Dell, a mass marketer, turning to high-end

Dell, which has beaten its competition by slicing profit margins and turning low-price computers into a commodity, is now turning to the high end, reports The New York Times (28 September).

The newspaper says Dell will announce today that it will begin selling a line of desktop and laptop computers it is marketing as luxury models.

According to the NYT.,while expensive laptops are nothing new, trying to sell them as a luxury product is. Dell said its new XPS brand would be sold at higher prices - and fatter margins - than its Dimension PC's and Inspiron laptops, starting at US$2,700 for the laptop and US$1,100 for entry-priced units of three desktop models.

The newspaper says Dell will sell the customised computers directly to customers over the phone or on the internet as it does with existing lines, but it has assigned a sales force and customer service team to handle XPS customers.

The announcement of the new line will be made today by Michael S. Dell, the company's founder and chairman, at a location that underscores the premise - the Ritz-Carlton Hotel on Central Park South in Manhattan.

The NYT reports that, as the personal computer market matures, manufacturers are seeking ways to reach specialised pockets of customers willing to pay a premium. The makers of watches or purses have long profited from dressing up their products and company image, and selling their wares as luxury goods. That strategy has been extended to utilitarian electronic products as well; the Vertu cellphone, for example, is sold through its own boutiques in Europe.

The newspaper says that at the high end of the computer market, Lenovo, the Chinese computer maker that bought IBM's ThinkPad line, is introducing a "special edition" laptop, the Z series, with a brushed titanium case. Apple's laptops have always commanded a premium relative to comparable PC's. Alienware and VoodooPC have been aiming at gamers willing to pay top dollar for a computer that plays PC games faster than their opponents' machines.

According to the NYT.,these desktops and laptops not only have the latest components, but also have cases with glowing lights and colorful finishes that resemble those of custom-built cars. With such extras, these machines command prices of US$3,000 or more while a low-end laptop can go for US$500.

Struggling Japanese electronics maker Sanyo Electric on Wednesday widened its loss estimate for this year, and said it would speed up job cuts, exit its DVD business and close some domestic plants.

Reuters reports in The New York Times (28 September) that Sanyo's net loss in the business year to March is now seen to total 140 billion yen (US$1.24 billion), compared with the firm's previous estimate of 92 billion yen.

The revision reflected falling prices of digital appliances as well as slumping sales at its consumer products and components divisions, it said.

According to Reuters in the NYT report, Sanyo slashed its operating profit forecast by a steep 72 percent to 18 billion yen for this business year, which would be less than half its profit earned a year ago.

The company also said it would complete two-thirds of planned job cuts by January 2006.

Under its original plan released in July, the country's third-largest consumer electronics firm said it would cut 14,000 jobs, or about 15 percent of its global work force, as part of a three-year restructuring scheme through March 2008, Reuters reports.

While speeding up the job cuts, Sanyo said it would also end its DVD player, DVD recorder and VCR businesses.

Reuters reports that the company said it will also close a factory in Hyogo prefecture, western Japan, where it first began operations in 1947 and a chip factory in Gunma prefecture, central Japan, by the end of March 2006, while aiming to cut 170 billion yen in costs over three years.

Sanyo said earlier on Wednesday it planned to downsize its semiconductor and home appliances divisions and shift resources to more promising areas such as rechargeable batteries and industrial-use air conditioners where it still earns healthy profits.

The Reuters/NYT report says that the company's announcement comes on the heels of revival plans announced last week by electronics giant Sony, which said it would cut about 7 percent of its work force, sell more than US$1 billion in assets and post a loss this year.

Japan's Toshiba said on Wednesday it would delay its launch of next-generation HD DVD players in the US market to around February or March, revising its prior plan for a year-end start date.

Reuters reports in The New York Times (28 September) that Toshiba, Japan's second-largest electronics conglomerate, said it still planned to introduce HD DVD players in the Japanese market by year-end.

Research in Motion said Tuesday it will use Intel's cellular microprocessors in upcoming BlackBerry devices as it tries to boost performance without sacrificing battery life.

The Associated Press reports in The New York Times (27 September) that the widely expected move is expected to improve the BlackBerry's ability to handle multimedia and internet applications. The gadget is best known for its thumb keyboard and wireless messaging and some models also have phone and handheld computer capabilities.

According to the AP/NYT report, Ontario-based RIM has chosen the Intel PXA9xx cellular processor, code named ''Hermon.'' The first BlackBerry products with the new technology would be available later this year, said RIM President Mike Lazaridis. No pricing was announced.

AP says the companies also announced that they will work together to develop additional wireless and phone features.

The deal comes a day after RIM rival Palm announced it was offering a smart phone that runs Microsoft's Windows Mobile operating system. The switch from PalmOS, now developed by a separate company, is expected make Palm more competitive, comments AP.

AP says Tuesday's announcement represents a return to Intel for RIM. Some previous BlackBerry devices were built on Intel 386 chips -- the same processors that powered desktop PCs in the late 1980s and early 1990s.

Virgin Records said Tuesday it would release the Rolling Stones' latest album on a new encrypted flash memory card that will allow users to preview and buy locked tracks from four of the veteran rockers' previous albums.

