Where do Apple rumors come from? Digitimes explains

Digitimes Research sheds some light on the the Apple supply chain -- the source of many a rumor -- before the release of the product.

(Credit: Mock-up by Brooke Crothers based on iPhone 5S)

With a large-screen iPhone 6 possibly showing up this year, Digitimes Research provides some insight into where and when Apple rumors likely originate.

In an article posted Friday titled Explaining the Chaiwan Model for the Mobile Supply Chain, Digitimes Research talked about, among other things, timing.

"We may provide shipment data for Apple 1-2 months before it even begins selling in the market, because that is when the supply chain delivers it to Apple," Digitimes Research said.

That may explain the crush of relatively reliable rumors that typically hit about a month before the product appears.

But there are stages before that. "When Apple is getting a product ready for the market, the product is in the supply chain pipeline 6-9 months before Apple even announces its launch," Digitimes Research said.

That assertion about a product being at suppliers but still going through changes six to nine months before release sheds light on some of the more dubious rumors that appear early on.

And where does the process begin?

"A brand like Apple or Samsung controls everything in the process of bringing their products to market...For example, it starts with the key component provider, which in the case of smartphones is the application processor."

So, a chip, like the Apple A7, or rumored A8 -- generally referred to as application processors -- may play a big part in the early stages of the product.

In a related discussion, Digitimes Research also notes that there "has been a seismic shift" in the design and manufacturing of products.

If you look at [processor] provider MediaTek, the company no longer follows a strict roadmap. It simply reacts to what the market wants. In 2013, for example, MediaTek sometimes went a couple of months without releasing a new product and then would release two products in the same month. They weren't following a roadmap, they were chasing demand.

Finally, Digitimes Research also spells out how Apple (and Samsung) have a different approach to mobile (smartphones and tablets) as opposed to laptops.

Huge brands like Apple and Samsung...continue to pursue a vertical integration strategy whereby they can control more of the design...in order to give them differentiation...However, this is a much different business model than that seen in the notebook industry, where ODMs provide designs to the brands and choose their own components. ODMs do a lot of heavy lifting in terms of product development, while EMS firms simply provide manufacturing services. The brands have much more control over the overall design and component choice.

Early Apple rumors, like the concept video above of an "iPad Pro," are usually pure speculation.

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Microsoft to reportedly cut Windows pricing by 70% as Apple, Google eat PC marketshare

As the mobile device market — led by device from Apple and Google — continues to devour traditional PC marketshare, Microsoft is reportedly looking cheaper Windows licensing fees in a bid to stop the hemorrhaging.

Citing people familiar with the matter, Bloomberg reports Microsoft will slash Windows licensing fees by 70 percent for low-cost hardware manufacturers in an attempt to regain marketshare lost to devices running iOS, Android and Chrome.

Under the supposed pricing scheme, OEMs will pay $15 to preinstall Windows 8.1 on devices that sell for less than $250. The fee is down from a traditional rate of $50 per device. Further, Microsoft will not impose restrictions on hardware size or form factor as long as the final product meets the required low retail price.

In addition to the lower fees, Microsoft will also relax its licensing standards by allowing manufacturers using the cheaper rates to forego logo certification. Usually, hardware compatibility is vetted by the Redmond, Wash., company. In addition, these sub-$250 products do not have to be touch enabled.

Recently-appointed Microsoft CEO Satya Nadella is said to be pushing for accelerated development and launch timelines for new Windows devices. The rumored licensing price cuts may be part of that plan.

Friday's report follows rumors that Microsoft is "seriously considerding" allowing Android apps to run on both the PC and mobile iterations of Windows. The move would allow the Windows maker to tap into Google's immense share of the mobile device market.

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Apple snaps up app-testing company Burstly

(Credit: James Martin/CNET ) Apple is said to have acquired the app-testing and analytics startup Burstly, and on Friday all but confirmed it: "Apple buys smaller technology companies from time to time, and we generally do not discuss our purpose or plans," an Apple spokesperson told CNET. Burstly is the operator of popular developer services like TestFlight, which lets app makers deploy an app to a small amount of users for field testing before wider release. That way, developers can work out kinks and monitor things like in-app purchases and the app's durability against crashing, without having to put the product up for full release on an app store. The startup also announced this week that it would end TestFlight's support of Android apps on the platform -- a clear indication of Apple asserting its new ownership, taking a dig at iOS's arch rival. Android support will officially end on March 21st. TechCrunch, which first reported news of the deal, also said that the startup's engineers have already begun working at Apple. Terms of the deal were not disclosed, but Apple is clearly continuing its trend of scooping up smaller companies for technological gains, as opposed to bigger, splashier buys, like Facebook made this week in its jaw-dropping purchase of messaging service WhatsApp for over $16 billion.

