China Cell Phone Growth in 2014-5

The growth of NAND flash consumption in China is a strong indication of cell phone, tablet, and other mobile products future growth in China. The prediction in the article below of

"The proportion of China's overall NAND Flash usage relative to the world's NAND Flash output... expected to hit 20.6 per cent in 2014, and 30 per cent or more in 2015."


This prediction will depend on a very high growth in mobile products


Ron
Insightful, timely, and accurate semiconductor consulting.
Semiconductor information and news at - http://www.maltiel-consulting.com/

Mobile device space lifts memory market in China

Posted: 18 Nov 2014  

China has consumed about 4.789 billion DRAM chips and 3.518 billion NAND Flash chips from the 2Gb category this year, accounting for a respective 19.2 per cent and 20.6 per cent of the world's total DRAM and NAND Flash output. This highlights the country's increasing business potential as a result of the appeal China generates in terms of consumer device markets such as PC, smartphone and tablets, indicated DRAMeXchange, a research arm of TrendForce.

China's PC DRAM consumption is presently at about 15 per cent. Benefiting from domestic demand, Lenovo has managed to raise the scale of its business operations over the years, and is acquiring other companies as a means to boost its presence among first tier manufacturers. While the company is still competing fiercely with HP for top position in the PC market, its overall PC shipments are ahead of all of its other competitors. For 2015, DRAMeXchange predicted that Lenovo's market share will arrive at about 17 per cent. As has been the case with the other markets, mobile DRAM is expected to gradually replace PC DRAM as the mainstream in China given the country's growing smartphone and tablet sales. Aside from ZTE and Huawei, which are doing relatively well overseas, most China-based smartphone brands are expected to place their focus on the domestic market. Based on TrendForce's 2014 market statistics, China alone accounts for 28 per cent of mobile DRAM's overall bit demand. The importance of China's economic development to the entire DRAM industry is expected to become more apparent next year as that proportion rises to over 40 per cent.

As the NAND Flash manufacturing processes are advancing to under 1ynm, many NAND Flash applications including smartphone and tablet-based eMMCs and notebook-based SSDs are showing improved growth in the market. Competition among global OEM manufacturers, meanwhile, is starting to become more intense, with brands other than Apple and Samsung starting to make their way into the country's lucrative market. The level of China's NAND Flash consumption has managed to grow considerably over recent years due to Lenovo's rise to prominence, the above-average growth shown by China's emerging brands, and the improving standards of China's hardware designs. By the end of 2014, DRAMeXchange projects that the NAND Flash market's total value in China will reach up to $6.3 billion. The proportion of China's overall NAND Flash usage relative to the world's NAND Flash output, on the other hand, is expected to hit 20.6 per cent in 2014, and 30 per cent or more in 2015.

China's efforts over the years to transform from a manufacturing-based to consumption-based economy has been largely successful. Given the consistent growth in its economy and the country's rising wage levels, many of the productions in China are bound to be outsourced to other emerging countries. The Chinese government's present goal is to improve the country's outlook by implementing strategic policies that are aimed at enhancing its industrial capabilities. One such policy involves increasing the imports of semiconductor components such as smartphone CPU, AP, DRAM and NAND Flash, the combined value of which exceeds the value of China's imports for oil. In the future, it would be interesting to see whether Unisplendour Corp. Ltd's (UNIS) efforts to integrate resources from Spreadtrum Communications, RDA and Intel will be successful.

Due to the relatively high proportion of CPU, DRAM and NAND Flash components imported by China, the government policies that are implemented with regard to these three product categories may prove critical to the country's industries. A few days ago, the Chinese government announced a policy worth nearly $20 billion that involves mastering the technologies at the upper streams of the country's semiconductor supply chain and applying these technologies to mid to lower streams. The main purpose behind this is to enable the country's supply chains to be more integrated and to allow momentum in China's domestic industries to persist.

20% of Tablet Application Processor Grabbed by Chinese Vendors

"Strategy Analytics is reporting an interesting snippet from its market research; that in 2012 Chinese vendors grabbed 20 percent volume share of the tablet application processor market between them. That's in a market that by value grew 83 percent year-on-year to reach $2.7 billion, the firm reckons. So even if those Chinese vendors were selling at the low-end of the pricing spectrum"

See March 213 Tablets are the New Mobile

 "Apple had about 48 percent revenue share of the tablet processor market in 2012, although clearly their devices are captive in the iPad. Nvidia, Texas Instruments, Samsung and Qualcomm made up Strategy Analytics' top-five ranking of vendors. Strategy Analytics reckons Nvidia led the non-iPad tablet market with 27 percent revenue share in 2012 having scored high-profile design wins in the Google Nexus 7 and the Microsoft Surface RT."

Ron
Insightful, timely, and accurate semiconductor consulting.
Semiconductor information and news at - http://www.maltiel-consulting.com/

London Calling: Did Allwinner outsell Intel, Qualcomm?
Peter Clarke, 5/8/2013 11:07 AM EDT
http://www.eetimes.com/electronics-blogs/other/4413656/London-Calling-Did-Allwinner-outsell-Intel-Qualcomm

It may seem strange but in 2012 Chinese chip vendor Allwinner probably sold more processors for tablet computers than Intel and Qualcomm together.
It may seem strange but Chinese chip vendor Allwinner Technologies Co. Ltd. (Zhuhai, China) probably sold more application processors for tablet computers in 2012 than Intel and Qualcomm put together.

The numbers for annual sales of smartphones and tablet computers are growing fast and we think we know who the winners are: the likes of Apple, Samsung, Nvidia, Qualcomm and so on, right? But Strategy Analytics is reporting an interesting snippet from its market research; that in 2012 Chinese vendors grabbed 20 percent volume share of the tablet application processor market between them. That's in a market that by value grew 83 percent year-on-year to reach $2.7 billion, the firm reckons. So even if those Chinese vendors were selling at the low-end of the pricing spectrum this is not chicken feed.

Sravann Kundojjala, senior analyst with Strategy Analytics, pointed out that the Chinese vendors are selling dual-core ARM chips at $4 or $5 and quad-cores at $8 or $9, less than half what Nvidia is selling its equivalent chips for and so probably the Chinese vendors, while significant in volume, do not yet have 10 percent of the market by value. 

Strategy Analytics reckons Apple had about 48 percent revenue share of the tablet processor market in 2012, although clearly their devices are captive in the iPad. Nvidia, Texas Instruments, Samsung and Qualcomm made up Strategy Analytics' top-five ranking of vendors. Strategy Analytics reckons Nvidia led the non-iPad tablet market with 27 percent revenue share in 2012 having scored high-profile design wins in the Google Nexus 7 and the Microsoft Surface RT.

So who are these Chinese tablet processor vendors? Strategy Analytics would like you buy a $6,999 report to find out their take on it.


The Chinese are coming

But we can try and guess who might be on Strategy Analytics' list. It probably includes: Allwinner Technology, Rockchip, Amlogic, Infotmic, Ingenic, Hi-Silicon, NuFront. It may include Via Technologies Inc. – a long time vendor of x86 chips and more recently of ARM processors – although Via is based in Taipei, Taiwan, and so may or may not have been included in the Chinese category.

