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HP split into two–HP Enterprise and HP Inc. (devices and printers)–for the growth phase of its turnaround

HP share price -- Sept 2011 - Oct 2014

HP share price — Sept 2011 – Oct 2014. Meg Whitman was named CEO on September 22, 2011. As well as renewing focus on HP’s Research & Development division, Whitman’s major decision during her first year as CEO has been to retain and recommit the firm to the PC business that her predecessor announced he was considering discarding (see the August 2011 post on this blog). After such “stabilization and foundation year” on October 03, 2012 she announced an ambitious 5-year turnaround strategy that promised new products by FY14 and finally growth by 2015.  This plan promised changes in HP’s four primary businesses. Enterprise Services got an entirely different operating model. Likewise the Enterprise Group planned to further utilize the cloud. The operating model of the Printing and Personal Systems Group was simplified by reducing its product line. A new cloud-based consumption model was implemented for the Software Group. With the split now  Meg Whitman writes  that “Hewlett-Packard Enterprise … will define the next generation of infrastructure, software, and services for the New Style of IT” while “HP Inc. will be extremely well-positioned to leverage its impressive portfolio and strong innovation pipeline across areas such as multi-function printing, Ink in the office, notebooks, mobile workstations, tablets and phablets, as well as 3-D printing and new computing experiences”. By separation into two they will “be able to accellerate the progress” they’ve made to date, “unlock additional value”, and “more aggressively go after the opportunities in front” of them.

Also seeing total 55,000 job cuts this year, with 45,000-50,000 cuts already done in Q2. CEO Meg Whitman (age 58) is enjoying huge bonus payments via those job cuts, and then she will lead HP Enterprise as CEO, as well as will become the non-executive Chairman of HP Inc.’s Board of Directors.

Detailed information on this blog about the new direction set up for Personal Systems Group part of HP Inc. (very few):

Latest news from HP Personal Systems Group:
– Revamped Z desktop and ZBook mobile workstations [Sept 10, 2014]
HP Stream series of skinny Windows 8.1 laptops and tablets targeted for the holidays [Sept 29, 2014]
– HP 10 Plus 10.1-Inch 16 GB Android Full HD IPS Tablet with Allwinner A31 quadcore 1.0 GHz on Amazon and elsewhere for $280  [July 13, 2014]
– HP Slate 21 – 21.5″-k100 All-in-One Full HD IPS Android PC with NVIDIA Tegra 4 for $400 [Sept 28, 2014] a 17″ version of which, HP Slate 17 will be hitting stores by New Year

Note that such large screen All-in-One Full HD IPS strategy for both desktop replacements as well as great home devices + complete flat tabletop mode for using an application that’s maybe multi-orientational was started with Windows 8-based HP ENVY Rove [June 23, 2013], using Intel® Core™ i3-4010U and now selling for $980.

Detailed information on this blog about the new direction set up for HP Enterprise (quite extensive and deep):


* Note here that as of now Microsoft Windows Server is not available (even the upcoming Windows Server 10 for “the Future of the datacenter from Microsoft“) on the emerging 64-bit ARM. See: Intel: ARM Server Competition ‘Imminent,’ But Not Yet There, Says MKM [Barrons.com, Oct 2, 2014], in which the current state characterized as:

ARM highlighted progress in servers by citing two data center end-customers (sharing the stage with Sandia Labs but not Paypal) that use HP blades for their Moonshot server chassis based on 64-bit Applied Micro (AMCC, NR, $6.90) and 32-bit Texas Instruments silicon.

HP Moonshot program and the 1st 64-bit ARM server (ARM TechCon 2014, Oct 1-3)

HP’s ARM-powered ProLiant m400 (Moonshot) is ready for DDR4 [ARM Connected Community, Oct 8, 2014]

AppliedMicro and Hewlett-Packard recently introduced the first commercially-available 64-bit ARMv8  server. Dubbed the ProLiant m400, the cartridge is specifically designed to fit HP’s Moonshot server framework. The new server – targeted at web caching workloads  – is based on AppliedMicro’s X-Gene System-on-a-Chip  (SoC) and runs Canonical’s versatile Ubuntu operating system.

… One of the key advantages of the X-Gene based m400? The doubling of addressable memory to 64GB per cartridge. … “You put 10 of these enclosures in a rack and you have 3,600 cores and 28 TB of memory to hook together to run a distributed application,” … “The m400 node burns about 55 watts with all of its components on the board, so a rack is in the neighborhood of 25 kilowatts across 450 nodes.” …

Loren Shalinsky, a Strategic Development Director at Rambus, points out that each ProLiant m400 cartridge is actually a fully contained server with its own dedicated memory, which, in the default launch version, carries a payload of DDR3L DIMMs.

“However, future generations of the cartridges can be upgraded from DDR3 to DDR4, without affecting the other cartridges in the rack. This should allow for even higher memory bandwidth and lower power consumption,” he added. “Our expectation is that DDR4 will ramp on the server side – both in terms of x86  and ARM – before finding its way into desktop PCs, laptops and consumer applications like digital TVs and set-top boxes.”

As we’ve previously discussed on Rambus Press , DDR4 memory delivers a 40-50 percent increase in bandwidth, along with a 35 percent reduction in power consumption compared to DDR3 memory, currently in servers. In addition, internal data transfers are faster with DDR4 , while in-memory applications such as databases – where a significant amount of processing takes place in DRAM – are expected to benefit as well.

Compare the above to what was written in Choosing chips for next-generation datacentres [ComputerWeekly.com, Sept 22, 2014]:

HP CEO Meg Whitman has high hopes for the company’s Moonshot low-energy server family as a differentiator in the commodity server market. Moonshot is based on Intel Atom and AMD Opteron system-on-a-chip (SoC) processors, optimised for desktop virtualisation and web content delivery applications. These servers can run Windows Server 2012 R2 or Red Hat, Canonical or Suse Linux distributions.

Semiconductor companies Cavium and Applied Micro are taking two different approaches to the ARM microserver market. Cavium is specialising in low-powered cores, while Applied Micro is taking a high-performance computing (HPC) approach.

AMD is building its chips based on the ARM Cortex-A57 core. … Servers with AMD’s Seattle [Opteron A-Series] ARM-based chip are not expected to ship until mid-2015.

Note here as well that AMD’s Seattle, i.e. Opteron A-Series strategy is also serving the company’s own dense server infrastructure strategy (going against HP’s Moonshot fabric solution) as described here earlier in AMD’s dense server strategy of mixing next-gen x86 Opterons with 64-bit ARM Cortex-A57 based Opterons on the SeaMicro Freedom™ fabric to disrupt the 2014 datacenter market using open source software (so far) [Dec 31, 2014 – Jan 28, 2014] post.

“HP has supported ARM’s standardization effort since its inception, recognizing the benefits of an extensible platform with value-added features,” said Dong Wei, HP fellow. “With the new SBSA specification [Server Base System Architecture from ARM], we are able to establish a simplified baseline for deploying ARM-based solutions and look forward to future HP [server] products based on the ARM architecture.”

 

Microsoft’s integrated solution for streaming video and Live TV providers on all devices, plus the upcoming live-action and “shared experience” TV of its own on Xbox

This is my finding as an update to the one of a year ago in “Microsoft entertainment as an affordable premium offering to be built on the basis of the Xbox console and Xbox LIVE services [Feb 13, 2013] OR create interactive content as a premium offering together with partners using Kinect technology as a starter OR moving Microsoft Xbox 360 to ‘entertainment console’ OR leaving the good quality commodities to others and going for a premium brand with Xbox as well”.

One cannot understand the Microsoft solution without first looking at:

  1. Cable and satellite video market (U.S. only)
  2. Pay-TV market (cable and satellite, IPTV, terrestrial)
  3. The overall TV market (home video, on demand video, linear TV)
  4. IPTV—AT&T U-verse TV and Verizon FiOS video in particular
  5. OTT (Over-the-top content)

Then the Microsoft solution could be presented as follows:

6.   Microsoft’s live TV solution on Xbox
7.   Preliminary information on the upcoming products from Xbox Entertainment Studios
8.   Xbox Music and Xbox Video services for other devices

Before all that, however, we should also understand a key trend that the Installed Base of Internet-Connected Video Devices to Exceed Global Population in 2017 [iSuppli press release, Oct 8, 2013] which is also showing the immense difficulty for the Microsoft effort:

More than 8 billion Internet-connected video devices will be installed worldwide in 2017, exceeding the population of the planet, according to research from  the Broadband Technology Service at IHS Inc. (NYSE: IHS).

The installed base of video-enabled devices that are connected to the Internet—a category that includes diverse product such as tablets, smart TVs, games consoles, smartphones, connected set-top boxes, Blu-ray players, and PCs—will expand to 8.2 billion units in 2017. This will represent a nearly 90 percent increase from 4.3 billion in 2013, as presented in the attached figure.

With the world’s population amounting to 7.4 billion people in 2017, this means that there will be 1.1 Internet-connected video devices installed for each global citizen.

image

“On average every human being in the world will possess more than one Internet-connected video device by the year 2017—a major milestone for the electronics market,” said Merrick Kingston, senior analyst, Broadband Technology, at IHS. “In practice, ownership of Internet-connected hardware will be concentrated among users whose homes are equipped with broadband connections. We’re quickly approaching a world where the average broadband household contains 10 connected, video-enabled devices. This means that each TV set installed in a broadband-equipped home will be surrounded by three Internet-connected devices.”
Asia-Pacific gets connected
The number of connected devices in the mature North American and Western European regions will grow at a relatively modest compound annual growth rate (CAGR) of 10 percent from 2013 to 2017.
In contrast, Asia-Pacific will expand at 20 percent during the same period. Driven largely by Chinese demand, Asia-Pacific will add 1.9 billion connected devices to the global installed base between 2013 and 2017.
On the other end of the regional spectrum, sub-Saharan Africa will contribute 145 million net additions to the total installed base during the next four years.

Challenges and opportunities

In order to cash in on this massive growth in Internet-connected devices, media companies across the operator, broadcast, consumer electronics manufacturing and over-the-top (OTT) businesses have embraced Internet protocol (IP) video distribution. Big names making a foray into IP video include HBO, Microsoft, DirecTV and Netflix.

However, all of these companies face a major challenge: how to wrap consumers into their ecosystems, given the proliferation of platforms, high switching costs and strong incentives for consumers to stay with their existing services.

Back in 2005, PCs comprised 93 percent of all connected devices. By the end of 2017, the base of connected devices will diversify dramatically, with PCs comprising only 23 percent of the connected installed base. Other devices will account for the rest of the market, including smart TVs at 5 percent, consoles  at 2 percent, and smartphones and tablets collectively representing 67 percent.
“Addressing the full breadth of the device landscape, and recuperating the development cost of doing so, will pose a major challenge for a number of media firms,” Kingston added.

1. Cable and satellite video market (U.S. only)

Let’s start with a list of cable and satellite video providers in the U.S.:

image
The chart is from Would a DirecTV-DISH Merger Still Make a New Pay-TV Media Monopoly?
[24/7 Wall St., Oct 10, 2013]. Note that Newco is the DirectTV-DISH merged company
just imagined by the article
. The actual Top 5 companies represented 75.4% of the U.S.
cable and satellite video subscribers: 35.6% satellite (newco) and 39.8% cable.
Relative to that Verizon FIOS video IPTV had 4.7M subscribers and
AT&T U-verse [IP]TV 4.5M by the end of Q4’12 (see below).

See also (in order to understand the challenges cable operators are facing everywhere):
TWC rebuffs Charter’s latest takeover bid [[IHS] Screen Digest commentary, Jan 14, 2014] with “The saga to create the nation’s second largest cable operation is moving into a new phase … With so many sharks circling TWC, IHS believes that it will be a matter of not if but when TWC accepts a bid.”
Time Warner Cable prepares for its business future [[IHS] Screen Digest commentary, Oct 8, 2013] with “TWC and other cable operators are in the unenviable position of seeing their primary product, pay TV video, declining. Coupled with encroachment from IPTV, and potential upstart OTT technologies, cable operators are pushing to grow other business lines. … Staying ahead of the technological curve is a problem for all pay TV operators, and cable more than IPTV, with Satellite experiencing the worst of it.
Netflix added to Virgin’s TiVo platform [[IHS] Screen Digest commentary, Sept 10, 2013] with “UK cable company Virgin Media has signed what is effectively an OTT carriage deal with Netflix to bring the streaming service onto the Virgin TiVo platform. Groundbreaking move is the first deal of its type and indicates a change in the positioning of Netflix and the competitive positioning of OTT against ‘traditional’ pay TV. … that more firmly positions Netflix as a content aggregator (read: channel) rather than a platform and opens the door for similar deals internationally. Move vindicates our long-held view that this was the correct way to position Netflix and other OTT content aggregators.

Cable takes the fight to OTT [[IHS] Screen Digest commentary, Oct 28, 2013]

After years of subscriber losses, Comcast announced on October 25, 2013, the first widespread test of a cable network lite bundle, the combination high-speed data (HSD) and broadcast basic video and premium channel. The trial is slated to run a minimum of one year, the operator plans to have stepped increases in the starter $49.99 per month price at 6 months ($60-$70) and again at one year ($70+).
This is not the first such offering however. In August of 2013 Time Warner Cable (TWC) initiated a similar promotion targeted at transitioning college students back toward video products, including HBO and HSD. TWC partnered with nine colleges in this limited trial, again the term is likely to run for a year or less. TWC is charging $79.99 per month for one year, but did not list a non-promotional price.
In the following analysis IHS makes two assumptions: 1) That cord-cutting and cord-never households will likely buy HSD from pay TV providers, and that it will skew toward higher speed tiers. 2) The price for bundled 25-30Mbit is ~$55 and unbundled ~$60.
Our take
The fact that the business of pay TV is  changing is no longer in doubt, but the business has insulated itself well and is preparing to weather the storm. Comcast and TWC are not the first to experiment with new offerings, Cox recently concluded its flareWatch trial, the first pay TV OTT trial. The difference between the Cox effort and Comcast and TWC is that the two latter companies have price efficiencies working  on their side.
That’s not to say that IHS believes that the Cox trial was ended because of price, more likely Cox received valuable customer feedback and experience. The Comcast and TWC deals are predicated on completely different foundations. Both offerings provide significant perceived value, and combined monetary value to subscribers.
Both deals compare to a HSD and Netflix and/or Hulu+ plan. The Netflix/Hulu+ plan will likely cost $68 to $76 depending upon HSD tier and number of OTT subscriptions, compared with Comcast’s year one monthly average of $60 and TWC’s $70. Another significant point of difference is the depth of offering.
Both pay TV providers share four common features, 25-30Mbit HSD, local broadcast channels, HBO, HBO GOComcast also includes StreamPix (Library title Subscription VOD). IHS believes that both Comcast and TWC are at a minimum matching Netflix on a like-for-like price content offering when considering HSD and HBO versus HSD and Netflix/Hulu+. The addition of broadcast local channels as well as SVOD in the case of Comcast, signal that cable is not going to give up the fight.

2. Pay-TV market (cable and satellite, IPTV, terrestrial)

Then, according to Worldwide pay-TV Subscribers to Exceed 1.1 Billion in 2019 with Increasing IPTV Market Share [ABI Research, Jan 22, 2014]

imageWorldwide pay-TV market reached 903.3 million subscribers in 2013, generating $249.8 billion in service revenue. IPTV operators enjoyed significant growth (18.5% YoY) in 2013 to 92 million subscribers with a total of $37.2 billion in service revenue.
“Increasing FTTH [Fiber To The Home] subscriber base and bundled subscriber base of telcos are boosting the IPTV market. ABI Research forecasts that the IPTV subscriber base will grow to 161 million subscribers in 2019 accounting for 15% of overall pay-TV market,” comments Jake Saunders, VP and practice director of core forecasting.
The global terrestrial TV market reached 9.5 million subscribers at the end of 2013. A declining pay DTT subscriber base in Italy and Spain had an impact on the overall Western European DTT market which dropped around 5% in 2013. Unlike Western Europe, the DTT market in Africa grew a remarkable 45% to 2.1 million subscribers in 2013. “As African countries start to switch over to digital, digital terrestrial TV has become an affordable alternative to satellite TV service in the region. ABI Research forecasts that Africa will have over 4.8 million DTT subscribers in 2019,” adds Khin Sandi Lynn, industry analyst.
DirecTV maintains its largest market share in terms of pay-TV service revenue. The company had around 20.2 million subscribers in the US with an ARPU above $102 by the end of 3Q-2013. Globally, the pay-TV market is expected to grow to 1.1 billion subscribers with $320.3 billion in service revenue in 2019.

3. The overall TV market (home video, on demand video, linear TV)

Or a broader view representing all other segments of the TV market as well:
Global TV market revenue to grow at a steady pace: up 23% by 2018
[DigiWorld by IDATE blog, Jan 30, 2014] by Florence Le Borgne
Head of the TV & Digital content Practice, IDATE.

At a time when video has become pervasive across all of our screens, most national TV markets are losing steam: shrinking viewership and pressure on advertising markets, especially in Europe. Although pay-TV seems to be holding its own, the fast-growing popularity of OTT offerings is shaking up the traditional pay-TV model, while the demise of physical media is virtually a foregone conclusion.
If the decline of physical media now seems inevitable, television still has a chance to reinvent itself in a way that takes into account changes in viewer behaviour and competition from new online vendors.
Accessing TV
According to IDATE, the number of TV households worldwide will reach 1.675 billion in 2018 (+9.6% in 5 years), with the number of digital TV households worldwide being 1.542 billion in 2018, which translates into 92% of TV households
  • Cable will the remain the chief access channel (592.3 million households in 2018) but will gradually lose ground to satellite and IPTV which will account for 32.9% and 10.9% of TV households, respectively, at the end of 2018.
  • Despite the development of hybrid TV solutions, terrestrial TV should continue its decline on the first TV set and drop down to number three spot by 2018, with roughly 21% share of the global market.
  • The development of hybrid solutions that combine live programming on broadcast networks (terrestrial and DTH) and OTT video services over the open Web is a key variable in the future development of the various TV access modes, and may well shake up current trends.
TV: top money-maker
Breakdown of audiovisual market revenue in 2013

image 

TV revenue
According to IDATE, the global TV industry’s revenue will come to €374.8 billion in 2013 and €459.2 billion in 2018.
  • Pay-TV revenue will grow by 21.3% between 2013 and 2018, or by an average 3.9% annually, to reach €220.2 billion in 2018.
  • Ad revenue will enjoy even stronger growth of 27.3% between 2013 and 2018, to reach €201.1 billion in 2018.
  • Public financing/licensing fees will continue to increase significantly (+7.7% in 5 years) to reach nearly €38 billion in 2018.
Video revenue
According to IDATE, physical media sales will total €16.3 billion in 2018, when video on demand (VoD) revenue will reach €35.4 billion in 2018, which is 90% more than in 2013.
  • This means that the global market will have shrunk to more than a quarter of what it was in 2013 (-27.2%).
  • Blu-ray will be the most common format and help temper plummeting physical media sales.
  • OTT video will continue to be the biggest earner, generating 51% of total revenue.
  • VoD will still be the dominant model on managed networks. It will generate €6.9 billion in 2018 versus €2.3 billion for subscription video on demand (S-VoD).
American OTT video providers’ footprint in Europe as of 31 December 2013
image
Source: IDATE, December 2013
American OTT vendors already have a solid foothold in Europe
Netflix is already present in seven European countries: Britain, Ireland, the Netherlands, Denmark, Norway, Finland and Sweden. The service had 1.6 million subscribers in the UK and Ireland at the end of 2013.
  • LoveFilm was reporting 1.9 million subscribers in the UK and Germany at the end of 2013.
  • At the end of 2013, iTunes’ VoD rental service was available in close to 110 countries, and permanent downloads in 14 countries, chiefly in North America and Europe.
More information on TV and new video services market report & database

UK Video Rental Market Plunges in 2013 as Half of Country’s Blockbuster Stores Close [IHS iSuppli press release, April 23, 2013]

The market for Blu-ray (BD) and DVD rental in the United Kingdom is expected to plunge by 22 percent in 2013, as half the country’s Blockbuster video stores shut down in a restructuring initiated by the company’s new management.
The U.K. market for physical-video rental will drop to £202 million in 2013, down £57 million, or 22 percent from £259 million in 2012, according to a newly updated forecast from IHS (NYSE: IHS) . While the market is generally on the decline, 2013 will bring the sharpest predicted annual decrease for the 11-year period from 2007 through 2017.

image

By the end of 2013, only 264 Blockbuster stores will be open in the country, down 50 percent from 530 in 2012. Blockbuster is the largest video rental chain in the country.
“The year 2013 is set to become a watershed for the U.K. video rental market as a result of the wholesale closure of Blockbuster UK stores,” said Tony Gunnarsson, senior video analyst at IHS. “The massive downturn in the store-based video rental market represents a significant loss to the video market and will result in a major decline and radical transformation of the U.K. video market overall. From 2013 on, the U.K. physical-video rental business increasingly will be dominated by online rent-by-mail subscription services.”
Both DVD and BD transactions are due to decrease across the store-based sector this year. DVD rentals will fall by a steep 53.2 percent to 15.4 million. BD is set to drop by an even larger 61.3 percent to 2.8 million respectively.
Blockbuster gets busted up
After filing for administration in January 2013, Blockbuster’s administrators Deloitte announced two separate rounds of store closures, including some 224 sites. In February 2013, supermarket chain Morrisons purchased 49 of these former Blockbuster stores in its drive to increase its store presence in southeast England.
Out of the remaining Blockbuster stores, Gordon Brothers acquired a total of 264 locations, including a number of Blockbuster outlets earmarked for closure that will now remain open.
Pay-TV killed the video store
In 2012, rental stores were responsible for 41.3 percent of the video rental market based on consumer spending. In the latest forecast for 2013, however, the store-based sector is now projected to generate just 24.7 percent of the overall market. This tilts the market toward the online sector, which will see its share of market increase massively from 58.7 percent in 2012 to 75.3 percent this year.
At the same time, the lost rental business won’t result in customers that used to rent at Blockbusters automatically signing up to become rent-by-mail customers with online providers, IHS believes. Rather, those customers are more likely to turn to a host of other video platforms, primarily pay-TV services.
Video rental market winds down
In the longer view, the U.K. rental market will return to a normal trend of decline after 2013, with spending on renting physical video shrinking at an annual rate of under 5 percent until 2017. By then, the retreat in spending is expected to be slightly more negative at 7 percent.

