Researchers Say Cameras, Display Add to Costs of Motorola Xoom

MARCH 1, 2011 THE WALL STREET JOURNAL


By DON CLARK And ANDREW DOWELL

Research firms that have taken apart Motorola Mobility Holdings Inc.'s Xoom tablet computer uncovered some additional clues about its features and why it costs more to build than Apple Inc.'s hit iPad.

UBM TechInsights estimates the components inside the Xoom cost Motorola about $278, compared with about $245 for a comparable iPad with 3G cellular capabilities and 32 gigabytes of flash memory. Motorola priced the Xoom at $799, excluding any wireless service contract, compared with $729 for a similar iPad.

Xooms, unlike iPads, come with front- and rear-facing video cameras, which UBM estimates cost about $14 to add. Its display boasts higher resolution than the iPad's, and it likely costs about $5 more, the Ottawa-based firm estimates. But IHS iSuppli analyst Wayne Lam—who has also disassembled the Xoom—noted that the iPad display is based on a technology called in-plane switching that produces a clearer picture at sharp viewing angles.

Analysts are quick to point out that such comparisons may be moot after Wednesday, when Apple is widely expected to introduce an updated iPad at an event in San Francisco. They also are left to speculate about one of Motorola's key choices—why the company didn't introduce a more stripped-down Xoom to compete with the $499 entry-level iPad, which has less memory capacity and comes with Wi-Fi communications capability only.

"We do think it will hurt them," said Susan Kevorkian, an analyst at IDC, of Xoom's higher entry-level price. "Device makers who would otherwise have a good shot at this market are effectively pricing themselves out of it from the get-go."

Motorola, which has shifted from trying to be a mass-market supplier of cellphones, is trying to position itself as a producer of premium devices based on Google Inc.'s Android operating system. Sanjay Jha, the company's chief executive, has argued that the Xoom deserves its price tag given its high quality and the fact that it can be upgraded free to 4G cellular technology.

Mr. Jha, at an investor conference Monday, said costs were driven up as Motorola added extra components to make the Xoom compete with Apple's next iPad, not just the current model. "We shot for performance coming out of the gate," he said.

The Xoom, for instance, comes with a chip from Nvidia Corp. that has dual processors, compared to just one calculating engine on the Apple A4 chip on the iPad. It also has much more dynamic random-access memory to help do multiple computing chores at the same time, iSuppli's Mr. Lam said.

Mr. Jha, who said Xoom sales are off to a good start, expects the tablet market to segment, with lower-priced devices for less demanding users, and will launch new tablets by the end of the year. The company already plans to offer a Wi-Fi only model in Europe, though has not discussed plans to do so in the U.S.

Write to Don Clark at don.clark@wsj.com and Andrew Dowell at andrew.dowell@dowjones.com

China Autos in a Growth Shift

MARCH 3, 2011   THE WALL STREET JOURNAL

By TOM ORLIK

The world's biggest auto market is getting congested.

Lured to China by a powerful trend—rising incomes mean rising demand for autos—auto makers now face a slowdown in growth. The government has phased out tax breaks that encouraged car buying in 2009 and 2010, financing purchases has become more difficult and Beijing has begun to restrict issuance of license plates.

After expanding 36% in 2010, passenger vehicle sales grew just 21% in January from a year earlier. But the decline may have been steeper than the data suggest: because manufacturers hit their 2010 sales targets early, they might not have counted some December sales until January. For 2011 overall, J.D. Power & Associates is forecasting a much slower growth rate of around 11%.

Zuma Press

Geely plans to double production capacity in China between 2010 and 2015. Volvo was acquired by Zhejiang Geely Holding Group.

That's not too shabby given the size of China's market, but it means the race is on for manufacturers to find the sections of the market where the scope for expansion is greatest.

Demand is still in the fast lane at the lower-price end, but this is also where competition is most intense. Domestic brands, which currently have a larger share of the budget market, are making significant additions to production capacity. Taken together, BYD, Chery Automobile and Geely Automobile Holdings, which in 2010 accounted for more than 10% of a fragmented market, will effectively double production capacity between 2010 and 2015.

But foreign companies like General Motors, Nissan and Honda, in joint ventures with local partners, are trying to muscle in too. Companies that previously focused on the glittering east are venturing inland and down market, developing new brands to attract demand from a rising wave of consumers in China's third- and fourth-tier cities.

A natural result of this contest will be lower prices. BYD has already announced plans for price cuts of up to 19% across five of its main models. Chery and Geely have so far declined to follow, but stock investors still fear a price war. Throw higher costs for raw material and labor into the mix, and the consequence is lower profit margins.

After running up sharply, Hong Kong-listed shares of BYD have been declining for a full year, and Geely has dipped 31% from a peak in November last year, considerably more than the 7% fall for the Hang Seng Composite Index as a whole. China's independent car makers have already started to stall.