Hi-Silicon, which is effectively part of Huawei, may have won business with its parent, although it is equally possible that such captive sales could have been missed. Ingenic is MIPS licensee with a reputation for being one company that has figured out to make most Android apps run smoothly on MIPS. Nufront is one of our less likely contenders. 

In fact we reckon that the first three names on our list – Allwinner, Rockchip and Amlogic – are probably responsible for more than half the Chinese supply of tablet processors in 2012. Allwinner clearly has the lion's share, according to supply chain checks made by my colleague Junko Yoshida; maybe nearly half the supply of Chinese tablet processors on its own. This would make it responsible for nearly 10 percent of the global supply by volume. The rest of the Chinese suppliers are part of a long list of much smaller suppliers. Interestingly in the previous year Rockchip was in a similar Chinese market-leading situation. The market changes and swings happen very fast in China.

Even more interesting is that Allwinner is therefore likely to have outsold Intel and Qualcomm put together. Strategy Analytics reckons Intel and Qualcomm missed the tablet processor boat in 2012 and captured less than 5 percent volume share in the tablet applications processor market. Stuart Robinson, director of the Strategy Analytics' handset component service, said that any success for these two in tablets will depend on Microsoft and whether its Windows tablet operating system can gain market acceptance.

Things can change rapidly in a fast-growing market but we suggest keeping an eye on Allwinner and its smaller competitors, Intel and Qualcomm.

Google and Facebook Shaking Server market

See more about server marketplace at Google, Facebook Top Buyers of Intel Server Chips


and at SSD, Flash, iPad, PC, Tablet, and Servers Architecture

Ron

Insightful, timely, and accurate semiconductor consulting.Semiconductor information and news at - www.maltiel-consulting.com

Google and Facebook Are Shaking Up the Server Market

By TIERNAN RAY 

http://online.barrons.com/article/SB50001424052748704882404578382574172584946.html?mod=BOL_hpp_dc#printMode

The 'Net giants are shunning traditional suppliers for cheaper, made-to-order hardware.

Hewlett-Packard and Dell, the top two global vendors of server computers, are caught in a whirlwind of change.
The personal-computer market, which generates enormous revenue for both firms, gets most of the attention when the companies' attempts to right their businesses are analyzed. But the humble server, which many assume is the stable part of the computer world, is experiencing far greater change -- change that, in coming years, could pay off in a big way for the duo, or cause them tremendous pain.
Hewlett-Packard (ticker: HPQ) made up 26.5% of worldwide server sales volume in the December quarter; Dell (DELL), 21.3%. Servers handle a myriad of tasks in corporate- and Internet-data centers, from serving up files to desktop computers in offices to processing online purchases to streaming video to tablet computers. Last year, the server market was worth roughly $52.5 billion on shipments of 9.7 million units, according to research firm Gartner.
That's relatively minuscule, compared with 2012 PC shipments of 352 million units. But the corporate market is a bastion of profits that offsets the low margins on PCs.
In the fiscal fourth quarter ended in January, for example, Hewlett-Packard's enterprise group, although not a perfect proxy since it sells networking and storage equipment in addition to servers, accounted for almost 16% of HP's total profit. PCs produced only 3% of the company's earnings, even though they generated greater revenue.
And unlike the personal-computer market, which is fighting tablets and smartphones for attention, servers are constantly finding new uses, and they're not going away anytime soon. "Servers have always been a gluttonous market," says Gartner analyst Jeff Hewitt, meaning the industry just can't get enough of them. Richard Fichera, who follows the industry for Forrester Research, even argues that building server farms is "the élan vital [vital impulse] of modern society."
Fichera and Hewitt agree that a couple of massive changes are under way.
One is that large Internet stars such as Google (GOOG), Facebook (FB) and Amazon.com (AMZN) are building their own servers by picking out parts and having machines assembled to spec by some outfit other than Dell or HP, often one of the Asia-based "original design manufacturers," such as Inventec, Quanta or Wistron. Google and Amazon "have incredibly low-cost infrastructures" as a result of using this commodity hardware, says Fichera.
Public and private organizations, such as schools, government and smaller companies, don't have the resources of a Google, but they're eagerto get the kinds of savings that can come from buying cheap, no-name hardware.

The category of "other," meaning not HP and Dell, made up 35% of server unit shipments in the fourth quarter, up from 31% a year earlier. Hewitt expects the figure to rise this year.
"The substitution of commodity servers for name brands is a real thing," observes Fichera. He cites a "large Wall Street firm" that has more than 75,000 servers, of which 20% are nonbranded. Hewitt says that Google and other nonbrand buyers have "been one of the primary drivers of unit growth" in the server market for some time.
The other trend is toward simple, modular servers -- basically, appliances -- that perform one dedicated task. As Hewitt sees it, the software vendor VMware (VMW) brought about a revolution in servers by allowing companies to use a single machine for several tasks simultaneously. The inadvertent outcome of VMware's software is that some of the server "workloads" -- video serving, database queries -- are now as big as the entire database market in terms of the number of "virtual servers" they employ. That makes it feasible to create specialized, stripped-down servers built for each kind of workload.
And he observes, "Where it gets interesting over the next three to four years is that these low-power processors in our cellphones are all that's needed for certain kinds of server workloads that don't demand a lot of individual CPU horsepower."
Both trends are being helped by the breakdown of the old WinTel regime in computing. Says Hewitt: "For years, if you did what Microsoft (MSFT) and Intel (INTC) told you to do in terms of product design, you could make money." Now, "You can still listen to Intel, but there are other influences weighing on server design."
HP and Dell realize all this, of course. They hope that some outfits that aren't Google will look to them to wrap their brand and support around the cheaper hardware -- to mainstream it. HP and Dell can certainly build server appliances.
But for the moment, both trends favor the no-name vendors of Asia, along with the Silicon Valley appliance start-ups. "There is market pressure on Dell and HP from both sides," says Hewitt. The outcome, he adds, "will depend, in part, on how they respond and whether they want to end up squeezed into a higher-margin but increasingly lower-volume segment of the market."
THE STAR OF BLACKBERRY'S fiscal fourth-quarter earnings report on Thursday was undoubtedly the phone maker's chief, Thorsten Heins, who resonated calm, confidence, and intelligence as he batted away the frantic questions of the business news anchors. This is a man who will go places.
And what of the business? What we know is that BlackBerry's subscriber base is declining; it fell by three million last quarter. Shipments of the new BlackBerry models are off to a good, but not great, start, with one million shipped in the quarter. And the company produced a surprise profit in the three-month period.
The stock (BBRY), which is up almost 22% this year, trades at just 1.2 times tangible book value, and the company has a still significant cash pile of $2.9 billion. All that probably puts a floor under its shares, around their Thursday close of $14.44. What we don't know is whether sales of the new handsets will speed up or slow down, and by how much. The mobile market is fiercely competitive, with Apple (AAPL) and Samsung Electronics (005930.Korea) dominating sales. We don't know how quickly -- or whether -- subscribers will keep sliding. But the drop last quarter -- the quarter in which BlackBerry introduced new phones -- isn't encouraging.
Probably, earnings estimates will rise in coming weeks as the next new model, the Q10, comes to market. This is a stock that still trades based on the premise that BlackBerry the company can be a profitable third- or fourth-place player in the smartphone market. For now, based on those hopes, the stock will continue to levitate. 