4. IPTV—AT&T U-verse TV and Verizon FiOS video in particular

As far as the U.S. is concerned AT&T U-verse TV and Verizon FiOS video are the leading IPTV services by far*, having 5.5 million and 5.3 million subscribers respectively, which is 11.7% of the above 92 million subscribers number by ABI Research:

image* The next service provider, CenturyLink “Ended the quarter with 149,000 CenturyLink® PrismTM TV subscribers, an increase of approximately 17,000 subscribers in third quarter 2013” according to its Q3 203 report [Nov 6, 2013]. CenturyLink only entered five U.S. markets after acquiring Embarq (2009) and Qwest (2010). In fact no other U.S. providers are in the Top 20 globally according to SNL Kagan Reports World’S 20 Largest IPTV Operators Served 83% of Global IPTV Households at End-2012 [June 6, 2013]. More:
– China’s leading telcos– China Telecom and China Unicom– serve an estimated 30% of the global IPTV subscriber base.
– Asian telcos accounted for 49.2% of the top 20’s IPTV subscribers in 2012, reflecting the region’s large market size and limited telco competition.
– France — the second-largest IPTV market by subscribers after China — is home to four operators ranked among the global top 20. [
Note that among Top 5 are Iliad and France Telecom. Iliad’s Freebox TV offering proposes a broad selection of TV channels (over 450, of which more than 200 are included in the basic package), as well as numerous audiovisual services, such as catch-up TV (with 45 channels available on Freebox Replay), and a wide video-on-demand offering. It was actually the largest IPTV deployment in the world with 2.4 million IPTV-enabled customers as of end 2007 (see here).]
– Nine operators out of 20 are located in Western Europe and seven in Asia
.

U-verse® Drives Wireline Consumer Growth and Broadband Gains

  • Wireline consumer revenue growth of 2.9 percent versus the year-earlier period
  • Total U-verse revenues, including business, up 27.9 percent year over year, now a $13 billion annualized revenue stream
  • 10.7 million total U-verse subscribers (TV and high speed Internet) in service:
    • 630,000 high speed Internet subscriber net adds; record annual net adds of 2.7 million
    • 194,000 U-verse TV subscribers added, lowest churn in product history
  • Continued U-verse broadband gains in the business customer segment, up 78,000, nearly doubling year-ago net adds
  • Strategic business services growth accelerates with revenues up 17.4 percent year over year, now more than 25 percent of wireline business revenues

Record-Low U-verse TV Churn. Total U-verse subscribers (TV and high speed Internet) reached 10.7 million in the fourth quarter. U-verse TV had the lowest-ever churn in its history. U-verse TV added 194,000 subscribers in the fourth quarter with an increase of 924,000 for the full year to reach 5.5 million in service. AT&T has more pay TV subscribers than any other telecommunications company.

U-verse TV penetration of customer locations continues to grow and was at 21 percent at the end of the fourth quarter.

image

Note that after AT&T Extends TV Watching to More Devices with Launch of U-verse TV on Xbox 360 [press release, Oct 11, 2010] and even after New U-verse Internet Customers Can Take Their Pick: A Free Xbox 360, SONOS PLAY:3, Kindle Fire or Nexus 7 Tablet [press release, March 18, 2013] that Xbox tie-up ended with AT&T U-verse TV To Drop Support For Xbox 360 on December 31 [Multichannel, Nov 26, 2013]:

“We’ve made this decision due to low customer demand,” an AT&T spokeswoman said via email on Tuesday. AT&T declined to say how many customers currently use the Xbox 360 as a set-top. … AT&T, the spokeswoman added, currently has no plans to support U-verse TV on the Xbox One. Verizon Communications FiOS TV is the first, and so far only, U.S. pay-TV provider to offer an authenticated app for the Xbox One during its initial launch phase.

In FiOS video we added 92,000 new subscribers in the quarter. Total FiOS videos customers reached 5.3 million, representing 35% penetration.

As far as the OnCue acquisition [from Intel, i.e. the Intel Media operation], look, the focus here is really to accelerate the availability of the next-generation IP video service which we will integrate into the FiOS video service. And really what we are trying to do is differentiate this even more so with fiber to the home versus others with the TV offerings and reducing the deployment costs. And this really accelerates us from if we were trying to build IP TV versus buying the IP TV technology.

From an FiOS customer perspective, we expect the benefits that they will have more elegant search and discovery activity and cost stream ease of use. But also keep in mind, with the acquisition of Verizon Wireless and becoming 100% ownership of that we also plan to take that platform and integrate it more deeply with our Verizon Wireless 4G LTE network. So that really was the strategy behind this.

As far as would we enable this platform to take us over the top, obviously we have our video digital media services that we have been working on for 2.5 years. We’ve just made two acquisitions related to that platform. So, look, we are positioning ourselves strategically to be in a position to competitively compete around the whole mobile first world and video, so I think that is where we are.

image

Pay-TV Operators Can Stave Off OTT Threat with Multiscreen and CDN Investments [iSuppli press release, April 17, 2013]

Despite the dire competitive threat posed by over-the-top (OTT) services, pay-TV operators can thrive by investing in additional service offerings that should include multiscreen services to more than make up for the erosion in their customer base, according to the IHS Screen Digest TV Intelligence Service from information and analytics provider IHS (NYSE: IHS).

Speaking here today at the IHS PEVE Entertainment 2013 Conference, Guy Bisson, research director for television at IHS, noted that although European cable operators have lost 1.4 million households, they have gained 17.8 more revenue-generating units (RGUs), during the five-year period from 2007 through 2012.

While cable operators in Europe and other regions are expected to lose more households in the coming years, RGUs will continue to increase, driving revenue growth for the industry. The below figure presents the IHS history and forecast of cable households and RGUs for the 27 countries of the European Union.

5. OTT (Over-the-top content)

OTT and IPTV Integration Increasingly Popular [Pyramid Points, Nov 27, 2012]

How do you plan to spend your evening most times when you order a pizza? You’re very likely to watch a video.
In the UK, Domino’s Pizza Group saw the value of over-the-top (OTT) online video to boost customer loyalty, and back in October launched the Domino’s Pizza Box Office video streaming offer. Customers order a pizza and get a download code to stream a movie at home. This is just another example of how OTT is revolutionizing the way video content is delivered to consumers: Today almost anyone can become a content provider.
Exhibit: Evolving video delivery environment and video platforms
image
Source: Pyramid Research

Many operators see the proliferation of OTT as a threat to their established IPTV business models. They fear that OTT will subvert their role in the pay-TV value chain and cannibalize revenue. We’ve found, however, that the opposite is just as likely to be true. In our new report, “OTT Growth Sparks Innovation Multiscreen Video Business Models,” we argue that OTT is serving as an innovation stimulus for the pay-TV market, pushing telcos to enhance their IPTV services with more screens. We also find that an increasing number of operators, alongside their managed IPTV services, are directly entering into non-managed OTT environments. This means that more operators are using the open Internet to offer video services to potentially any consumer with a broadband connectivity, being their existing customers or not.

OTT in emerging markets: Challenges and opportunities
Operators are warming up to the idea of launching their own OTT services, especially in emerging markets. While IPTV remains a premium service, which requires subscribers to purchase more expensive bundles, OTT is more flexible and only requires a good broadband connection. This means that in the more price-sensitive markets, where there is still strong demand for online video, OTT is becoming an attractive option for users. Besides, OTT services are typically delivered over a wide range of screens and at different price points, including smartphones, tablets and gaming consoles, making them more accessible to different consumer profiles.
In Colombia, for example, ETB has announced that it will shortly launch an OTT service to complement its upcoming IPTV deployment. In Mexico, the OTT service provided by fiber-to-the-home (FTTH) operator Totalplay, dubbed Totalmovie, has rapidly become the main competitor to Netflix. It offers video content in Mexico alongside the operators’ IPTV platform and across Latin America by using third-party operator infrastructure. As of October, it had 1.9m registered users and 5m unique monthly visitors.
We expect to see more Latin American operators launching OTT services. The second largest regional group, Telefonica, is considering positioning OTT commercial offers in several countries. The decision between managed (IPTV) or unmanaged video delivery (OTT) ultimately depends on each country’s infrastructure, competitive environment and operator position. Telefonica has, however, confirmed that there are already ongoing OTT initiatives outside Spain.
In Turkey, TTNET, the ISP of fixed-line incumbent Turk Telekom, has already been quite successful in combining its IPTV and OTT offerings. TTNET wants to add value to the bundles, which in turns helps increase customer loyalty and reduce churn. This is crucial in preventing the decline of Turk Telekom’s fixed-line base. While IPTV is positioned as a premium service, OTT is priced very competitively. As of August this year, TTNET had over 1.2m OTT and 150,000 IPTV subscriptions.
OTT can provide significant benefits to operators. In the case of TTNET, positioning OTT alongside IPTV is encouraging consumers to break through their broadband allowances, thus creating the need to migrate to higher-value packages. In the case of Totalplay in Mexico, OTT is contributing to the monetization of the operator’s superfast fiber-based network. For both operators, using third-party infrastructure breaks the link between content delivery and network management.

The outlook is positive

In the near future, we expect to see significant revenue-generating opportunities associated with VoD, catch-up TV, and targeted advertising, especially when telcos can integrate their OTT and IPTV offerings with interactive and social media functions.

Using the open Internet for content delivery, however, has its downsides. The main shortcoming with OTT is that the operator is not in control of quality of service (QoS). Especially in emerging markets, quality of service and network speeds vary wildly from country to country, making it challenging to ensure the same quality of experience (QoE) that can be guaranteed through a managed IPTV network. Another challenge for operators is securing in-demand content for OTT platforms. Without doubt content is king, but content is also costly. Unless they are backed by multimedia and broadcasting groups, operators tend to be the weak link in the content production and delivery value chain. But that is a challenge with IPTV too.

All in all, if telcos are serious about developing a pay-TV offering that can resonate with the demand for multiple viewing platforms at different price levels, they need to seriously consider the opportunity of complementing IPTV platforms with OTT.

— Daniele Tricarico, Analyst

More information from Pyramid Research:
Is the Arab World Ready for OTT Video? [Sept 13, 2013]
CDNs Offer New OTT Revenue Hope [Feb 20, 2013]
Chinese Regulator Opens Up to MVNOs [mobile virtual network operators] [March 15, 2013]

Finally here is a list of Top 10 Online Streaming Video Services [tom’sGUIDE, Jan 1, 2014] in the U.S. in order to understand the state-of-the-art of OTT video services:

Digital video options

Streaming video has just about displaced the DVD on the list of home entertainment options, and it may supersede cable and broadcast TV in the near future. Every modern computer has access to streaming video services, as do most game consoles and mobile devices, and even a growing proportion of televisions. Whether you’re looking to get your feet wet or expand your streaming horizons, check out 10 of the best services for watching movies, TV, music videos, Web shows and more.

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Netflix

Netflix is the most popular video streaming service out there, and with good reason. The service is available on just about every platform, including computers, game consoles, set-top boxes and mobile devices, and it hosts movies and TV shows to accommodate every taste. From hit films like “The Avengers” to every “Star Trek” TV series to original programming like “Orange Is the New Black,” Netflix’s variety of content is unparalleled. You can even share an account among five different users to keep recommendations and viewing habits separate. Netflix costs $8 per month.

Inserts of mine:
Netflix added to Virgin’s TiVo platform [[IHS] Screen Digest commentary, Sept 10, 2013] with “UK cable company Virgin Media has signed what is effectively an OTT carriage deal with Netflix to bring the streaming service onto the Virgin TiVo platform. Groundbreaking move is the first deal of its type and indicates a change in the positioning of Netflix and the competitive positioning of OTT against ‘traditional’ pay TV. … that more firmly positions Netflix as a content aggregator (read: channel) rather than a platform and opens the door for similar deals internationally. Move vindicates our long-held view that this was the correct way to position Netflix and other OTT content aggregators.
Netflix passes 38m paying ‘streaming’ subscribers [[IHS] Screen Digest commentary, Oct 22, 2013] with:

Netflix’s total number of paid streaming subscribers increased by 2.4m over the quarter, to reach 29.9m subscribers in the United States and 8.1m subscribers internationally. The international streaming service saw a larger than expected increase of free trialists to 1.1m driven by Latin America and the September launch of the service in the Netherlands.
The third quarter of 2013 is a significant milestone for Netflix, as the quarter in which the Netflix US streaming subscriber count pulled even with the US subscriber count of pay TV giant HBO. The company ended the quarter just shy of 30 million streaming subscribers with estimates for HBO at roughly the same level.
The comparison with HBO is the most appropriate for companies such as Netflix, Amazon and Hulu‘s subscription service, rather than with the pay TV operators. Netflix, as well as Hulu Plus and Amazon, are acting as premium channels in investing in acquired and original content and following in HBO’s early-1990s footsteps. Despite the investment Netflix has made in its own original programming, the company has reported that a greater percentage of overall viewing on the platform is of previous-season TV episodes and catalogue movies. Netflix indicates that it plans to double its investment in original content in 2014, although this will still represent less than 10per cent of global content expenditure.
Netflix’s international business remained a loss-making venture as the company struggles to gain profitability without scale and without a legacy high margin physical business. Whereas in the US the company initially bundled its streaming proposition with disc rentals add value to the physical subscription Netflix has not had a preexisting business from which to launch a digital subscription internationally. At present, the international ventures are subsidized by domestic market return and with ongoing market expansions planned by Netflix; IHS does not expect this to change in the mid-term.

End od my inserts for Netflix

Hulu Plus

If you want to catch TV shows almost as soon as they air, Hulu Plus may be right for you. This streaming service hosts a plethora of TV shows and movies. Whether you want to watch “Leverage,” “Family Guy” or “Spongebob Squarepants,” Hulu generally posts new episodes within days of their airing on TV. Hulu Plus costs $8 per month (with some shows available only on computers for free), and provides past seasons of shows along with Hulu’s original programs. It is available on computers, game consoles, streaming boxes and mobiles.

Amazon Prime Instant Video

Amazon Prime Instant Video is a streaming service that comes with an Amazon Prime subscription. In addition to offering free shipping on Amazon orders and free Kindle books to borrow, Amazon Prime allows subscribers to access approximately 40,000 movies and TV shows. In addition to unlimited streaming offerings, users can rent and buy other TV shows and movies a la carte. This makes Amazon Instant Video a good choice for watching newer movies before they touch down on unlimited streaming services like Netflix. Amazon Prime costs $79 per year.

See also: Amazon may hike Prime cost as earnings disappoint and further challenges lay ahead of the company for which it needs to adjust its business model and expand its operations [‘Experiencing the Cloud’, Jan 31, 2014]

M-Go

If you’re not interested in paying a monthly fee for your streaming video content, M-Go might be up your alley. M-Go, which is the default streaming service on Roku boxes and also available on computers and mobile devices, allows you to rent and buy TV shows and movies. Prices range from $2 for individual TV episodes to $20 for HD movie purchases. M-Go excels in offering both HD and SD versions of content, making it an attractive choice if you want a one-off rental.

Blip

Watching big-budget movies and TV is all well and good, but for curated, original Web shows from charismatic creators, nothing fits the bill like Blip. Think of Blip as a more curated, creator-friendly version of YouTube. Individuals create and upload original series, ranging from comedy to reviews to funny pet videos, and Blip ensures that the content has professional production values and that new entries are added regularly. All content on Blip is free, and you can access it via your computer, mobile device or Xbox 360.

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Vevo

MTV hasn’t played music videos since the ’90s, but the medium is not dead just yet. Vevo hosts the latest music videos from artists ranging from Katy Perry to Old Crow Medicine Show, but audiophiles would be wise to stick around for its scads of original content. Users can access biographies, retrospectives, behind-the-scenes footage and interviews about their favorite musicians, and curated playlists for both individual artists and entire genres. Vevo is free, and available on computers, mobile devices, Rokus, Apple TVs and Xbox 360s.

MLB.TV

If you’re a baseball fan, you’re in luck: Major League Baseball‘s streaming service is one of the best in professional sports. MLB.TV allows viewers to watch most games during the regular MLB season. (Postseason games are available through the Postseason.TV service at additional cost.) Fans can watch both home and away games from anywhere in the world. Stat junkies can examine each pitch as it happens and compare their fantasy teams in real time. MLB.TV costs $130 per year and is available on computers, mobile devices, set-top boxes, Xbox 360s and PS3s.

Crackle

If you crave pop cinema, Crackle could be the best thing to happen to your TV since afternoon basic cable. The Crackle service offers a rotating selection of a few hundred movies and TV shows, including “Ghostbusters,” “The Cable Guy” and “The Shield.” Crackle also creates and hosts original content, ranging from espionage thriller serials to “Comedians in Cars Getting Coffee” starring Jerry Seinfeld. Crackle is free (though you’ll have to watch some commercials) and available on computers, mobile devices, set-top boxes and game consoles.

Twitch

Watching other people play video games is, surprisingly, almost as much fun as playing yourself — sometimes more so, if you have a good host. Twitch is a platform for gamers to livestream their play sessions. You can find streams of everything from “League of Legends” to “Minecraft.” Whether you want to see tutorials, speed runs or popular Web personalities’ reviews, Twitch has you covered. The service is free, both to watch and to stream your own sessions. Twitch is available on computers, mobile devices, set-top boxes and PS4s.

YouTube

The biggest video streaming service online is just about unbeatable when it comes to variety of content. YouTube is the go-to site to upload short videos: cats, clips from your favorite TV programs, cats, original Web shows, cats, movie trailers, cats and more. The service will be one of the first to support content for the higher-resolution 4K TVs. If you’re looking to watch short-form videos, this is the place to start. YouTube is free and available on just about every device with a screen and an Internet connection.

Discovery to take majority control of Eurosport [[IHS] Screen Digest commentary, Jan 22, 2014]

Discovery Communications has agreed to take a controlling interest in Eurosport International, the pan-European sports channel, from its partner TF1 Group [of France]. … Discovery, which primarily operates a portfolio of factual channels in Europe, has branched out in recent years with the acquisitions of SBS Nordic in Scandinavia and Italy’s Switchover Media. It now has the option to acquire 100% of Eurosport International and could also increase its interest in Eurosport France, though TF1 expects to retain its 80% interest until at least 1 January 2015.
The US group‘s move to take control of Eurosport is, as the company noted yesterday, taking place a year sooner than originally planned. While sports is clearly a new playing field for Discovery, the male-skewing profile of Eurosport is a good fit with its factual channel brands, offering possibilities for combining advertising and network sales. To date, co-operation has focused on markets where Eurosport is not present, notably the US and China. In the US, Discovery has been showcasing Eurosport rally and superbike programming on its Velocity channel.
A further move into the US appears unlikely given the presence of ESPN and powerful rivals like Fox Sports, NBC Sports and CBS. Fox Sports in particular has recently made strong moves into the international market place. Outside the US, Eurosport successfully occupies a niche where it is not competing with premium pay operators like BSkyB, Canal Plus and Sky Italia for high cost events like league football, but instead focuses on lower profile events where rights are often shared with local free-to-air broadcasters.
The main uncertainty over Eurosport’s change of ownership surrounds its content supply from the European Broadcasting Union (EBU), which provides hundreds of hours of events like cycling, grand slam tennis, winter sports and athletics. TF1 is an EBU member, but with Discovery holding the reins, this arrangement will almost certainly have to be renegotiated, with possible implications for Eurosport’s cost base. Even now, there appears to be room for improvement: Discovery’s operating margin for its international operations was 44% in 2012, compared to a slender 14% for Eurosport International.

Sky sees future in OTT as upsell becomes focus [[IHS] Screen Digest commentary, July 26, 2013]

Sky [more precisely BSkyB] added more Now TV customers in the quarter to end June 2013 than new satellite customers and is increasingly pushing OTT access and connected devices as the core of its future growth strategy. In calendar second quarter (Sky’s fiscal Q4), the pay TV provider added 34,000 new TV customers to reach 10.442m and said the ‘bulk’ of TV growth came from OTT service Now TV. Organic growth for broadband stood at 119,000 (25 per cent more than BT added in the same quarter) with a further 400,000 added through the acquisition of O2’s UK broadband operations to reach 4.9m. Telephony grew 140,000 organically with 153,000 coming from O2 to reach 4.5m. The number of HD subscribers grew 117,000 to reach 4.789m or 46 per cent of the TV base, with 2.7m HD boxes connected to broadband. Annualised ARPU hit £577 up £29 in the year.
Sky said that its future strategy would focus on becoming the centre of the connected home across a range of content windows that would increasingly include DVD window for paid on-demand and movie retail as well as the traditional subscription window. The move comes on the back of impressive figures for on-demand and OTT content subscription with a three fold increase in Sky Store (on-demand) revenue and 166,000 customers paying £5 a month for the Sky Go Extra service that allows content download to mobile devices. Sky said that, on average, Sky homes have seven connected devices and that content access inside and outside the home was increasingly important to its offer. The operator said it had concluded four new studio deals with a wider range of rights to service this market and would prioritise getting its customer base connected. The new Sky HD box now comes with built in Wi-Fi and a new low-cost wireless connector is being made available. Sky also released a new Now TV box priced at £9.99 when a Now TV subscription is taken, the device also enables Smart TV functionality and is targeted at the 13m Freeview [a free-to-air digital terrestrial television service in UK, a joint venture between the BBC, ITV,Channel 4, BSkyB and transmitter operator Arqiva] homes who don’t currently subscribe to Sky services.
Our take
The latest move is interesting in that is represents a significant vote of confidence in both the incremental revenue that can be derived from OTT services and the potential to tap an entirely new customer base in the form of ‘dip-in’ Now TV users. While this goes hand in hand with an increased investment in original content and channels as well as sports rights to support the core service, it is clear that Sky sees the most upside in incremental revenue driven by OTT rather than strong additional growth in traditional satellite pay TV customers. With broadband and telephony being an increasingly important area of revenue growth, the connected device/OTT space becomes the next area for up-sell, meaning that the so-called ‘multi-product strategy’ becomes central. While none of the services require a tie-in to Sky’s own broadband, it is this very area that BT has chosen to attack with its bold move into sport. The free access to BT’s suite of new sports channels with a BT broadband 12 month contract means that not only could there be a subset of Sky TV customers who will migrate to BT broadband, but a further segment of existing BT customers who will not be available to Sky for triple-play up-sell. To date there has been no evidence that’s BT’s strategy is paying off (net TV additions for BT were roughly flat in the quarter to end June 2013). But BT says it believes this will change when the channels launch.
Sky’s strategy, then, is to fall back on its traditional strengths centred on content, but to do this in a way that embraces new forms of distribution and leverages the power of its existing customer relationships. Headroom for growth remains strong: despite triple-play penetration reaching 35 per cent among the Sky customer base, two-thirds of Sky customers have yet to take a broadband offer. With Sky out-performing the market in broadband net adds, this area is likely to ensure continued strong revenue and ARPU growth. But two areas of risk remain. If the majority of TV growth comes from Now TV, Sky will have to deal with an increasingly large segment of TV customers who are not tied into a contract and who are relatively low value in terms of ARPU. As this segment scales, clearly this could lead to large and seasonal fluctuations in churn and ARPU. The second area of risk is related: cannibalisation. While this is a risk that Sky is well aware of and keeping close tabs on, the renewed connected home push risks accelerating the transition to a more transient customer base.

