vice Chairman: George C. Huang, age 61
CFO: Randall C. (Randy) Bolten, age 50
SVP and General Manager, Corporate Engineering and Planning: W. Curtis (Curt) Francis, age 53, $260,000 pay
SVP and General Manager, Corporate Marketing and Product Division: Timothy D. (Tim) Eades, age 33
SVP and General Manager, Global Sales and Support Division: David L. Gibbs, age 45, $256,345 pay
SVP, General Counsel, and Secretary: Linda V. Moore, age 55, $254,000 pay
VP, Asia/Pacific: George Man
VP, Human Resources: Magda M. Madriz, age 50
General Manager, Taiwan: Jack Huang
Director, Product Marketing, FirstWare: Brian Andersen
Manager, Global Public Relations: David (Dave) Tractenberg
LOCATION
Headquarters: 411 E. Plumeria Dr., San Jose, CA 95134-1924
Web Site: http://www.phoenix.com
Phone: 408-570-1000
Fax: 408-570-1001
Phoenix Technologies has operations in China, Germany, Hong Kong, Hungary,
Japan, the Netherlands, South Korea, Taiwan, and the US.
2002 Sales
$ mil. % of total
Asia
Japan 35.4 38
Taiwan 22.8 24
Other countries 7.4 8
North America 22.2 24
Europe 5.3 6
Total 93.1 100
PRODUCTS/SERVICES
2002 Sales
$ mil. % of total
License fees 84.8 91
Services 8.3 9
Total 93.1 100
Selected Software:
DeviceConnect (ties desktops and PCs to network security policy)
FirstAuthority (infrastructure security and device authentication programs)
FirstBIOS (standards-based programs for microprocessor-based devices)
FirstView Connect (activates, secures, connects, and recovers digital
devices)FirstWare (diagnostic and repair services)
ImageCast Enterprise (PC deployment, configuration, and management tool)
ServerBIOS (standards-based programs for PCs and servers)
COMPETITORS
Acer
American Megatrends
Cisco Systems
Dell
e.Digital
Hewlett-Packard
Intel
IBM
Microsoft
Opera Software
Planetweb
Symantec
Synopsys
Toshiba
TouchStone Software
Wind River
FINANCIALS
2002 2001 2000 1999
Sales ($ mil.) 93.1 121.4 144.4 125.8
Net Income ($ mil.) (4.9) (18.0) 20.9 1.8
Net Profit Margin -- -- 14.5% 1.4%
Earnings Per Share ($) (0.25) (0.72) 0.77 0.07
Stock Price - FY High ($) 14.16 19.63 30.25 18.19
Stock Price - FY Low ($) 6.00 7.81 8.63 5.00
Stock Price - FY Close ($) 7.25 10.03 15.94 11.19
P/E High -- -- 39 260
P/E Low -- -- 11 71
Dividends Per Share 0.00 0.00 0.00 0.00
Book Value Per Share 4.80 4.74 5.79 4.11
Employees 542 515 773 705
1998 1997 1996
Sales ($ mil.) 122.9 82.1 72.1
Net Income ($ mil.) 0.7 15.7 12.8
Net Profit Margin 0.6% 19.1% 17.8%
Earnings Per Share ($) 0.03 0.74 0.63
Stock Price - FY High ($) 18.38 19.75 20.38
Stock Price - FY Low ($) 5.59 11.00 9.88
Stock Price - FY Close ($) 5.63 14.88 17.25
P/E High 613 27 32
P/E Low 186 15 16
Dividends Per Share 0.00 0.00 0.00
Book Value Per Share 4.77 6.14 5.39
Employees 804 572 490
1995 1994 1993
Sales ($ mil.) 49.9 86.2 76.3
Net Income ($ mil.) 8.8 6.8 2.6
Net Profit Margin 17.6% 7.9% 3.4%
Earnings Per Share ($) 0.46 0.41 0.19
Stock Price - FY High ($) 14.38 6.25 7.13
Stock Price - FY Low ($) 5.38 3.50 3.75
Stock Price - FY Close ($) 12.63 5.63 4.25
P/E High 31 15 38
P/E Low 12 9 20
Dividends Per Share 0.00 0.00 0.00
Book Value Per Share 3.62 2.94 2.43
Employees 362 360 389
2002 Year-End:
Debt Ratio: 0.6%
Cash ($ mil.): 25.2
Current Ratio: 3.69
Long-Term Debt ($ mil.): 0.7
Shares Outstanding (mil.): 26.2
Dividend Yield: 0.0%
Dividend Payout: --
Market Value ($ mil.): 190.1
Link to e.digital odyssey 1000 on Network World
http://www.nwfusion.com/links/Holiday_Gift_Guide/Digital_audio_players/index.html
EDIG mention - Network World 2003 Holiday gift guide
Cool Yule Tools; Shopping for the techie who has everything? You've just struck gift guide gold! Uh, make that silver!
Keith Shaw
24 November 2003
Network World
Network World 2003 holiday gift guide
Cool Yule Tools
Shopping for the techie who has everything? You've just struck holiday gift guide gold! Uh, make that silver !
Silver belles
Santa's helpers, Titanium (above) and Platinum (below), ring in the season with these silver-toned accessories.
AOC LM729 monitor
$400
Titanium takes the AOC LM729 monitor for a spin - literally! This 17-inch flat-panel with integrated speakers easily swivels from horizontal to vertical, and at $400, even the price tag turns heads.