Enlarge Image

Tablets,Smartphones, and SSDs Market Share of NAND in 2013

The Smartphones, Tablet PCs, SSDs Propelling NAND Flash Sales in 2013 report  discusses the percentages of NAND sales to the various end markets.  NAND demand is being impacted quite a bit by the growth of tablets that are replacing laptops.   iPad market grew fast and the pc makers have been marketing and testing out various tablet forms that are gaining acceptance.  Tablets are expected to reach 12% of the $30.0 Billion NAND flash market in 2013.  In addition, every Tablet has an SSD storage, so the growth of Tablets will lead to increased demand of SSDs.

More about Tablets are the new mobile (Tablets are the new mobile, the slide deck in the article shows the growth of mobile and Tablets in the Apple and Android eco-sphere. There are many other slides at the link below. The future of mobile was discussed in the April 15, 2009 Mobile Computing the Next Big Market article)

Ron

Insightful, timely, and accurate semiconductor consulting.Semiconductor information and news at - www.maltiel-consulting.com

Tablets are the New Mobile

Tablets are the new mobile, the slide deck in the article shows the growth of mobile, tablets in the Apple and Android eco-sphere. there are many other slide at the link below. The future of mobile follows the trajectory of April 15, 2009 Mobile Computing the Next Big Market.

Ron

Insightful, timely, and accurate semiconductor consulting.Semiconductor information and news at - www.maltiel-consulting.com

Future Of Mobile [SLIDE DECK]

 

Henry Blodget and Alex Cocotas | Mar. 21, 2013, 11:37 AM

Read more: http://www.businessinsider.com/the-future-of-mobile-slide-deck-2013-3?op=1#ixzz2OHIaEnKc

To kick off the conference, our BI Intelligence team—Marcelo Ballvé, Alex Cocotas, and I—put together a deck on the current trends in mobile. We looked closely at the growth of smartphone and tablet adoption, the platform wars, and how consumers are actually using their devices.

See more 

 

Integrating Flash in DDR4 DIMMs

Micron came up with a new product that adds flash memory on " the DDR4 bus in 18 months... leapfrogging today's solid state drives on PCI Express to open up new applications. ... The move gives flash a new position in the computer memory hierarchy, ahead of today’s solid state drives that ride the PCI Express bus.
The Hybrid DIMMs will be more expensive than SSDs but likely offer greater performance with memory access times measured in nano- rather than microseconds."
See more


This is an interesting product that leverages the speed of flash and places it higher in a computer system hierarchy. Intel has been working on developing other products that add flash memory closer to the microprocessor (see April 5, 2012 Flash is not just about storage )



Ron

Insightful, timely, and accurate semiconductor consulting.
Semiconductor information and news at - http://www.maltiel-consulting.com/

3D Flash Memory Marching Forward

3-D Flash starts to appear in the market. Hynix version is based on VSAT technology.


See more about VSAT at http://www.maltiel-consulting.com/3D_Charge_Trapping-CT_NAND_Flash.pdf .


The dramatic iincrease in flash memory cycling endurance (mentioned in IEDM 2012) is likely to extend the life of the basic flash NAND technology.


Ron
Insightful, timely, and accurate semiconductor consulting.
Semiconductor information and news at - http://www.maltiel-consulting.com/







Hynix to start sampling 3D flash memory chips

04 Jan 2013

South Korean memory semiconductor supplier SK Hynix said earlier this week that it would begin mass production and sampling of 3D flash memory chips that utilises vertical-stacked-array-transistor (VSAT) technology, according to a report by the Korea Times.

Flash chip, which is a type of non-volatile memory that can be erased and reprogrammed, is ideal for data-intensive devices that constantly connect to the Internet. It has a simple cell structure that allows for higher memory capacity, density and durability.
"As far as I know, all major semiconductor companies are investing more in the development of 3D flash memory chips. SK Hynix is trying hard to mass produce them as early as possible," said CTO Park Sung-wook. Samsung Electronics is reportedly planning to produce 3D flash memory chips in its plant in Xi'an, China upon completion of the facility.

Flash Memory Growth & Sales Surpass DRAM

See in August 2012 Flash Memory Sales Surpass DRAM  , and DRAM Market Plateau/ Flash NAND Growing

While the NOR market size is not growing as fast as NAND market it is still big enough to make the combined flash market bigger than DRAM market.

More on NOR market in a previous comments Flash NOR Memory Revival and in my May 2007 article on Long Term Trends in the NOR and NAND Markets

Ron


http://www.maltiel-consulting.com/




Flash overtakes DRAM
David Manners,   Thursday 20 December 2012 10:09

The flash memory market will grow 2% to $30bn in 2012, overtaking the $28bn DRAM market for the first time, says IC Insights.

With the exception of 2010, the DRAM and flash memory markets have been growing closer in size to each other for several years but demand for flash used in portable media devices, coupled with two years of weaker demand and price erosion for commodity DRAM used in personal computers, will finally be enough to push total flash sales beyond those for DRAM this year, says IC Insights.

Among portable media devices, smartphone shipments are projected to finish the year up 55% to 750 million units and shipments of tablet computers are forecast to rise 80% to 117 million units.

Through 2017, the flash memory market is expected to widen its lead over DRAM. In fact, IC Insights forecasts the NAND flash memory market alone will be larger than the DRAM market beginning in 2013.

Among more than 30 product segments classified by WSTS, NAND flash is forecast to have the third-highest average annual growth rate through 2017, trailing only the market growth rates for tablet processors and cellphone application processors.
NAND flash sales are forecast to increase 14% annually from 2012-2017, growing to $53bn at the end of the forecast period while the DRAM market is forecast to grow 9% annually over this same time.

Preview of 2013 ISSCC

ISSCC Full program

Some highlights from the upcoming ISSCC 2013



1. Revving ReRAMS, boosting memory bandwidth

2. Samsung big.little, but no Intel, Nvidia CPUs










ISSCC preview: Revving ReRAMS, boosting memory bandwidth

Brian Fuller 11/19/2012 9:05 AM EST

http://eetimes.com/electronics-news/4401652/ISSCC-preview--Revving-ReRAMS--boosting-memory-bandwidth

SAN FRANCISCO--Relentless scaling advances will highlight memory papers at February's International Solid State Circuits Conference here, but it may be break-throughs in off-beat memory architectures that raise a few eyebrows.
ISSCC, scheduled for Feb. 17-21, 2013 at the Marriott, features a slightly smaller percentage of memory papers than usual for the five-day affair (9 percent of the total is down from 10 percent this year and 10 pecent in 2011), but the topics are no less fascinating.