UK TV viewing is about connection, says Ofcom report [[IHS] Screen Digest commentary, Aug 1, 2013]

The home entertainment experience is becoming increasingly connected with multi-tasking central to the enjoyment of TV content, according to the latest Communications Market Report from UK regulator Ofcom. According to the findings, there has been a huge increase in the devices that people take to the living room. On average, each UK household owns three different types on Internet-enabled device. The biggest growth over the last year in take-up of services and devices has been on the number of tablets and smart-phones. Thanks to the device mix, 22 per cent of people in the living room watching screens other than the main TV most of the time.
The main TV set remains important. Ninety-one per cent of UK population tune into the main TV set weekly up from 88 per cent in 2002, with viewers on average watching four hours a day in 2012 compared to 3.6 hours in 2006. Although the report finds that people gather around the TV in the living room, there has been a decline in the number of children with TVs in their bedroom; 52 per cent of UK children now have a TV set in their bedrooms which represents a 17 per cent decline over the last six years, mainly related to the increase number of tablets and Internet connected devices.
Average media household spend has increased in the last year to £113.51 a month after many years of decline. The biggest increase has been on mobile services (£46.73 a month) and fixed internet (£11.91 a month) and the biggest decrease has been on fixed voice (down £22.48 versus one year ago to £21.61 in 2012). TV spend has been stable over the last five years at between £28-£29 a month.
Our take

Ofcom figures reflect what IHS Screen Digest has long noted: live linear TV is not dead.

According to Ofcom, time-shifted viewing represents just 10 per cent of the total and hasn’t changed much over the last years despite the huge increase in DVR ownership. According to BARB figures DVR has grown from 18 per cent in 2007 to 55 per cent in 2010 and 67 per cent in 2012. Despite this, growth in time-shifted viewing has been only moderate up from six per cent four years ago. 
More than half of UK adults are regular media multi taskers, they ‘stack’ or ‘mesh’while watching TV weekly, with tablet owners more likely to multi-task than average. Almost one in four UK adults made direct communication with friends and family about the programs as they watching (media meshing) and half of UK adults conduct other activities while they are watching TV on a weekly basis (media staking).
The increase in tablet owners has also changed consumer viewing behaviour with VOD requests coming from tablets increasing from three per cent in 2011 to 12 per cent in 2012. More than 56 per cent of tablet owners used them to watch TV and 57 per cent of those watched linear TV on the tablet.

Ofcom also found that, when it comes to the much-hyped area of social TV, it is news, reality shows and sport events that are engaging viewers through social media, but the knock-on effect is that consumers want to watch these shows live in order to engage socially, providing another boost for linear TV.

TV Everywhere Spreads Among US Television and Cable Networks; NBCUniversal Leads [IHS iSuppli press release, Oct 18, 2013]

NBCUniversal leads the US TV Everywhere (TVE) effort in providing access to TV content on second screens like smartphones and tablets, while EPIX and HBO share the distinction of supporting TVE on more second-screen devices than any other premium or basic cable network, according to a new report from the TV Intelligence Service at IHS Inc. (NYSE: IHS).

From Wikipedia: TV Everywhere (also sometimes known as authenticated streaming)[1] refers to a model wherein television providers and broadcasters, particularly cable channels, allow their subscribers to access their respective content on digital platforms, including video on demand and live streaming of the channels themselves. TV Everywhere systems utilize user accounts provided by the television provider—which are used to verify whether the user is a subscriber to a particular channel, thus allowing or denying access to the content. The U.S. provider Time Warner Cable first introduced the concept in 2009; in 2010, many television providers and broadcasters began to roll out TV Everywhere services for their subscribers, including major networks such as ESPN, HBO,NBC (particularly for its Olympics coverage).
NBCUniversal provides TVE in 15 of its 18 channels, or 83 percent of the studio’s total stable of cable and broadcast networks to pay-TV subscribers willing to authenticate on second-screen devices. Meanwhile, EPIX and HBO have been at the forefront of the TVE experience, with both very willing to embrace new technologies and offering significant amounts of content on their apps and portals.
EPIX first kicked off the TVE phenomena in October 2009, formed by partners Paramount, MGM and Lionsgate after their failed renewal with Showtime HBO followed suit in February 2010 with the launch of its web portal and how has a vast TVE library online, even though it does not yet offer live linear streaming.

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HBO, along with Cinemax and BTN2Go, are the only three networks to have TV Everywhere authentication agreements with all major US pay TV operators.
For its part, Showtime is the only premium network offering live linear streaming through TV Everywhere. The company is also allowing for authentication outside of the home, a feature likely to expand to other basic and premium cable networks as TVE continues to evolve.
The last premium channel group to the party is Liberty’s STARZ. STARZ and Encore launched TV Everywhere services in October of 2012, but are still missing authentication deals with both Comcast and DISH Network.
One entity so far remains the lone hold-out among the major channel groups not providing any TV Everywhere content—Discovery Communications. But that will change as Discovery is expected to finally jump into the fray in the near to midterm time frame. It will likely become critical to offer similar services, IHS believes, as TVE access becomes more central to the future of US pay TV video.
Solving the cord-cutting problem before it gathers steam
All major pay-TV operators to date have implemented some form of the TVE service, although sometimes in very limited form, via either live linear streaming or video on demand (VoD). But while the streaming of live linear network feeds is largely relegated to in-home use, video on demand (VoD) is a significant out-of-home TVE product.
VoD streaming channels, at 73 including cable, premium and broadcast, far outnumber the channels offering live streaming, at 31, as shown in the attached figure. NBCUniversal, the TVE leader, has 15 VoD channels and five live streaming channels, followed by Time Warner with nine VoD channels and three live streaming channels.
“TV Everywhere has been developed as a collective strategy by both pay-TV operators and TV content owners to enhance the traditional linear TV proposition, so that secondary screens like tablets and smartphones can be used to view TV content in addition to the primary screen,” said Erik Brannon, analyst for U.S. cable networks at IHS. “And in spite of the differences in strategy, all TVE products have one thing in common: They allow for current pay-TV video subscribers to authenticate and consume on secondary screens a significant amount of content that they purchase as part of their normal pay-TV video subscriptions.”
TVE is one approach that pay-TV operators and network owners are using to stem the tide of cord-cutting among cable subscribers before the number of defections become significant. In many cases, cable subscribers are finding themselves increasingly tempted to end their subscriptions—either because of high costs or because of other alternatives now available, such as over-the-top (OTT) alternatives like Netflix. In the second quarter of 2013 alone IHS estimates that the pay-TV business shed 352,000 subscribers, mostly to seasonality, but some elements of cord-cutting are likely to have been present as well. To be sure, the combined price of $28 (Netflix, Hulu Plus and Aereo) may be more appealing to consumers than the $80+ average revenue per user that IHS estimates pay-TV video customers will pony up for service in 2013.
Through TVE, both pay-TV operators and network owners hope to add new functionality and interactivity to the television viewing experience. And by partnering with pay-TV operators, content owners like the broadcast networks hope they can continue to solidify their hold on the distribution of premium television content.
Device compatibility extending beyond iOS and Android
TV Everywhere is also evolving beyond Apple iOS and Android, the two platforms on which TVE apps first appeared. Now, TVE apps from networks are becoming available and are being deployed across a wide range of connected devices, including smart TVs; video game consoles like Microsoft’s Xbox; Amazon’s Kindle Fire; Blu-ray players; and digital media products such as Roku and Apple TV.
Adoption of TVE initiatives by the major channels is a reaction to the changing landscape of TV viewers in the country, Brannon noted. And as it continues to grow in awareness and popularity, TV Everywhere will remain a central focus for pay-TV operators.

6. Microsoft’s live TV solution on Xbox

From Worldwide launch of Xbox One sparks global celebration for a new generation in games and entertainment [Microsoft press release, Nov 21, 2013]

Xbox One’s innovative architecture means you no longer have to choose between your games and entertainment. Get multiplayer alerts while you watch TV, and keep watching TV while you play. Snap your NFL fantasy football stats next to the game. Jump instantly from a game to TV, movies, fitness, music, sports, the Internet and Skype video chat with the sound of your voice. With Xbox One, you never have to stop playing to talk to a friend, surf the Web or watch live TV. You also have access to a new generation of TV experiences, and starting in the U.S. and coming to many markets soon, OneGuide will allow you to access your favorite shows, channels, apps or games with the Bing natural language voice search.

Xbox One Live TV, Xbox Fitness with Yusuf Mehdi [scarlettgarden YouTube channel, Oct 27, 2013]

Here’s an Xbox Wire interview with Yusuf Mehdi regarding live TV on the Xbox with instant switching and Xbox experiences tailored to the gamer profile

From Xbox One: Your Top Questions Answered [May, 2013]

Our goal is to enable live TV through Xbox One in every way that it is delivered throughout the world, whether that’s television service providers, over the air or over the Internet, or HDMI-in via a set top box (as is the case with many providers in the US). The delivery of TV is complex and we are working through the many technologies and policies around the world to make live TV available where Xbox One is available.

The TWC Case:

This deal, which will bring more live channels than any other experience on Xbox 360, will offer Time Warner Cable [TWC] subscribers with an Xbox Live Gold membership the ability to watch their favorite shows from right from their Xbox 360 — including favorites like AMC, BBC World News, Bravo, Cartoon Network, CNN, Comedy Central, Food Network, HGTV and more. And unlike any other platform, you’ll be able to control your entertainment using your voice via Kinect for Xbox 360.
I’m excited to announce, alongside our good friends at Time Warner Cable, that the TWC TV app has launched on Xbox 360 today, delivering up to 300 of the most popular TV channels to Xbox Live Gold members in the U.S. who are also TWC subscribers.
At Xbox, our vision has always been to provide all the entertainment people want in one place, putting the best in TV, movies, music and sports right next to your favorite games. Like Xbox 360, Xbox One will be the best place in your house for gaming, apps and TV and we can’t wait to show you more on that soon. Today, we’re thrilled to expand our growing entertainment app portfolio of more than 130 voice-controlled apps on Xbox 360 with the addition of TWC TV. TWC customers, thank you for your support and welcome to the Xbox family.
When we launched the TWC TV app on Xbox 360 in August, we promised we were hard at work with our partners at Time Warner Cable to bring you Video On Demand and just in time for the holidays, we’re delivering. Starting today, Xbox Live Gold members in the U.S. who are also Time Warner Cable subscribers can now get On Demand content right on their Xbox 360 in addition to the nearly 300 channels of live TV that the TWC TV on Xbox 360 app already offers. And don’t forget that with Kinect for Xbox 360, the app lets you control your favorite shows using voice and gestures so you can kick back, remote-free.
The update also includes an exclusive “share” feature that allows you to send messages to other Xbox Live members that are TWC TV customers while channel surfing. With the TWC TV app, you’ll have access to more than 5,000 On Demand choices and in-app messaging. Look for the update today or download the app now!

With an unexperienced person: Hands-on video: The Xbox One as a media device [gigaom YouTube channel, Nov 19, 2013]

The Xbox One promises to combine state-of-the-art video gaming with live TV and streaming apps. Check out or hands-on video for a closer look at the device’s entertainment offerings.

First Wave of TV & Entertainment Apps Coming to Xbox One Unveiled [Xbox Wire from Microsoft, Nov 8, 2013]

Offering more entertainment options has always been important to Xbox fans. For years, we’ve been working with leading entertainment brands and TV providers to offer our customers a wide variety of live and on-demand entertainment. Today we unveiled the complete Xbox One experience – showcasing how Xbox One delivers the best games and multiplayer features, along with your favorite movies, music, sports and live TV experiences – all in one place.

“We set out to make Xbox One the all-in-one games and entertainment hub for your home. The one system that offers the best games next to the best entertainment experiences and apps,” said Marc Whitten, Xbox Chief Product Officer. “Along with offering a stellar app portfolio from around the world, Xbox One takes the next step by offering them in a way that is seamless and easy to use.”

In addition to delivering live TV in every market where Xbox One will be sold, we are also bringing premium, voice and gesture controlled TV and entertainment apps specifically designed for your living room. These apps have been built from the ground up uniquely for Xbox One and are designed to harness the power of the all-in-one platform.  For example, Xbox One is empowering partners to bring media achievements and exclusive Snap experiences, as well as many other things to entertainment apps, offering everybody the opportunity to achieve badges or rewards for the media they consume in addition to gaming.

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Something truly unique we’re doing with Xbox One is bringing together your favorite TV channels and entertainment app channels into one screen. Xbox One is also the only games and entertainment system that enables HDMI pass through. You can create your own personal Favorites in OneGuide – the Xbox One electronic program guide – so you can quickly and easily choose what you want to watch, whether it’s a TV channel like CBS, NBC or ESPN, or something inside an app like Xbox Video, Hulu Plus or the NFL on Xbox One. You can even add your personal photos and videos from the SkyDrive app to your OneGuide Favorites.

Additionally, a Bing search for TV, movies, games, or music scans across all apps to find exactly what you’re looking for, instead of having to hunt through each app individually. For the first time, you don’t have to juggle multiple screens across cable TV, video streaming services and other entertainment apps to quickly find the entertainment you’re looking for.

Today, we’re announcing the very first wave of some of the world’s biggest names in entertainment rolling out on Xbox One in the 13 launch markets between Nov. 22 at launch and spring 2014:

Australia

  • Crackle
  • Machinima
  • MUZU TV
  • Network Ten’s tenplay
  • Quickflix
  • SBS On Demand
  • TED
  • Twitch

Austria

  • Eurosport
  • Machinima
  • MUZU TV
  • TED
  • Twitch

Brazil

  • Crackle
  • Machinima
  • Muu
  • Netflix
  • Saraiva Player
  • Sky Online
  • SporTV
  • TED
  • Telecine
  • Twitch
  • Vivo Play

Canada

  • CinemaNow
  • Crackle
  • Machinima
  • MUZU TV
  • Netflix
  • Rogers Anyplace TV
  • Sportsnet
  • TED
  • The NFL on Xbox One
  • Twitch

France

  • 6Play
  • Canal+/CanalSat
  • France 2,3,4,5
  • La TV d’Orange
  • Machinima
  • MUZU TV
  • MyTF1
  • MYTF1VOD
  • SFR TV
  • TED
  • Twitch

Germany

  • Amazon\LOVEFiLM
  • Eurosport
  • Machinima
  • MUZU TV
  • TED
  • Twitch
  • Watchever
  • Zattoo

Ireland

  • Eurosport
  • Machinima
  • MUZU TV
  • Netflix
  • TED
  • Twitch

Italy

  • Eurosport
  • Machinima
  • MUZU TV
  • Premium Play
  • TED
  • Twitch

Mexico

  • Clarovideo
  • Crackle
  • Machinima
  • Netflix
  • TED
  • Televisa
  • The NFL on Xbox One
  • TV Azteca
  • Twitch
  • Veo

New Zealand

  • Machinima
  • MUZU TV
  • Quickflix
  • TED
  • Twitch

Spain

  • Eurosport
  • Gol Televisión
  • Machinima
  • MUZU TV
  • RTVE
  • TED
  • Twitch
  • Wuaki.tv
  • Zattoo

United Kingdom

  • 4oD
  • Amazon\LOVEFiLM
  • blinkbox
  • Crackle
  • Demand 5
  • Eurosport
  • Machinima
  • MUZU TV
  • Netflix
  • NOW TV
  • TED
  • Twitch
  • Wuaki.tv

United States

  • Amazon Instant Video
  • Crackle
  • The CW
  • ESPN
  • FOX NOW
  • FXNOW
  • HBO GO (coming soon)
  • Hulu Plus
  • Machinima
  • MUZU TV
  • Netflix
  • Redbox Instant by Verizon
  • Target Ticket
  • TED
  • The NFL on Xbox One
  • Twitch
  • Univision Deportes
  • Verizon FiOS TV
  • VUDU

The list above* is just the first wave of third-party apps that are coming to Xbox One over the course of the next few months.  We will continue to announce more apps coming to the platform and both the Xbox One and Xbox 360 entertainment app portfolios will continue to grow weekly.
*Xbox LIVE Gold membership required

In addition to the entertainment apps coming from partners, in every market Xbox One will also feature:

  • Internet Explorer
  • Skype
  • SkyDrive
  • Upload

With games, multiplayer gaming, live TV and the best entertainment apps, Xbox One is the most complete entertainment system.

Note that after AT&T Extends TV Watching to More Devices with Launch of U-verse TV on Xbox 360 [press release, Oct 11, 2010] and even after New U-verse Internet Customers Can Take Their Pick: A Free Xbox 360, SONOS PLAY:3, Kindle Fire or Nexus 7 Tablet [press release, March 18, 2013] that Xbox tie-up ended with AT&T U-verse TV To Drop Support For Xbox 360 on December 31 [Multichannel, Nov 26, 2013]:

“We’ve made this decision due to low customer demand,” an AT&T spokeswoman said via email on Tuesday. AT&T declined to say how many customers currently use the Xbox 360 as a set-top. … AT&T, the spokeswoman added, currently has no plans to support U-verse TV on the Xbox One. Verizon Communications FiOS TV is the first, and so far only, U.S. pay-TV provider to offer an authenticated app for the Xbox One during its initial launch phase.

With highly experienced users: Xbox One All-in-One Demo with Yusuf Mehdi and Marc Whitten [xbox YouTube channel, Nov 8, 2013]

Marc Whitten and Yusuf Mehdi walk through a comprehensive demo of Xbox One, including instant switching, biometric sign-in, Live TV, Skype, game DVR, OneGuide and more.

From Xbox One: The Complete All-in-One Games and Entertainment System [Xbox Wire from Microsoft, Nov 8, 2013]

As we head toward Nov. 22, we’re showcasing the all-in-one capabilities of Xbox One. This is the real Xbox One in action. Corporate Vice President of Marketing and Strategy, Yusuf Mehdi, and Chief Product Officer Marc Whitten show the best of Xbox One in this new video. And, you can see 10 of our favorite new features below.
#1 – Unleashing the Power of Your Voice
A simple voice command turns on your Xbox One, your TV, your set-top box and your AV system because Kinect for Xbox One is an Infra-Red blaster. And when you say “Xbox On,” your game is always ready to resume from wherever you left off. You can start playing your favorite game, find your favorite show, change channels, turn up the TV volume and more – with the sound of your voice, powered by Bing voice recognition technology.  Just say “Xbox, go to ESPN” and your TV will change directly to the ESPN channel. Or, “Xbox, go to Hulu Plus,” “Xbox, Volume Up,” “Xbox, Mute,” “Xbox, go to Music” – it’s simple. Kinect “talks to” your TV, set-top box and AV receiver, making it easier than ever to navigate entertainment in your living room.
#2 – Biometric Sign In
#3 – Instant Resume and Instant Switching
We’ve talked about instant switching before, but now you can see it for yourself in action. The video showcases how quickly you can jump from one experience to another and right back where you left off. You can literally jump from a game to live TV, music, movies, sports, Web sites and back again in seconds, just by using your voice.
#4 – Watch Live TV via Xbox One
Xbox One lets you watch live TV from your HDMI-compatible cable or satellite box, making it easy to switch from games to live TV – all with the sound of your voice, and without having to switch TV inputs. No more multiple remotes, missed multiplayer matches while you’re watching TV, or frustrating delays. Just connect your set top box to your Xbox One and you can watch live TV through your Xbox One.
#5 – Get a Multiplayer Invite, while you are Watching a movie or live TV
#6 – Game DVR and Upload Studio Let You Record and Share Your Greatest Moments
#7 – Do Two Things at Once
You can also choose to snap two experiences together – so you can play a game while you watch TV or listen to Xbox Music. Or, watch the big NFL game while you manage your fantasy football team. For gamers, snapping Machinima opens up a whole new world of opportunity. Just by saying “Xbox, Snap Machinima,” the Machinima app will be snapped next to “Dead Rising 3” or your favorite game, and walk-throughs, game reviews, help videos and more will appear.
#8 – Skype on the Big Screen, With Groups and Free Long Distance
Skype is amazing on Xbox One, offering the only big screen experience with Group Video Chat with up to four people. Kinect is the only camera in the world that will follow the caller and pan and zoom automatically as if you had your own camera man. You can talk with your friends while surfing the Web or checking the latest stats of a sports team. And have full 1080p video calls for one-to-one chats on your TV. 1
1 For 1080p video call, both users must have compatible HD displays, web cams, messaging clients, and broadband internet.

#9 – OneGuide Delivers Personalized Guide to TV, Apps and More

Xbox One has its own TV listings guide that can be navigated with your voice. Say “Xbox, what’s on Discovery Channel?” and boom, there you have the list of shows.  Call out your favorite TV show by name and start watching it instantly.  And, Xbox One is the only system that brings together your favorite TV channels and entertainment app channels into one screen.  Create your own personal Favorites in OneGuide, so you can easily choose what you want to watch – whether it’s on Fox, CBS, NBC, ESPN, Hulu Plus or the NFL on Xbox One app. For the first time you don’t have to juggle multiple screens across cable TV, video streaming services and other entertainment apps to quickly find the entertainment you’re looking for.

#10 – Xbox SmartGlass Enhances Gaming in New Way

Microsoft Is Changing the Game for Sports Fans [Xbox Wire from Microsoft, Sept 3, 2013]

Whether it’s in the living room or on the playing field, Microsoft and products like Xbox, Surface, and Windows 8 are impacting the way we experience our favorite sports.
In May, Microsoft announced a multi-year, landmark partnership with the NFL. For the Xbox community, this means exclusive interactive NFL experiences for fans at home, found only on Xbox One starting this November. Today, we’re excited to share more details about this partnership and the game changing NFL experiences for Xbox One and Surface. We are also pleased to introduce NFL.com Fantasy Football on Xbox 360, Windows 8 and Windows Phone which are available for download today.
Also making headlines today is the confirmation and details around the all-new ESPN application for Xbox One. Leveraging the unique platform capabilities of Xbox One, sports fans will now have control of the live programming, highlights, stats and more across ESPN like never before. 
The NFL on Xbox One and Surface 
Tailored for you, the NFL on Xbox One will deliver the best of the NFL, in a way that will completely reimagine the way you experience football from the comfort of your home.  Only Xbox One can bring interactivity to live games, stats, scores, highlights and your NFL.com Fantasy Football team all together on the best screen in the house – your TV. Xbox One will personalize your NFL experience, for your team, with the best content the NFL has to offer including NFL.com, NFL Network, and NFL RedZone.  Whether you’re watching the game or not, Xbox One makes it easy to keep tabs on the league with Snap mode. You can watch live TV, play games, or watch movies, while simultaneously tracking your NFL.com Fantasy Football team, or checking in for the latest scores and stats. 
While you’re watching at home, Surface technology is in the stadium, on the sidelines to help protect your favorite players.  Teams and trainers will implement use of the X2 concussion testing application this season to quickly diagnose potential player concussions immediately after leaving the playing field with the help of Surface tablets, helping quickly determine if they can get back in the game or call it a day.
ESPN on Xbox One We are also excited to announce ESPN on Xbox One, which builds on our innovations with ESPN on Xbox 360, and provides you with the best of ESPN networks and web content personalized just for you.  Featuring deeper sports content personalization, ESPN on Xbox One gives you immediate access to the teams and sports you care about most.  With WatchESPN, ESPN.com, and ESPN3 video content, you get the best highlights, live events and on-demand sports in full screen mode.  Additionally, you will receive personalized scores and stats in Snap mode from the most popular sports.
NFL.com Fantasy Football on Xbox 360, Windows 8, and Windows Phone 
Beginning today, NFL.com Fantasy Football is now available on Xbox 360, offering a whole new way to track your team and leagues on the best screen in your house – your TV. This destination is tailored just for you and your NFL.com Fantasy Football team, and is easy to jump into and simple to use. The Xbox 360 app brings you an endless playlist of Fantasy Football highlights, Fantasy analysis, stats, scores and standings about your NFL.com Fantasy Football team and leagues, making sure you don’t miss a thing. Consumers can head to NFL.com today to sign up for a league and get in the game before kick off on September 5th.
And, with the new NFL.com Fantasy Football apps for Windows 8 and Windows Phone, you can keep tabs on your team and leagues on your tablet, PC, and mobile device as well.
Download NFL.com Fantasy Football for Xbox 360, Windows 8 and Windows Phone today, and stay tuned for game changing experiences on Xbox One this November.

