Microsoft To Buy Research In Motion? Uh, I Don't Think So

Well, here we go again.

The Financial Post is reporting yet another breakout of rumors thatMicrosoft might want to buyResearch In Motion.

The story apparently was spurred by an item on the financial news site Benzinga which asserted that there is chatter Microsoft might invest $3.5 billion in RIMM. Last month, the talk was that maybe Samsung would buy RIMM. I didn’t believe that one, and I’m not buying this one.

New RIM CEO Thorsten Heins recently indicated that all options are on the table for the BlackBerry maker, which is basically an engraved invitation to speculate in ridiculous nonsense. But let’s get real. It certainly is possible that Microsoft could find value in RIM’s patent portfolio, although some analysts are skeptical that there’s a lot of there there. I can’t see why Microsoft would want the rest. They’re not going to want the company’s crumbling handset business, and they certainly don’t need the BlackBerry OS; they already have an OS. (Plus, Microsoft is above all else a builder of operating systems; do you really think they’d buy one from someone else?) And think strategically: Microsoft has everything to gain from the demise of RIM, and nothing to lose. Were RIM to disappear further into handset irrelevancy, it creates an opening for Microsoft to secure its position as the primary alternative to Apple and Android devices. For Microsoft, there’s no logic at all in rescuing RIM from its continued slide into the mire.

No, this strikes me as desperate speculation, former bulls looking for an exit strategy, not anything that is logical or based on reality.

Nothing else to see here.

Move along.

RIMM is up 12 cents at $13.05.

Nokia lowers profit outlook, shares nosedive

HELSINKI (AP) — Nokia Corp. saw its share price plummet 14 percent on Wednesday after it warned that heavy competition will hit its first-quarter earnings, especially in developing markets, and that it expected no improvement in the second quarter.

The world's largest cell phone maker said multiple factors had hurt sales, particularly in the fast-growing markets of India, the Middle East and Africa and China.

The Finnish company has increasingly been losing out to competitors in the lucrative top-end smartphone sector, against Apple Inc.'s iPhone and brands using Google Inc.'s popular Android software, including Samsung. But it's also been squeezed in the low-end by Asian manufacturers making cheaper phones, such as China's ZTE.

Nokia said operating margins in the first quarter were "approximately negative 3 percent." Previously, it had expected them "around break-even, ranging either above or below by approximately 2 percentage points."

It said it sold 71 million mobile phones in the quarter — down from 108 million in 2011 — with net sales of €2.3 billion ($3 billion), while smartphone sales halved to 12 million units from a year earlier.

The profit warning was coupled by other bad news from the cell phone maker, which acknowledged a data connection problem with the Lumia 900 just two days after a high-profile launch in Times Square in New York and elsewhere in the United States.

Nokia said it would compensate American Lumia 900 users with $100 in credit at AT&T because of the software problem, as well as providing an updated Lumia 900.

Wednesday's news spooked investors, who sent Nokia's share price down more than 14 percent to close at €3.27 ($4.29) on the Helsinki Stock Exchange.

CEO Stephen Elop described the performance as "disappointing" for the company that had pinned hopes on posing a new challenge against chief rivals with new Windows-based Lumia smartphones, first launched in Europe in November and later in the United States and China.

"Our devices and services business continues to be in the midst of transition," Elop said. "Within our smart devices business unit, we have established early momentum with Lumia, and we are increasing our investments in Lumia to achieve market success."

In the first quarter 2012, Nokia said it sold more than 2 million Lumia phones at an average price of €220. On Wednesday it unveiled a new version of the Lumia 610 which will give customers near field communication technology, or NFC, allowing users make payments at adapted sales tills and exchange data with handsets with similar technology.

Elop also told analysts that Nokia would launch new products in the second quarter, take "tactical pricing actions in the near term" and would speed cost-cutting measures and "pursue significant structural actions if and when necessary."