Memory subcommittee chair Kevin Zhang of Intel notes in his memory overview, "We continue to see progressive scaling in embedded SRAM, DRAM, and floating-gate based Flash for very broad applications. However, due to the major scaling challenges in all mainstream memory technologies, we see a continued increase in the use of smart algorithms and error-correction techniques to compensate for increased device variability."
Revving ReRAM


One of the standout papers for the memory sessions comes from Toshiba and Sandisk, who will describe a 32Gb ReRAM (Resistive random-access memory) test chip developed in 24nm process, with a diode as the selection device.

The allure of alternative non-volatile memories has been high cycling capability and lower power per bit in read/write but their densities don't compete with NAND flash. ISSCC organizers noted that the highest density for a single chip published at last year’s ISSCC is 64Mb for ReRAM and 8Gb for PRAM, while NAND can reach up to 128Gb.

The Sandisk-Toshiba test chip is a metal-oxide-based ReRAM is based on 24nm technology node with a diode as the selection device and a 2-layered architecture.....

2. Samsung big.little, but no Intel, Nvidia CPUs
Samsung will describe the first mobile applications processor to use ARM’s big.little concept....

Additional information

Ron Maltiel
www.maltiel-consulting.com

Inside Microsoft Surface and Amazon Kindle Fire HD

"One big winner with the Surface appears to be Samsung. With one key exception —building the main processor chips —Samsung has been pushed out of Apple's iPad and iPhone products. For the Surface, Samsung supplied the display, the memory chips and the battery, amounting to about $137, or about half of the $271 bill-of-materials (BOM) cost."

Ron
http://www.maltiel-consulting.com/





Two More Teardowns Look Inside Microsoft Surface and Amazon Kindle Fire HD
Arik Hesseldahl  November 6


You have to credit the folks over at research firm IHS, because, apparently, they’ve pulling a little bit of overtime. Along with the teardown of Apple’s iPad mini, the results of which they sent to AllThingsD yesterday, they also included their first looks inside Microsoft’s Surface and Amazon’s seven-inch Kindle Fire HD.


Let’s get to the Surface first. (That’s a picture of it taken apart, at right.) With a base price of $499 for a 32 gigabyte Surface without the Touch Cover accessory, IHS estimates that the cost of components used to build it amount to $271 for a starter 32GB model, without the cover. The main components include a Tegra 3 processor chip from Nvidia, and a display and memory chips from Samsung. (Of course, Microsoft is probably buying memory chips from more than one vendor.)

Analyst Andrew Rassweiler, who led the IHS teardown team, said that Microsoft is using the relatively low entry price as a base, in hope of enticing consumers to buy higher-end models with the Touch Cover and higher memory capacity. The Touch Cover, which my colleague Walt Mossberg liked in his review of the Surface, costs $120 when purchased separately, and is bundled with the higher-end models.

Rassweiler estimates the cost of the parts used to build the Touch Cover at about $16, making it appear to be pretty profitable. It contains chips from Atmel and Freescale Semiconductor, he says. “It’s a compelling accessory for users to have, and a great example of a way in which manufacturers get consumers interested with a base price, and hope they’ll impulsively opt for extra features that make more profit,” he told me. Accessories always have higher profit margins than the devices they are intended to be sold with, Rassweiler says, and protective cases for phones and tablets always tend to sell well.

One big winner with the Surface appears to be Samsung. With one key exception — building the main processor chips — Samsung has been pushed out of Apple’s iPad and iPhone products. For the Surface, Samsung supplied the display, the memory chips and the battery, amounting to about $137, or about half of the $271 bill-of-materials (BOM) cost.

Now, on to the Kindle Fire HD. (Seen in its exploded view at right; click to make bigger.) Recall that the last Kindle Fire to get the teardown treatment came in with a cost estimate of $202 (later revised down to about $187) against a retail price of $199, meaning that Amazon was close or near to losing money on the hardware, and was hoping to make it back on the sale of content from its digital store, and even on sales of physical goods from its retail store. One estimate earlier this year suggested that Amazon makes more than $100 off each Kindle Fire. It’s probably pretty close to breakeven, if slightly profitable this time around, Rassweiler told me. Amazon CEO Jeff Bezos has said the devices are sold at cost.

Like the old one, the new Kindle Fire HD sells for a starting price of $199, and carries a combined cost of components of $165, according to IHS estimates. Key suppliers are LG Display, which made the screen; Texas Instruments, which repeated its role as the supplier of the main processing chip, plus power and video chips; and Samsung, which provided the memory.

Microsoft Surface TearDown

"Prominent ICs chips on the Surface motherboard: 

• Purplish-Blue (R26, G48, B231; #1a30e7): Marvell 88W8797-BMP2 wireless MIMO SoC

• Greenish-Yellow (R228, G230, B74; #e4e64a): Micron 2RE22 D9QBJ 2 GB DDR3 SDRAM

• Greyish-Red (R163, G50, B25; #a33219): Nvidia quad-core 1.4GHz Tegra 3 ARM-based microprocessor

• Bluish-Green (R97, G171, B162; #61aba2): Texas Instruments TPS659110 power management IC

• Brownish-Orange (R198, G112, B36; #c67024): Samsung KLMBG4GE4A eMMC 32GB NAND Flash

• Pale Violet with a Trace of Mauve (R181, G92, B227; #b55ce3): Wolfson 8962E ultra low power stereo audio codec

• Cypress Semiconductor CY8C20466A capacitive touchscreen controller
• Atmel MXT1386 touchscreen controller
• M430 G2402
• 1600P E284A " (from iFixIt's and theregistry.co.uk)

 more at Latest Microsoft Surface TearDown




Ron Maltiel

http://www.maltiel-consulting.com/

  

 

 

Microsoft Surface Teardown

We got our hands on Microsoft's new Surface, and to its credit, it lasted a good twenty minutes before we decided to tear it open.

 

Step 1 — Microsoft Surface Teardown 

Is that the display assembly from a PC laptop? Nope, it's the new Microsoft Surface with Windows RT.

Notable tech specs:

•  0.6" ClearType HD Display (resolution of 1366x768 pixels)
• Quad-core NVIDIA Tegra 3 processor
• 2 GB RAM
• 32 or 64 GB flash storage
• Wi-Fi (802.11a/b/g/n) + Bluetooth 4.0
• 720p HD Front and Rear facing LifeCams

 

 

To give the Surface laptop-like connectivity, nearly every edge includes ports and buttons. They are (from left to right):

 

Magnetic charging, USB 2.0, and Micro-HDMI out on the right side

 Magnetic connection for the Touch Cover or Type Cover on the bottom

 Headphone jack and volume rocker on the left side 

Mobile DRAM Takes Over

"mobile DRAM commanded more than 26 percent of all DRAM revenue during the second quarter—a significant improvement from 19 percent the same time a year ago, and from 11 percent two years ago in 2010.
This is attributed to 2 reasons:
1. Share of mobile DRAM bit shipments is now at 17.8 percent, up from 7.9 percent in the first quarter.
2. The price of mobile DRAM has fallen less than that of its commodity cousin and its pricing is overall less vulnerable given the segments it plays in."(from Mobile DRAM Market Grows, Samsung Domination Continues)

Ron
www.maltiel-consulting.com



Mobile DRAM revenues up in 2nd Quarter

Thursday, October 18, 2012


Mobile DRAM revenues rose to the highest level yet in the second quarter of 2012 Revenues amounted to US$1.85 billion in the second quarter, up from US$1.83 billion in the first.