7. Preliminary information on the upcoming products from Xbox Entertainment Studios

Best Advice: Nancy Tellem [Fortune Magazine YouTube channel, Oct 31, 2013]

Nancy Tellem is the entertainment and digital media president of Microsoft.

Faces to Watch in 2014: Digital media | Nancy Tellem, Mike Hopkins, Issa Rae [Los Angeles Times, Dec 27, 2013]

A big year is coming up for game designers Ryan and Amy Green and Ruben Farrus, plus Microsoft’s Nancy Tellem, Hulu’s Mike Hopkins and Web writer-actress Issa Rae.

The Times asked its reporters and critics to highlight figures in entertainment and the arts who will be making news in 2014. Here’s who they picked:

Nancy Tellem | Microsoft’s president of entertainment and digital media

The veteran CBS television executive had her work cut out when she joined Microsoft Corp. in 2012 to launch a Santa Monica studio to create original content.

Long fascinated with changes in consumer behavior, Tellem is now playing an important role in determining what appeals to younger consumers accustomed to getting their entertainment on multiple screens. She is trying to build on the momentum that Microsoft has achieved by encouraging millions of consumers to consider the Xbox more than just a video game console. Xbox users spend more than half of their time online listening to music and streaming movies, TV shows and exploring other entertainment options. Microsoft wants to build a trove of exclusive content to differentiate its game system from the rival Sony PlayStation.

Microsoft’s slate of new shows designed to appeal to the digitally connected generation is expected to launch in the first half of 2014. Microsoft also brought Tellem on board to make inroads with Hollywood’s creative community. One of the first projects she announced was a live-action TV series, produced by Steven Spielberg, based on the “Halo” game franchise for Xbox Live, a feature that enables gamers to play against online opponents.

Tellem was trained as a lawyer and worked her way up the ranks in business affairs at Lorimar, Warner Bros. and then CBS. At the broadcast network, Tellem was a key executive in the development of new shows, including the hit reality show “Survivor.” She was one of the TV industry’s first female entertainment presidents.

— Meg James

Mike Hopkins | Hulu chief executive

Issa Rae | Actress-writer-director
… 

Nancy Tellem at Wrap Power Women Breakfast: Microsoft Is Aiming for a “Game of Thrones”  [The Wrap YouTube channel, Oct 30, 2013]

TheWrap’s keynote speaker at its fourth annual Power Women Breakfast (Oct 30, 2013) says Microsoft’s new studio has the ambition and the means to create landmark programming

Nancy Tellem at Wrap Power Women Breakfast: Microsoft Is Aiming for a ‘Game of Thrones’ (Video) [TheWrap, Oct 30, 2013]

Nancy Tellem, Microsoft’s new president of entertainment and digital media, said on Wednesday she has the means and the ambition to make a “Game of Thrones”-like series for the new studio backed by the technology giant.

“I have the ambition” to make a show as grand as “Game of Thrones,” said the former president of CBS entertainment at TheWrap‘s Power Women Breakfast at the Montage in Beverly Hills.

That, to me, was greatest testament to how wonderful television can be and how engrossed people are and committed – and it was a social experience,” she said.

And, she said smiling, Microsoft’s budget was “enough for me to do my job, let’s just say.”

Not being bound by the constraints of a 22-episode season or even show length and with the technology to engage the viewer through the Xbox platform allows Tellem and her team to “focus on the content itself” and then way viewers canshare that experience.”

Tellem said she expects that Microsoft will begin rolling out its new shows — which will range from sports programs to scripted series — as soon as the spring. She says they have not decided whether to release the episodes over time or put them all out at once, like Netflix.

Asked about binge viewing, Tellem said she was not sure if Microsoft would release all its content at once, observing that interactivity was more the distinctive purview of Microsoft.

Xbox One Reveal: Halo TV and NFL [xbox YouTube channel, May 23, 2013]

Nancy Tellem’s Xbox Entertainment Studios announcements of Halo TV with 343 Industries and Steven Spielberg and NFL from Xbox One Reveal Press Briefing.

From Microsoft unveils Xbox One: the ultimate all-in-one home entertainment system [press release, May 21, 2013]

Blockbuster titles, Steven Spielberg-produced Halo TV series, and exclusive agreements with the NFL transform games, TV and entertainment for the 21st century living room.

“Halo” television series. Award-winning filmmaker, director and producer, Steven Spielberg will executive-produce an original “Halo” live-action television series with exclusive interactive Xbox One content, created in partnership with 343 Industries and Xbox Entertainment Studios.

RTS Cambridge Convention 2013: Xbox One – From Gaming to Content [Royal Television Society, Sept 12, 2013]

Created for gaming, the Xbox One is the latest challenger to old-fashioned telly, but, said Microsoft entertainment and digital media president Nancy Tellem, it is not the final nail in the TV industry’s coffin.

“It’s an augmentation,” she argued. “Right now, [TV] is in a renaissance period — what Xbox offers is a different TV experience.” 

Since joining Microsoft from CBS a year ago, Tellem has been spearheading the software giant’s move into TV, delivered via its Xbox One gaming console.

Interactivity among its current 76 million connected console users would be the key to Xbox One’s success. “It isn’t just delivering content. It really offers an immersive experience,” she said.

The session was chaired by Matt Frei from Channel 4 News, who said that he enjoyed being a “passive” consumer of TV. To laughter from the audience, Tellem replied: “Xbox addresses the next generation.”  

Tellem identified sport, live events and scripted entertainment as genres particularly suited to Xbox One. Mentioning Game of Thrones as the type of complex drama suited to the console, she claimed: “You can give a much richer understanding of the characters and their history.”

Tellem is in discussions with studios and talent about commissions, which she hopes to announce in a few weeks. Earlier this year, Microsoft revealed that a TV show based on the Halo game, with the involvement of Steven Spielberg, was in the pipeline.

She also countered a suggestion from the audience that Xbox One’s programming would be geared at 18-year-old boys. Tellum said that her ambition was to reach out beyond traditional gamers, adding that 40% of its platform users were female, with most of the audience between 18 and 40. 

My mission it to transform it into an entertainment service,” she said, which would include music, film and sport as well as games. “It’s a simple offering that can access all your entertainment needs.”

Before joining Microsoft, Tellem had worked at the US network CBS for a decade and a half, latterly as senior adviser to chief executive Leslie Moonves.

Xbox Entertainment Studios to Debut Documentary Series Exclusively on Xbox in 2014 [Xbox Wire from Microsoft, Dec 19, 2013]

First Documentary Explores the Fabled Atari Mystery

Today, Xbox Entertainment Studios announced an original documentary series that will debut exclusively on Xbox in 2014. Xbox will produce the series with two-time Academy Award-winning producer Simon Chinn (Searching for Sugar Man and Man on Wire) and Emmy-winning producer Jonathan Chinn (FX’s 30 Days and PBS’s American High) through their new multi-platform media company, Lightbox

“Our collaboration with Xbox offers an unparalleled opportunity to make a unique series of films around the extraordinary events and characters that have given rise to the digital age,” said Simon Chinn. “Our goal is to produce a series of compelling and entertaining docs which will deploy all the narrative techniques of Simon’s and my previous work. It’s particularly exciting to be partnering with filmmakers like Zak Penn who come to this process from other filmmaking disciplines and who will bring their own distinctive creative vision to this,” added Jonathan Chinn.

“Jonathan and Simon Chinn are the perfect team to spearhead this series for Xbox. They are consummate story tellers and they plan to match their creative sensibility with the best talent in the industry,” commented Xbox Entertainment Studios President Nancy Tellem. “These stories will expose how the digital revolution created a global democracy of information, entertainment and commerce, and how it impacts our lives every day.”

The first film in the groundbreaking series investigates the events surrounding the great video game burial of 1983. The Atari Corporation, faced with overwhelmingly negative response to the video game “E.T. the Extra-Terrestrial,” buried millions of unsold game cartridges in the middle of the night in the small town of Alamogordo, New Mexico.

Fuel Entertainment, an innovator in cross-platform content development, secured the exclusive rights to excavate the Atari landfill and approached Xbox. Lightbox will document the dig, which is planned for early next year.

Filmmaker and avid gamer Zak Penn (X-Men 2, Avengers, Incident at Loch Ness) will direct. This episode will not only document the excavation, it will also place the urban legend of the burial in the context of the precipitous rise and fall of Atari itself.

“When Simon and Jonathan Chinn approached me about this story, I knew it would be something important and fascinating,” said Penn. “I wasn’t expecting to be handed the opportunity to uncover one of the most controversial mysteries of gaming lore.”

Shooting begins in January. The series will air exclusively on Xbox One and Xbox 360 in 2014 and will be available globally in all markets where Xbox Live is supported.

8. Xbox Music and Xbox Video services for other devices

Xbox Music + Video apps for Windows Phone 8 [Windows Phone Central YouTube channel, Dec 18, 2013]

On December 18th, Microsoft released two new apps for Windows Phone 8: Xbox Music and Xbox Video. We give a tour of both apps and show off some of their features on a Lumia 1520. More info: http://www.wpcentral.com/xbox-music-and-video-app-tour

Xbox Video for Windows Phone 8 Walkthrough [Pocketnow YouTube channel, Dec 19, 2013]

Microsoft finally released the Xbox Video application for Windows Phone 8. We go hands-on with the new application in this walkthrough video, and discover all its features and missing functionality. See more at Pocketnow: http://pocketnow.com/2013/12/19/xbox-video-for-windows-phone

New Xbox Video and Xbox Music apps Available for Windows Phone 8 Customers [Xbox Wire from Microsoft, Dec 18, 2013]

It’s a big day for Windows Phone 8 customers. New apps for Xbox Video and Xbox Music are becoming available today in the Windows Phone store.

Xbox Video Comes to Windows Phone

Today, Xbox Video launches on Windows Phone 8, so now you can truly take your movies and TV shows with you wherever you go. Stream from the cloud or download your favorite movie or TV episodes to your phone to watch them offline. You can rent or buy the newest hit movies or search for classics from the massive catalog with the only app that lets you download movies and TV episodes right to your Windows Phone 8. You’ll even get Rotten Tomatoes ratings and Metacritic scores right on your phone.

Xbox Video on Windows Phone 8 also delivers countless TV shows. With a Season Pass, brand new episodes are automatically added to your collection so you don’t miss a beat from your favorite new shows. Or catch up with every episode from past seasons and relive the glory days of your favorite shows from years past.

With Xbox Video, your collection follows you from screen to screen in the cloud. For example, you can buy and start a movie or TV show from XboxVideo.com or Xbox Video on a Windows 8.1 tablet, and continue watching on your Xbox One, Xbox 360 or Windows Phone 8. And with Xbox SmartGlass, you get a richer viewing experience that isn’t found anywhere else. Xbox SmartGlass integrated with Xbox Video for Xbox One and Xbox 360 offers second-screen experiences with bonus content and exclusive extras, serves as a remote control, and gives you new ways to interact with whatever you’re watching.

Xbox Video is a free download in the Windows Phone Store today, and don’t forget to check out our new Web store at XboxVideo.com

A Peek at the New Xbox Music for Windows Phone

Also releasing today is a new Xbox Music preview app. This early-access app gives Xbox Music Pass users a look into the new music experience on Windows Phone 8.¹ Stream millions of songs from your phone or download the ones you want for offline listening. Create playlists that sync across your devices. Play songs from your personal music collection alongside your Xbox Music Pass content. It’s the best way to experience all the music you love on your Windows Phone.

The Xbox Music Preview is available in all 22 markets where Xbox Music is available today and can be found in the Windows Phone Store. The full release will roll out in 2014. Xbox Music is available today on Windows Phone, Xbox One, Xbox 360, Windows 8/8.1, online at Music.Xbox.com and iOS and Android devices.

¹ Xbox Music Pass required to use the app. Compatible devices and internet required. Data charges apply. See Xbox.com/music.

Xbox Music For Android Review [Mikey Capoccia YouTube channel, Sept 9, 2013]

In todays video I will be reviewing the Xbox Music application for Android

Microsoft launches Xbox Music across iOS and Android, adds free streaming on the Web [press release, Sept 8, 2013]

Enjoy your favorite music from a 30 million-song global catalog powered by the one service that integrates your music experiences across your tablet, PC, phone and TV. All the music you love, every way you want it.

Nearing its one-year anniversary, Microsoft Corp.’s all-in-one music service, Xbox Music, continues making strides to deliver all the music people want, wherever they want it played. Today, Microsoft announced its plans to bring Xbox Music to iOS and Android devices, as well as free streaming on Xbox Music via the Web.[1]

Accessing music across all the different devices people interact with has become complicated. People today use PCs, laptops, tablets, phones and TVs to access different music services that don’t connect with one another. Xbox Music is designed to solve this common problem by combining the best of all music offerings with free streaming on the Web and on Windows 8 PCs and tablets, Internet radio, subscription (called Xbox Music Pass), and download-to-own options.[2] With today’s news, access to Xbox Music grows to include iOS and Android devices, as well as a free Web-based interface on computers.

“Xbox Music now, more than ever, powers music experiences between Windows 8, Xbox, Windows Phone, and now iOS, Android and the Web,” said Jerry Johnson, general manager of Xbox Music. “We’re also excited to connect artists with their fans on the most anticipated consumer product of the year when Xbox One launches Nov. 22.”

Expanding the Xbox Music family of devices

Starting today, your Xbox Music Pass brings the catalog of music to iOS and Android devices. Get unlimited access to the songs and artists you want at any time with playback across your tablet, PC, phone and Xbox console for $9.99 per month or $99.99 per year. Add a song to your collection on your Xbox, and you’ll also have that song on your iOS, Android or Windows 8 device on the go or at the office. Xbox Music Pass also unlocks unlimited access to tens of thousands of music videos on your Xbox 360.

With the addition of free streaming on the Web, enjoy on-demand access to 30 million songs globally for free on the Xbox Music Web player at http://music.xbox.com or through the Xbox Music app on all Windows 8 tablets and PCs. Discovering and enjoying free music is as easy as typing an artist or song name and hitting “play.” Songs are instantly available to stream at no cost and for you to create an unlimited amount of playlists.[1]

Continued innovation

Xbox Music will continue to grow and evolve over the coming months. Microsoft will add Radio to the free Web player, a quick and dynamic way to personalize your collection, discover new favorites, and create ultimate playlists by launching instant mixes based on your favorite artists. With unlimited skips and a view of the full recommended music stream, Radio puts you in control of your Internet radio experience.[1]

Xbox Music will grow on Windows 8 when it adds the anticipated new Web Playlist tool this fall. The tool scans all the artists and music available on a given Web page and creates a custom playlist of all that music. Think about the Web page of your favorite radio station, or an upcoming music festival, and all the bands and songs included on that Web page. Web Playlist identifies all that music and creates an instant, custom playlist inside Xbox Music with the simple touch of a button. Web Playlist along with Windows 8.1 will be released Oct. 17.

In the coming months, additional updates for iOS and Android platforms will become available, including an offline mode that lets you save your music to your device for playback without an Internet or data connection.

About Xbox

Xbox is Microsoft’s premier entertainment brand for the TV, phone, PC and tablet. In living rooms or on the go, Xbox is home to the best and broadest games, as well as one of the world’s largest libraries of movies, TV, music and sports. Your favorite games, TV and entertainment come to life in new ways through the power of Kinect, Xbox SmartGlass and Xbox Live, the world’s premier social entertainment network. More information about Xbox can be found online at http://www.xbox.com.

[1] Free streaming available only on the Web and devices running Windows 8 or later. Limited hours of free streaming after six months; unlimited with paid subscription. Coming later this fall: artist-based Radio on Android, iOS and the Web.
[2] Xbox Music Pass is streaming only on Xbox consoles, Android, iOS and the Web. Applicable taxes extra. On Xbox consoles, Xbox Music requires an Xbox Music Pass and an Xbox Live Gold membership (both sold separately). Download music on up to four devices. Some Xbox Music content may not be available via Xbox Music Pass, and may vary over time and by region. Coming later this fall: Xbox music download-to-own on Android and iOS, and playlists and song sync on Windows Phone 8. See http://www.xbox.com/music.
For details, please visit http://news.xbox.com.
For assets, please visit http://news.xbox.com/media.

Multi-tasking and multi-window view used together for high performance productivity scenarios in the state-of-the-art UX environment of Microsoft Windows 8.1 – the ultimate solution not available with Apple and Android devices

The versions of multi-tasking and multi-window view in Windows 8.1 are already the second generations of the concept which first appeared during the preview of Windows 8 in September, 2011. Properly designed applications relying on them can not only be run simultaneously but also can manifest themselves at the same time on up to 4 independent parts of a single screen, as well as extended by using any number screens where there are additional monitors connected to the system. That capability not only enables much higher performance productivity scenarios than before with the first version (i.e. in Windows 8), but the number of possible scenarios can be significantly higher and more complex.

This is especially important as – unlike the current iPad and Android system – application developers could plan their individual apps as part of a growing society of apps (delivered usually by 3d parties) which can be used together with some companion apps simultaneously, constituting together a given scenario actually created by the user himself or herself. This is very much a workstation like environment already found in classic GUI based workstations, but now inside such a state-of-the-art UX environment as that of Microsoft Windows 8.1.

Acknowledgement: I should thank Zsolt Bátorfi from the DPE (Developer and Platform Evangelism) unit of Microsoft Hungary for his invaluable input to this post.  

The quite simplistic iPad and Android environments are mainly satisfying the entertainment scenarios only. So the 2nd generation Microsoft Surface family of productivity tablets priced upto $2420 (when for an All-in-One configuration) [‘Experiencing the Cloud’, Sept 24, 2013] was rightfully positioned against them as there is a growing demand on the market which is not served by any other platform. The same applies to the upcoming Windows 8.1 devices from the 3d party vendors.

There will be entry level products like the $349 ASUS Transformer Book T100 which was already shown as part of The long awaited Windows 8.1 breakthrough opportunity with the new Intel “Bay Trail-T”, “Bay Trail-M” and “Bay Trail-D” SoCs? [‘Experiencing the Cloud’, Sept 14, 2013] delivered by Intel. With that the growing but still unsatisfied demands could be fulfilled by starting at sufficiently competitive levels in terms of Android entertainments devices from major global vendors, even more so in terms of Samsung devices.

I put together this post in order to understand this additional (to Intel Bay Trail and Haswell SoCs) breakthrough opportunity as clearly as only possible.

Details

Windows From Continuing the Windows 8 vision with Windows 8.1 [by Antoine Leblond on Blogging Windows, May 30, 2013]

image

We’re also making improvements for using multiple apps at once in Windows 8.1.

Windows 8.1 brings variable, continuous size of snap views. You will have more ways to see multiple apps on the screen at the same time. You can resize apps to any size you want, share the screen between two apps, or have up to four apps on screen. If you have multiple displays connected, you can have different Windows Store apps running on all the displays at the same time and the Start Screen can stay open on one monitor. This makes multi-tasking even easier. Also in Windows 8.1, you can have multiple windows of the same app snapped together – such as two Internet Explorer windows.

Microsoft started to run this TV ad in May 2013 to communicate the concept of Windows 8: Multitasking [Windows YouTube channel, May 9, 2013] most widely

International Social Video: Like playing Piano and Ping Pong, Windows 8 lets you work and play at the same time. See more athttp://windows.com

And it was showcased last time with Windows 8.1 as Microsoft Surface 2 Halo Spartan Assault Gaming and Office Suite Multitasking Demo [HotHardware YouTube channel, Sept 25, 2013]

At Microsoft’s recent Surface 2 event in New York, Corporate VP of MS Surface, Panos Panay, demonstrated their new NVIDIA Tegra 4-powered Surface 2 tablet playing Halo Spartan Assault with running several Office applications like One Note, Word, Email and Excel all in the background or side by side at the same time.

At the same time people are even discovering undocumented (so far) capabilities like in this Modern App Multitasking in Windows 8.1 RTM [WindowsObserver YouTube channel, Sept 11, 2013]

This video highlights what I initially thought was a bug in Windows 8.1 Preview and now believe is an undocumented UI feature when you are working with more than one Modern App on your devices screen. Update: Thanks to a Twitter follower (@awktane) for this tip which I missed. When you select that third Modern App click and hold your mouse button in the middle of the floating app. After a few seconds an opening will appear to add that app as a third snapped app on the screen. Of course this depends on your screen resolution being large enough to support 3 snapped apps. Another Twitter follower @DatabaseJase shared with me that you can drag the floating app to the top of the screen to open it in full

Compare this to the previous generation hardware and software Microsoft Surface RT – True Multitasking Demo [MyWorldOfIT YouTube channel, Nov 2, 2012] with Windows 8.0 which a common Android tablet or iPad still cannot do (except some Samsung GALAXY devices still in a limited split screen fashion, as noted a little later)

which was described in Design case study: iPad to Windows Store app [MSDN, March 21, 2012] as

Use snap view to engage your users
Windows 8 lets users multitask by “snapping” an app next to another app. The snapped view is a great way to increase the app’s time on screen and engage users for longer periods. It’s easy for a user to change the main app and the snapped app by manipulating the splitter between the two, so it is important to maintain context across resizes. We don’t want users to lose app state as a result of resizing their app.
Example: home screen snap view image
Windows Store app
    • The snap view of the home screen is just a different view of the home page where a user can still access the same content.
    • In snap view, a user pans vertically to get to more content because it is more comfortable to pan along the long edge. This is different than the horizontal panning in full view, which is also optimized to pan along the long edge.

