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Wall Street Buzz: Apple Set to Design Chips for Its Own Gadgets

Apple Inc. is preparing to get into the chip design business, making processors to work in its highly successful line of cell phones and music players, according to a report in The Wall Street Journal.

The business paper reported today that Apple is hiring engineers and designers in the Silicon Valley area from chipmakers that have been laying-off workers recently. It wrote that the effort by the Cupertino, Calif., computer firm is aimed at extending the features of its handheld devices to stay one step ahead of its rivals.

Apple could possibly use custom designed chips in its hit iPod and iPhone lines to reduce power consumption and accelerate graphics capabilities, in order to bring advanced games to the tiny platforms, insiders told the Journal.

Apple recently hired Raja Koduri, formerly the chief technology officer of the graphics products group at Advanced Micro Devices Inc. Koduri started at Apple this week, following in the footsteps of Bob Drebin, who had held the same title at AMD and is also now working for Apple. Online job postings from Apple describe dozens of chip-related positions it is trying to fill, some with partial descriptions like "testing the functional correctness of Apple developed silicon," according to the Journal account.

A year ago, Apple acquired start-up P.A. Semi to acquire expertise to help run the increasingly sophisticated software on iPhones and iPods. "You can't just go out and buy the chips off the shelf to do that," Apple CEO Steve Jobs told the Journal at the time.

Currently, Apple uses custom-designed microprocessors based on chips from ARM Holdings Plc and manufactured by Samsung Electronics Co. in its cell phones.

Apple declined to comment to media outlets on today's report.

News Report: Chrysler to Declare Bankruptcy and Merge with Fiat

Chrysler LLC, the parent company of the U.S. automaker, will file for Chapter 11 bankruptcy tomorrow, paving the way for a merger with Italy's Fiat SpA, according to the Bloomberg news agency.

Bloomberg has reported that Pres. Barack Obama will make the announcement tomorrow, although the bankruptcy plan has not been completely finalized as of today. Chrysler, which is owned primarily by Cerberus Capital Management, of New York City, would sell its best assets to a new entity, according to the Bloomberg account.

The Italian company would become a 20 percent owner of Chrysler, and a union retiree health-care trust fund would own 55 percent, with the rest of the company staying in the U.S. governmentâ''s hands initially, Bloomberg reported.

Chrysler, of Auburn Hills, Mich., was founded in 1925 and is considered one of the "Big Three" of U.S. automakers, along with Ford and General Motors. It employs 58 000 workers worldwide.

Key to Understanding MEPs Tough Stance on Nanotechnology: Non-Binding

In a rather hastily conceived bit of public grandstanding Members of the European Parliament (MEPs) voted 391 votes in favor and three against, amid four abstentions to support a controversial report from Swedish Green MEP Carl Schlyter that urges the European Commission to consider nanomaterials as new substances, and that existing legislation does not take into account the risks associated with nanotechnology.

The key, of course, to any bit of political theater like this one is that you need to make sure that it doesnâ''t have any real consequences. In this case, the vote just supported a non-binding opinion.

But what an opinion it is, borne as it is out of the simultaneous misunderstanding of the scientific evidence thus far and perverting that evidence to support your already determined conclusions. TNTLog has a pretty accurate rundown of how these â''opinionsâ'' typically come into being.

Why couldnâ''t the MEPs offer a non-binding opinion that might actually be helpful, like we need to do more research, so letâ''s get it funded? I suppose that wouldnâ''t satisfy those so rabid for â''actionâ'' that they might actually find this opinion helpful. And let's face it, that's who this vote and opinion were meant for, not to further address the issue of nanomaterials' potential risks.

ARPA-E takes first baby steps

http://www.eetimes.com/news/semi/showArticle.jhtml?articleID=217200483

Today the first signs of life were evident at ARPA-E. They released a "Funding Opportunity Announcement" which was funded through the American Recovery and

Reinvestment Act of 20093

It's not quite the same thing as a DARPA proposal. For one thing, ARPA-E doesn't really exist yet. For another, it has no program offices and no projects. Also, it has no web site of its own. Doesn't every federal agency need a site of one's own?

Interestingly, IARPA has had a web site since May 2008, the DARPA site has been around since they invented the internet, but ARPA-E's web site languishes as a subdomain of the Department of Energy's energy.gov web site. They haven't even bought the domain name! The thing was passed into law a year and a half ago!

This might seem a trifling bone to pick but I think it's indicative of a larger program. The Defense Department is not in direct competition with DARPA; DARPA is a valued part of the Pentagon. ARPA-E, on the other hand, has been described by house staffers as kind of a red-headed stepchild of the DOE. The DOE, it seems, resents anything that might siphon tax dollars away from existing projects.

The Discipline of NanoEthics Needs to Exercise Some Discipline

My patience with ethicists who apply themselves to the subject of nanotechnology has worn pretty thin already.