Two reasons account for mobile DRAM's rising market clout. First, mobile DRAM's share of total DRAM bit shipments is now at 17.8%, up from 7.9% in the first quarter.

Second, the price of mobile DRAM has fallen less than that of itsd cousin, commodity DRAM, IHS noted. While commodity DRAM historically has been subject to great swings in pricing—with the product losing as much as half of its value from the second to the fourth quarter last year alone—mobile DRAM pricing is less vulnerable, falling 10% per quarter on average.

Mobile DRAM also tends to be priced according to manufacturing cost, not based on the general balance between supply and demand. As a result, DRAM companies are able to earn a more reasonable margin for their mobile memory products—unlike in commodity DRAM, where negative margins are frequently the rule.

Samsung Electronics continued its unshakable hold at the top of the mobile DRAM market in the second quarter of 2012, with sales of US$1.1 billion, or a remarkable 61% of the global mobile DRAM market.

With the success of smartphones such as the Galaxy S3, the South Korean electronics titan also is now one of the world's largest consumers of mobile DRAM. Samsung enjoyed a 3% improvement in sales during the quarter, and its year-to-year growth was even more impressive at 35%.

SK Hynix was No. 2 behind Samsung with sales of US$362 million, down from US$366 million in the first quarter and from US$377 million the same time a year ago.

Elpida Memory snagged a 13% share based on mobile DRAM revenues of US$245 million in the second quarter of 2012, while Micron Technology saw its share amount to 4% in light of US$79 million in revenues.
By: DocMemory

Android vs iPad Sales 48% to 52%

Similar to the history of  android phones vs. iPhone sales growth, Android tablets sales are approaching iPad sales. Android tablet sales are likely to surpass iPad sales this year.

A key reason for android tablet's strength is the multitude of products made by many vendors using the Android platform. The introduction of a new kindle fire by Amazon and other vendors updating their offering will propel this trend.

It is very tough for a single company to control the market with just one dedicated product line.

The article below discusses that the Android tablet is growing faster than iPad " In the year of 2012, Android holds a whopping 48% of all U.S. tablet sales, bringing Apple’s iPad into reach at just 52%"


Ron
http://www.maltiel-consulting.com/



Pew Research: Android Up to 48% of U.S. Tablet Sales, iPad Drops to Low of 52%
by: Tim-o-tato 10.02.12

A new study from the Pew Research Center has pegged Android at a spot in the tablet market that we didn’t think would come this early in the game. In the year of 2012, Android holds a whopping 48% of all U.S. tablet sales, bringing Apple’s iPad into reach at just 52%. Although, Amazon’s Kindle Fire accounts for a hefty 21% of Android’s tablet market success. And do keep in mind, these numbers do not reflect Nexus 7 or Kindle Fire HD sales yet.

The study also shows the world sales data, which differs quite a bit. According to the report, Apple still holds a commanding 61% of the world’s tablet market with Android coming in at a much lower 31%. But hey, things are looking up for Google’s Android. Once numbers are published reflecting the seemingly popular Nexus 7 and Kindle Fire HD tabs, these numbers are sure to change a wee bit.




14 Reasons for the Google Nexus 7 vs Nine Reasons for the Apple iPad 3 64GB
A detailed table is in the article.

An opposing view is at-
An iPad Lover’s Take On The Nexus 7
Mg Siegler Sunday, July 15th, 2012144

MG Siegler is a general partner at CrunchFund and a columnist for TechCrunch, where he has been writing since 2009. His focus is on Apple. Prior to TechCrunch, MG covered various technology beats for VentureBeat. Originally from Ohio, MG attended the University of Michigan in Ann Arbor, MI. He’s previously lived in Los Angeles where he worked in Hollywood and in... → Learn More

Trolls, feel free to skip to the bottom of this column and post your comments immediately without reading a word. Actually, who are we kidding — you didn’t make it this far.

Everyone else, brace yourselves. You may want small children to leave the room. I’m about to do something I don’t do often — something I always said I’d do if the product deserved

Lenovo Prove: Outsourcing is Not the Only Way (Updated)

The article below discusses Lenovo, the world's No. 2 personal-computer maker's entry into PC manufacturing in North Carolina next year.

Lenovo is not outsourcing its manufacturing as is done by other vendors (see July article Lenovo Prove: Outsourcing is Not the Only Way)




The July article discusses how Lenovo has been successful manufacturing in house. It is a good way to avoid the commodity PC price squeeze.

Lenovo Chief Technology Officer says the strategy is playing a key role in the development of new products. "If you look at the industry trends, most innovations for" PCs, smartphones, tablets and smart TVs are "related to innovation of key components—display, battery and storage," he said. "Differentiation of key parts is so important. So we started investing more…and working very closely with key parts suppliers" for things like bigger and thinner touch screens."


Ron

http://www.maltiel-consulting.com/









Lenovo to Set Up PC Plant in U.S.
By JURO OSAWA   October 2, 2012, 12:57 a.m. ET

Chinese computer-maker Lenovo Group Ltd. will start manufacturing PCs in North Carolina next year. Company executives said the effort, starting with only a few million dollars and just over 100 workers, will be the beginning of something bigger, rather than a one-time made-in-America publicity effort.

The world's No. 2 personal-computer maker says the PC production line now being built at a facility in Whitsett, N.C., will allow the company to become more responsive to U.S. corporate clients' demand for flexible supplies and product customization. Although the cost of U.S. production will be higher compared with overseas production, an added benefit will be to raise Lenovo's profile in the U.S., where it ranks fourth in market share by shipment.

"Us having a [production] facility here in a home country is a differentiator that people will value," said Lenovo North America President David Schmoock. He said the incentive for the move is similar to companies taking steps to become more environmentally sustainable. "Being green is not necessarily the lowest-cost option for a lot of companies, but you do it because your customers and partners value you being green."

While the investment is tiny for Lenovo, whose revenue was nearly $30 billion in the most recent fiscal year, it is a symbolic move for the company that rose to international prominence when it bought the PC business of International Business Machines Corp. in 2005. And with its new production line in North Carolina, Lenovo will stand apart from its U.S. rivals—No. 1 PC maker Hewlett-Packard Co., HPQ -3.09%Dell Inc. DELL +0.58%and Apple Inc. AAPL +0.32%—which no longer make personal computers in the U.S.

Lenovo executives said the new production line isn't a temporary publicity stunt. "I believe this is the first of many steps to increase our production capability," Mr. Schmoock said. "I'm very, very bullish about what I can get out of this facility."

Gerry Smith, Lenovo's head of global supply chain, said the decision to set up a production site in the U.S. is in line with the company's broader strategy of localizing its production in major markets as much as possible.