But with competition set to intensify, falling stock prices do not mean value has started to emerge.

奇美電好樂 吃到蘋果iPad2

2011-03-04 工商時報 【記者張瀞文、陳泳丞／台北報導】

蘋果iPad 2上市引起全球Apple迷一陣騷動，iPad 2供應鏈也頓時再度成為當紅炸子雞，據了解，國內的奇美電也正式打入iPad 2面板供應，成為台灣唯一入選的面板供應商（國外還有三星與LGD）。

　至於與面板息息相關的驅動IC方面，南韓三星及台灣聯詠的驅動IC也順勢打入iPad 2供應鏈中。此外，由於三星在台驅動IC透過至上交給新奇美，至上也沾上蘋果光，順利打入iPad 2概念股。

　iPad 2面板仍舊採用高階顯示面板，搭配多點觸控功能，奇美電先前已經是蘋果供應商之一，這次的二代iPad奇美電當然也不放過，聯合母公司鴻海大力搶灘零組件訂單供應，據悉目前僅有三星與LGD、奇美電已經算是勝券在握，由於今年蘋果平板機成長潛力驚人，估計對於挹注奇美電的中小尺寸業務大有幫助。不過奇美電官方對於客戶訂單等議題，也表達一貫不予評論的立場。

　蘋果為了鞏固整個供應鏈的穩定性，採取增加供應商的作法，去年底業界就盛傳，今年開始奇美電從LGD（搭配的驅動IC是瑞薩）手中搶下許多蘋果ipad訂單，與奇美電搭配的驅動IC供應商也由日系的瑞薩轉為其他兩家廠商，業界盛傳這兩家廠商搭配使用廠商就是聯詠及三星的驅動IC。

　業者表示，聯詠與蘋果過去就有不錯的合作關係，目前聯詠除了是iPod驅動IC主要供應商外，也是宏達電智慧手機驅動IC最主要的供應商，甚至也供應宏達電平板電腦FLYER驅動IC，有HTC及蘋果的加持，讓聯詠業績不「紅」也難。

全球晶圓廠今年支出 估創新高

2011.03.03   【中央社╱新竹3日電】

國際半導體設備材料產業協會（SEMI）最新報告指出，去年全球晶圓廠總支出386億美元，預期今年將進一步擴增至472億美元，創歷史新高。
SEMI 表示，全球晶片龍頭廠英特爾（Intel）及晶圓代工龍頭廠台積電今年資本支出將分別達90億及78億美元，同創歷史新高；全球晶圓（Globalfoundries）今年資本支出也將倍增至54億美元。
SEMI預估，今年全球晶圓廠支出金額將達 472億美元，將較去年增加 22%，並將超越2007年晶圓廠總支出的高峰464億美元。
儘管晶圓廠支出金額將創歷史新高，SEMI指出，晶圓廠大部分支出是用在升級現有設施，業者普遍盡量避免產能過剩、供過於求的情況；估計今年產能將僅成長約 9%，低於2004至2007年的成長14%至23%水準。
SEMI表示，在可預見的未來只有少數新廠建置計畫，因此2012年至2014年，全球晶圓廠產能將維持在年成長 7%左右。

【2011/03/03 中央社】@ http://udn.com/

廣達仁寶 出貨大躍進

2011.03.02   【經濟日報╱記者李立達／台北報導】



筆記型電腦（NB）代工廠商3月出貨暴衝，兩大龍頭廠廣達（2382）、仁寶（2324）單月出貨均上看450萬台，月增率兩成起跳，第二季出貨可望持續攀高。
法人指出，NB代工族群已走出英特爾Sandy Bridge晶片組瑕疵風暴，本月出貨恢復正軌，加上今年平板電腦出貨，3月出貨大增。NB代工族群昨天則由廣達領軍，全數反彈，廣達股價連續兩個交易日大漲，昨天收盤上漲2.7元，收60.8元；仁寶上漲0.7元，收35.45元。
法人評估，下游電子股陰霾散去，包括去年第四季匯損及今年首季出貨狀況已充分反映在股價，法人砍不下手，未來下跌空間低，且受德國漢諾威電腦展CeBIT帶動，鴻海帶頭，電子股昨天向上急攻。
NB供應鏈指出，今年上半年從3月開始需求轉旺，隨市場對英特爾Sandy Bridge接受提高，第二季出貨成長可期。
廣達元月出貨月減16%，至420萬台，法人評估，2月受工作天數影響，將再下滑10%至15%，不過受惠普及蘋果3月拉貨增加，3月出貨將達440萬至450萬台，月增將逾兩成。
廣達主要客戶惠普已調高3月出貨量，達400至500萬台，較2月成長近倍，且另一客戶蘋果MacBook Pro 新款上市，頗受市場好評，將大幅挹注營收。
仁寶主要客戶宏碁，3月拉貨積極，宏碁昨天宣布，打造無瑕疵的Sandy Bridge筆電，搶先空運抵台，獨家提供六款Corei3、i5、i7新品，即日開賣。
供應鏈指出，宏碁搶攻市場積極，光是3月拉貨就較上月成長三至五成，從2月的120萬台，提高至160至180萬台，帶動仁寶3月出貨上揚，預估出貨量將達400萬至450萬台。