Veo Wireless Observer camera
$300
Platinum loves the space-ship design of the Veo Wireless Observer camera, but it's what this baby can do that's really out of this world. Set it up anywhere within range of a wireless LAN, and beam pictures across the Internet (watch the kids, your pets or do security monitoring). Pan, tilt and zoom features make this camera a winner!
" Silver toys, silver toys, - It's holiday time in the test labs . . . "
- Keith Shaw
Silver surfers
Platinum does her holiday shopping on the Web and on the go now that wireless, last year's luxury feature, has become standard in laptop and handheld computing devices like these:
1. Sharp Actius MM10
$1,500
An ultra-portable notebook that offers an impressive level of mobility. At 2.1 pounds, this is an extremely small laptop. It includes embedded wireless for Internet connectivity, but sacrifices a bit of performance to gain the mobility (only a 1-GHz Crusoe processor).
2. Palm Tungsten T3
$400
The latest and greatest Palm device, complete with a display that rotates horizontally or extends vertically to offer more screen real estate. The device has a brilliant screen resolution, the latest operating system and integrated Bluetooth for connectivity.
3. Research in Motion BlackBerry 7230
$399
We love how BlackBerry has entered the color screen age. If staying in touch is important to you, then the 7230 is your device. Wireless e-mail, a cell phone and a decent organizer all complement each other in a small package.
4. Fujitsu Lifebook P5000
$1,550
We love small and light laptops this year, and the P5000 rates among the best. It's one of the smallest notebooks that includes a DVD drive, so you still can watch that movie on the plane and not have to lug around a 7-pound beast.
5. Handspring Treo 600 from Sprint
$600
This is a rare device that actually lives up to its hype. The Treo 600 from Sprint provides road warriors with everything they need: organizer,
e-mail, cell phone, digital camera and more. All of this comes in a handy package that is only slightly bigger than a regular cell phone.
6. Toshiba Portege R100 notebook
$2,300
We love the keyboard on this extremely tiny notebook. No optical drive, but you can attach one via USB port if you want. The best part is it's very light.
On the third page of this gift guide, my true love gave to me . . .
Silver nuggets
Good things come in small, silvery packages:
1. LG VX6000 from Verizon Wireless
$200
This was the year of the camera phone, and this model was our favorite. But it also has a ton of other bells and whistles, including a really fancy external display.
2. Oregon Scientific Digital Camera
$130
Our second-favorite tiny camera is barely more than 3 inches wide, 2 inches tall and a quarter-inch thick. This is a 1.3-megapixel camera that comes with a zoom lens and flash attachment. Not the best camera for serious prints, but you can't beat the size for those moments when you need to take a quick photo to send around via e-mail.
3. Kanguru Wizard USB security key
$50
If you want to hide sensitive data on your PC from prying eyes, plug in this USB drive, transfer the files to a "virtual folder" and watch them disappear when you remove the device. One of the simplest ways to hide data we've seen in a while.
4. Logitech Pocket Digital 130 camera
$150
Tiny digital cameras came out last year, but they stunk. This year they're getting better. The 1.3-megapixel camera has a cool spy camera feel, and a flash to improve picture-taking. And it's easy to operate and carry around in your pocket.
5. Gateway DC-T50 digital camera
$400
We loved the small and sleek 6-ounce digital camera. Five big megapixels will be more than enough for your printable photos. It has great battery life, too.
6. Belkin Hi-Speed USB 2.0 7-port hub
$50
The more stuff you get to connect to your PC, the more you're going to need a USB hub. This version lets you connect up to seven devices and is stackable so you can connect even more. It's smiling, silver face will brighten up your desktop and your day.
Silver where?
Lost in the holiday shuffle? Find your way to giving gifts like these:
1. iPaq Navigation System
$330
End all your in-car arguments about whether you're lost. This tiny GPS receiver uses Bluetooth to talk to an iPaq (newer devices) and gives you step-by-step driving directions.
2. HP iPaq h4150 Pocket PC
$450
Make your colleagues go "oooh and aaah" when they see this small and light Pocket PC. Integrated Bluetooth and 802.11b gives connectivity options galore.
3. Magellan SporTrak Color
$380
A tiny handheld that tells you exactly where you are and where you want to go on a crisp, color screen. Use as a stand-alone GPS device or connect to a laptop and use with mapping software.
Platinum hits
No matter what their musical tastes, give gifts like these and you'll be No. 1 on their top 40 chart.
4. Digital Vinyl CD-R discs
$6 to $10
We still remember records. If you do too, then take all the digital music you've been gathering and burn it onto one of these. We love the style - nostalgia rocks!
5. E.Digital Odyssey 1000 digital player
$350
The alterna-iPod. More than just an MP3 player, the Odyssey 1000 is a 20G-byte hard drive with a large backlit display, support for MP3, WMA and WAV files; voice recording; and an FM player - all stuffed into a shiny metallic box about the size of a sardine can.
6. Gateway DMB-200 audio player
$130
Gateway's foray into consumer electronics hits a home run with this model, the perfect device for listening to music while working out. With 128M bytes of music storage and a triple-A battery as its power source, the device is perfect for those on the go.
7. Freecom Beatman Flash MP3 Recorder
$180
A hip little device that offers MP3 playing and recording abilities. The stereo line-in recording feature lets you convert music into MP3s on the fly. One-touch FM radio recording lets you instantly record any song that the DJ feels like playing.
We won't go until we get these,
we won't go until we get these,
we won't go until we get these,
so buy us some now!
Silver screen
Record holiday memories big and small, and then share them in style with these great gift ideas:
1. SmartDisk FlashTrax
$500
A must for a digital photographer. Take your images, plug them into the FlashTrax and see them on a 3.5-inch LCD screen. Oh yeah, it has a great MP3 player and video player, too.