"Now we are big enough in the U.S. to justify this move," he said.

The move also comes as political rhetoric against Chinese companies heats up in the U.S. Last week, President Barack Obama prevented a company owned by two Chinese nationals from acquiring four wind-farm projects in Oregon, saying that those sites are all within or near restricted airspace. Mitt Romney, Mr. Obama's Republican rival in November's presidential election, also has taken a harsh tone against China.

Critics of China have focused on national security, industrial spying and job losses. Chinese telecommunications suppliers Huawei Technologies Co. and ZTE Corp. 000063.SZ +5.48%are being investigated by the U.S. House of Representatives Intelligence Committee over whether their gear could be used to spy on the U.S.

Mr. Schmoock said the decision to introduce a production line in the U.S. isn't a response to the political climate. Lenovo's customers already know that Lenovo is a "truly global" company, he said. "I don't think there's any negative perception we have to overcome."

Lenovo manufactures close to half of the computers it sells, far more than its U.S. rivals. Currently, the PCs that Lenovo sells in the U.S. are produced at the company's Mexican or Chinese factories.

Despite owning the well-regarded ThinkPad brand and having a solid presence in the U.S. market for PCs used in offices and schools, Lenovo has yet to become a major brand for general consumers in the U.S. Its global market share in PCs is about 15% but its U.S. market share is 8%, running fourth behind Hewlett-Packard, Dell and Apple, according to research firm IDC.

The new production line will be located near the company's U.S. headquarters outside of Raleigh, N.C. Unemployment in the area has remained stubbornly high, with the jobless rate in the county at 10% compared with the national rate of 8.1%. The factory isn't far from the site of the last Dell PC factory in the U.S., which closed in 2010.
—Ben Worthen contributed to this article.

DRAM Market Plateau/ Flash NAND Growing

While the PC market is slowing as the article below discusses, the Tablet and iPad are new markets that should offer growth opportunities for both Flash NAND and DRAM.

The key reason that DRAM is slowing while NAND (and NOR) are growing faster is due to the inherent advantages of Flash vs. DRAM.






We can already see that Flash Memory Sales Surpass DRAM  additional reasons were mentioned in the March 2012 article When will Flash Memory Market be 2x of DRAMs


Ron
http://www.maltiel-consulting.com/







DRAM Makers Continue to Suffer as DRAM Price Falls

http://www.xbitlabs.com/news/memory/display/20121032152632_DRAM_Makers_Continue_to_Suffer_as_DRAM_Price_Falls.html
4GB DDR3 DRAM Module's Price Drops to $16.25

by Anton Shilov 10/01/2012 

Dynamic random access memory (DRAM) market monitoring company DRAMeXchange claims that as notebook shipments show signs of weakening and Windows 8 looks unlikely to stimulate PC shipments, second-half September contract price continues on a downtrend.

Average transaction price per 4GB DDR module fell from $17.25 to 16.25, with a low of $16, close to the lowest price reached during the second half of 2011. Average 2GB module price, on the other hand, has dropped to $9.25, a 5.13% decrease compared to the first half of the month. As 4GB modules have replaced 2GB modules as the market mainstream, 4GB price drops have become more apparent.

At press time, one untested [eTT] 2Gb DDR3 chip price cost $0.683 on average in Taiwan's spot market, 2Gb DDR3 1333MHz/1600MHz chip's price was approximately $0.844, whereas 4Gb DDR3 1600MHz memory IC was priced at $2.545 on average on the spot market.

From the market perspective, DRAM average selling price has been plummeting at an increasing rate since July, reflecting not only weaker-than-expected seasonal demand, but also the fact that supply-side adjustments were not as effective as hoped. Using 4GB module price as the basis of calculation, 2Gb chip price has plunged to a low of $0.84, arriving at spot price levels. Looking at the spot market, as purchasing is weak, module makers are less eager to restock inventory. Both contract and spot prices reflect price negotiation difficulties, and transaction volume has been much lower than last quarter, clear indication that both module makers and PC OEMs have high stock levels; thus, buying momentum is not likely to pick up in the short term. In the absence of large-scale production cuts, TrendForce expects contract price will remain on a downtrend.

As the PC market has matured in recent years, in addition to the fact that the global economy is expected to worsen in the second half of this year, TrendForce forecasts PC shipments will see -3.9% growth for 2012. Furthermore, as consumers’ limited budgets and changing preferences steer them towards other mobile devices, smartphones and tablets are experiencing high growth while the PC market suffers. It is clear that PC demand is not as it was; the category is no longer the market mainstream, as shown by the fact that the 2012 PC DRAM shipment ratio has fallen below 50% for the first time.

On side, although makers are beginning to favor non-commodity DRAM production, PC DRAM supply is still in excess, which indicates restoring the supply-demand balance can no longer be achieved via production adjustments. A portion of commodity DRAM capacity must be permanently reduced if industry supply levels are to be lowered. According to TrendForce data, 2HSept. 4GB module price is approaching last year’s low, and is already below every DRAM maker’s total cost (based on mainstream 30nm process). Losses from commodity DRAM are not decreasing, and price is expected to continue falling in the short term unless large-scale capacity cuts are initiated.

SSD, Flash, iPad, PC, Tablet, and Servers Architecture

The pace of implementing an appropriate eco-system of software and hardware for SSD, iPad, Servers, tablets, and PCs,  that would take into account flash memory is surprisingly slow. 

Just in a pc, NAND flash technology is slowly integrated in the PC's organization of hard drive, cache memory, and processor (see my April comments Flash is not just about storage  ).

The article below discusses Intel's perspective.

Intel's chief technology officer, Justin Rattner:
"the implications of what happens when main memory becomes non-volatile, Rattner said.
"Right now all extant architectures assume all [directly CPU-accessible] memory is volatile," he said, noting that Intel is looking at adding instructions to processors to help them correctly move data between cache and into persistent memory and back.

Along with processors, Intel is thinking about filing systems as well as it would be "ridiculous" to use conventional techniques on top of non-volatile memory. "Those [filing systems] are all optimised for when access times are in the tens of milliseconds, but [with non-volatile] now they're in the tens of nanoseconds.," Rattner said.

Ultimately, architectures will have to change because widespread use of non-volatile memory will make the "distinction between main memory and bulk memory... begin to disappear",

Ron
http://www.maltiel.com/


Intel: Non-volatile memory shift means chips need an overhaul

http://www.zdnet.com/intel-non-volatile-memory-shift-means-chips-need-an-overhaul-7000004221/
Summary: Processor architectures and filing systems will need dramatic redesigns to take advantage of upcoming non-volatile memory technologies, Intel has said.
By Jack Clark

Current processor and filing system designs must be revamped to get the most out of non-volatile memory technologies, Intel has said.
Though we are still a few years away from seeing a replacement for flash that will dominate the market, when it does chipmakers and filing system designers will need to alter their technologies to take advantage of the low latencies afforded by this new class of memory, Intel's chief technology officer, Justin Rattner, told ZDNet on Tuesday at the Intel Developer Forum in San Francisco.
"I'm reasonably confident that... non-volatile technologies will replace flash and bring non-volatile memory very close [to compute] with dramatic improvements in latency," he said. "Architectures will clearly have to react and respond to that."