Rich Price for This Tweet-y Bird

MARCH 1, 2011   THE WALL STREET JOURNAL

By ROLFE WINKLER

Is Twitter really worth over $4 billion? J.P. Morgan Chase may be betting clients' money that it is potentially worth much more.

After all, that is the approximate valuation at which the bank's new digital growth fund may take a minority stake in Twitter. For such a bet to work out, though, Twitter will have to secure a higher value later. If it does, it may not be because the business merits it.

Unlike other hot Internet companies, such as Facebook, Groupon and Zynga, Twitter is still struggling to establish a lucrative business model. Lately, it has had success selling advertisers placement on its list of trending topics on the site—for as much as $120,000 a day, estimates Debra Williamson of eMarketer. Even so, Ms. Williamson estimates Twitter will generate just $150 million in revenue in 2011. Compare that to Facebook's $4 billion.

And much of the demand for Twitter advertising may be experimentation. It isn't clear yet what kind of return advertisers can expect to generate. Twitter reaches far fewer users than most realize. The site boasts over 200 million registered accounts, but after excluding inactive, duplicate and nonhuman accounts, the number of monthly users is just 16 million in the U.S., says eMarketer. There are many users internationally, of course, but advertisers aren't willing to pay as much to reach these users.

The best hope for J.P. Morgan's fund may be if Twitter is acquired. Google and Facebook may be interested. Facebook's popular status updates are threatened by Twitter. And Google trails badly in social media. Investing in hot stocks during a bubble is always dangerous—more so when the company's business model is so airy.

Write to Rolfe Winkler at rolfe.winkler@wsj.com

Mukherjee Gets Some Things Right

FEBRUARY 28, 2011   THE WALL STREET JOURNAL

By HARSH JOSHI

It is fashionable to criticize New Delhi's clumsiness. But on Monday, India's government got something right.

View Full Image

Agence France-Presse/Getty Images

India's Finance Minister Pranab Mukherjee, center, left for India's Parliament with India's annual budget papers in New Delhi, Feb. 28, 2011.

In the annual budget, Finance Minister Pranab Mukherjee took a step toward solving two chronic problems India faces: food insecurity and poor infrastructure. Moreover, he did so despite the fact that this spending won't yield results for years.

On food security, Mr. Mukerjee was detailed in his plans. The entire $450 million increase in funding for rural infrastructure will go toward creating warehouses. This is critical to prevent the waste of tons of food grains and vegetables each year. To further encourage investment in cold storage, he exempted air-conditioning units and refrigeration equipment from excise duty.

In addition, India will set aside $330 million for investing in clusters of farmlands and villages that will produce lentils, palm oil and vegetables. Because of supply shortages, these have been key drivers of food inflation in recent months. True, India needs much more, but this shows New Delhi is at last taking practical steps that can be built upon in subsequent budgets.

The investment in palm cultivation, for example, in five years will increase palm oil yields fivefold to 300,000 tons annually, Mr. Mukherjee said.

On infrastructure, Mr. Mukherjee was less specific.

New Delhi has long touted a goal of drawing $1 trillion in infrastructure investment in the coming six years, and on Monday he laid out some steps toward achieving this.

The limit on foreign investment in bonds issued by infrastructure companies will be increased five times to $25 billion, ensuring that investors wary of investing directly in projects can instead choose to lend to companies.

To encourage domestic investors, the option for individuals to buy $450 worth of infrastructure bonds as tax-free investment was extended by one year.

Of course not all of this will go smoothly. For example, Mr. Mukherjee has a target of building 15 new mega food parks—zones for growing, storing and processing food—in the coming year. This is as many as New Delhi has managed to build in the prior four years.

And not everything was a break from the usual. Increasing the limits on income-tax exemption and lowering the age to be eligible for senior-citizen benefits are surely aimed at assuaging Indians irked by inflation—in other words, motivated by short-term political concerns.

But thanks to the nation's fast-growing economy, New Delhi expects gross tax collections to rise 25% next year. It means Mr. Mukherjee has the luxury of making the political handouts, while also channeling resources toward long-term solutions to India's problems. It's a small start but a welcome one.

Write to Harsh Joshi at harsh.joshi@dowjones.com