Earlier this year, Nokia announced 4,000 job cuts — on top of 10,000 last year — and said it will stop assembling cell phones in Europe by 2013 as it shifts production to Asia, where the majority of component suppliers are based, to cut costs and help it reach markets faster.

Nokia has been the leading handset maker since 1998 but after reaching its global goal of 40 percent market share in 2008 it has gradually lost ground, falling to below 30 percent market share last year.

In a major strategy shift, it began a partnership with Microsoft Corp. last year, launching its first phone with the Windows operating system in October, aimed at clawing back lost ground. But analysts said it would take several quarters before the company's success could be measured.

Hannu Rauhala from OP-Pohjola bank in Helsinki said Nokia had lost market share quicker than expected — especially in China, its largest market — and that Windows-based phones had not managed to compensate for the loss.

"The market share shifted from Nokia to cheap Android phones in China," Rauhala said. "The interest will be increasingly turning to the second half of the year when we'll see Windows tablets and new generation Windows phones ... and if they are competitive and able to challenge Samsung and Apple."

Nokia is due to report first-quarter earnings results on April 19.

The Espoo-based company, near Helsinki, employs some 130,000 people, down from more than 132,000 a year ago.

US sues Apple, publishers over ebook prices

WASHINGTON

The Justice Department and several states have sued Apple Inc. and major book publishers, alleging a conspiracy to raise the price of electronic books that Attorney General Eric Holder says cost consumers millions of dollars.

The government also has reached a settlement with three publishers, Hachette, HarperCollins and Simon & Shuster. But it will proceed with its lawsuit in federal court in New York City against Apple and Holtzbrinck Publishers, doing business as Macmillan, and The Penguin Publishing Co. Ltd., doing business as Penguin Group.

Holder told Justice Department news conference on Wednesday that "we believe that consumers paid millions of dollars more for some of the most popular titles" as a result of the alleged conspiracy. Justice's antitrust chief Sharon Pozen said the scheme added $2 to $3 to the prices of individual books.

Connecticut Attorney General George Jepsen said the total cost to consumers was more than $100 million.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.

The U.S. government filed an antitrust lawsuit against Apple Inc. and book publishers Wednesday, saying the publishers conspired with Apple to raise retail electronic-book prices to limit competition.

The government also filed papers in U.S. District Court in Manhattan saying it had reached a settlement with publishers Hachette, HarperCollins and Simon & Schuster. It will proceed with its lawsuit against Apple and other publishers, including Holtzbrinck Publishers, doing business as Macmillan, and The Penguin Publishing Co. Ltd., doing business as Penguin Group.

The lawsuit said the effort was a response to the success Amazon.com had in selling e-books for just under $10. The alleged conspiracy came as Apple was preparing to launch the iPad and called for Apple to be guaranteed a 30 percent commission on each e-book it sold, the lawsuit said.

"To effectuate their conspiracy, the publisher defendants teamed up with defendant Apple, which shared the same goal of restraining retail price competition in the sale of e-books," the lawsuit said.

Apple did not immediately respond to a comment request.

Macmillan Chief Executive Officer John Sargent said in a letter to authors, illustrators and agents that the company has not settled because it is "hard to settle a lawsuit when you know you have done no wrong."

He said: "Macmillan did not act illegally. Macmillan did not collude."

Sargent said the filing of the lawsuit came after discussions with the Department of Justice that lasted months.

"But the terms the DOJ demanded were too onerous. After careful consideration, we came to the conclusion that the terms could have allowed Amazon to recover the monopoly position it had been building before our switch to the agency model," he said. "We also felt the settlement the DOJ wanted to impose would have a very negative and long term impact on those who sell books for a living, from the largest chain stores to the smallest independents."

At the heart of the e-book pricing debate is the industry's ongoing concerns about Amazon. Publishers see the "agency model" as their best, short-term hope against preventing the online retailer from dominating the e-book market and driving down the price of books to a level unsustainable for publishers and booksellers.