Memory hierarchy

The jury is still out on exactly which technology will come to replace flash. It could be any one of phase change memory (which is currently being developed by IBM), memristors, which are being worked on by HP and Hynix, or spin-transfer torque, Rattner said.
Non-volatile memory can retain information without power — unlike RAM — and has fast access times, providing both huge power savings and the potential for much faster data transfer.

"Within probably the next three, four or five years we're going to have that memory, and we need to start now to look at the operating system issues and file system issues to take advantage of it," Rattner said.

When you change the memory hierarchy, it has huge knock-on effects on how computation works, he explained.

"Through most of the history of computing, we've assumed a persistent storage system — including the file system and virtual memory system — based on the characteristics of moving-head disks — devices with a very high access latency organised into fixed-sized blocks of thousands of bytes," Hank Levy, a professor of computer science and engineering at the University of Washington and non-volatile memory chip design researcher, told ZDNet on Thursday.

"These characteristics run very deep at every level of the software stack. These new memory technologies are fundamentally different both in their low access time and their fine-grained (byte-level) access."

If chip and filing system designers do not make fundamental changes to take advantage of new memory, "then we'll be missing an opportunity to really benefit from what these technologies can provide", Levy said.

Intel Labs research

To that end, Intel Labs is currently doing research about the implications of what happens when main memory becomes non-volatile, Rattner said.

"These new memory technologies are fundamentally different both in their low access time and their fine-grained (byte-level) access" — Hank Levy

"Right now all extant architectures assume all [directly CPU-accessible] memory is volatile," he said, noting that Intel is looking at adding instructions to processors to help them correctly move data between cache and into persistent memory and back.

Along with processors, Intel is thinking about filing systems as well as it would be "ridiculous" to use conventional techniques on top of non-volatile memory.
"Those [filing systems] are all optimised for when access times are in the tens of milliseconds, but [with non-volatile] now they're in the tens of nanoseconds.," Rattner said.
Ultimately, architectures will have to change because widespread use of non-volatile memory will make the "distinction between main memory and bulk memory... begin to disappear", he added.

Race to replace flash

Richard Coulson, director of the storage technologies group within Intel's technology and manufacturing group, pointed out that there is currently "a race" between spin-transfer torque, memristors and PCM to see which technology can be mass manufactured at a low enough price to be viable.
"We don't know which one of those or others will ultimately be cost effective," he told ZDNet on Wednesday. But when one of these comes in, "it changes the whole memory storage hierarchy".

Unfortunately, a lot of further development work depends on which non-volatile technology comes to dominate, and that is as yet unknown. "The base memory technology is the biggest wild card at the moment," Coulson said.

Google, Facebook Top Buyers of Intel Server Chips

The link below discuss the top 8 buyers of server chips from Intel. It is interesting to notice the rise of Google and Facebook in the list.



These chips are about 20% of Intel's revenues (Intel: Tremendous Growth of Clouds' Servers ).



Ron
http://www.maltiel-consulting.com/


Intel Confirms Decline of Server Giants HP, Dell, and IBM
http://www.wired.com/wiredenterprise/2012/09/29853/

In 2008, says Intel bigwig Diane Bryant, three familiar names bought far more server chips than any other company on earth. That year, she remembers, HP, Dell, and IBM accounted for 75 percent of the revenue Intel raked in from the sale of processors destined for the beefy computer servers that drive the internet and so much of the software used inside the world’s businesses
Intel sells a vast majority of the world’s server chips, so this was a sure sign that a vast majority of the world’s businesses were buying their servers from HP, Dell, and IBM.
But just four years later, Bryant says, the landscape has completely changed. Today, she explains, eight server makers account for 75 percent of Intel’s server chip revenues, and at least one of those eight doesn’t even sell servers. It only makes servers for itself. “Google is something like number five on that list,” Bryant told us on Monday evening, during a dinner with reporters in downtown San Francisco.


That’s right, Google is likely the world’s fifth largest server maker.
Over a decade ago, Google started designing its own machines for the massive data centers that underpin its web empire, looking to save both power and cost as the empire expanded to epic proportions, and this was only the beginning of a movement away from traditional server sellers such as HP, Dell, and IBM. As Bryant points out, other companies are now buying machines directly from “original design manufacturers,” or ODMs, in Asia, working to cut costs in much the same way. This includes Facebook, and according to a former employee of one large ODM, it includes Amazon as well.
In short, some of the biggest server buyers are cutting out the big-name middlemen. Those ODMs are some of the same companies that manufacture machines on behalf of the HPs and the Dells.
Bryant did not list all eight of Intel’s biggest customers. But she did name Quanta and SuperMicro as ODMs who are “growing up into OEMs” — i.e., original equipment manufacturers that sell directly to server buyers — and she mentioned Wiwynn, the new U.S. subsidiary of ODM Wistron. The whole idea behind Wiwynn is to sell directly to server buyers here in the States.
She also said that new server makers in China, including Huawei, are now having a big effect on the worldwide market.

The Big Switch

In 2008, Diane Bryant left Intel’s server group to take over as the company’s CIO, but in January of this year, she returned to lead the group as vice president and general manager. When she arrived, she didn’t recognize the place.
For one, the name had changed. The server group had morphed into the datacenter and connected systems group, encompassing not only server chips but also storage and networking hardware. But the bigger change was that HP, Dell, and IBM were no longer the dominant forces of years gone by.
Dell and IBM did not immediately respond when asked about Bryant’s view of today’s server market. But an HP spokesperson said her comments were inconsistent with the latest server market stats from research outfit IDC, which still put the combined market share of HP, Dell, and IBM at 73.9 percent, down slightly from 78.2 percent in 2008.

‘Google is something like number five on that list.’
— Diane BryantIt should be noted, however, that research operations such as IDC and Gartner don’t have the best view into direct sales by the ODMs — let alone Google’s highly secretive hardware operation — and these hidden parts of the market are increasingly important. It’s the big web players that are moving away from the HPs and the Dells, and most of these same companies offer large “cloud” services that let other businesses run their operations without purchasing servers in the first place.
To be sure, as the market shifts, HP, Dell, and IBM are working to reinvent themselves. Dell, for instance, launched a new business unit dedicated to building custom gear for the big web players — Dell Data Center Services — and all these outfits are now offering their own cloud services. But the tide is against them.
Google now calls itself one of the world’s largest hardware makers, and Bryant’s comments show just how big it has become. Asked about its relationship with Intel, a Google spokesperson merely said: “We work with a variety of vendors to manufacture the equipment we use in our data centers.” But it has long been an open secret that Google buys directly from Intel — and that it buys so much.
This summer, Urs Hölzle told us that Google designs just about all the servers used in its worldwide network of data centers, and though he declined to discuss where these machines are manufactured, it appears that the company contracts with manufacturers in Asia and elsewhere in the world, providing these builders not only with the server designs but with chips and other hardware purchased from component suppliers such as Intel.