    Or in a somewhat different early presentation of Windows 8 Multitasking Experience [Vectorform YouTube channel, Sept 27, 2011]

    A quick look at the multitasking experience in Windows 8’s Metro UI running on a tablet.
    Note that Samsung was quick to employ this single concept in its forked Android solution, first in Multiscreen – GALAXY Note 10.1 – Samsung [SAMSUNGMOBILEUK YouTube channel, Oct 12, 2012]  and  then later in GALAXY Note II and Note 3 phablets, and in the Note 8.0 tablet and GALAXY S4 smartphone, where it was called Multi Window (also for Note 10.1), but just for two applications at the same time for which the device screen is split into two parts. See also Samsung GALAXY Note 10.1 Has Arrived Game-Changing Device Hits U.S. Store Shelves Tomorrow [Samsung Mobile Press, Aug 15, 2012]. Not for all GALAXY devices!
    Multiscreen on the Galaxy Note 10.1 makes multitasking easy – see here how cutting and pasting an image is as simple as it possibly could be. Find out more here: http://spr.ly/GN101Ytd

    And here is a rare recognition of the fact that Yes, the Microsoft Surface RT tablet is much better than Android or iPad Tablets [GodGunsGutsGlory4KJV YouTube channel, Aug 21, 2013]

    I held off from buying a Microsoft Tablet and bought an Android Tablet after listening to some flawed and rather biased reviews a while back. But after being frustrated once again that Android STILL CAN’T MULTITASK while playing videos I went and looked further into the Microsoft Surface RT and bought one. There are several popular youtube videos comparing the Surface RT to Androids and iPad tablets but evidently either those people don’t know how to run a REAL tablet or they are deliberately skewing the comparisons. Because face it, the Surface RT is much more capable than the Android. And the Surface Pro of course is a full powered laptop but with less battery life and cost a pretty penny/ So for what I want in a tablet I got a Surface RT and it is great! As I said, the most of the reviews that came up in search were flawed. I was watching this pathetic one and should have known better when I saw the username… http://www.youtube.com/watch?v=sYbCfL… But check out the comments now. LOL! The comments were more helpful than the video. They talked about some honest review by some Lisa woman so I found this video and it was great… http://www.youtube.com/watch?v=lIOG2V… So after that I bought one and the Surface RT did what I needed and then some. Like built in Remote Desktop that works just like it did on my Windows 7 laptop so I can log into my home pc while away. And while most reviews just showed the Surface running the active tiles home screen and launched apps from there they did not demonstrate the Desktop mode which operates it in the more native Windows screen that people are used to which is where you can open windows and navigate the machine or use full Internet Explorer 10. Anyway I am ranting again… and that’s what this video is. It is more of a RANT and a warning to others to be careful with the biased reviews. I give a two thumbs up to this tablet!
    I held off from buying a Microsoft Tablet and bought an Android Tablet after listening to some flawed and rather biased reviews a while back.
    But after being frustrated once again that Android STILL CAN’T MULTITASK while playing videos I went and looked further into the Microsoft Surface RT and bought one.
    There are several popular youtube videos comparing the Surface RT to Androids and iPad tablets but evidently either those people don’t know how to run a REAL tablet or they are deliberately skewing the comparisons. Because face it, the Surface RT is much more capable than the Android. And the Surface Pro of course is a full powered laptop but with less battery life and cost a pretty penny/ So for what I want in a tablet I got a Surface RT and it is great!
    As I said, the most of the reviews that came up in search were flawed.
    I was watching this pathetic one and should have known better when I saw the username… http://www.youtube.com/watch?v=sYbCfL…
    But check out the comments now. LOL! The comments were more helpful than the video.
    They talked about some honest review by some Lisa woman so I found this video and it was great… http://www.youtube.com/watch?v=lIOG2V…
    So after that I bought one and the Surface RT did what I needed and then some. Like built in Remote Desktop that works just like it did on my Windows 7 laptop so I can log into my home pc while away.
    And while most reviews just showed the Surface running the active tiles home screen and launched apps from there they did not demonstrate the Desktop mode which operates it in the more native Windows screen that people are used to which is where you can open windows and navigate the machine or use full Internet Explorer 10.
    Anyway I am ranting again… and that’s what this video is. It is more of a RANT and a warning to others to be careful with the biased reviews. I give a two thumbs up to this tablet!

    No wonder that Microsoft started to highlight the multitasking advantage in this recent video about Surface RT vs. iPad [Windows YouTube channel, Aug 7, 2013], see the part starting at [0:43] under the title “Multitask” and noting that:

    One app at a time [on iPad] vs. Do multiple things at once [on Surface RT]

    See how the Surface RT with Windows 8 matches up against the iPad. Check out more at http://windows.com/compare


    Design, technology and business background for the above differentiation

    Microsoft design principles (Windows) [MSDN, March 8, 2013]

    Here are five principles for building great Windows Store apps. Use these principles when you plan your app, and always ensure that your design and development choices live up to them.

  • Pride in craftsmanship
  • Be fast and fluid
  • Authentically digital
  • Do more with less
  • Win as one
        • Work with other apps, devices, and the system to complete scenarios for people. For example, let people get content from one app and share it with another. Take advantage of what people already know, like standard touch gestures and charms, to provide a sense of familiarity, control, and confidence.

          • Use the UI model.
          • Work with other apps to complete scenarios by participating in app contracts.
          • Use our tools and templates to promote consistency.

    Following these five Microsoft design principles will help you make the best choices when you design your app.

    See also: Modern Design at Microsoft [by Steve Clayton on Microsoft News Center, June 7, 2013] – Going beyond flat design

    A very important example of “Work with other apps to complete scenarios“ is the multitasking which became available in the first version of Windows 8, and had been significantly enhanced in the recent second version:

    Jensen Harris on productivity and multitasking from Tami Reller: Worldwide Partner Conference 2013 Keynote [transcript provided by Microsoft, July 8, 2013]

    The desktop in Windows is the single most powerful platform in the world. It is the only platform in which you can run Photoshop and Lightroom and AutoCAD and Visual Studio and Office all in one platform. And we really wanted to bring together the best of the modern UI and the best of the desktop UI and harmonize them in Windows 8.1.

    So the first thing that you’ll notice is that we’ve made it really easy to get to the Start screen in 8.1 with the addition of the Start button. (Laughter, applause.)
    So when I click this, this is not just your father’s Start button, this actually floats in the tiles on top of the desktop. So you get this beautiful look of your desktop. You don’t lose context of what you’re working on. It just comes in over top and then floats away.
    And you can see we’ve done a lot of work here to make your Start screen be ultra-efficient. We’ve got the small tiles, we’ve got the groups, we’ve got the large tiles that allow you to create, together with new enterprise custom ability and control that we’re giving over the Start screen in Windows 8.1 for you to create an awesome, enterprise consumer dashboard that has all the things that you love in one place.
    And of course, one other thing that you can do by default in Windows 8.1 is boot to the desktop if you want as well. And so the whole experience comes together where you have control over the PC.

    So we love the desktop and we have made it a lot better. But productivity isn’t just defined by the desktop. The desktop is one way of working. Productivity is defined by robust multitasking, flexibility, efficiency, and having all the apps that you need. And what we’ve done in 8.1 is taken productivity to the next level and brought what was great about the desktop and the things that you could do there and made it even better in the modern UI and optimized it for not just 8-inch tablets, but also large screens, desktops, powerful laptops.

    Let me show you some of what we’ve done. So one of the most important apps that exists is mail. This is the new version of the mail app that we have not yet made available publicly, but will be available with Windows 8.1 RTM.
    And I’m going to use my mouse here. The first thing you’re going to notice is this power pane here on the left that shows me my folders, it shows me people. I can flag mails very quickly just here in the view — boom, boom, boom, boom, boom — and they’ll show up here in my flag view.
    We have my favorite people, all of the mail here, and I also have them split out. Of course I control this. So if I want to put Panos in my list of favorite people, I can do that. If I want to take some people out, I can do that as well.
    We’ve also integrated some awesome features to help keep your mail under control. Of course something like drag and drop is really important, and we have all your folders here that you can just directly drag and drop into using your mouse or touch.
    We have brought together all of your social updates. So things from Foursquare and Facebook and LinkedIn, these sort of pseudo-spammy, but kind of interesting things and put them in one place so they’re out of your way without needing to set anything up.
    And then probably my favorite view here is the newsletter view. And these are also things that sometimes you want to see. Like I love that I have these Living Social deals, but I don’t need to get eight of them a day, I really only need to see the most recent one. And so we’ve integrated a feature called Sweep into the mail app. And what this allows me to do is I can delete all of my Living Social deals. But what’s even cooler is I can say, just delete all of them except for the latest ones. I’m going to hit Sweep, and it’s going to set this up on the server. You’re going to see all of the Living Social deals have disappeared except for the top ones, and it’s always going to make sure that I only have one of these in my inbox from now on. These are some of the ways in which mail makes you more efficient. (Applause.) Thank you.
    Another thing, though, that’s really important if you’re being efficient is the keyboard because I don’t know about you, but I do an awful lot with keyboard shortcuts just typing. And I showed you the new search feature, but I haven’t shown you how well it works with the keyboard and how it makes you more efficient.
    This new search feature is really the command line for Windows. So I’m just going to type a single — I type “Windows plus S” to bring up search. I’m going to type a single character, “K.” And in doing so, it has brought back apps like Kindle and In the Kitchen, it’s brought back Music, it’s brought back settings like keyboard settings, it’s brought back files, local and in the cloud, it’s brought back Web suggestions, it’s brought back people on my PC. And it’s very, very powerful.
    For instance, if I’m just here in mail and I just want to start playing a song, I can just type “K” it brings up the name of the song. I’m just going to hit enter, and it starts playing without even taking me out of the app. Just immediate music playback. So this is one of the examples of how the new Search box makes it possible to do things very, very fast. You will find that this becomes the stickiest feature in Windows 8.1, and you can’t imagine ever living without it.

    Another thing that defines productivity is multitasking. And one of the things that I think is really cool about 8.1 is the multi-window view that we have.

    So here are a few photos that are attached to a mail. And when I click one of these, notice that it opened up photos side by side with mail. This isn’t some weird preview app that only shows a few file formats or something like this. This is the actual app that is associated with the file extension. And so this could be photos, PDFs, it could be Office, it could be anything. And this happened just automatically.

    Another example of this, let me pull this off the screen, and I’m going to show you a link. And when I click this, it’s going to open up IE side by side with mail. You can see that there’s no restriction anymore on just one very small snapped app and then a huge app. We can now use the window 50/50. I can move the snap point so I can make one a little bigger, I can make the other one a little bigger if I want. And it’s not just limited to two apps side by side.

    So here in IE, I’m going to right click and do open link in new window. And suddenly, what I have here is two IE windows side by side. (Applause.) Yeah. Suddenly, I have something that is starting to look like a very productive work station. And I can move these windows around, I can put them where I want. We have maximize, we have resize, and all of a sudden you start to realize that there’s more than one way of doing awesome productivity. This uses all the pixels on my PC.

    And on this sort of smallish monitor, I can fit three. But if I had something like a 2550 x 1440 monitor, I could show four apps on the screen at once. And all of a sudden, now you’re way more productive than you could have been on the desktop. You’ve got your Twitter feed, you’ve got your full running mail app, you’ve got multiple browser windows or multiple mails up at once.

    And it gets even better. If I attach a second monitor, then suddenly I can do the same thing on multiple monitors at once. So I have any collection of apps across my monitors in any configuration I want, any size I want, blending desktop and modern apps across my screens. I can bring the Start screen up on one and just leave it, and this doesn’t just work for two monitors, it works for three, four, five, six, seven, as many as I have. And so this sort of shows the power of Windows 8.1 and the modern UI even on a desktop engineering workstation making you more productive.

    And then we think about Windows starting on

    TAMI RELLER: A phone?

    JENSEN HARRIS: A phone. On 8-inch tablets, also doing the same multitasking and running all the way up across all of these devices, integrated with Xbox and out to any kind of workstation. And it is pretty fantastic.

    You can watch the full Tami Reller keynote about Windows 8.1 Product Enhancements [msPartner YouTube channel, July 9, 2013] presenting the complete high-end differentiation vs. the iPad and Android devices which contains the whole demo by Jensen Harris starting at [21:10] while the above part at [53:10], and the end of the demo is at [1:02:10]:

    And here is an overall First look at Windows 8.1 [Windows YouTube channel, June 5, 2013] video by Jensen Harris worth to watch as well:

    Jensen Harris from the Windows Team shows some highlights of what to expect in Windows 8.1 coming later this year as a free update for Windows 8 customers. http://bit.ly/10OM2Th

    Windows [inc. Phone] 8.x chances of becoming the alternative platform to iOS and Android: VERY SLIM as it is even more difficult for Microsoft now than any time before

    First recent findings about The hierarchy of developer needs: Creativeness, not money is the top motivator [VisionMobile blog, Aug 12, 2013] are showing quite clearly how much Microsoft is in disadvantage in the global developers community not only vs. iOS and Android, but even vs. HTML5 in general, which is already a real third platform for developers. Regarding that read UPDATE: HTML5 Vs. Native Mobile Apps — HTML5 Is Down But Not Out [Business Insider Australia, Aug 14, 2013], HIGHLY RECOMMENDED!

    It is even more so as a much better HTML5 platform (than the corresponding Windows 8 subset, so called WinJS) came now to the market with FireFox OS:
    – as its “first two devices hitting the market – the Alcatel OneTouch Fire and ZTE Open – the latter just launched in Spain from Telefonica for €69 ($90) contract-free including €30 ($39) of airtime for prepaid” according to p. 12 of the free Developer Economics Q3 2013 [VisionMobile, July 29, 2013] report
    – and “In just a short space of time, Firefox OS has managed to amass a respectable Developer Intent share, even before devices hit the market, and while competing for Windows Phone, Windows 8 and BlackBerry 10 all of which are much older platforms, with devices in market and billions of market dollars behind them.” as per p. 24 of the same report.

    Now the quite important findings from The hierarchy of developer needs: Creativeness, not money is the top motivator [VisionMobile blog, Aug 12, 2013]

    image

    What motivates developers? Is it fame or fortune? Our new Developer Segmentation 2013 report [starting from £1,495.00] addresses this questions, presenting a needs-bases segmentation model that focuses on developer goals, not just demographics. Based on data from our latest Developer Economics survey (6,000 respondents from 115 countries [FREE to download from here: HIGHLY RECOMMENDED]), this article gives you some insights from the report, discussing how the sense of achievement, not money is the prime motivator for developers.

    Most business are resorting to traditional, textbook marketing techniques to segment developers – by technology (web, Java, Windows, Android, Apple), job function (coders, designers, architects, team leads, IT managers, CxOs), by company size, app category (games vs enterprise developers), by audience (B2C vs B2B) or by demographics (age, income, education or location).

    Yet all these segmentation models are bound to fail, as they fundamentally neglect to address how developers make investment decisions in a new platform, API or SDK. In other words, it’s not age, job function, audience or technology background that influences how a developer chooses between Apple, Google, Windows Phone, BlackBerry or Tizen.

    To understand the complex mosaic of developer personas we segment developers in terms of their outcomes, or what developers are trying to achieve. This is based on the Jobs to Be Done methodology, popularized by Harvard Professor Clay Christensen and which constitutes today’s cutting edge in segmentation techniques. We have backed this model with unprecedented statistical rigor and hard data, from the largest-ever mobile developer survey of 6,000+ developers.

    Building on our earlier Developer Economics 2012 research work, we extracted hard data on thousands of developers in terms of their aspirations, motivations, challenges and plans in app development. We produced a unique model of eight developer segments – the Hobbyists, the Explorers, the Hunters, the Guns for Hire, the Product Extenders, the Digital Content Publishers, the Gold Seekers and the enterprise IT developers.

    How do these eight segments and three clusters contribute to the app economy? More importantly, when do these segments interact with platforms?

    We find that Explorers and Hobbyists, those seeking to learn, have fun and self-improve, make up 33% of the mobile developer population but only 13% of the app economy revenues. These segments prefer – more than average – BlackBerry 10, Windows Phone as a platform, as these are more often associated with experimentation and learning.

    The Hunters and Guns for Hire, those seeking revenues from the app economy, make up 42% of the developer population and 48% of the app economy revenues. These segments prefer – more than average – iOS as a platform, due to the consistent revenue-generating opportunities of the platform.

    Product Extenders, Enterprise IT developers, Digital Content Publishers and Gold Seekers, aiming at extending a [non-mobile] business [with apps], make up 29% of the developer population, and a whopping 39% of app economy revenues. These segments prefer – more than average – Android and HTML5 as a platformdue to the reach that these platforms offer across the entire smartphone and feature phone installed base.

    … <goes to “The Hierarchy of Developer Motivations” chart, not relevant to this post, so omitted> …

    Then Microsoft should take into account The evolution of handset business models: From source of profits to distribution channel [VisionMobile blog, Aug 5, 2013]

    The evolution of the PC and mobile handset industry have been mirror images of each other, as both saw two distinct disruptions: a new market disruption, followed by a low-end disruption. Guest author Sameer Singh discusses how the shift from integrated companies to modular competitors will pressure hardware profit margins across the industry, leading to the emergence of a new business model, i.e. hardware-as-distribution.

    image

    The mobile handset industry has already seen two waves of disruption: A “new market disruption”, led by Apple, and a “low-cost disruption”, driven by Google and its Android platform. Each wave created distinctly different business models that completely realigned competitive dynamics in the industry. Where do we go from here?

    We believe that the coming, third wave of disruption will again reshuffle the deck for all industry players. We will see growth in a new class of business models, where handset hardware is no longer seen as a source of profits, but is treated as a distribution channel for digital products and services.

    … <two long sections about “Dual Disruption Patterns in Computing” and “Impact of Value Chain Integration on Business Model Evolution” which are quite important to prove the author’s prediction about the inevitability of the third wave of mobile handset industry disuption, but for us here it is sufficient for our subject to include his “Third Disruption” discussion> …

    The Third Disruption: Hardware as a Distribution Channel

    As there will be fewer profits left in the handset industry, a third wave of disruption is a certainty.

    In the PC industry, once the dominance of modular architectures led to deep commoditization, hardware just became a distribution channel for software (the operating system and applications). The evolution of the mobile handset industry works out slightly differently. Google essentially destroyed the software licensing business model by giving the Android operating system away for free. Consequently, the cost of owning a proprietary operating system became unviable for most players (like Motorola, Sony Ericsson or Nokia) because hardware margins became severely pressured. This ensured that industry focus and profitability would accrue to the next layer of the value chain that was underserved, i.e. Google’s core business – online services.

    In the PC industry, OEMs like Dell and Sony used the “hardware as distribution” approach to charge software vendors to pre-install applications on their devices and boost margins. In the mobile industry, we have seen already numerous companies follow this model to create a competitive advantage by leveraging established ecosystems. Many service companies like Baidu, Dropbox, Opera, Facebook and Whatsapp have attempted this strategy by partnering with OEMs to pre-install or use their services by default.

    Another variation of this strategy, followed by services and content companies, is selling relatively high-end hardware at cost, in order to enable deeper penetration of the company’s core services. Companies like Amazon and Xiaomi compete asymmetrically with true hardware vendors in order to expand their consumer base. Both strategies have been quite successful – Amazon has expanded Kindle Fire availability to numerous countries based on strong sales and Xiaomi expects to double its handset sales to 15 million this year [to 20 million, see p. 25 of my The Upcoming Mobile Internet Superpower mini e-book]. Many more services companies like Evernote and Spotify are contemplating the low-cost, “hardware as distribution” strategy in the future. We have already seen a smartphone called SmartNamo dedicated to an Indian politician, Narendra Modi. Will we see a “Justin Bieber phone”, “Shah Rukh Khan phone” or even a “Real Madrid phone”?

    Rapid commoditization will only make it easier for companies to convert hardware into a distribution channel. The tablet industry has seen more price competition than the smartphone market in the absence of carrier-driven price distortions. As a result, commoditization has been much more rapid and the “hardware as distribution” model has come to the forefront in a very narrow time frame. Low-cost tablet hardware has allowed companies like Newscorp to enter the industry with preloaded, education-focused content. We have seen similar models emerge in South Africa, India, China and many more countries. As price competition increases, commoditization pressure in the smartphone industry, variations of “hardware as distribution”, could become one of the primary drivers of profitability.

    The expected shift in handset business models will reshuffle the deck once again. Companies that catch the trend early will find plenty of opportunities to create competitive advantages and thrive in the new environment. Those who miss it will be destined to fight the losing battle of “competition to the best”, which Prof. Porter calls “the granddaddy of all strategy mistakes”.

    On pp. 32-33 of my The Upcoming Mobile Internet Superpower mini e-book [Aug 14, 2013] it was further noted that:

    China Daily reported not less than 14 months ago that Xiaomi, China’s Apple success story?

    The broader vision of Xiaomi, Lei [Jun, chairman and chief executive officer of Xiaomi Corp] pointed out, is to ship more than 100 million smartphones annually for one model by 2016.

    “I know it (the vision) is crazy, but we would like to have a try,” said Lei. Cupertino-based Apple managed to sell more than 90 million iPhone devices last year. It is widely believed that Apple will break the 100 million unit mark this year, although it has been less than five years since the first iPhone launched in 2007.

    The difference in business model was even more clearly communicated in this recent interview: Xiaomi CEO: Don’t call us China’s Apple [Reuters TV YouTube channel, Aug 15, 2013]

    Aug. 15 – China’s Xiaomi has sparked a frenzy with a low-cost smartphone that may help the tech firm widen its lead over Apple in the local market — but CEO Lei Jun says it has very different ambitions.

    This shows very well how the above mentioned third disruption could fundamentally alter the current state of mobile intelligent devices market. As far as our subject is concerned my three other posts are giving further clues about growing Microsoft difficulties:


    Watch also a recent video report closely related to that: In China smartphone market, cheap rules – and Apple suffers [Reuters TV YouTube channel, Aug 19, 2013]

    Aug. 19 – Apple’s seen its market share in China dwindle as homegrown smartphone makers crank out feature-packed budget models. Could the launch of a cheaper iPhone restore its flagging fortunes?

    Consider also Apple and Samsung Losing Share to Chinese Smartphone Makers [China Internet Watch, Aug 7, 2013]

    image

    The high-end players like Apple and Samsung are losing share to Chinese manufacturers like ZTE, Huawei, and Lenovo, and no-name brands which are willing to make extremely cheap smartphones. As you can see in the picture, Samsung’s Q2 share in 2013 is 1% lesser than that of 2012, and Apple decreases 3.6% share, while Chinese manufacturers grow 3.5%.

    Microsoft: With cloud services investments starting to pay off Windows 8 and Windows Blue will bring more competitive devices particularly in new smaller form factors targeting the tablet market

    This statement is the essential  summary of Microsoft current performance according to the results  in the first 3 months of 2013 and the near term actions the company declared now to further improve its stance, particularly in the market which Microsoft critics are calling “PC market”, but not Microsoft, as its Earnings Call discussion was started with the following:

    Before I dive into more details on our progress …, I want to address what’s top of mind for many of you, which is our Windows business.
    There is no doubt that the device market is evolving. Consumers and businesses are increasingly shifting their focus to touch and mobility, and as a result, they want touch-enabled computing devices that are ultrathin, lightweight, and have long battery life. While Windows revenue has been impacted by the transition from the traditional PC to a new era of computing devices, the overall addressable markets are growing, and we are excited by the opportunities ahead of us.
    We built Windows 8 with touch and mobility at the center of the experience, which positions us well in this new era. However, the transition is complicated, given the size of our hardware and software ecosystem. We still have an immense amount of work to do, yet we feel good about the foundation we have laid and are optimistic about the long term success of Windows.
    I want to take some time now to be clear about where we are in this journey, and what we are doing to help drive this change. With Windows 8, we are setting a new, accelerated pace for updates and innovations, as we focus on making the Windows experience richer and better.
    Since launch we have delivered several important updates to improve our mail, storage, search, music, and video services. During the quarter, we also added to the Surface family of devices with Surface Pro, which combines the performance capabilities of a PC with a modern tablet design.