2. SiPix StyleCam DV100
$130
A miniature digital camera that can capture still photos, short videos with audio or audio only that you can post on a Web site, send via e-mail or use in presentations. The unit includes software that's fun and easy to use.
3. Philips FlatTV LCD TV
$1,000
At first we thought this 17-inch flat panel was a monitor, then discovered how cool it was as a TV. A widescreen picture for even the smallest spaces.
4. Hy-Tek Tek Panel 300
$6,500
Get the big picture with a 30-inch widescreen LCD monitor, a DVD
player and a high-speed computer in one package. We cried when we had to return this. Convergence brought to the logical extreme.
5. Auravision's EluminX keyboard
$80
Perfect for your digital home theater, the 104 illuminated rubber plunger-style keys keep your keyboard seen but not heard in the dark.
6. Epson PowerLite S1 projector
$1,000
When a 30-inch widescreen still isn't big enough, you need one of these. 1,200 lumens of brightness packed into a 7.3-pound package that's easy enough for anyone on your list to use.
Credits
Project Editor: Keith Shaw
Designer: Brian Gaidry
Photographer: Walter Silver
Santa's Little Testers: Brett Cough, Greg Cusack, Ryan Francis, Adam Gaffin, Sandra Gittlen, Monica Hamilton, Peter Hebenstreit, Tom Kroon, Jason Meserve, Keith Shaw, Melissa Shaw, Zach Sullivan, Matt Tucker, Alex Weinberg, Elizabeth Weinberg, Neal Weinberg, Brian Wood.
Now serving flights between Seattle and Boston. Flights between Seattle and Miami will begin on Nov. 26. Service to New York, Orlando, and Washington, DC coming soon.
Direct link to digeplayer....
http://www.alaskaair.com/DayOfFlight_TOC.asp
Inflight Music, Movies & More
Fujitsu Ten to release product....could we be getting closer to our product release?
Auto electronics maker Fujitsu Ten to release product
13 November 2003
Business Daily Update
2003 China Daily Information Company.
Japanese automobile electronic product maker Fujitsu Ten said November 12 in Beijing that it would release its automobile navigation system, Eclipse, in China in January in the hope of taking a 20 percent market share by 2007.
The first product to come to the market is the Eclipse AVN 5533, which includes a global positioning system, and audio and video components.
It will be sold in the cities of Beijing, Shanghai, Tianjin and Changchun and in Guangdong Province at a price of about 25,000 yuan (US$3,000).
TheSUBWAY.com -- Hot Stocks To Watch for Friday, November 14, 2003: ELIN, LATD, APBH, EDIG, VXGN
14 November 2003
PrimeZone Media Network
WESTON, Fla., Nov. 14, 2003 (PRIMEZONE) -- TheSUBWAY.com names eLinear Inc. (OTCBB:ELIN) to its Stock Watch List. ELIN is new to TheSUBWAY.com, and has announced good news! Watch this company, it has traded higher on solid volume, and could continue to move in the near term! Other stocks highlighted include:
Latitude Communications (Nasdaq:LATD): Market Perform,
American Publishing Inc. (OTCBB:APBH): Market Perform,
e.Digital Corporation (OTCBB:EDIG): Market Perform,
VaxGen Inc. (Nasdaq:VXGN): Market Underperform.
WHAT THESE RATINGS MEAN:
TheSUBWAY.com ranks stocks from time to time utilizing both fundamental and technical analysis in comparison to the S&P 500 over the short term. These ratings reflect the opinion of TheSUBWAY.com.
ABOUT TheSUBWAY.com:
TheSUBWAY.com, a leader in corporate communications and finance, provides all investors with a wide-ranging set of financial tools, including original stock market commentary, stock quotes, interactive charts, portfolio watch, live chat and message boards, etc., plus the latest news, press releases, investment opinions, and research reports for all companies highlighted on the site. For more daily commentary, go to http://www.thesubway.com/sub_comm.asp.
Gateway tries to extend electronics sales lead
Bob Keefe, WEST COAST BUREAU
12 November 2003
Austin American-Statesman
SAN DIEGO -- Gateway Inc. hasn't led its competitors in much of anything for a very long time. But as the computer industry pushes into the broader business of consumer electronics, Gateway may be ahead of the pack for a change. On Tuesday, Gateway introduced 14 new products, including a budget-minded MP3 music player, a DVD recorder and two flat-screen television models in a move that solidifies its transformation from a PC maker to a marketer of gadgets and home electronics.
Since May, the company has introduced almost 100 new products, a wider array of consumer electronics offerings than any other domestic PC maker.
"We're about 90 percent done with what we needed to get done," Gateway Chairman Ted Waitt said in a telephone interview after announcing the new products. "Now it's time to execute."
There's little doubt that Gateway needs to do something different.
The company, which helped usher in the consumer PC business when Waitt co-founded it in an Iowa farm house in 1985, has fallen from being a leader in the industry to an also-ran.
Based in the San Diego suburb of Poway, Gateway has lost money in 11 of its past 12 quarters. Its stock price has dropped from about $80 a share four years ago to $4.58 on Tuesday. Since 2000, it has laid off or plans to lay off more than 18,000 workers.
Once the biggest seller of PCs by some measures, it now has only about 3.3 percent of the U.S. market. And in the third quarter, when PC sales surged worldwide, Gateway was one of the few companies that saw its sales dip.
After watching other strategies flop, Gateway is now counting in a big way on the consumer electronics business.