Google Not the Only One

In August, Bryant told us that Google is the only web company that buys chips directly from Intel. But Facebook also designs its own servers, and a source familiar with Facebook’s operation tells us that the company purchases directly from Intel too.
However, the source said, Facebook uses a “just-in-time” purchase model, meaning it does not actually acquire and store the chips itself. Intel sends Facebook’s chips directly to manufacturers such as Quanta and Wistron when they’re needed for manufacturing, the source said.
This means that Facebook avoids getting stuck with a warehouse full of old chips it doesn’t want. It simply buys chips as it needs them.
In any event, Facebook is also a big part of the move away from the HPs and the Dells. It has even “open sourced” its server designs, hoping that others will buy similar gear through the ODMs and drive down prices even further.
The social networking giants shows that the lines between the web players and the ODMs are often blurred. Facebook designs its servers in tandem with the ODMs and other hardware makers, and though it negotiates directly with Intel for chips, the ODMs do all the manufacturing. Which one is the server maker?
Though Bryant did not rank the rest of Intel’s largest server chip customers, we’re guessing that Quanta now sits quite high on the list. According to an ex-Google engineer, Quanta has worked with Google in the past on its custom-built networking gear. Facebook is quite open about its relationship with Quanta. And Quanta itself says it has been selling servers, storage gear, and networking switches to multiple web outfits, which jibes with what an ex-Quanta man has told us.

Typically, the big web companies say very little about who they’re buying gear from. Companies such as Google and Amazon see their hardware operations as a competitive advantage best kept hidden from rivals. But Diane Bryant provides another look behind the scenes. And one thing is for sure: HP, Dell, and IBM aren’t the powers they used to be.

IBM Ecosystem: $1 billion Drives 40% Profit

"The new I.B.M. mainframe, according to the company, represents $1 billion in research and development spending over three years...sale of mainframe computers accounts for only about 4 percent of I.B.M.’s revenue these days. Yet the mainframe is a vital asset to I.B.M. because of all the business that flows from it. When all the mainframe-related software, services and storage are included, mainframe technology delivers about 25 percent of I.B.M.’s revenue and more than 40 percent of its profits"


This type of leverage is the key behind Apple and Google / Samsung success. It will be hard for their competitors to fight ( Apple vs. Samsung: Not Really an Apple Win ).

Ron Maltiel
www.maltiel.com




I.B.M. Mainframe Evolves to Serve the Digital World
http://www.nytimes.com/2012/08/28/technology/ibm-mainframe-evolves-to-serve-the-digital-world.html?_r=1
By STEVE LOHR August 28, 2012



I.B.M. is introducing on Tuesday a new line of mainframe computers, adding yet another chapter to a remarkable story of technological longevity and business strategy.

The new model, the zEnterprise EC12, has strengthened the traditional mainframe’s skill of reliably and securely handling vast volumes of transactions. That is why the mainframe is still the digital workhorse for banking and telecommunications networks — and why mainframes are selling briskly in the emerging economies of Asia and Africa.
The new models have added capabilities for computing chores that are growing rapidly, like analyzing torrents of data from the Web and corporate databases to predict consumer behavior and business risks. Name a trend in corporate computing — cloud computing, data center consolidation, flash-memory storage, so-called green computing — and I.B.M. executives point to tailored features in its mainframe that deliver the goods.
The death of the mainframe has been predicted many times over the years. But it has prevailed because it has been overhauled time and again. In the early 1990s, the personal computer revolution took off and I.B.M., wedded to its big-iron computers, was in deep trouble. To make the mainframe more competitive, its insides were retooled, using low-cost microprocessors as the computing engine.
Like any threatened species that survives, the mainframe evolved. It has been tweaked to master new programming languages, like Java, and new software operating systems, like Linux.
“The mainframe is the most flexible technology platform in computing,” said Rodney C. Adkins, I.B.M.’s senior vice president for systems and technology.
That flexibility is a byproduct of investment. The new I.B.M. mainframe, according to the company, represents $1 billion in research and development spending over three years.
I.B.M. has also invested beyond its corporate walls. Nearly a decade ago, fearing that its mainframe business would wither if retiring mainframe engineers were not replaced, I.B.M. went out to universities, advocating for mainframe courses and offering support. Today, more than 1,000 schools in 67 countries participate in I.B.M.’s academic initiative for mainframe education.
The sale of mainframe computers accounts for only about 4 percent of I.B.M.’s revenue these days. Yet the mainframe is a vital asset to I.B.M. because of all the business that flows from it. When all the mainframe-related software, services and storage are included, mainframe technology delivers about 25 percent of I.B.M.’s revenue and more than 40 percent of its profits, estimates A. M. Sacconaghi, an analyst at Sanford C. Bernstein.
The I.B.M. mainframe story offers a glimpse of why manufacturing can be crucial to an American company — and to the economy as a whole — even though high-end manufacturing does not employ large numbers of factory workers.

Over the last 15 years, I.B.M. has aggressively globalized its operations and work force, and pulled out of manufacturing businesses including personal computers and disk drives.
But I.B.M. held on to its core mainframe business, whose development is supported by thousands of engineers and scientists. Mainframe parts are produced in I.B.M. facilities in the United States, in Endicott, N.Y., and Fishkill, N.Y., and in Germany and elsewhere. The final assembly work is done in Poughkeepsie, N.Y., where I.B.M. opened a $30 million mainframe plant in 2010.
A mainframe costs more than $1 million, and higher-performance models with peripheral equipment often cost $10 million or more. Yet even young companies and emerging nations, analysts say, find the expense worth it for some tasks.
Comepay, for instance, is a fast-growing company that says it operates more than 10,000 self-service payment kiosks in Russia, where consumers pay for products and services ranging from Internet service and cellphones to electric bills. Comepay handles millions of transactions a day, and the volume is rising. The Russian company bought an I.B.M. mainframe in 2010.

“Mainframes are extremely reliable,” said Ruslan Stepanenko, chief information officer of Comepay. “It keeps working even when the transaction load is very high.”

Last year, the Senegal Ministry of Finance bought two I.B.M. mainframes to help monitor all the imports, exports and customs duties at the African country’s 30 border checkpoints.
Performance, security and reliability were the main reasons for selecting the mainframe, said Momar Fall, a manager and mainframe technical specialist in CFAO Technologies, an I.B.M. partner in Senegal. But another advantage in a developing nation, he said, is that the mainframes are constantly communicating over the Internet with a remote I.B.M. support center.

“So seven days a week, 24 hours a day, I.B.M. is looking after them,” Mr. Fall said.

Longtime mainframe customers say the technology has done a good job keeping up with the times. Last year, Primerica, a financial services company, purchased its 19th mainframe in 30 years.
David Wade, chief information officer, has worked for Primerica, based in Duluth, Ga., since its first mainframe arrived. With more than four million life insurance customers and more than two million investment-account clients, he said the company needs the reliable processing technology of the mainframe. “It works like nothing else,” Mr. Wade said.