    This means that Microsoft is showing clear signs of staying relevant unlike some recent conclusions just stemming from the initial market difficulties of the new Windows 8 platform:

    When Gartner issued its “Forecast: Devices by Operating System and User Type, Worldwide, 2010-2017, 1Q13 Update.” on April 4 and stated in its related press release that:
    Traditional PC Market Predicted to Decline 7.6 Percent as Change in Consumers’ Behavior Drives Transition to Tablets and Ultramobiles
    The proliferation of lower-priced tablets and their growing capability is accelerating the shift from PCs to tablets. “While there will be some individuals who retain both a personal PC and a tablet, especially those who use either or both for work and play, most will be satisfied with the experience they get from a tablet as their main computing device,” said Carolina Milanesi, research vice president at Gartner. “As consumers shift their time away from their PC to tablets and smartphones, they will no longer see their PC as a device that they need to replace on a regular basis.”
    the Daily Ticker of Yahoo! Finance came to conclusion that Microsoft Could Be Obsolete By 2017: Gartner Report.

    So let’s examine all this in detail:

    Microsoft Reports Third-Quarter Results [press release, April 18, 2013], the sales revenue historic diagram is from qz.com while that of the Online Services Division operating income from businessinsider.com

    Microsoft Corp. today announced quarterly revenue of $20.49 billion for the quarter ended March 31, 2013. Operating income, net income, and diluted earnings per share for the quarter were $7.61 billion, $6.06 billion, and $0.72 per share.

    image

    The bold bets we made on cloud services are paying off as people increasingly choose Microsoft services including Office 365, Windows Azure, Xbox LIVE, and Skype,” said Steve Ballmer, chief executive officer at Microsoft. “While there is still work to do, we are optimistic that the bets we’ve made on Windows devices position us well for the long-term.”

    The Microsoft Business Division posted $6.32 billion of revenue, an 8% increase from the prior year period. Adjusting for the net recognition of revenue related to the Office Upgrade Offer and Pre-Sales, Microsoft Business Division non-GAAP revenue increased 5%. During the quarter, we launched the new Office, enhancing productivity and the user experience through new mobility, social, and cloud features.

    The Server & Tools business reported $5.04 billion of revenue, an 11% increase from the prior year period, driven by double-digit percentage revenue growth in SQL Server and System Center.
    Our enterprise business continues to thrive,” said Kevin Turner, chief operating officer at Microsoft. “Enterprise customers are increasingly turning to Microsoft for their IT solutions and as a result, we continue to take share from our competitors in key areas including hybrid cloud, data platform, and virtualization.”

    The Windows Division posted revenue of $5.70 billion, a 23% increase from the prior year period. Adjusting for the recognition of revenue related to the Windows Upgrade Offer [see: How Microsoft got Windows revenue to go up despite PC sales going down [The Guardian, Feb 19, 2013]], Windows Division non-GAAP revenue was flat. During the quarter, we added to the Surface family of devices with Surface Pro.

    The Online Services Division reported revenue of $832 million, an 18% increase from the prior year period. Online advertising revenue grew 22% driven by an increase in revenue per search.
    image
    The Entertainment and Devices Division posted revenue of $2.53 billion, an increase of 56% from the prior year period. Adjusting for the recognition of revenue related to the Video Game Deferral, the division’s non-GAAP revenue increased 33% for the third quarter. Xbox LIVE now has over 46 million members worldwide, an 18% increase from the prior year period.
    “Our diverse business continues to deliver solid financial results, even as we navigate the evolving device market,” said Peter Klein, chief financial officer at Microsoft. “Looking ahead, we will continue to invest in long-term growth opportunities to drive our devices and services strategy forward and deliver ongoing value to shareholders.”

    Microsoft’s Management Discusses F3Q 2013 Results – Earnings Call Transcript [Seeking Alpha, April 18, 2013] from which I extracted the following excerpts as the most notable ones:

    Peter Klein – Chief Financial Officer

    I think one of the main takeaways for me is in particularly some of our cloud services, we’re really starting to get scale. Bing continues to improve, their margins. And Office 365 is really starting to get to scale. So those things are really encouraging.

    Ed Maguire – CLSA

    You just launched your Azure infrastructure as a service. Just went generally available this week. And I’d love to get some color on how much that’s figuring in the growth in long term contracts, and what your expectations might be for more traditional infrastructure as a service uptake over the next several quarters.

    Peter Klein – Chief Financial Officer

    Great question. It’s clearly a key enabler of our [unintelligible] cloud OS story, and how we’re driving what we’re doing with enterprise in the data center. We have infrastructure as a service, we have now the most complete end-to-end offering through platform, and software, identity, and access.

    But having the infrastructure is a key enabler, and I think a real accelerator for the Windows Azure strategy, and really more broadly the cloud OS strategy. We now have a complete end-to-end story through the data center, from private, to hosted, to public, from infrastructure to platform, so I think it’s, again, a key enabler of that [all up] strategy, and an accelerator.

    Gregg Moskowitz – Cowen & Company

    In recent periods, we’ve seen your MBD [Microsoft Business Division]growth significantly outpace PC unit growth, although we now have a dynamic where your Office subscription is really resonating with customers. So the question is, just looking at it on a directional basis, is MBD revenue outperformance relative to PC units something that you think is sustainable going forward?

    Peter Klein – Chief Financial Officer

    The answer is that it will depend, and certainly an offset between attach gains we’re making against the market, offset against some deferrals as revenue moves to a subscription. And so it will kind of depend each quarter. Long term, it’s a great trend, because we’re building up a banked book of business on the subscription side, which will become less and less connected to the PC market.

    Then I focused on four subjects for which made further extracts from the Earnings Call:

    1. The Windows and Office (productivity) markets
    2. Q3 FY13 performance for that
    3. Q4 FY13 outlook for that
    4. PC market

    1. The Windows and Office (productivity) markets: Peter Klein – Chief Financial Officer

    Looking ahead, we will release the next version of Windows, codenamed Windows Blue, which further advances the vision of Windows 8 as well as responds to customer feedback. The assortment of touch-enabled devices that are built for Windows 8 by our OEM partners is also improving.

    Over the last couple of months, we’ve started seeing devices that take full advantage of Windows 8, and we expect to see more devices across more attractive price points over the coming months. As part of this, we are also working closely with OEMs on a new suite of small touch devices powered by Windows. These devices will have competitive price points, partly enabled by our latest OEM offerings designed specifically for these smaller devices, and will be available in the coming months.

    In the upcoming back to school selling season, we expect to see devices that incorporate advances from throughout the supply chain, including chipsets. As well, Intel’s fourth generation Core processor will help enable new devices that combine performance benefits with power savings. Later in the year, we expect to see devices based on Intel’s upcoming Bay Trail Atom processor, which promises to deliver tablets and hybrid PCs with extended battery life at competitive prices.

    Today in the Windows Store, there are six times as many apps since launch, and we expect more to be added as we gain traction with Windows 8 adoption. In June, we will host Build, our developer conference, where we will provide more tools and information for developers to build great Windows 8 apps.

    In retail, we are working to improve the consumer purchasing experience. Our initiatives include focused efforts to further educate and incentivize retail sales professionals and to have better in-store product differentiation.

    In summary, Windows is transforming to the new era of computing. As I said on our last earnings call, growth in Windows depends on our ability to give customers the exciting hardware they want at the price points they demand, and a wider range of apps and services to meet their diverse need. We are hard at work with our partners to meet these goals, and we’re confident we are moving in the right direction.

    Now, switching gears to productivity, this quarter we launched the latest version of Office, which brings mobility, social, and cloud features to the world’s most popular productivity app. Importantly, the new Office represents a fundamental shift in our model. Now both businesses and consumers can access Office through subscription.

    With this shift, we expect to grow our customer base, increase customer satisfaction via continuous updates, and reduce piracy. As our enterprise customers modernize their productivity infrastructures, we are confident that they will continue to deploy Office 365. We also expect our transactional customers to increasingly transition to the cloud with Office 365.

    It’s been a while now that we’ve been talking about our investments in the cloud, and I’m pleased to share that we are starting to realize the benefits of those investments in a meaningful way.

    Office 365 lights up with this latest release, as evidenced by our growing customer adoption. This quarter was our strongest ever, with net seat additions up 5 times of the prior year. One in four of our enterprise customers now has Office 365, and the business is on a $1 billion annual revenue run rate.

    2. Q3 FY13 performance: Chris Suh – General Manager of Investor Relations

    In the Windows Division, revenue was flat this quarter. Within that, OEM revenue performance was in line with the underlying x86 PC market, which continues to be challenged as the PC market evolves beyond the traditional PC to touch and mobile devices. This quarter, inventory levels were drawn down as the channel awaits new Windows 8 devices.

    Non-OEM revenue grew 40% this quarter, driven by sales in Surface and continued double digit growth in volume licensing. Businesses continue to value the Windows platform, and volume licensing of Windows is on track to deliver almost $4 billion in revenue this year, and nearly three-quarters of enterprise agreements that we signed this year include Windows.

    Additionally, this quarter we saw continued progress in the transition of Windows XP to Windows 7, and now two-thirds of enterprise desktops are running Windows 7.

    Now, I’ll move on to the Microsoft Business Division, where revenue grew 5%. Within that, business revenue grew 10%, driven by 16% growth in multiyear licensing. In January, we launched the new Office for consumers. The new Office introduces touch, social, and mobile scenarios as well as tight integration with SkyDrive, enabling access to documents from any device.

    The new Office is also available as a subscription, which benefits customers as they are always using the most modern version of Office. As Peter stated, we expect the shift to grow our customer base, and we saw strong early adoption of the subscription service.

    I would like to remind you that with subscription, the revenue is earned ratably over the length of the subscription, rather than at the initial purchase. All up, consumer revenue was roughly in line with the consumer PC market, influenced by the shift to subscription and strong [attach] gain.

    Peter Klein – Chief Financial Officer

    We are seeing [near term impact from going to subscription revenues on our revenues], particularly in our transactional business, in MBD [Microsoft Business Division], as people move from what may have been a transactional to a perpetual license, where the revenue is recognized up front, to a subscription service, where it’s recognized ratably. So you’re basically deferring the rest of the term of the subscription. So in the short term, you’ll be deferring revenues that were not in a subscription, and would have been recognized immediately.

    And as the subscription business is growing, you’ll see that impact growing, but over time, what you’ll get is what looks like an annuity revenue stream, that’s more predictable and has higher customer satisfaction and probably higher retention rates going forward. But in the short term, that will impact mostly in the transactional side of the MBD business.

    It is a fact that we are starting to get scale in our cloud services, and so the growth that we’re seeing in Office 365 is really coming at an improved margin as we scale that out.

    3. Q4 FY13 outlook: Peter Klein – Chief Financial Officer

    In the Windows Division, similar to this quarter, revenue will continue to reflect sales of Surface and strong volume licensing, while OEM revenue will be impacted by the declining traditional PC market as we work to increase our share in tablets.

    In the Microsoft Business Division, multiyear licensing revenue, which is approximately 60% of the division’s total, should grow low double digits. Excluding the recognition of revenue from the Office upgrade offer, transactional revenue, which is the remaining 40% of the division total, should be in line with the x86 PC market.

    As a reminder, when updating your Q4 models, we expect to recognize approximately $780 million of revenue related to the Office upgrade offer.

    … we are expanding both the product set and distribution, and that is broadly, all devices, inclusive of Surface. We are expanding distribution of Surface. We are now in 22 countries, 70 retailers. And we’ll continue to look to expand that. Not only just expanding, but improving the experience. And that’s true not just for Surface, but for broadly Windows 8 devices. And so we’ll be investing against that for both Surface and a broader array of Windows 8 devices at multiple price points, including lower price points going forward.

    4. PC market: Peter Klein – Chief Financial Officer

    On the PC market, I would look to some of the third parties, IDC and Gartner. They’re sort of in the 12-13-14 [%] down range this quarter. And in terms of the chipsets, we’ve always felt that with Windows 8, it was a process of the ecosystem of innovating across the board, and really starting to see that on the chips. And we’re very encouraged by both Haswell and some of the Atom processors to really improve the overall user experience that Windows 8 delivers. And over the coming selling season, I think that’s very encouraging and we’re optimistic about that.

    I think broadly, in improving our position in tablets, and generally in devices, there’s five or six dimensions ranging from what we’re doing with OEMs on the devices and the range of devices, and how they can have a range of price points. What the chips can do, because I think that’s a part of it. Both first party and third-party apps, and we’ve seen improvements across the board there. The user interface, and how we’re innovating across the user experience. And then distribution

    So if you start sort of from the bottom up, all the way to when you buy the product, we’re working across all those dimensions. And on the device side, we are working closely with the OEMs to help them take Windows 8 and show it off in all its glory, across different form factors. I talked about new smaller form factors and how Windows 8 can innovate to improve that experience.

    So I think the biggest thing we’re doing is helping them develop new and improved user experiences across the board, across size, across price point, and deliver a really compelling Windows 8 experience. And it’s not just the devices, like I said, it’s chips, it’s the apps, it’s the buying experience, it’s the user interface. So we’re really focused on all five or six of those dimensions going forward.

    Saving Intel: next-gen Intel ultrabooks for enterprise and professional markets from $500; next-gen Intel notebooks, other value devices and tablets for entry level computing and consumer markets from $300

    imageimageOR “2 for 1” (or “two-for-one”) touch and voice enabled ultrabooks of convertible and detachable form factors with Haswell / 4th generation Intel Core processor family (shipping now and on track for Q2’13 launch) starting as low as $500.

    Touch-enabled notebooks [other value devices and tablets]
    with Bay Trail
    down to the $300 to $400 range
    in Q4’13, and as low as $200 later.

    OR after Intel’s biggest flop: at least 3-month delay in delivering the power management solution for its first tablet SoC [‘Experiencing the Cloud’, Dec 20, 2012] AND Urgent search for an Intel savior [‘Experiencing the Cloud’, Nov 21 – Dec 11, 2012] Intel is finally ready to drop entry level prices to competitive levels in both enterprise/professional and entry level computing /consumer markets

    Updates: a young Seeking Alpha investment research contributor reflected on it as Intel Just Made A Huge Decision [April 14, 2013] with the following reasoning to close his article which I wholeheartedly agree with:

    Intel’s “Atom” chips command margins roughly in line with the corporate average. This makes sense given that Nvidia recently disclosed that its “Tegra” mobile SoC business carried roughly 50% gross margins. Given that Intel owns its own fabs (and doesn’t pay royalties to ARM), gross margins in the 60%+ range are completely plausible. The problem is that raw ASPs for the chips are much lower than that of the traditional notebook and desktop chips.
    Selling a $25 – $30 processor isn’t going to give you the raw margin dollars that a $100 processor will, even if the gross margin percentage is the same. If we start seeing a trend where people are simply going with the Atom based solutions rather than the Core solutions, then this will of course be a problem for Intel at the top and bottom lines. But if we see the “Core” solutions staying mostly flat with the rejuvenated Atom helping to gain back market share from the ARM vendors, then this is pure upside for Intel.
    My guess is that the “truth” is going to be somewhere in the middle. The people who need performance, will always need performance, and the people who generally bought low cost, would have bought the cheaper “Celeron” and “Pentium” products (these aren’t too much more expensive than an Atom/ARM SoC) anyway. I expect that the difference is that while today’s “Celeron” and “Pentium” products generally end up in crappy systems with bad screens, slow hard disks, and lousy battery life, the “Atom” products will end up in much more compelling systems, as the PC OEMs/Intel can’t really afford to keep the good stuff confined to expensive systems that people may not be buying anyway.
    Conclusion
    Intel made the right move to unleash Atom and to grin and bear the potential blended ASP erosion that is sure to happen. The key, then, is to focus not on blended ASPs, but to keep an eye on total revenue and gross margin dollars. If these grow as a result of Atom, then great – Intel gets rewarded with a higher multiple as it will have proven its viability going forward, and increased revenues/earnings will only further serve to amplify the share price. If revenues stagnate, then Intel still made the right decision (because it is likely that without Atom being competitive, ARM based chips would have caused continued negative growth), but will need to really focus on increasing the total # of devices that it serves.
    In no way is making Atom more competitive a “mistake”, and Intel would rather cannibalize itself than let the other chip vendors do it. The big question mark is how total sales are going to be, and whether a competitive Atom at the low end PC + tablet spaces is going to be enough. My bet is “yes”, but nothing is ever sure when it comes to business.

    Don’t forget meawhile that Intel promotes Android convertible notebooks, say vendors [DIGITIMES, April 19, 2013]

    Viewing that Windows 8 has been unable to stimulate global demand for notebooks, and global sales of Android tablets have been increasing, Intel has begun to promote Android tablet-convertible notebooks, and China-based vendor Lenovo has taken the initiative to launch initial models in May while Hewlett-Packard (HP), Toshiba, Acer and Asustek Computer will launch models in the third quarter, according to sources from notebook vendors.
    Lenovo’s Android-based Yoga notebook [see: Lenovo Yoga 11S ultrabook tablet-convertible [Notebookitalia YouTube channel, Jan 7, 2013] and the IDF Bejing slide inserted on the left in a smaller format, both embedded much below in this post], set for release in May, is expected to feature an 11-inch display, the sources noted.
    Intel has estimated that the price sweet spot of Android-based notebooks is around US$500, and the machines will also need to feature detachable keyboard designs to allow transformation into a tablet, the sources said.
    Since most consumers are familiar with Android, with the addition of document processing applications, the sources believe Android-based notebooks should be able to attract strong demand.

    At the same time Some China-based white-box vendors plan to develop Windows 8 tablets [DIGITIMES, April 17, 2013]

    Viewing that Android tablets, especially 7-inch models, have been under intense price competition and therefore profitability is thinning, some China-based white-box vendors are considering developing Windows 8 tablets equipped with Intel processors for market segmentation, according to industry sources at the 2013 China Sourcing Fair: Electronics and Components taking place in Hong Kong during April 12-15.
    The products are expected to show up at the beginning of the third quarter, at the soonest.
    The sources believe that since the volume of tablets using a Windows operating system is still low, if they are able to enter the market ahead of others, there may be a chance of gaining profits.
    Although related costs are expected to increase by using Intel’s platform and Microsoft’s operating system, the sources pointed out that the advantage as an early mover will allow them to achieve better gross margins than for Android-based models. The fees from the operating system are not really a huge concern, the sources added.

    End of updates

    Sections of this post:

    1. Touch-enabled notebooks [other value devices and tablets] with Bay Trail down to the $300 to $400 range in Q4’13, and as low as $200 later.
    2. “2 for 1” (or “two-for-one”) touch and voice enabled ultrabooks of convertible and detachable form factors with Haswell/4th generation Intel Core processor family (shipping now and on track for Q2’13 launch) starting as low as $500.
    3. Intel’s CEO Discusses Q1 2013 Results – Earnings Call Transcript [Seeking Alpha, April 16, 2013]
    4. Earlier information from Intel


    1. Touch-enabled notebooks [other value devices and tablets] with Bay Trail
    down to the $300 to $400 range in Q4’13, and as low as $200 later.

    image
    Note that on this slide demoed on the screen of Bay Trail prototype (see the video embedded below) the targeted launch is set for “HR’13”, meaning “Holiday Revenue 2013”. Note as well that the Bail Trail SoC is both for entry desktop (i.e. Celeron) and entry notebook (i.e. current Atom) replacement. This why in the video below both an entry desktop motherboard prototype (from Gigabyte) and an entry notebook (from ASUS) is demoed. The range of devices with Bay Trail SoC is going to be however much wider than that, as is communicated already by Intel in the below excerpts. More exact information will be available later.

    From: Intel’s CEO Discusses Q1 2013 Results – Earnings Call Transcript [Seeking Alpha, April 16, 2013]

    … as we get into the Christmas selling season … we’ll see, because of Bay Trail coming into the marketplace, you’ll see touch-enabled thin notebooks with really good performance that are hitting kind of $300 price points. And then with our Android tablets, you’ll see things that are significantly …

    … If you look at touch-enabled Intel based notebooks that are ultrathin and light using non-Core processors, those prices are going to be down to as low as $200 probably. …

    Intel Bay Trail Prototype Hands On & HD Video Demo [minipcpro YouTube channel, April 9, 2013]

    Intel Bay Trail http://www.mobilegeeks.com. At IDF Beijing Intel took the opportunity to quietly announce Bay Trail, this new processor line up will be aimed at entry level computing. The new product line will feature Baytrail M for Mobile and Baytrail D for desktop. The 22nm chipset will be aimed at smartphones and tablets and in desktop think All in One systems. Bay Trail will be the most powerful Atom processor to date as it will be offering a Quad Core SoC, it should double the computing performance on Intel’s current generation of tablet processors.

    From: Intel Developer Forum: Transforming Computing Experiences from the Device to the Cloud [press release, April 10, 2013] Images are inserted from:
    Reinventing the Computing Experience presentation at IDF 2013 by Kirk Skaugen, Intel senior vice president and general manager of the PC Client Group
    Mobile Inside at IDF 2013 by Tan Weng Kuan, vice president and general manager of the Mobile Communications Group, Intel China
    Developing on Innovative Intel® Atom™ Processor Based Tablet Platforms [April 11, 2013 presentation by Intel at the IDF Beijing]

    Augmenting the company’s offerings for computing at a variety of price points, Skaugen announced plans for new market variants of its “Bay Trail22nm SoC with PC feature sets specifically designed for value convertibles, clamshell laptops, desktops and value all-in-one computers to ship later this year.

    imageTaking full advantage of the broad spectrum of capabilities enabled by Intel® architecture, processor technology leadership, manufacturing and multi OS support across Windows* 8 and Android*, Tan discussed the company’s forthcoming smartphone and tablet products based on Intel’s leading-edge 22nm process and an entirely new Atom microarchitecture. Intel’s quad-core Atom SoC (“Bay Trail“) will be the most powerful Atom processor to-date, doubling the computing performance of Intel’s current-generation tablet offering1. Scheduled for holiday 2013 tablets [in market Q4’13], “Bay Trail” will help enable new experiences and designs as thin as 8mm that have all-day battery life and weeks of standby.

    image

    What’s New in Tablets? Intel Powers Android & Windows 8 [channelintel YouTube channel, Feb 27, 2013]

    Intel continues its tablet expansion, now powering both Android and Windows 8 devices.


    2. “2 for 1” (or “two-for-one”) touch and voice enabled ultrabooks of convertible and detachable form factors
    with Haswell / 4th generation Intel Core processor family (shipping now and on track for Q2’13 launch) starting as low as $500.