Since launching the Kindle in 2007, Amazon has made a point of offering best-sellers for $9.99. The discount is so deep from list prices of $20 and more that it's widely believed Amazon is selling the e-books at a loss as a way of attracting more customers and forcing competitors to lower their prices. Amazon also has been demanding higher discounts from publishers and stopped offering e-books from the Independent Publishers Group, a Chicago-based distributor, after they couldn't agree to terms.

When Apple launched its tablet computer two years ago, publishers saw two ways to balance Amazon's power: Enough readers would prefer Apple's shiny tablet over the Kindle to cut into Amazon's sales and the agency model would stabilize prices.

Apple's iBookstore has yet to become a major force, but publishers believes the new price model has reduced Amazon's market share from around 90 percent to around 60 percent, with Barnes & Noble's Nook in second at 25 percent. The iBookstore is believed to have 10 to 15 percent.

Macmillan's Sargent has found himself at the heart of the dispute. In early 2010, as publishers were trying to get Amazon to agree to Apple's pricing system, Amazon pulled all the listings for Macmillan books, from Jonathan Franzen's "The Corrections" to Barbara Ehrenreich's "Nickle and Dimed." Sargent refused to back down and Amazon eventually gave in.

New e-books from Macmillan and the other publishers investigated by the Justice Department often are priced initially between $12.99 and $14.99, with Amazon making a point of noting that the price was set by the publisher. Ironically, publishers usually make less money off the agency model than the traditional one because they receive a smaller percentage of the proceeds.

Random House Inc. was the only "big six" publisher not to agree to the agency model in 2010 and was not part of the lawsuit. But the publisher of Dan Brown, John Grisham and others did agree to terms with Apple last year and now must decide whether to keep prices the same, cut them to keep up with competitors or drop the agency model altogether. Random House spokesman Stuart Applebaum -- the only of the big six publishers not involved in the case -- said Random would have no comments Wednesday.

According to court papers, the settlement agreement reached with three publishers said the companies agreed that for two years they will not restrict, limit or impede an e-book retailer's ability to set, alter or reduce the retail price of any electronic book. It said the retailers will be able to offer price discounts and other forms or promotions to encourage consumers to buy one or more electronic books.

The agreement also calls for the defendants not to enter into any agreement or conspiracy with any electronic-book publisher to raise, stabilize, fix, set or coordinate the retail price or wholesale price of any electronic book.

Finally, A National Database To Stop Criminals From Stealing Smartphones

As robberies of electronic gadgets continue to rise in cities around the nation, carriers can no longer just sit back and watch these crimes happen.

The Federal Communications Committee has announced its plans to work with four U.S. mobile operators to fight smartphone theft. The plan is to set up a centralized database system, which will be implemented in six months. Such a database will prevent stolen phones from being reactivated.

Chairman Julius Genachowski made an announcement with police chiefs and folks from the four wireless carriers -- AT&T, T-Mobile, Verizon, and Sprint -- that have 90 percent of U.S. subscribers. 

The point of a registry system is to deter the theft of smartphones and to keep smartphone data safe.

In New York, more than 40 percent of robberies involve smartphones and cell phones, according to the FCC. That rate is also true in urban sprawls around the country. It's even higher in cities like Washington D.C., where the rate is more than 50 percent.

The main issue with smartphone thefts is that when the gadgets are stolen, they can be resold at close to market value. Victims of robberies can't do anything to stop the phone from being used again because carriers allow stolen phones to be re-activated. It's a vicious cycle.

A database that keeps track of stolen phones has reduced crime in other parts of the world because there is no reason for criminals to resell an item that won't ever work.

"I wish that there could be a national registry for stolen devices. It could be a huge deterrent for iPhone thefts," one San Francisco officer who investigates these crimes recently told us.

There are always ways around it, GigaOM pointed out. The Unique Mobile Equipment Identify Number can be changed if a criminal is armed with the right tools.

Beyond implementing technology to deter the crimes, members of congress are discussing plans to introduce legislation that will make it a federal crime if someone messes with the hardware identifiers on wireless devices.

That would would make it trying to change the vehicle identification number on a car -- something only criminals would bother to do.

U.S. Senator Charles Schumer said, “If you steal a cellphone it will be a worthless endeavor. If you try to sell a stolen cellphone you will get caught.”

Better late than never, right?

T-Mobile breaks 1 million iPhone mark on EDGE

Amid AT&T’s new unlocking of their off-contract iPhones in collaboration with Apple officially, T-Mobile has chosen this opportune moment to announce that they’ve already got 1 million iPhone customers on their network. They do this with the micro-SIM cards they’ve already got available for sale separate from smartphones for their network along with lower prices than AT&T is offering, albeit with slower speeds for the uploading and downloading of data. Will the AT&T unlock wave bring them another batch of new users?
Speaking with 9to5Mac this week on the situation, T-Mobile has brought the game to the iPhone market with enticing pricing for families looking to bring on two or more iPhones, amongst other tasty price bits. With T-Mobile’s Value family plan they note you’ll get “unlimited talk, unlimited text and unlimited data with 2 GB of high-speed data is just $49.99 per line for two lines.”

This price of course seems like a fantastic deal when you see AT&T’s similar two-person family deal at $130. That price of course includes AT&T’s 3G network while your T-Mobile phones will be working with 2G or EDGE speed data, both of them significantly lower quality than AT&T’s 3G. That said, T-Mobile has noted that they’ll be adding HSPA+ (their version of 4G) to their 1900 MHz PCS spectrum. This means 4G for the iPhone.

Sound good to you? Let us know if you plan on making the switch! Also remember to check out these simple instructions for unlocking your off-contract AT&T iPhone to get this process started!

Flying car gets closer to reality with test flight, introduction to customers at New York show

                This obviously is not the flying car; no media photos are available yet, but the basic principle seen here is about the same.

Flying cars aren't just science fiction anymore.

Woburn, Massachusetts-based Terrafugia Inc. said Monday that its prototype flying car has completed its first flight, bringing the company closer to its goal of selling the flying car within the next year. The vehicle - dubbed the Transition - has two seats, four wheels and wings that fold up so it can be driven like a car. Last month, it flew at 1,400 feet (426 metres) for eight minutes. Commercial jets fly at 35,000 feet (10.668 metres).

Around 100 people have already put down a $10,000 deposit to get a Transition when they go on sale, and those numbers will likely rise after Terrafugia introduces the Transition to the public later this week at the New York Auto Show. But don't expect it to show up in too many driveways. It's expected to cost $279,000.

And it won't help if you're stuck in traffic. The car needs a runway.

The flying car has always had a special place in the American imagination. Inventors have been trying to make them since the 1930s, according to Robert Mann, an airline industry analyst who owns R.W. Mann & Co. in Port Washington, New York.

But Mann thinks Terrafugia has come closer than anyone to making the flying car a reality. The government has already granted the company's request to use special tires and glass that are lighter than normal automotive ones, to make it easier for the vehicle to fly. The government has also temporarily exempted the Transition from the requirement to equip vehicles with electronic stability control, which would add about six pounds (2.72 kilograms) to the vehicle. The Transition is currently going through a battery of automotive crash tests to make sure it meets federal safety standards.

Mann said Terrafugia was helped by the Federal Aviation Administration's decision five years ago to create a separate set of standards for light sport aircraft. The standards govern the size and speed of the plane and licensing requirements for pilots, which are less restrictive than requirements for pilots of larger planes. Terrafugia says an owner would need to pass a test and complete 20 hours of flying time to be able to fly the Transition, a relatively low hurdle for pilots.

The Transition can reach around 70 miles per hour (112 kph) on the road and 115 mph (185 kph) in the air, spokesman Steven Moscaritolo said. On the ground, it gets 35 miles per gallon (15 kilometres per litre).