The next two months will be critical. Traditionally, 40 percent of sales of products such as digital cameras, high-end televisions and DVD players comes during the holiday shopping season, according to Scott Edwards, whom Waitt hired away from Sony Corp. this year to run Gateway's consumer business.
"We're hoping to see a big impact" in the fourth quarter, Edwards said.
Compared with the PC industry, which has matured with more stable sales, the consumer electronics business is growing fast. Moreover, profit margins on some of those goods are 15 percent to 20 percent, compared with 4 percent or less for low-end computers.
"All these products have higher margins than PCs and all are in growth categories," Waitt said. "And these are all markets on the rise, rather than the PC business, which is acting more like a mature market these days."
Of course, that's why other major computer makers -- namely Dell Inc. and Hewlett-Packard Co. -- also are jumping into the consumer electronics business. Dell recently announced it is selling its own LCD television, MP3 player and other goods.
Waitt knows first-hand how Dell can hammer the competition. While Dell and Gateway pioneered the direct-to-the-customer PC business model, Dell refined it to a science, leaving Gateway and most others in its dust.
"We've learned a lot from the past," Waitt said.
Gateway plans to do two things differently this time, he said.
First, it will push for innovation in design -- something that Dell and the PC business as a whole isn't known for.
Second, it will rely on its network of stores, which Dell -- while it has kiosks in malls -- doesn't have.
"Ninety-four percent of consumer electronics are bought at retail stores," Waitt said. "That's a pretty big piece of the business."
Gateway and the other computer makers also face stiff competition from traditional electronics retailers such as Best Buy, Fry's and Circuit City, which have been in the game much longer.
The advantage PC makers have over traditional retailers is that many of the gadgets -- digital cameras and MP3 players, for instance -- are dependent on the PC.
"(Gateway and other computer companies) can all make various cases that they have something more -- specific knowledge, more customer care, suites of products that are designed to work together," IDC analyst Roger Kay said. "It's not everything, but it is a differentiating value."
Gateway may also have a significant advantage because of its head start, said Jennifer Gerlach, an analyst with technology research firm ARS Inc.
"Dell at the moment is a little behind the mark," she said. "And Gateway is ahead of the game in this round."
Gateway..MP3 player bundling and Napster
Special Report: Tech Buying Guide: In The Office
PCs: Looking Beyond The Big Brands; Plenty of smaller boutiques offer models that could be just what you want
By Peter Burrows
10 November 2003
BusinessWeek
JED ROSE BEGAN SHOPPING for a PC earlier this summer, and he knew he wanted something different. The 23-year-old marketing manager for Microsoft craved a machine that would let him edit videos and play games, DVDs, or downloaded music -- with resolution and sound fidelity good enough to grace his large-screen TV and living room stereo. The prospect of a plain PC box in his Seattle apartment repelled him. ``If you look at PCs from 10 years ago, there hasn't been much advancement in the cool factor,'' he says. ``I didn't want an eyesore.''
To get what he desired, Rose looked beyond the usual suspects. Due to indus- try consolidation, four companies -- Dell, Hewlett-Packard, Gateway, and eMachines -- supply roughly two-thirds of the home PCs sold in the U.S. Instead, Rose bought a Mini QBox 845-3000 from Polywell Computers in South San Francisco. The size of a small toaster oven, it has a grip on top so it can be easily taken to the office or to a ``LAN party'' where gamers get together to compete over a fast local area network. It has a metallic, industrial-hip design, with plexiglass sides illuminated by a blue-tinted inside light. ``Frankly, I'm surprised Dell or Gateway don't have a product like this,'' says Rose, who paid $1,200, not including monitor, keyboard, or mouse. ``Most of my friends are young technology enthusiasts. When they see it, they all say, 'Wow, this is cool.'''
There are some universal rules of thumb for PC shoppers this holiday season. Now that there are finally easy ways to manage digital photos, buy songs, or rent movies online, you'll want at least 80 gigabytes of storage. The minimum amount of memory you should demand is 256 megabytes, though 512 MB is a safer bet. For the microprocessor, you'll want Intel's powerful Pentium 4 or Advanced Micro Devices' Athlon. (Intel's Celeron could slow you down if you try to do anything beyond word processing and other pedestrian tasks.) Still, don't bother buying the fastest models. A 3.2-GHz Pentium 4 costs around $300 more than a 2.8-GHz, and only gamers and other power users would be able to tell the difference in performance.
There are plenty of cool choices beyond the big brands. Apart from differences in style, outfits such as Polywell, Pacific NorthWest, and Alienware use a variety of strategies to squeeze optimal performance out of their PCs. Major players such as Apple, Sony, and Hewlett-Packard still do a better job developing families of products designed to work together -- say, a PC, photo printer, and digital camera for photography buffs. But in many ways, the small boutiques outshine them.
PERSONAL SERVICE
THE NO-NAME BRANDS that make up most of our top picks have various ways of setting their machines apart. Gamers -- whose virtual lives can depend on whether their machine can outgun rival players -- have flocked to these brands because they're oftentimes built with higher performance components. But others can benefit, too. Rose says his Mini Qbox boots up in less than 10 seconds, partly because the machine isn't loaded down with the reams of prepackaged programs the bigger brands often add. The Mini Qbox also sports enough USB and FireWire ports to connect Rose's digital camera, camcorder, MP3 player, and wireless mouse, keyboard, and network. What's more, the premium he paid gets him personal service: When he has questions, he's routed to the same support person. This is Polywell's policy, unless that service rep is unavailable.