    From: Intel’s CEO Discusses Q1 2013 Results – Earnings Call Transcript [Seeking Alpha, April 16, 2013]

    … as we get into the Christmas selling season, your expectation is you will see touch-enabled ultrabooks that are $499 and $599 pretty commonly out there. $599 commonly, and $499 as kind of special SKUs.

    From: Intel Developer Forum: Transforming Computing Experiences from the Device to the Cloud [press release, April 10, 2013]
    Images are inserted from Reinventing the Computing Experience presentation at IDF2013 by Kirk Skaugen, Intel senior vice president and general manager of the PC Client Group

    Reinventing the Computing Experience

    During his keynote, Kirk Skaugen, Intel senior vice president and general manager of the PC Client Group, provided a deeper look at the forthcoming 4th generation Intel Core processor family, which he said is now shipping to OEM customers and will launch later this quarter.

    Ultrabooks based on the 4th generation Intel Core processor family will enable exciting, new computing experiences and all-day battery life delivering the most significant battery life capability improvement in Intel’s history,” said Skaugen. “It will also bring to consumers a new wave of ‘two-for-oneconvertible and detachable systems that combine the best of a full PC experience with the best of a tablet in amazing new form factors.”

    NEW Architecture on 22nm Tri Gate

    NEW Intel Power Optimizer: 20x Power Reduction
    vs. 2nd gen Intel® Core™ Processors

    NEW Integrated on package PCH [Platform Controller Hub]
    for amazing form factors

    NEW Integrated Audio DSP: more battery life, higher quality

    Shipping Now and On Track for Q2 2013 Launch

    The new Intel Core microarchitecture will allow the company to deliver up to double the graphics performance over the previous generation. In addition, the new graphics solution will have high levels of integration to enable new form factors and designs with excellent visual quality built in. Skaugen demonstrated these graphics improvements on the 4th generation Intel Core processor-based Ultrabook reference design called “Harris Beach.” The demo featured Dirt 3*, a popular gaming title, showing the same visual experience and game play as a discrete graphics card that users would otherwise have to add separately. He also showed the 4th generation Intel Core processor-based concept, codenamed “Niagara,” a premium notebook with the ability to play the unreleased enthusiast title Grid 2* from CodeMasters* without the aid of a discrete graphics card.

    Along with touch capability, Intel® Wireless Display (Intel WiDi) will be enabled on all 4th generation Intel Core processor-based Ultrabook devices to allow people to quickly and securely stream content and apps from devices to the big screen, free from the burden of cables. Skaugen said the China ecosystem is taking the lead on integrating Intel WiDi into systems, and announced that the leading television manufacturer in China, TCL*, has a new model with the Intel WiDi technology built in. He also announced new receivers certified for Intel WiDi from QVOD* and Lenovo* and a set-top box from Gehua*.

    Where the idea of “2 for 1” (or “two-for-one”) was already demonstrated in 
    Convertible Ultrabook™ Features [channelintel YouTube channel, Feb 7, 2013]

    A complimentary piece to the “Best of Both World’s” Live-action video. This animation is intended to educate the viewer on the specific features and details surrounding convertible Ultrabook™. Many different form factors are shown as well as several usage models to give the user an idea for the many different ways that a user can take advantage of a convertible Ultrabook™.

    and here is The Best of Both Worlds, a Convertible Ultrabook™ Story (Long Version) [channelintel YouTube channel, Feb 27, 2013] live–action video for that

    A day in the life of our favorite PC user, Alysha Nett. Watch as she uses her Intel-based Convertible Ultrabook™ for both work and play — follow the two sides of her story as she uses the Ultrabook™ by day in her interior design job and by night out with friends watching her favorite band, “We Will Be Lions”. A shorter version of this video is also available.

    Shown first at CES 2013 for May’13 delivery: Lenovo Yoga 11S ultrabook tablet-convertible [Notebookitalia YouTube channel, Jan 7, 2013]

    Lenovo unveiled the IdeaPad Yoga 11S at CES 2013, highlighting the ability of this 11.6-inch notebook to turn into an 11.6-inch tablet.

    As well as a detachable form factor ultrabook reference design: IDF Beijing 2013 Keynote Demo – North Cape [channelintel YouTube channel, April 17, 2013]

    Kirk Skaugen showcases the North Cape reference design at the Intel Developer Forum in Beijing.

    Kirk Skaugen:

    [0:17] This is a full 17 mm clamshell ultrabook. In this configuration it actually has 13 hours of battery life, and it is a full Core i5 computer. But what I can do here, as I can just very simply push in an electronic eject button, and lift it out very simply with one hand. About 3 hours of battery life comes from a battery that sits under the keyboard. But here then I have an amazing notebook that gives me a less than 3 pound tablet with 10 hours of battery life. [0:51]

    At CeBIT 2013 in Hannover, Germany (March 5-9) North Cape was demonstrated as:
    Haswell Ultrabook – North Cape Reference Design Hands-On [Steve Chippy Paine YouTube channel, March 5, 2013]

    and in the companion article it was reported:

    In a chat with one of the marketing managers I confirmed that there will be COnnected Standby and non-Connected Standby Ultrabooks on Haswell. The CS Ultrabooks are likely to be the cream of the crop and will be more expensive but will have lower power profiles. Clearly the hybrid designs are the perfect fit for CS-capable Ultrabooks but I’ wouldn’t be surprised to see Samsung have a CS-capable Series 9. Remember, CS is not just about being up-to-date with emails, it means apps can run when the Ultrabook is in your bag, without a fan, on an SSD, for days. It’s the mark of extreme battery life, it’s very exciting technology and likely to be exclusive to Ultrabooks.

    then immediately before IDF the same source delivered the news that Haswell Ultrabooks could achieve Tablet-like 100mW Connected-Idle [April 9, 2013]

    imageIn a presentation due to go out at the Intel Developer Forum over the next two days Intel will outline best practices for low-power idle on Ultrabooks. Today you’ll be lucky to see an Ultrabook idle to less than 3000mW (3 Watts) which is a background drain that’s always there. On Haswell, Intel says that you could get to a screen-off idle state of 100mW.
    By effectively removing nearly 3W of background drain, all operations are going to benefit, not just idle. Where Internet browsing was a 9W operation, expect to see that go down to around 6W for a big increase in battery life.
    The 100mW target requires both system designers and software engineers to build to the best standards but when it comes to laptops, it’s the Ultrabooks that have the best chance of getting the best engineers working on them. Low-power DDR3 memory, SSD storage, high-quality power components and tight board design mean the best systems won’t be cheap systems but all the ingredients and skills are now available to make laptops that idle like tablets.
    Intel also want’s to see engineers using configurable TDP and other features to create systems in the 10W (fanless) range. High Density Interconnects on motherboards could also bring advantages. By reducing the mainboard size, space is created for more battery. Intel says there’s a chance to fit 20-45% more battery inside when motherboard sizes are reduced using HDI techniques.
    imageWhile the ingredients and techniques might be on the shelf, it’s up to the OEMS to decide how they use them. Pricing pressures often lead to compromises so don’t expect all of the new engineering techniques to appear on anything but the high-end Ultrabooks.

     

    More information: Form Factor and Average Power Innovations for Ultrabooks™
    [April 10, 2013 presentation by Intel at the IDF Beijing] with the following abstract:

    Intended Audience: OEMs and ODMs – Motherboard Layout Designers, Power Delivery, and Power Management Architects
    In this session we propose methods to improve, form factor, battery capacity, and power consumption for Ultrabook™ devices. We show how High Density Interconnects (HDI) Printed Circuit Boards could free up considerable space for more battery and other features, especially in thinner Ultrabooks. We show current practices with HDI and propose better ways to achieve higher mother board area reduction to close the cost gap between type 3 and type 4 (HDI) designs. For power consumption, we also show design methods to reduce average power, especially by reducing platform idle power.

    and agenda:

      • What is HDI?
      • Benefits of HDI in Form Factor Constrained Systems
      • Reducing the Cost of HDI
      • Reducing Platform Power
      • Thermal management an Power Configurability

    North Cape was first shown at CES 2013, so OEMs had pretty much time to work on Haswell based offerings to be unveiled in Q2’13:
    Intel Delivers Broad Range of New Mobile Experiences [press release, Jan 7, 2013]

        • 4th generation Intel® Core™ processor family (formerly codenamed “Haswell“) will enable a broad new range of Ultrabook convertibles, detachables and tablets with all-day battery life; the biggest battery life gain over a previous generation in company’s history3.
    3 4th Generation Intel Core processors provide 3-5 hours of additional battery life when compared to 3rd Generation Intel Core processors, based on measurement of 1080p HD video playback.

    Low Power Fuels Ultrabook Innovation

    Since mid-2011, Intel has led the industry in enabling Ultrabook devices aimed at providing new, richer mobile computing experiences in thin, elegant and increasingly convertible and detachable designs. To enable these innovative designs, Intel announced last September that it added a new line of processors to its forthcoming 4th generation Intel Core processor family targeted at about 10 watt design power, while still delivering the excellent performance people want and need.

    Skaugen announced today that the company is bringing the low-power line of processors into its existing 3rd generation Intel Core processor family. Available now, these chips will operate as low as 7 watts, allowing manufacturers greater flexibility in thinner, lighter convertible designs. Currently there are more than a dozen designs in development based on this new low-power offering and they are expected to enable a full PC experience in innovative mobile form factors including tablets and Ultrabook convertibles. The Lenovo IdeaPad Yoga* 11S Ultrabook and a future Ultrabook detachable from Acer will be among the first to market this spring based on the new Intel processors and were demonstrated by Skaugen on stage.

    The 4th generation Intel Core processor family enables true all-day battery life — representing the most significant battery life capability improvement in Intel history. Skaugen disclosed that new systems are expected to deliver up to 9 hours of continuous battery life, freeing people from some of the wires and bulky power bricks typically toted around.
    “The 4th generation Core processors are the first Intel chips built from the ground up with the Ultrabook in mind,” Skaugen said. “We expect the tremendous advancements in lower-power Core processors, and the significant ramp of touch-based systems will lead to a significant new wave of convertible Ultrabooks and tablets that are thinner, lighter and, at the same time, have the performance required for more human-like interaction such as touch, voice and gesture controls.”

    To demonstrate the impact of the 4th generation Intel Core processor family, Skaugen showed a new form factor Ultrabook detachable reference design (codenamed “North Cape“) that converts into a 10mm tablet and can run on battery for up to 13 hours while docked.

    Advancements made in the way consumers will interact with their computing devices were also demonstrated, including natural and more immersive interaction experiences using a 3-D depth camera. Intel showed applications running on an Ultrabook in which objects can be manipulated naturally with free movements of the hands, fingers, face and voice. One application that was demonstrated can be used for enabling new and immersive video collaboration and blogging experiences. These were all enabled using the Intel® Perceptual Computing SDK Beta. This year, Intel expects more Ultrabooks and all-in-one (AIO) systems to offer applications for voice control (Dragon Assistant*) and facial recognition (Fast Access*) for convenience and freedom from passwords.

    So this was first shown at CES 2013 as well: IDF Beijing 2013 Keynote Demo — Perceptual Computing SDK [channelintel YouTube channel, April 17, 2013]

    New gesture and voice capabilities shown during Doug Fisher’s keynote at the Intel Developer Forum in Beijing

    which was used in the IDF Beijing 2013 Keynote Demo – Personified Chat [channelintel YouTube channel, April 17, 2013]

    The latest in perceptual computing demonstrated using an example of personified chat at the Intel Developer Forum Beijing.

    IDF 2013 Beijing Highlights Day One [channelintel YouTube channel, April 16, 2013]

    Intel® UltrabookConvertible SBA v1 [channelintel YouTube channel, April 2, 2013]

    Get the flexibility to move your business forward with the ultra versatile, ultra sleek, Ultrabook™. Inspired by Intel®

    Intel® UltrabookPerformance SBA v2 [channelintel YouTube channel, April 2, 2013]

    You have big business goals. Reaching them requires the right tools. The ultra responsive, ultra sleek Ultrabook™. Inspired by Intel®.


    3. Intel’s CEO Discusses Q1 2013 Results – Earnings Call Transcript [Seeking Alpha, April 16, 2013]

    Paul Otellini for the second half of the year for sales:

    … as the OEMs start looking at new form factors that they can design around our new chips, Haswell in particular, and maybe Bay Trail, and Windows 8, enabling touch, the explosion in form factors and the competitiveness of that platform is going to be substantially different, at price points down into the $300 to $400 range enabling touch. We didn’t have that last year. So you go into the prime selling season with new products, new technologies, new form factors, and new capabilities that, up to now, were unapproachable price points.

    Paul Otellini regarding his current view on Haswell’s potential to revitalize the PC market with Windows 8:

    With Haswell, there’s a number of things. First of all, the overall performance goes up, graphics performance goes up, as well as the integer performance. So it’s a better punch in the package than we’ve had with Ivy Bridge. Point one. Point two, the power envelope, or the batter life for that level of performance, is exceptionally better than Ivy Bridge.

    Third, it gets into the form factor innovation and the integration with touch as I spoke about earlier, which I think is really part of the recipe required for Win 8 adoption. I’ve recently converted personally to Windows 8 with touch, and it is a better Windows than Windows 7 in the desktop mode, when you implement the touch and the touch-based applications and operating environment. It’s just a lot easier to use.

    There is an adoption curve, and once you get over that adoption curve, I don’t think you go back. And we didn’t quite have that same kind of adoption curve in Windows 7 versus XP before it. This requires a little bit of training. And I think people are attracted to touch, and the touch price points today are still fairly high, and they’re coming down very rapidly over the next couple of quarters.

    Paul Otellini about technology transitions:

    We’ve also got the technology transition to the 14 nanometers. [unintelligible] a first order, all of our spending is focused on 14 nanometers , which gives us a fairly significant ramp capability. If demand for older products exceeds what we could build on 14, we could still build 22 for quite some time. So I really think it depends on whatever demand scenario you see out there. In any event, the most important thing for us is to make that transition to 14 and continue to have the leading edge.

    Lenovo Talks Tablets [detachable ultrabooks] at HIMSS 13 [channelintel YouTube channel, April 16, 2013]

    At HIMSS 13, Lenovo Ambassador Ashley Rodrigue showed off the company’s new health IT convertible devices that feature the best of both worlds for clinicians—a detachable tablet and an Ultrabook laptop for more robust activity. The benefit for health IT professionals? Just one device to manage. Find out more information and read the latest blog posts on health IT in the Intel Healthcare Community: http://communities.intel.com/community/healthcare

    Paul Ottelini on what Intel can do to help the PC ecosystem to become healthy again:

    I think continue to give them the tools to innovate. And I wouldn’t paint the entire customer base with the same brush that you just did. Certainly if you looked at the last quarter, even inside the PC space, Lenovo outperformed everybody else, and actually had a very good year on year set of numbers, in a down year. Apple continues to do well.

    Subsets of customers in different segments are also doing very well in terms of, say, those. Those providing products into the internet data centers. What I see when we look out is a tremendous amount of innovation, particularly at the ODM and Taiwanese OEM side, where the ability to miniaturize and bring things into extremely thin form factors is as revolutionary as the amount of changes I’ve seen in my time in this industry.

    And so I think what we can do is give them the products, like Haswell and Bay Trail to innovate around. We can help them with other feature sets like voice and speech that go around them, and just help them build better products.

    Paul Ottelini on Intel efforts to invest in things outside of what could called core PC, such as the set top box or in the foundry efforts or other areas of revenue that the company is seeking:

    I don’t look at things with quite that level of granularity. The foundry thing, the investment is really going to be taking advantage, at least near term, with the current customer base, of capacity that we’re already putting in place. That doesn’t mean that at some point we won’t have to actually build extra capacity for a foundry customer or a foundry business, but today, up to this point, it’s certainly within our ability to absorb.

    The set top box spending, or the stuff we’re doing in Intel Media, in the grand scheme of things, is not a lot of spending. So the real issue is inside of our core microprocessor and platform development, and we’re at the point now where roughly half of our spending is focused on System on Chip, inside the microprocessor world.

    And the System on Chip environment is really a lot of the ultramobile products. It’s the phones, it’s the tablets. It’s embedded systems. It’s automotive, etc. Where we have fairly strong growth opportunities. So it’s not the same monolithic Tick-Tock model that we put in place eight years ago.

    Paul Otellini on the proper interpretation of the new price points mentioned earlier in the earnings call:

    We have a certain spec for ultrabooks, and that is the product that Stacy said is going to be centered at as low as $599 with some [diverse] SKUs to $499. If you look at touch-enabled Intel based notebooks that are ultrathin and light using non-Core processors, those prices are going to be down to as low as $200 probably.

    Re: Stacy Smith (Chief Financial Officer, Executive Vice President) about the sources of increased confidence now in versus where Intel was three months ago talking earlier in the earnings call as follows:

    First of all, just to make sure I’m not oversoaking things here, you really just need seasonal from where we are in order to achieve the low single digit revenue growth. So I don’t think we have a hugely high bar out there, and I went through a dissection of where I think the revenue comes from.

    In terms of the things that give me confidence, or at least I personally believe it could be better than seasonal, it’s the things we talked about, improving macroeconomic environment, the fact that we now are participating across a range of compute devices, and so the mix between those don’t impact us nearly as much.

    And then third, as Paul said, you have innovative form factors coming out in ultrabooks, in convertibles, and in detachables, that are hitting these really compelling mainstream price points that are touch enabled. And as we get into the Christmas selling season, your expectation is you will see touch-enabled ultrabooks that are $499 and $599 pretty commonly out there. $599 commonly, and $499 as kind of special SKUs.

    And then we’ll see, because of Bay Trail coming into the marketplace, you’ll see touch-enabled thin notebooks with really good performance that are hitting kind of $300 price points. And then with our Android tablets, you’ll see things that are significantly, [hey, I have that]. So we’ll be participating across a broad range of compute devices as we get into the back half of this year.


    4. Earlier information from Intel:

    Intel Accelerates Mobile Computing Push [press release, Feb 24, 2012]

    NEWS HIGHLIGHTS

    • Launches dual-core Intel® Atom™ Processor-based platform (formerly “Clover Trail+”) aimed at performance and mainstream smartphone market segments, and providing double the compute performance and 3x graphics capabilities1 with competitive battery life. Product to also debut in Android* tablets.
    • Reveals one of the world’s smallest2 and lowest-power multimode-multiband LTE solutions for global roaming in one SKU with envelope tracking and antenna tuning. Shipping single mode now with multimode shipments beginning first half of 2013.
    • Demonstrates continued momentum in emerging markets with Intel® Atom™ Z2420 processor, including new smartphone engagement with Etisalat* in Egypt. ASUS* to also debut a new Android* tablet based on the Atom Z2420 processor.
    • Announces support from leading ODMs for next-generation quad-core Atom SoC (“Bay Trail”), scheduled to be available for holiday 2013.
    • Extends mobile device enabling efforts to tablets, followed by phones.
    MOBILE WORLD CONGRESS, Barcelona, Spain, Feb. 25, 2013 – Intel Corporation today announced a range of new products, ecosystem and enabling efforts that will further accelerate the company’s presence in mobile and help usher in new devices and richer experiences with Intel Inside®.
    The announcements include a new dual-core Atom™ SoC (“Clover Trail+“) platform for smartphones and Android* tablets, and the company’s first global, multimode-multiband LTE solution that will ship in the first half of this year. Other disclosures included “Bay Trail” momentum, mobile device enabling efforts, and continued smartphone momentum in emerging markets with the Intel® Atom™ Z2420 processor-based platform.
    “Today’s announcements build on Intel’s growing device portfolio across a range of mobile market segments,” said Hermann Eul, Intel vice president and co-general manager of the Mobile and Communications Group. “In less than a year’s time we have worked closely with our customers to bring Intel-based smartphones to market in more than 20 countries around the world, and have also delivered an industry-leading low-power Atom™ SoC tablet solution running Windows* 8, and shipping with leading OEM customers today. Looking forward, we will build upon this foundation and work closely with our ecosystem partners, across operating systems, to deliver the best mobile products and experiences for consumers with Intel Inside.”
    New, Efficient Atom™ SoC Platform
    Intel’s new Atom™ processor platform (“Clover Trail+“) and smartphone reference design delivers industry-leading performance with low-power and long battery life that rivals today’s most popular Android* phones. The product brings Intel’s classic product strengths, including high performance that lets you enjoy smooth Web browsing,  vibrant, glitch-free, full HD movies, and an Android* applications experience that launches fast and runs great.
    The platform’s 32nm dual core Intel® Atom™ Processors — Z2580, Z2560, Z2520 — are available in speeds up to 2.0 GHz, 1.6 GHz and 1.2GHz, respectively. The processor also features support for Intel® Hyper-Threading Technology, supporting four simultaneous application threads and further enhancing the overall efficiency of the Atom cores.
    The integrated platform also includes an Intel® Graphics Media Accelerator engine with a graphics core supporting up to 533MHz with boost mode, and delivering up to three times the graphics performance1 for rich 3-D visuals, lifelike gaming and smooth, full 1080P hardware-accelerated video encode and decode at 30fps.
    “Our second-generation product delivers double the compute performance and up to three times the graphics capabilities1, all while maintaining competitive low power,” Eul said. “As we transition to 22nm Atom SoCs later this year, we will take full advantage of the broad spectrum of capabilities enabled by our design, architecture, 22nm tri-gate transistor technology, and leading-edge manufacturing to further accelerate our position.”
    The new Atom platform also brings advanced imaging capabilities, including support for two cameras, with a primary camera sensor up to 16 megapixels. The imaging system also enables panorama capture, a 15 frame-per-second burst mode for 8 megapixel photos, real-time facial detection and recognition, and mobile HDR image capture with de-ghosting for clearer pictures in flight.
    The platform is also equipped with Intel® Identity Protection Technology (Intel IPT), helping to enable strong, two-factor authentication for protecting cloud services such as remote banking, e-commerce, online gaming and social networking from unauthorized access. Since Intel IPT is embedded at chip-level, unlike hardware or phone-based tokens, it can enable more secure, yet user-friendly cloud access protection. Intel is working with partners including Feitian*, Garanti Bank*, MasterCard*, McAfee*, SecureKey* Technologies Inc., Symantec*, Vasco Data Security International* Inc. and Visa* Inc. to incorporate this technology into their services.
    With WUXGA display support of 1920×12003, the platform will also enable larger-screen Android* tablet designs. It also includes support for Android* 4.2 (Jelly Bean), Intel Wireless Display Technology, HSPA+ at 42Mbps with the Intel® XMM 6360 slim modem solution, and the new industry-standard UltraViolet™ Common File Format.
    Customers announcing support for “Clover Trail+” platform for phones and tablets include ASUS*, Lenovo*, and ZTE*.
    Debuting at CES last month, the Lenovo* IdeaPhone K900* is based on the Intel® Atom™ processor Z2580 and delivers rich video, graphics and Web content at fantastic speeds. The IdeaPhone is 6.9mm thin and also features the world’s first 5.5-inch full high-definition 400+ PPI screen for increased clarity of text and images. The K900 will be the first product to market based on the Atom processor Z2580. Lenovo plans to introduce the smartphone in the second quarter of 2013 in China, followed soon by select international markets.
    Building on the Atom processor platform (“Clover Trail+”), Intel also highlighted its forthcoming 22nm smartphone Atom™ SoC (“Merrifield“). The product is based on Intel’s leading-edge 22nm process and an entirely new Atom microarchitecture that will help enable increased smartphone performance, power efficiency and battery life.
    Long-Term Evolution (4G LTE)
    Intel’s strategy is to deliver a leading low-power, global modem solution that works across multiple bands, modes, regions and devices.
    The Intel XMM 7160 is one of the world’s smallest2 and lowest-power multimode-multiband LTE solutions (LTE / DC-HSPA+ / EDGE), supporting multiple devices including smartphones, tablets and Ultrabooks™.  The 7160 global modem supports 15 LTE bands simultaneously, more than any other in-market solution. It also includes a highly configurable RF architecture running real time algorithms for envelope tracking and antenna tuning that enables cost-efficient multiband configurations, extended battery life, and global roaming in a single SKU.
    “The 7160 is a well-timed and highly competitive 4G LTE solution that we expect will meet the growing needs of the emerging global 4G market,” Eul said. “Independent analysts have shown our solution to be world class and I’m confident that our offerings will lead Intel into new multi-comm solutions. With LTE connections projected to double over the next 12 months to more than 120 million connections, we believe our solution will give developers and service providers a single competitive offering while delivering to consumers the best global 4G experience. Building on this, Intel will also accelerate the delivery of new advanced features to be timed with future advanced 4G network deployments.”
    Intel is currently shipping its single mode 4G LTE data solution and will begin multimode shipments later in the first half of this year. The company is also optimizing its LTE solutions concurrently with its SoC roadmap to ensure the delivery of leading-edge low-power combined solutions to the marketplace.
    Intel® Atom™ Platform Z2420
    As Intel expands its geographic presence, the company sees tremendous opportunity in delivering rich Intel-based mobile experiences to consumers across emerging markets.
    As part of its strategy to take advantage of the fast growing market for value smartphones in emerging markets, which some analysts expect to reach 500 million units by 2015, Intel highlighted continuing momentum with the Intel Atom Processor Z2420 platform (formerly “Lexington“). Since it was first announced at CES, Acer* (Thailand, Malaysia), Lava* (India) and Safaricom* (Kenya) have all announced new handsets.
    Etisalat Misr*, a leading telco operator based in Egypt and a subsidiary of Etisalat group UAE, in collaboration with Intel today announced plans for the Etisalat E-20 Smartphone with Intel Inside®. Set to debut in Egypt in April, the Intel-based handset will be the first in the Middle East and North Africa region, and the second introduction in Africa to-date, building on the recent launch of Safaricom* in Kenya.
    Demonstrating the flexibility of the Atom SoC platform to accommodate a range of device and market segment needs, ASUS* later today will announce a new Android* tablet based on the Intel® Atom™ Processor Z2420.