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Apple is the next Microsoft, analyst says

Barclays analyst Ben Reitzes says he just doesn't see growth in Cupertino's future, whether it's from a watch or a TV. Is this really Steve Ballmer? (Credit: James Martin/CNET) The first time I ever talked to an analyst, she told me that I was perfectly sane, but merely needed a few hundred Prozac to lighten my burden. This early, troubling experience has tended to color my encounters with the word "analyst." However, in the venal world of money, every time an analyst speaks, numbers seem to twirl on Wall Street in nervous reaction. I am surprised, therefore, that Wall Street and half of California didn't endure electrical faults on hearing that an analyst had declared Apple heading down Microsoft Way. As Business Insider reports, Barclays' Ben Reitzes sniffed that Apple's shares were, you know, alright to have and to hold, but only if you're prepared for richer or poorer. "Frankly, we just couldn't quite bring ourselves to use smart watches or TVs as reasons to raise numbers," he said. "Nor were we fully convinced that these products could move the needle like new categories did in the old days." Ah, the old days. When iPods were exciting and Barclays was just a bank. Reitzes, though, continued to make the one comparison that will energize the bile of many who believe Apple to be the way, the truth, and the life. He said: "We look at a valuation analogy vs. Microsoft from 2000 to about 2010 and see no precedent that large-size tech companies simply start to broadly outperform again after a tough year or two if the law of large numbers is catching up to them and margins have peaked." In essence, Apple is just like Microsoft, merely steps away from a flattened mediocrity, and ready to elect a hoodie-wearing cricket fan to the CEO's throne. Reitzes might turn out to be right. It may well be that Apple slips into a fallow irrelevance, as other competitors (who?) stomp upon it with innovation (what innovation?). Still, analysts make many predictions so that at least some of them might turn out to be right. Some analysts, I understand, even put their money on the very opposite side of where there mouth is. It's called being clever or something. Your fickle is their normal. Why, just two years ago, an analyst issued an upgrade note on Apple. He used phrases like "solid momentum," "pent-up demand" and "bloody hell, there's money to be made here." Actually, I made the last one up. What I'm not making up is that the optimistic analyst of 2012 was Barclays' Ben Reitzes. Has it really all gone so wrong for Apple in these last two years? One analyst says "perhaps." Another says "perhaps not."

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Samsung Materials Affiliates Hold Investment Due to Slow Business

It has been about four months since the electronic material research center of the Samsung Group was opened in Suwon City, Gyeonggi Province. However, its subsidiaries’ move-in is continuing to be delayed. Besides, the recent poor performances of Cheil Industries, Samsung SDI, and Samsung Fine Chemicals and their investment postponement announcements are adding difficulties to the Samsung Group’s plan for the promotion of its material business segment.

At present, Cheil Industries has yet to complete its relocation, and Samsung Fine Chemicals is planning to be housed there from next month, according to its plan to move the headquarters to Suwon. Only Samsung SDI has finished the relocation so far.

Under the circumstances, some industry insiders point out that the Samsung Group has failed to draw up a big picture for the restructuring of its materials business arms. “The overhaul is likely to be led by Samsung Electronics, but no specific plan has been suggested yet,” said one of them, adding, “It seems that Samsung is suffering from the lack of a control tower.”

The trouble has been compounded by the subsidiaries’ less-than-expected earnings for the fourth quarter of last year. Not a few investment plans have been put on hold, signaling some change in their long-term business strategies. Cheil Industries and Samsung SDI recorded losses in that quarter while Samsung Fine Chemicals’ annual operating profits fell below zero. The first has decided to reexamine its 1.8 trillion won (US$1.68 billion) investment plan for the next three years. The third is going to pace itself as well in manufacturing polysilicon and positive electrode active materials for secondary batteries.

Things were quite different earlier last year. At that time, Cheil Industries took over Novaled, which owns OLED patents, and sold its fashion business unit to Samsung Everland to speed up the reorganization. However, the pace has been significantly slowed, due mainly to the poor performance of Samsung Electronics, one of its major clients.

The group has not come up with any countermeasures, either. This means that the future of the subsidiaries of Samsung is not entirely rosy in the short term.

Samsung Fine Chemicals is moving ahead with its polysilicon and active material businesses, through collaboration with SunEdison (formerly MEMC) of the US and TODA of Japan. Samsung SDI, in the meantime, is producing products based on its PDP patent contracts with Seiko, Asahi, Sony, etc. Although they have hundreds of patents and their own R&D teams and projects, these are easily eclipsed by its rivals like LG Chem.

This is why some employees of the companies are claiming that the chemical business unit, rather than electronics, lead the development of the materials business in view of its own characteristics, that is, at least five to 10 years is taken for at least some tangible results. Then, it is Cheil Industries that is to assume the central role. Still, it remains to be seen whether or not Cheil Industries is capable enough when its business showings and relations with the National Pension Service, the largest shareholder, are taken into consideration.

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