Brands large and small are focusing on models based on Microsoft's clunkily named Windows XP Media Center Edition 2004 software. Media Center PCs are designed to be used while leaning back on the sofa rather than leaning forward over the keyboard. With a TV-style remote, you can look at digital photos, watch videos, or play music, either through a flat-panel monitor or a TV. Media Center PCs also mimic the popular TiVo personal video recorders, automatically storing your favorite TV shows for later viewing and allowing you to pause or rewind during live shows. The picture on many models remains inferior to that on the average TV. Still, Media Center will probably be one of the biggest trends in home computing by mid-decade.
Already, computer makers are unveiling Media Center models designed for places other than Dad's office or the desk in the kids' room. ZT Group International's pricey Home Theatre PC A5071 looks more like a high-end stereo than a PC. Gateway's new 610 Media Center PC has an appealing all-in-one design, with the PC stuffed behind the 17-inch wide-screen flat-panel monitor. There are cheaper versions that look more like garden-variety PCs. Dell and Gateway have already introduced Media Center PCs for around $1,000.
Shoppers will also have the option to buy a PC that's bundled with other products designed to work with it. Apple Computer has been packaging consumer gear with Macs for years, as has Sony with its Vaios. Hewlett-Packard is pushing digital-photography bundles, complete with a digital camera, photo printer, and related accessories. Gateway will offer bundles centered on video, and a music configuration will include Gateway's MP3 player and a month's subscription to the Napster 2.0 music service.
Gateway - Hot Stocks On Wall $treet Week With Fortune
3 November 2003
NEW YORK (Dow Jones)--The following companies were mentioned during the Friday, Oct. 31 airing of "Wall $treet Week With Fortune" on PBS.
Gateway Chief Executive Ted Waite said he's "excited" about the company's fourth-quarter because of the computer-makers new line-up of electronics products.
"We will have announced 100 new products by the end of this year," he said, naming consumer electronics items like digital cameras, plasma TVs and MP3 players.
Waite said that the company is working closely with component suppliers and manufacturers to put a "tremendous amount of quality control in place" for its new product lines.
He also said he sees Gateway having an advantage over traditional consumer electronics makers, as it brings the high-velocity style of the PC industry to a new business.
Computer makers like Gateway and Dell will reshape the competitive landscape of the consumer electronics business, said Stephen Baker, an analyst at market research group NPD Group.
Gateway and Dell are "putting pressure on the entire electronics business, by trying to change the business model to what they're used to--which is fast product cycles, low margins and quick turns," Baker said.
Baker predicts that companies like Best Buy and Wal Mart will be winners in the new landscape for consumer electronics because they'll be able to deliver more products at aggressive prices.
He also said Hewlett-Packard should benefit from its mix of computer and electronics products, as consumers learn how to use items like digital cameras, printers and computers together.
Consumer electronics giants in Asia, such as Samsung, Sharp, Canon and Sony, may lose out, he added, agreeing with Fortune Magazine writer Adam Lashinsky, who noted that even airline and record company Virgin is getting into the consumer electronics field.
Gateway Chief Executive Ted Waite concurred, and said he sees Wal-Mart, Best Buy and Circuit City, as well as the Asian consumer electronics makers as competitors now.
More Than a Player
By Troy Dreier
October 29, 2003
Product: Samsung Napster YP-910GS
How did they fit all that in there? That's the first question you'll ask after checking out the new co-branded Samsung Napster YP-910GS player/recorder ($399 street). This latest addition to Samsung's YEPP line of digital-audio devices is roughly the same size as the Apple iPod, but the YP-910GS manages to cram in a lot of extras—features the iPod lacks, such as an FM tuner, an FM transmitter, and a voice recorder.
At 4.2 by 2.8 by 0.8 inches (HWD), the YP-910GS isn't as sleek as current iPods, which occupy just 4.1 by 2.4 by 0.7 inches, but at 6.0 ounces, it's lighter by 0.2 ounces. Its front houses a four-line display, a large button that controls volume and menu scrolling, and three smaller buttons—Record, Menu, and Select. On/off and music playback controls are on the right side of the device; hold and reset are on the left. Atop the YP-910GS, you'll find the earphone/remote-control jack as well as USB 2.0 and line-in ports hidden behind a stubborn panel we could only pry open with a fingernail. The controls, although easy to use, aren't nearly as well designed as the iPod's, which let you operate the player with your thumb alone.
The interesting feature collection is a first for a palm-size hard-drive audio device. Like the e.Digital Odyssey 1000, the YP-910GS has an FM tuner. Unlike its competitors though, it also has a built-in wireless transmitter, so you can broadcast to an FM radio without buying a separate device. All you have to do is plug the included antenna into the YP-910GS line-in port. The player broadcasts over four different frequencies. Its range is extremely short, though—it managed less than 1 foot in our testing.
The YP-910GS can take voice notes, but beyond that, it can record directly from the radio and lets you transfer those recordings to a PC via the included USB 2.0 cable. The process is wonderfully easy: Simply click the record button when a station is playing and the capture starts a second later. You can easily transfer the resulting WMA file from your player's library to your PC's hard drive the next time you connect. Plug the included audio cable into the line-in port, and you can record directly from a stereo or other source.
Battery life is good. We got 10 hours; slightly better than the 9 hours a 30GB Apple iPod gave when recently tested in our story "Let the Music Play."
The device is not without its faults, though. You can't create playlists on the YP-910GS itself, as you can with iPods. Thankfully, creating lists on a computer is simple—you select songs in your Napster 2.0 library, then drag them into a playlist. When you connect the YP-910GS to your PC, you drag the playlist to the player/recorder's library. Irritatingly, the songs list in alphabetical order rather than album order; you have to drag songs around in the library to reorder them, then transfer them back to the device.