    Tablets with Intel Inside®

    Building on the device momentum and industry-leading power-efficiency of the award-winning Atom processor Z2760, Intel’s first quad-core Atom SoC (“Bay Trail“), will be the most powerful Atom processor to-date — doubling the computing performance of Intel’s current- generation tablet offering and providing the ecosystem with a strong technology foundation and feature set from which to innovate. The “Bay Trail” platform, scheduled to be available for holiday 2013, is already up and running on Windows* and Android* and will help enable new experiences in designs as thin as 8mm that have all-day battery life and weeks of standby.

    Intel is currently working with Compal*, ECS*, Pegatron*, Quanta* and Wistron* to accelerate “Bay Trail” tablets to the market. Intel is also extending its work with leading OEM partners globally, building on the strong foundation of  Intel Atom processor Z2760-based tablet designs in market from Acer*, ASUS*, Dell*, Fujitsu*, HP*, Lenovo*, LG Electronics and Samsung*.

    Enabling Mobile Devices with Intel Inside®

    Intel today announced an expansion of its ecosystem enabling efforts to deliver new device and market innovations across a range of Windows*- and Android*-based mobile devices.

    Intel platform and enabling programs have been the foundation of OEM and ODM innovation for decades. The new program will focus on accelerating time to market for leading-edge mobile devices based on Intel® architecture with top OEMs and ODMs. The program will focus first on tablets, followed by phones, providing pre-qualified solutions with simplified building blocks to scale designs quickly for mature and emerging markets. The Atom Processor Z2760 and the company’s forthcoming 22nm Atom SoC, codenamed “Bay Trail,” will be the starting foundation for the effort.

    1 Compared to the Intel Atom Processor Z2460 platform; Graphics clock will vary based on SKU: Z2580, Z2560, Z2520.
    2 Compared with competitive solutions shipping in market today.
    3 Corrected from misprinted ‘1900×1200’ to ‘1920×1200’ – Feb. 27,21013

    Intel Developer Forum: Transforming Computing Experiences  from the Device to the Cloud [press release, April 10, 2013]
    Images are inserted from Reinventing the Computing Experience presentation at IDF2013 by Kirk Skaugen, Intel senior vice president and general manager of the PC Client Group

    Company Accelerates Expansion of 22nm Data Center Processor Families; Graphics Innovations, Intel® Wireless Display Coming to Next-Generation Ultrabooks

    NEWS HIGHLIGHTS

    • Accelerates expansion of offerings across the data center processor product lines based on Intel’s innovative 22nm manufacturing technology.
    • Aims to revolutionize the server rack design by delivering an Intel rack scale architecture for increased flexibility, density and utilization of servers leading to lower total cost of ownership.
    • Next-generation, 64-bit Intel® Atom™ processor for microservers, codenamed “Avoton,” is being sampled to customers with broad availability expected in the second half of this year.
    • 4th generation Intel® Core™ processors are now shipping to customers and will launch later this quarter.
    INTEL DEVELOPER FORUM, Beijing, April 10, 2013 – During Intel Corporation’s annual developer forum this week, company executives announced new technologies and partnerships aimed at transforming how people experience technology from the device to the cloud. The announcements included details on new data center product lines based on the 22-nanometer (nm) process technology and the new Intel rack scale architecture, along with details on the forthcoming 4th generation Intel® Core™ processor family.
    During her keynote, Diane Bryant, Intel senior vice president and general manager of the Datacenter and Connected Systems Group, underscored the importance of the data center in enabling amazing personal computing experiences to deliver real-time information and services. She also outlined the steps Intel is taking to provide the hardware and software needed for data analytics to improve the capabilities of intelligent devices and data center infrastructure.
    “People are increasingly demanding more from their devices through applications and services whether at home, at work or wherever they may be,” Bryant said. “Intel is delivering a powerful portfolio of hardware and software computing technologies from the device to the data center that can improve experiences and enable new services.”
    Bryant outlined plans to accelerate the expansion of Intel’s offerings across the data center processor product lines based on its innovative 22nm manufacturing technology before the end of the year, thereby enabling a more cost-effective and efficient data center infrastructure. Intel’s broad portfolio of data center intellectual property enables Intel to quickly integrate features into new products and bring them to market. For example, Intel is launching the new Intel® Atom™ S12x9 processor family customized for storage today, just four months after the debut of the Intel Atom S1200 processor for microservers.
    Intel plans to deliver two more Intel Atom processor-based products this year that promise to deliver new architectures, improved performance-per-watt and an expanded feature set. Bryant demonstrated for the first time the next-generation Intel Atom processor family for microservers, codenamed “Avoton,” and confirmed it is currently shipping samples to customers for evaluation. Avoton will feature an integrated Ethernet controller and is expected to deliver industry-leading energy efficiency and performance-per-watt for microservers and scale out workloads.
    Re-Architecting the Data Center
    Bryant also revealed details on Intel’s plans to develop a reference design for rack scale architecture that uses a suite of Intel technologies optimized for deployment as a full rack. Hyper-scale data centers run by companies that maintain thousands of servers and store vast amounts of data require continued advancements in rack designs that make it easier and more cost effective to deal with major growth in users, data and devices. Traditional rack systems are designed to handle a wide variety of application workloads and may not always achieve the highest efficiency under all hyper-scale usages. The reference design will help re-architect a rack level solution that is modular at the subsystem level (storage, CPU, memory, network) while providing the ability to provision and refresh or logically allocate resources based on application specific workload requirements. Benefits include increased flexibility, higher density and higher utilization leading to a lower total cost of ownership.
    Additional information on these announcements as well as the new Intel Atom processor S12x9 product family for storage servers, Intel® Xeon® processor E3v3 product family, Intel Xeon processor E7v2 product family and Intel Atom processor for communication and networking devices codenamed “Rangeley” is available in the news fact sheet.

    Reinventing the Computing Experience

    During his keynote, Kirk Skaugen, Intel senior vice president and general manager of the PC Client Group, provided a deeper look at the forthcoming 4th generation Intel Core processor family, which he said is now shipping to OEM customers and will launch later this quarter.

    Ultrabooks based on the 4th generation Intel Core processor family will enable exciting, new computing experiences and all-day battery life delivering the most significant battery life capability improvement in Intel’s history,” said Skaugen. “It will also bring to consumers a new wave of ‘two-for-oneconvertible and detachable systems that combine the best of a full PC experience with the best of a tablet in amazing new form factors.”

    image

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    NEW Architecture on 22nm Tri Gate

    NEW Intel Power Optimizer: 20x Power Reduction
    vs. 2nd gen Intel® Core™ Processors

    NEW Integrated on package PCH [Platform Controller Hub]
    for amazing form factors

    NEW Integrated Audio DSP: more battery life, higher quality

    Shipping Now and On Track for Q2 2013 Launch

    The new Intel Core microarchitecture will allow the company to deliver up to double the graphics performance over the previous generation. In addition, the new graphics solution will have high levels of integration to enable new form factors and designs with excellent visual quality built in. Skaugen demonstrated these graphics improvements on the 4th generation Intel Core processor-based Ultrabook reference design called “Harris Beach.” The demo featured Dirt 3*, a popular gaming title, showing the same visual experience and game play as a discrete graphics card that users would otherwise have to add separately. He also showed the 4th generation Intel Core processor-based concept, codenamed “Niagara,” a premium notebook with the ability to play the unreleased enthusiast title Grid 2* from CodeMasters* without the aid of a discrete graphics card.

    Along with touch capability, Intel® Wireless Display (Intel WiDi) will be enabled on all 4th generation Intel Core processor-based Ultrabook devices to allow people to quickly and securely stream content and apps from devices to the big screen, free from the burden of cables. Skaugen said the China ecosystem is taking the lead on integrating Intel WiDi into systems, and announced that the leading television manufacturer in China, TCL*, has a new model with the Intel WiDi technology built in. He also announced new receivers certified for Intel WiDi from QVOD* and Lenovo* and a set-top box from Gehua*.

    Illustrating the low-power advances in Ultrabook devices, Skaugen showed off the new Toshiba Portege* Ultrabook detachable, based on the new low-power line of the 3rd generation Intel® Core™ processors.

    image

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    Furthermore, Skaugen revealed that voice interaction in Mandarin is now available on Ultrabook devices from Intel through Nuance*.

    Augmenting the company’s offerings for computing at a variety of price points, Skaugen announced plans for new market variants of its “Bay Trail” 22nm SoC with PC feature sets specifically designed for value convertibles, clamshell laptops, desktops and value all-in-one computers to ship later this year.

    image

    Mobile Inside
    Tan Weng Kuan, vice president and general manager of the Mobile Communications Group, Intel China, highlighted how the company is working with ecosystem partners to deliver the best smartphone and tablet experiences with Intel inside. Tan discussed the company’s progress with the new Intel® Atom™ processor Z2580 (“Clover Trail+“) for smartphones and the Intel Atom Processor Z2760 (“Clover Trail“) for tablets, both of which are helping to usher in a range of new devices and user experiences.

    image

    Taking full advantage of the broad spectrum of capabilities enabled by Intel® architecture, processor technology leadership, manufacturing and multi OS support across Windows* 8 and Android*, Tan discussed the company’s forthcoming smartphone and tablet products based on Intel’s leading-edge 22nm process and an entirely new Atom microarchitecture. Intel’s quad-core Atom SoC (“Bay Trail“) will be the most powerful Atom processor to-date, doubling the computing performance of Intel’s current-generation tablet offering1. Scheduled for holiday 2013 tablets [in market Q4’13], “Bay Trail” will help enable new experiences and designs as thin as 8mm that have all-day battery life and weeks of standby.

    Tan also highlighted Intel’s Atom SoC, codenamed “Merrifield,” which is scheduled to ship to customers by the end of this year [in market Q1’14]. The product will deliver increased smartphone performance, power efficiency and battery life over the current-generation offering.
    Tan closed his remarks by calling upon China developers for collective innovation in helping to accelerate and grow the mobile market together. He announced the creation of a China-specific expansion of the company’s platform and ecosystem enabling efforts, focused initially on Atom processor-based tablets running Android*, and designed to speed time-to-market of leading-edge mobile devices based on Intel technology. He added that China developers are instrumental to this effort and will bring speed, scale and ingenuity that will drive new innovation globally.
    Day 2 IDF Preview
    Doug Fisher, vice president and general manager of Intel’s System Software Division, will open the second day of IDF, addressing several myths surrounding the industry and providing a vision on the vast opportunities that await developers. Specifically, he will showcase Intel’s transformation of the PC experience and advances in device segments, support of multiple operating environments and efforts to help developers scale and modernize computing with new hardware features and software advancements for more compelling user experiences. He will discuss how developers can utilize HTML5 to help lower total costs and improve time-to-market for cross-platform applications development and deployment, incorporate touch and sensor interfaces to modernize applications, and use perceptual compute technologies to enable consumers to interact with PCs via voice control, gesture recognition and more.
    Intel Chief Technology Officer Justin Rattner will also take the stage to discuss how Intel Labs is drawing up plans for a bright future. He will reveal a vision for connected and sustainable cities where information technology helps to address challenges of clean air, clean water, better health and improved safety. He will also explain how today’s mobile, urban lifestyle is demanding faster and cheaper wireless broadband communications. Forecasting a move beyond the information age, Rattner will describe a new era coined “the data society” and show how information in the cloud will work on everyone’s behalf, collaboratively and safely, by analyzing and relating different data to deliver new value to individuals, enterprises and society as a whole. Rattner plans to surprise the audience with an exclusive first look at Intel® Silicon Photonics Technology.

    This was summarized by Intel in a New Ultrabook™ experiences unveiled at IDF Beijing 2013 [Intel Developer Zone blog, April 16, 2013] post as follows:

    Last week at the Intel® Developer Forum held April 10-11, 2013 in Beijing, China, Ultrabooks™ were in the spotlight as new experiences based on the 4th generation Intel® Core™ processor family were announced:

    “Ultrabooks based on the 4th generation Intel Core processor family will enable exciting, new computing experiences and all-day battery life delivering the most significant battery life capability improvement in Intel’s history,” said Skaugen. “It will also bring to consumers a new wave of ‘two-for-one’ convertible and detachable systems that combine the best of a full PC experience with the best of a tablet in amazing new form factors.” – Kirk Skaugen, Intel senior vice president and general manager of the PC Client Group

    There are three major factors in this new announcement: amazing graphics, even more Ultrabook form factor designs, and low-power advances creating longer battery life. Touch capability will also be part of this new generation of devices, along with Intel® Wireless Display (Intel WiDi) enabled on all on all 4th generation Intel Core processor-based Ultrabook devices to allow people to quickly and securely stream content and apps from devices to the big screen.

    4th generation Intel® Core™ processors

    The Ultrabook computing category was first introduced in 2011 with a 2nd generation Intel® Core™ processor. This was ramped up greatly in 2012 with the addition of touch and mainstream price points, along with the 3rdgeneration Intel core processor. In 2013, we get to experience a 4th generation Intel Core processor and the concept of “2 for 1” computing; basically, we get to experience a table and a PC experience in one machine:

    “The new Intel Core microarchitecture will allow the company to deliver up to double the graphics performance over the previous generation. In addition, the new graphics solution will have high levels of integration to enable new form factors and designs with excellent visual quality built in. Skaugen demonstrated these graphics improvements on the 4th generation Intel Core processor-based Ultrabook reference design called “Harris Beach.” The demo featured Dirt 3*, a popular gaming title, showing the same visual experience and game play as a discrete graphics card that users would otherwise have to add separately. He also showed the 4th generation Intel Core processor-based concept, codenamed “Niagara,” a premium notebook with the ability to play the unreleased enthusiast title Grid 2* from CodeMasters* without the aid of a discrete graphics card.” –Intel Newsroom

    These new processors will include:

    • new architecture on 22nm Tri Gate
    • Intel Power Optimizer: 20x power reduction vs. 2nd gen Intel Core Processors
    • integrated on package PCH for amazing form factors
    • integrated audio DSP which means more battery life and higher quality

    Graphics

    With this new generation of processors comes increasingly higher level graphics support, including:

    • 3D graphics with up to 2x performance
    • integrated on-package EDRAM memory
    • API support
    • Display with new 3-screen collage display
    • enhanced 4k x 2k support
    • 2x bandwidth with display port 1.2
    • Media with new faster Intel Quick Sync Video
    • faster JPEG and MPEG decode
    • new OpenCL 1.2 support

    (Source: IDF Keynote)

    Touch

    Touch is becoming more mainstream, and more consumers than ever before are expecting touch as a standard addition to their devices. In an Intel study of touch carried out in December of 2011, users chose touch nearly 80% of the time when given the choice between touch, keyboard, mouse, and track pad. These findings were echoed in another touch study by UX Innovation Manager Daria Loi:

    “With touch capability becoming available in more and more Ultrabook devices, Intel undertook a research program to better understand if and how people might use touch capabilities in more traditional, notebook form-factor devices…… To spoil the ending, the results were positive-very positive, in fact. Users who were presented with a way to interact with their computers via touch, keyboard, and mouse found it an extremely natural and fluid way of working. One user described it using the Italian word simpatico-literally, that her computer was in tune with her and sympathetic to her demands.” – “The Human Touch: Building Ultrabook™ Applications in a Post-PC Age” [Intel Developer Zone blog, July 11, 2012]

    Touch designs in Ultrabook form factors continue to ramp up, especially with the October 2012 launch of Windows*8, and this trend is expected to continue.

    Power

    One of the most intriguing announcements to come out of Beijing was the idea of heightened power consumption for the Ultrabook. Chips for notebooks, phones, and tablets are going to be greatly enhanced, boosting both runtime and standby power:

    “By effectively removing nearly 3W of background drain, all operations are going to benefit, not just idle. Where Internet browsing was a 9W operation, expect to see that go down to around 6W for a big increase in battery life….. By reducing the mainboard size, space is created for more battery. Intel says there’s a chance to fit 20-45% more battery inside when motherboard sizes are reduced using HDI techniques.” – Ultrabooknews.com

    Higher power expectations ties in with the announcement of 4th generation Intel Core processor Ultrabook systems that are coming out as early as June 2013 and on track for Q2 2013 launch.

    Ultrabooks: just getting started

    The experience you can expect from an Ultrabook with the new 4th generation core processor is, in a word, superior. These are extremely responsive machines that offer amazing performance, a natural UI with touch and voice, and AOAC (always on always connected) as a given. You also get to take advantage of Intel Identity Protection, anti-virus, facial log-in, vPro, and Small Business Advantage so your data is always safe. The machine itself is meant to be mobile, with all-day battery life, thinner lighter designs, and Intel Wireless Display. And let’s not forget that it just looks cool; great visuals, 2 in 1 convertibles and detachable form factors, not to mention a high res display.

    Ultrabook as a PC category is continuing to drive market innovation; we’re seeing thinner form factors, intriguing designs (convertibles, detachable, etc.), and more natural human/computer interaction, such as voice control integration. Ultrabooks are able to deliver what is essentially a mobile computing experience; we’re looking at consumption usages similar to that of a smartphone or a tablet, with the productivity potential and sheer computing power of that of a full-blown PC. Is it a notebook or is it a tablet? The beauty of an Ultrabook is that it’s both.

    Windows RT Buzz: only the naming will disappear?

    Microsoft defends Windows RT as necessary disruption [CNET, March 21, 2013]
    vs.
    Microsoft to merge Windows RT into next-generation Windows OS [DIGITIMES, March 27, 2013]

    These headlines tell everything. And don’t forget, end of March is the end of PRISM when all top level decisions for the next fiscal year have already been taken. Now put these two media reports against each other:

    [Michael] Angiulo [corporate vice president, Windows Planning, Hardware & PC Ecosystem] says Microsoft has good reason to stick with the platform.
    “It was a ton of work for us and we didn’t do the work and endure the disruption for any reason other than the fact that there’s a strategy there that just gets stronger over time.
    Looking at things now like power performance and standby time and passive [fanless] form factors. When we launched Windows 8, it was really competitive with a full-sized iPad. A lot of that was made possible by the ARM [chip] architecture.
    If you look forward a year or two and you look at the performance output of ARM chips, those are some really capable chips. I think it has a very bright future.
    People are talking about legacy desktop software not running, but they don’t think about the customer benefit of only running modern apps. The only apps that you install from the Windows store are the kind, that as a customer, you can manage your rights to.
    Let’s say you drop that PC in a pool. Well, you get a new one and then you just redownload [the apps]. That’s the kind of model people are used to with a phone or tablet today. I can maintain all the apps in the [Microsoft] store and reset with a single switch.
    So, on Windows RT, the user experience stays consistent over time. That’s a big benefit. And as the number of apps grow in the store, that value promise only gets stronger.
    And on the ARM side, there is a propensity for a much higher percentage of PCs that are going to ship with mobile broadband [3G/4G], precisely because ARM PCs have even longer battery life [than Intel PCs] on connected standby [when a device is in standby mode but still connected to e-mail, social networking sites, and the Internet in general].”
    Microsoft will no longer launch products under its Windows RT line and will instead merge the product line into the software giant’s next-generation Windows, codenamed Blue, according to sources from the upstream supply chain.
    Although the PC supply chain had pushed the Windows on ARM (WoA) platform aggressively, the Windows RT’s name, which has misled most consumers into believing that the operating system is able to support all existing x86 Windows programs, the lack of apps, as well as compatibility issues have all significantly damaged demand.
    The next-generation of Windows is expected to make its first appearance at the Microsoft Build Developer Conference 2013, hosted from June 26-28 in San Francisco, the US.
    The sources believe that Wintel PC demand is likely to drop significantly before Intel and Microsoft’s next-generation products show up in the second half of the year.

    With that the strategy to stick to Windows RT as a product, but not as a name, is crystall clear. Nevertheless between these two news dates we have other news articles in the world which are casting doubts on the future of Windows RT as a product.

    Look at the bulk of news headlines between March 21 and March 28 to see the kind of mixed reporting. As these headlines coming from the proper Google search: