Gadget Watch: 7 Consumer Electronics Stories

1. Apple (AAPL) failed to trade above $200/share for the first time in 6 sessions. Perhaps the reason is the lack of positive catalysts, with analyst notes adding no value or new information and news being mildly negative. Needham initiated coverage with a "buy" rating and target of $235, saying surging Mac and iPhone sales set the stage for the second chapter of the company's growth story (not much original there), while American Technology Research expects Apple to introduce a MacBook mini or MacBook slim based on flash technology at Macworld (that information appeared on Seeking Alpha almost a month ago). Apple is expected to affirm its support of the Blu-ray DVD format (big deal), and would have no problem launching its own record label. More interesting was data from an antitrust lawsuit: Apple controls 75% of the online video market, 83% of online music, 90%+ of the hard-drive based music device market and 70% of the flash-based music device market.

2. Echostar Holding's (SATS) Sling Media announced plans to offer a software solution for Research in Motion's (RIMM) Blackberry devices, leaving only the iPhone as a primary phone platform without a Sling client. Sling allows users to watch their home cable/satellite TV and DVR remotely for a one-time $29.99 software fee and no ongoing monthly charges. EchoStar completed its corporate split into two listed firms: EchoStar Communications (DISH), which runs the Dish Network satellite TV broadcasting business, and Echostar Holding (SATS), which runs the fixed satellite services and set-top boxes business. Lehman thinks that both pieces are undervalued.

3. Microsoft (MSFT) said that Holiday 2007 was a blockbuster season for the gaming industry. It sold 4.3M Xbox 360s in Q4-2007 for 17.7M unit sales since launch. Sales of "Halo 3" now total 8.1M units since its late Sept. launch. NPD's industry sales data won't be released until later in the month.

4. Netflix (NFLX) announced it will launch a set-top box in the second-half of the year with LG Electronics to stream movies and other programs straight to HDTVs. The stock lost 1.1% to $26.07 after gapping up 7.4% to $28.30.

5. Motorola (MOT) said it will show a mobile media device for playing live TV, on-demand videos and previously saved DVR content at the Consumer Electronics Show. The DH01 goes on sale later this month.

6. Japanese consumer electronics stocks were hammered Friday, along with the broader Japanese market's 4%-plus drop, on a stronger yen and concerns over the U.S. economy, in Japan's first day of trading in 2008. Sony (SNE) dropped 6.6%, Matsushita (MC) 6.1% and Nintendo (NTDOY.PK) 4.5%.

7. Intel (INTC) resigned from the board of the nonprofit One Laptop Per Child. One Laptop Per Child has touched more nerves that expected; see the articles about it on Seeking Alpha.

Comments

[Long-Short Guy:]

How is this 7 developments? The first one has 4 bullet points alone, each of which seems to be a different topic. Confusing layout.

2008 Jan 04 08:15 AM

[Lisa:]

This is great info, but I agree the layout makes it hard to read.

2008 Jan 04 08:18 AM

[Long-Short Guy:]

Yup -- I didn't mean to be so negative. The content was great.

2008 Jan 04 08:20 AM

[Steven Towns:]

Thank you both Useful Link Man and Lisa, for your comments. I have updated the title.

2008 Jan 04 09:01 AM

[Tom B:]

"Apple is expected to affirm its support of the Blu-ray DVD format (big deal)"

It IS a big deal, but ISN'T unexpected; HD DVD has been moribund for some time now, and Warner's recent decision to drop HD DVD cements that.

"and would have no problem launching its own record label"

Why not? The real labels are doing a piss-poor job, and Jobs comprehends content (remember PIXAR?). This i sthe the kind of thing that separates the men (Jobs) from the dabblers (Bill Gates).

"More interesting was data from an antitrust lawsuit: Apple controls 75% of the online video market, 83% of online music, 90%+ of the hard-drive based music device market and 70% of the flash-based music device market."

And damned fools like Amazon nevertheless promote a service (UNBOX) that doesn't even WORK on portable players! NetFlix, a decent "player" in the movie biz is running scared-- the latest is that they, too, are trying to break into downloaded movie content!

Incidently, the lawsuit is frivolous. The plaintiffs are annoyed that Apple didn't pay MSFT to license WMA, so WMA content could play on iPods. Like-- why would they bother? WMA is not widely used anymore.

2008 Jan 05 10:35 PM