You'll find just five equalizer settings on the YP-910GS versus the iPod's 22 and none of the games or time killers Apple's player has. You do get a wired remote, but the included headphones are subpar and the off-white leather case isn't too attractive.
The player's release coincides with the availability of Napster 2.0, Roxio's reincarnation of Napster as a pay service. As one might assume, the YP-910GS is the only hardware of its type that smoothly integrates with the Napster 2.0 software. Unfortunately, Roxio's software lacks a sync button, so you have to drag all tracks over manually. Other players will need Windows Media Player 9 to transfer Napster 2.0's songs.
At first glance, the YP-910GS looks like it might be an iPod-killer, especially considering that the devices are about the same size and available with 20GB hard drives for $399. But the iPod provides a satisfying user experience the new kid can't touch despite its interesting extras. While the Samsung Napster YP-910GS is a great machine, we think the iPod's top-dog status is safe for now.
Archos Introduces Customizable MP3 Players
October 22, 2003 - Archos, Inc., a global provider of innovative handheld entertainment and storage solutions, introduced today a new line of portable MP3 players that can be customized to suit individual preferences. The GMINI 220 and GMINI 120 players are the first to offer music fans add-on accessories for creating a custom player with music, radio and photo options, and an icon-based interface for easy navigation. The GMINI 120 is available today at major U.S. retailers, or at www.archos.com. The GMINI 220, the industry's smallest 20-gigabyte MP3 player, will be available in November.
The GMINI Series is designed for music fans who want a specific player and price customized to them. The GMINI 220 is the smallest 20-gigabyte MP3 player on the market, and weighs only six ounces. With the GMINI Series, Archos introduces an icon-based interface and the ARCLibrary, an advanced music management program that allows for controlling and organizing music directly on the device. The GMINI devices can store 5,000 songs, or 500 full-length CDs or 300 hours of audio.
"With the GMINI Series introduction, Archos continues its strategy of delivering innovative products with flexible features and prices points, and have delivered another breakthrough product today," said Hyder Rabbani, Archos president in the United States. "Aside from the sleek appearance of the new products, for the first time music enthusiasts of all ages and tastes will be able to personalize their MP3 player to their listening habits and cost preferences, and create a truly personal and powerful MP3 player."
Compact and Powerful with Features and a Price for Everyone
The new GMINI product line is powerful in size and performance, yet both the 220 and 120 fit comfortably in a shirt pocket. The differences in the GMINI 220 and 120 devices come in the form factor and screen size, where the GMINI 220 is the smaller and has a 2.5 inch LCD screen. The GMINI 220 screen is grayscale with a blue backlight for easy viewing of photos and icons.
Both players offer MP3 and WMA recording and playback, an icon-based interface, and advanced music management capabilities through the Archos ARCLibrary and Musicmatch Jukebox Plus. The new ARCLibrary lets users delete, rename, copy and move files, and create folders directly on the GMINI Series - all without using a PC. MUSICMATCH Jukebox Plus, the award-winning digital music software, lets music fans convert entire CD collections to MP3 or WMA format, and organize songs by artist, album, genre, album art and more.
A Modular Approach to a Compact MP3 Player
Music fans can select up to four personalized add-on accessories for the GMINI Series:
Audio Recorder/Voice Recorder - With a built-in microphone, this accessory offers recording of music from any audio source and holds up to 700 hours of voice recording.
Photo wallet - With the compact flash memory card, customers can easily store, organize and view JPEG photos on the GMINI built-in screen. (Adaptors for other memory cards also are available.)
MadWaves Interactive Music Composer - Exclusive to Archos, this unique interactive software allows aspiring artists to compose their own music by interacting with pre-loaded, copyright-free digital music samples.
FM Remote Control - An add-on remote control transforms the GMINI series into an FM radio with full MP3 recording capabilities. Connect the module and record songs from the radio at any time.
Pricing and Product Specifications
The GMINI series modular concept allows the music listener to choose the player and accessories that best meets their needs. The GMINI 120 and 220 have suggested retail prices of $249.95 and $349.95, respectively, and products are sold with a USB 2.0 cable, AC adapter, batteries, stereo headphones and MUSICMATCH Jukebox Plus software. The optional accessories are available at www.archos.com with the following suggested retail prices:
Audio Recorder/Voice Recorder: $19.95
Photo Wallet: $29.95
MadWaves Interactive Music Composer: $9.95
FM Remote Control: $39.95
The GMINI Series requires a PC running a Windows 98 Special Edition or higher operating system and a 233 Megahertz or faster processor, or Mac 9.2 or X (10.2.4) USB Manager version 1.2 or higher.
Company information and products are available at www.archos.com.
Microsoft Launches Voice Control for Mobile Devices
Monday November 3, 2003 10:43 AM EST
Microsoft Gives Mobile Devices a New Voice
REDMOND, Wash. -- Microsoft Corp. today unveiled its first voice-controlled software for Windows Mobile-based Pocket PC and Pocket PC Phone Edition, making consumers' wishes their command. Microsoft Voice Command transforms PDAs and cell phones into virtual personal assistants by allowing consumers to experience effortless, speaker-independent, hands-free voice interaction with their phone, contacts, calendar and digital music while on the go. Voice Command moves the company one step closer to putting the digital lifestyle within reach.