Mann questions the size of the market for the Transition. The general aviation market has been in decline for two decades, he said, largely because of fuel costs and the high cost of liability for manufacturers. Also, fewer people are learning how to fly.

“This is not going to be an inexpensive aircraft to produce or market,” he said. “It has some uniqueness, and will get some sales, but the question is, could it ever be a profitable enterprise?”

Mann sees the western U.S. as the most likely market, where people could fly instead of driving long distances.

Terrafugia has been working on flying cars since 2006, and has already pushed back the launch once. Last summer the company said it would have to delay expected 2011 deliveries due to design challenges and problems with parts suppliers.

With the appearance in New York, the company hopes to attract the eye of customers as well as investors.

“We are introducing ourselves as a viable company to the automotive world,” Moscaritolo said.

Europe Opens Patent Investigations Into Motorola Mobility

     BRUSSELS — The European Union’s competition office on Tuesday opened two antitrust cases against Motorola Mobility for possible patent abuses following complaints by two rivals, Microsoft andApple.

        The cases mark the latest stage in what has become a full-blown battle over the ownership of essential technologies that help power mobile and gaming devices, a fight that has engulfed Google and other major players in the industry.  

         The European Commission opened two cases in order to look at separate allegations by Microsoft, which is concerned about access to video and wireless patents for its products including the Xbox, and by Apple, which is concerned about access to separate wireless patents for the iPhone and iPad.

Both Microsoft and Apple complained to the commission that they were victims of unfair licensing conditions and abusive litigation by Motorola Mobility.

The investigation will look at whether “Motorola has failed to honor its irrevocable commitments made to standard-setting organizations” to license its technologies to other companies on fair, reasonable and non-discriminatory terms, the commission said.

The cases could have consequences for Google, which is seeking final regulatory approvals for its purchase of Motorola Mobility to compete directly with its new archrival, Apple. Google’s deal, worth about $12.5 billion, cleared the biggest hurdles in the United States and the Union in February.

In a warning in February, Joaquín Almunia, the E.U. competition commissioner, said that his decision to clear Google’s deal for Motorola Mobility would not exonerate any wrongdoing concerning patents “by Motorola in the past or all future action by Google.”

The commission can fine companies up to 10 percent of their worldwide annual income if it finds them guilty of antitrust violations. But the way any such fines would be calculated would depend on which company owned Motorola Mobility at the time of the offenses. Determining which company would pay any such fines can often depend on the fine print of merger agreements. Motorola Mobility was split off from Motorola Inc. in January 2011.

The commission also has the power to require companies to change the way they do business. That, too, could have consequences for Google and its deal for Motorola Mobility.

“We haven’t finalized our acquisition of Motorola Mobility, but will work with the European Commission to answer any questions they might have,” said Al Verney, a spokesman for Google in Brussels. “We have longstanding concerns about patent abuses, including lawsuits and royalty demands targeting the Android ecosystem,” Mr. Verney added, referring to Google’s operating system for mobile devices.

But a prominent commentator on the issue, Florian Mueller, who also advises companies including Microsoft on patent issues, said in a blog posting that the decision Tuesday by Mr. Almunia to start a formal investigation into Motorola Mobility was a bad sign for Google.

“If and when Google closes the deal, it will effectively buy itself into two more E.U. antitrust investigations,” Mr. Mueller wrote. “It’s time for some people in Mountain View to realize that a multi-front war against competition authorities, on three continents in parallel, is a war that they won’t be able to win,” he wrote, referring to Google’s headquarters in California.

The commission is already investigating Samsung for the way it used standard, essential patents and for the way it sought injunctions against its competitors in national courts.

Samsung — a South Korean company that relies heavily on Android for many of its products — has been pursuing legal battles worldwide over the levels and fairness of fees it imposes on other companies for using patented technologies.