The Associated Press reports in The New York Times (28 September) that the memory card, dubbed Gruvi, is manufactured by SanDisk, and will be available in November at select US stores for US$39.95, SanDisk and the label said in a statement.

By comparison, the Stones' latest album, ''A Bigger Bang,'' costs about US$14 on CD.

The AP report says that SanDisk spokesman Ken Castle said the value for consumers is in being able to use the thumbnail-sized memory card to move music and other media between compatible mobile phones, electronic organisers, computers and other devices.

To keep that content from ending up on internet file-swapping sites or otherwise distributed without permission, the card comes with copy-protection technology, or firmware, built in, repoprts AP in the NYT.

Four music giants and their local subsidiaries have entered mediation with Baidu.com, China's largest internet search engine, over the recording companies' claims of copyright infringement.

The Associated Press reports in The New York Times (27 September) that no agreement was reached after more than five hours of discussions that began Monday at the Beijing No. 1 Intermediate People's Court, the official China Daily newspaper said. A judge would resolve the issue if there is no resolution.

According to the AP/NYT report, it is the second time this month that Baidu, whose share price went as high as US$153.98 after an initial public offering at US$27 on the Nasdaq Stock Market in August, was in a Chinese court dealing with accusations of copyright violations. Baidu's US shares fell US$4.78 to close at US$72.50 Tuesday on the Nasdaq.

AP says that Universal, EMI, Warner, Sony BMG and local subsidiaries claim that Baidu made it easy for its users to illegally download copies of 137 of their songs through the mp3.baidu.com search page. The music companies are seeking 1.67 million yuan, or US$206,000, in compensation, the China Daily newspaper said.

The AP report says that, according to the China Daily, Baidu defended itself by saying that it is simply providing basic search functions, not downloading services. The company also says it advocates improving copyright protection on the internet and promises to provide protection if a company can prove it owns the rights to a song, the newspaper said.

Baidu's lawyer, Li Decheng of the Zhonglun W&D Law Firm in Beijing, said Tuesday that he could not comment on the case without his client's permission. Cynthia He, a Beijing spokeswoman for Baidu, said the company had no comment.

Baidu's MP3 search page is hugely popular among young, increasingly tech-savvy Chinese. Analysts say it has grown into China's largest search engine, prompting US search giant Google to buy 2.6 percent of the company last year.

Google will stop boasting on its home page about the number of web pages it has stored in its index, even as the online search engine leader continues a crusade to prove it scans substantially more material than its rivals.

The Associated Press reports (27 September) that the company planned to remove the index size late Monday. It will mark the first time in more than five years that Google hasn't listed the size of its search index on its sparse home page.

When Google started the practice in mid-2000, the index spanned 1 billion pages; as of Monday afternoon, Google's home page said the search index contained 8.17 billion pages.

According to AP., that figure qualified it as the largest in the industry until last month, when nemesis Yahoo revealed its database included 20.8 billion documents and images. Unlike Google, Yahoo never listed that figure on its home page, disclosing it only in a Web posting by one of its executives.

Yahoo's claim nevertheless came under immediate fire from Google executives, who questioned its accuracy before finally concluding that the two companies are counting things differently, AP says.

Cingular Wireless, the biggest US wireless service, plans to use RealNetworks's video streaming technology to deliver video to mobile phones, the companies said late on Tuesday.

Reuters reports in The New York Times (28 September) that the deal is a key win for RealNetworks over its arch-rival Microsoft as both companies try to expand from the desktop into the wireless services market.

Cingular's biggest rival, Verizon Wireless, uses Microsoft's media player for a mobile video service that delivers news and entertainment video clips to customers using its high-speed wireless data network.

Reuters says that, like other operators around the world, Cingular and Verizon are developing advanced services such as mobile video and music in a bid to boost revenue as phone call prices fall and the number of potential new mobile phone users shrinks.

Along with music some analysts expect video services to become one of the hottest advanced mobile phone features.

Qualcomm expects to run tests of live television over mobile phone networks in Europe and Asia next year, with potential commercial services in 2007, a company executive said on Tuesday.

Reuters reports in The New York Times (27 September) that the supplier of the core wireless chip technology for mobile phones is on track to introduce mobile TV based on its MediaFlo technology in several large US cities in October next year, Qualcomm engineering executive Rob Chandhok said.

According to the Reuters report, video and music are expected to be the next hot features for mobile phones as wireless providers deliver new services to help them boost revenue as prices of conventional voice calls drop and the number of potential new users shrinks.

Qualcomm has long dominated the market for chips based on CDMA, the biggest US standard for mobile phone technology. It is looking to expand this lead into advanced technologies such as mobile TV.

Reuters says that in Europe, where Qualcomm is only starting to make inroads with its wireless communications chips and technology, Chandhok said both TV broadcasters and wireless network operators were showing a strong interest in its MediaFlo technology.

``We have been pulled into Europe more than we've pushed,'' said Chandhok at a wireless conference in San Francisco, where he demonstrated the technology on a prototype cellphone.

Chandhok said he expected multiple European trials in 2006 with some commercial services in 2007. He also expects companies in Asia to start trials of the technology next year. He declined to name potential customers.

Qualcomm is hoping to stoke demand for its TV broadcast technology by investing $800 million to build a nationwide U.S. network and it expects to sell the service through at least one existing wireless service provider.