Voice Command turns up the volume on today's speech-recognition technology, revolutionizing the way consumers interact with their Pocket PC. Whether users are phoning a friend from behind the wheel, checking appointments while running errands or listening to music on the treadmill, Voice Command makes it easier, simpler and more convenient than ever for them to take their connected lifestyle with them wherever they go.
"Microsoft's Voice Command sets a new standard in voice-controlled applications for mobile devices," said Dale Coffing, editor in chief of PocketPCPassion.com. "The out-of-the-box experience for making phone calls, hearing the details of upcoming appointments and listening to music is superb. Being able to use my Pocket PC so easily while driving my car or just walking down the street is phenomenal."
Voice Command uses Microsoft's next-generation phonetic speech-recognition technology, the result of 10 years of research, to make speech interaction simple, intuitive and practical. While most voice-controlled software applications today require people to deliver unnatural and prerecorded verbal commands, Voice Command allows them to use natural language to go directly to what's most important in a matter of seconds. The following key features are provided in Voice Command:
Voice-controlled hands-free phone. Whether in the car, at the airport or walking down the street, people will enjoy true hands-free phone conversations without ever having to manually dial a number. They can simply say any name from their contact list. For example, they might say "Call Bob Smith," or they could give a number, saying for example, "Dial 555-1212."
Voice-controlled calendar lookup. Checking appointments has never been easier. Regardless of location, consumers can simply ask their Pocket PC, "What's my next appointment?" or "What's my calendar?" and the time, subject and location of each entry will be read aloud.
Voice-controlled Windows Media Player. Now voice commands can be used as a virtual remote control to select and play music by album, artist or genre so people won't be fumbling for CDs or scrolling through a long list of songs. Consumers can also simply say, "Play music," using Voice Command as their personal disc jockey.
Voice-controlled application launcher. Consumers can open Pocket PC applications with ease using natural voice cues to launch any program, including Internet Explorer, Outlook® Calendar, Contacts and Tasks, games and Calculator. For example, a consumer can say "Start Solitaire," and let the games begin.
"Voice Command provides a significant improvement in speech software that is dramatically changing the way people will forever use their mobile devices," said Pieter Knook, corporate vice president for Mobile and Embedded Devices and Network Service Providers at Microsoft. "The product is a great example of how we're driving synergies between our platforms and devices business to create more powerful mobile experiences for our customers."
Automotive Business Unit Turns Up the Volume on Voice-Controlled Software
Microsoft's Automotive Business Unit developed Voice Command to address consumers' need to be safely connected while on the go. People want access to their personalized information, regardless of location, and research supports this trend. A recent survey revealed that 85 percent of U.S. cell phone owners and 50 percent of PDA owners use their devices while in the car.*
"We've been focused on providing improved communication, entertainment and information to drivers and passengers for the past decade," said Dick Brass, corporate vice president of Automotive Technologies at Microsoft. "No other company has the expertise and technical tools to provide a simple solution like Voice Command to the thousands who need safer, more convenient access to their personalized information both inside and outside the car."
Status on Alaska digEplayer launch....
Per Marketing:
1) The site link should be up in the next week.
2) First Class availability week of 11/10
3) Main Cabin availability week of 11/17
Slight delay due to manufacture/shipping but confirmed they will be onboard trancon flights soon.
Disney And HP Expand Their Alliance
9 October 2003
CMP TechWeb
In 1937, the Walt Disney Co. became one of Hewlett-Packard's first customers when Walt Disney himself purchased a customized oscillator produced in the Palo Alto, Calif., garage where Bill Hewlett and David Packard founded their business. The two companies have been working together ever since, and Thursday, they advanced their 66-year relationship with a 10-year strategic alliance to refine consumer-entertainment technologies by working collaboratively on everything from theme-park attractions to back-office IT systems to home networking gear.
At the same time, Disney unveiled Mission: Space, the newest attraction at Walt Disney World's Epcot and one the company is calling its most technologically advanced ride ever--built with unspecified HP technologies. "This is the closest any of us will get to visiting Mars," HP CEO Carly Fiorina said during a Webcast to announce the companies' expanded relationship. The companies launched a national advertising campaign for the ride featuring TV spots directed by Jake Scott, son of famed movie director Ridley Scott.
Mission: Space isn't HP's first foray into Disney theme parks. Many of the control systems behind the fireworks display at Disneyland run on HP technology, and the two companies co-developed a wireless translation system called "Ears to the World" that provides synchronized narration in five languages at more than 25 Walt Disney World attractions via lightweight headsets.
The companies already have a fairly deep technology partnership outside of the parks: HP oversaw a massive E-mail consolidation project for Disney; it manages the Walt Disney Internet Group's help desk and PC support; it has 70,000 PCs and 10,000 Intel-based servers deployed within the company; and it provided Linux workstations and servers as the backbone of Disney's digital animation production system.
In the future, HP will work with Disney to develop a digital infrastructure for securing content delivered over the Internet, and they will jointly develop entertainment appliances for home networks.
DISNEY LAUNCHES CAMPAIGN TO CURE TOURISM SLUMP HOPES PINNED ON MISSION: SPACE THE COMPANY IS BETTING ON THE SUCCESS OF THE $100 MILLION RIDE AND OTHER NEW FEATURES TO BOOST ITS THEME-PARK FORTUNES.
Richard Verrier, Sentinel Staff Writer
7 October 2003
Orlando Sentinel
Walt Disney Co. is counting on a big lift from Mission: Space, the $100 million ride whose grand opening this week is part of a larger campaign to promote Disney's signature resort in Orlando.
The entertainment giant hopes the latest Epcot attraction, along with other new features at the Central Florida parks, will help it recover from a tourism slump that has hobbled the company's overall earnings -- and the fortunes of an industry.
"We're not sitting back and waiting for the water level to rise and raise the ship," Jay Rasulo, president of Walt Disney Parks and Resorts, said in a recent interview. "I don't expect a giant rebound, and we're not planning for that . . . but we are aggressively seizing the moment in any way we can."
That's the message Rasulo will convey today in a conference call with Wall Street analysts, who have been invited to view the new ride and other offerings at Walt Disney World as part of an overview of the company's theme-park strategy.
The official launching of Mission, which had a soft opening in August, will involve Disney's first-ever national television-advertising campaign of a single attraction. The opening comes as Disney and others are investing millions again in new attractions and marketing approaches in the hopes of spurring a recovery of a business that employs more than 65,000 in Central Florida and thousands more around the globe.
Although business has picked up this summer, major theme-park resorts are still weathering the effects of what insiders have come to describe as the "perfect storm" -- an extraordinary confluence of economic slowdown, lingering security concerns after the Sept. 11, 2001, terrorist attacks and the Iraq war, not to mention high gas prices.
3 TRENDS TO FACE
Compounding the industry's woes are three long-term trends that pose new challenges to those in the business, industry analysts and veteran executives say.
For one thing, the industry has shown signs of reaching a peak in the United States. About 315 million people visit theme parks each year in the United States -- an average of more than one visit per person -- leaving little room for growth. By contrast, only one in three Europeans visits a theme park each year.
"It's the most saturated theme-park market in the world," said Tim O'Brien, editor of trade publication Amusement Business. "Now it's going to start separating the men from the boys out there."
In addition, the industry faces increasing competition for entertainment dollars. On top of that are troubling demographic shifts on the horizon.
There are currently 80.5 million people in the 25- to 44-year-old age group that represents a key demographic for the theme-park industry. That group is expected to shrink by 2.4 percent during the next five years. During the same time period, the 45- to 64-year-old category is estimated to grow 14 percent.
"The growth rate is not going to be what it was in the past because the theme-park market is shrinking in size," said Jim Cammisa, publisher of Travel Industry Indicators, a Miami-based travel-industry newsletter.
Some point the blame inward, saying that the major operators have recently focused too much on the bottom line at the expense of investing in major new attractions year after year to keep visitors coming back.
"I don't think the industry's woes are 100 percent 9-11 and the economy," said Ron Bension, former chairman and CEO of the Universal Studios' theme-park group. "Fifty percent of it is self-inflicted wounds."
NOVEL MARKETING
Industry executives say they are moving decisively to stimulate business through major new attractions, heavy promotions and fresh marketing approaches.
For its part, Disney this week launches a national TV-advertising campaign called "Magical Gatherings" that assists friends and families in planning reunions and group vacations at Walt Disney World. Disney is expected to offer a similar service at Disneyland.
"Nobody really owns this market; we want to be the first," said Linda Warren, executive vice president of marketing for Walt Disney World Resort.
Beyond Mission: Space, Disney this week also will tout a new 3-D film, Mickey's PhilharMagic, and the December opening of the first phase of Pop Century Resort, a new hotel that will have 2,880 rooms in its first phase.
And at California Adventure in Anaheim, which has struggled to meet its business projections, Disney is building the Twilight Zone Tower of Terror, a $75 million thrill ride that the company hopes will attract new visitors.
"I don't have a pessimistic view of the industry," said Rasulo, who was recently appointed to head a panel that will advise U.S. Commerce Secretary Don Evans on ways to draw more foreign tourists to the country.
"I think there are continued opportunities for those who are ready to evolve," Rasulo said.
HEAVY INVESTMENT
Disney's chief rival, Vivendi Universal's Universal Studios, also has been heavily squeezed by the industry downturn and is similarly investing heavily in new rides and shows.
Those include Revenge of the Mummy, a $40 million ride scheduled to open at its Universal Studios Florida and Universal Studios Hollywood in the spring. The money going into Revenge of the Mummy comes on top of more than $60 million that Universal has invested this year in attractions related to the animated hit movies Shrek and Jimmy Neutron: Boy Genius.
"I don't get the sense that the market has gone stale," said Wyman Roberts, chief marketing officer of Universal Parks and Resorts. "It's very difficult to say when we'll be totally healthy again, but we like the way the country is moving."
In Florida, Universal has stepped up its national advertising of Universal Orlando as a resort destination while promoting Universal Hollywood more heavily to the locals.
SMALL PARKS BENEFIT
In contrast to the big destination resorts operated by Disney and Universal, smaller regional parks that rely on day tourists have fared far better.
The SeaWorld parks in Orlando and San Diego (owned by Anheuser Busch) and Knott's Berry Farm in Buena Park, Calif., (owned by Cedar Fair Ltd.) have gotten a bounce from a recent trend that has seen people taking shorter vacations and staying closer to home.
"We see kind of a mixed bag," said Fred Jacobs, spokesman for Busch Entertainment Corp, some of whose holdings such as Busch Gardens in Tampa have been squeezed. "We've done about as well as can be expected this year."
SeaWorld San Diego also hopes to get a boost next year with the opening of a new roller-coaster ride, Journey to Atlantis.
Responding to demographic changes, Busch recently entered into a partnership with the AARP to promote its theme parks.
Cammisa, the publisher of Travel Industry Indicators, applauds such moves. To stay competitive, theme parks must continue to adapt their products with more emphasis on amenities geared to an aging population, he says.
"When one's core market is shrinking in size, changes in strategy are required."