So I was not really in the mood for another of these articles. But alas, let me point you in the direction of this latest piece entitled â''The Wild West of Nanotechnologyâ''.

Before addressing this colorfully titled article, let me start by explaining that what is paramount to understanding the nanoethicist is that the ethical issues they are concerned about deal more with genetic research, stem cell research or some other scientific discipline in which the relationship to nanotechnology is tangential at best.

It seems just a tiresome idea to these ethicists that technologies such as genetic profiling can be done without nanotechnologies; nanotech just makes them faster and cheaper. But, of course, putting the ethical dilemma in those terms sort of makes nanotech inconsequential to the whole matter.

No, sir, theyâ''ll have none of that.

So again letâ''s look at the Wild West article. While the author, Summer Johnson, Executive Managing Editor of The American Journal of Bioethics, explains to us that â''Wild Westâ'' is a term that is â''actually a good thing for nanotechnology's image,â'' I strangely conjured up images of lawlessness. How silly of me.

Of course, no article on nanotechnology can go without some kind of description of how huge it is. Whether nanotech is a Gold Rush or the next Industrial Revolution, the idea has to be gotten across that itâ''s some huge money-making, corporate monolith. In this case, to magnify how large nanotech is in medicine we get the following: â''Multiply that times the amount of money being invested by NNI and venture capitalists and other private investment and you begin to grasp the grandiosity of nanomedicine as an endeavor.â''

Really? That is the undetermined factor you want to multiply by? Letâ''s try on some real figures. Estimates have pegged VC funding of nanotech over the last seven years at about $1 billion. And the US government has spent a little less than $8 billion over the last 5 years. Those are the factors but to give you a little comparison, the NASA budget announced for 2009 alone is $17.6 billion.

I am feeling a little less convinced of the â''grandiosityâ'' of nanomedicine or any other nano for that matter.

You know, the real issue that ethicists want to talk about when it comes to nanotechnology is self-replicating nanobots. But in order to do that you have to be both a futurist (with an extremely open mind) and an ethicist. But undeterred, Johnson did not shy away from nanobots in this piece and she does so by using the term as a metaphor for the number of applications popping up for nanotechnology. Well done! I think that marks a first.

Finally, we get to the real crux of the matter for Johnson. It appears that she got duped into giving a presentation for an organization she claims was fraudulent called the Academy of Nanomedicine (AANM).

All I can say is that I am impressed. You drag the entire reputation of the field of nanotechnology through the mud to indict some guy by the name Wei--I really have to look into this whole ethicist business.

Dots and Dashes: Morse Code Returns for a Day

If you used Google today, you saw the search engine's front page adorned with artwork that looked a bit odd. It was a colorful depiction of the Morse Code symbols (--. --- --- --. .-.. .) for the word 'google'. It was used to mark the birthday of the man who made the telegraph one of the greatest technologies of all time.

Samuel Morse was born on 27 April 1791 in Charlestown, Mass. He became a painter by profession as a young man, but in mid-life turned his attention to the exciting new field of electromagnetism. Morse was one of those iconic American inventors who did not create the technology associated with his name but rather found the perfect way to use it.

During a trip to Europe in 1832 to study the latest artistic styles, Morse became interested in the electrical inventions that were causing a sensation in the press of the era. Upon his return, he became fixated on inventing a system of his own that could use electromagnetism to send messages over a copper wire. He suspended his promising painting career and turned his attention to developing a practical telegraph transmitter and receiver.

Morse was apparently unaware that others had already created telegraph schemes, notably Carl Steinhill of Germany and Charles Wheatstone of Britain. Still, with the help of American inventor Joseph Henry, he forged ahead with an independent approach. By 1837, he was able to demonstrate a prototype of his telegraph at the University of the City of New York. Shortly afterward, collaborating with a university student named Alfred Vail, Morse hit upon a plan to use short and long pulses of current to form a code standing for 36 alphanumeric characters. Then he applied for a patent for the system.

Discovering an obscure government award of US $30 000 to anyone who could build a practical signaling system over a thousand miles along the Eastern Seaboard, Morse set out to win the prize. He took his equipment to Washington, D.C., to display its workings to the government. However, the nation was in the midst of a recession, and Morse found little support for his seemingly far-fetched idea. In 1843, though, the Congress granted Morse funding to build a working demonstration of his telegraph to be operated between Washington and Baltimore.

On 24 May 1844, the telegraph line stretched 40 miles to its planned destination; and Morse, sitting in a chamber at the Capitol Building, keyed the signals for the words "What hath God wrought."

It was the beginning of a new era featuring a new field that would revolutionize the world: telecommunications.

For more than a century, Morse's code would be used to transmit messages both profound and mundane, but it would eventually be supplanted by newer means, from the telephone to the Internet. And the dots and dashes of Morse's language would fade into obscurity. Yet, today, on his 218th birthday, we celebrate the ingenious idea embodied by Morse Code, developed by a man who had set out to become a famous painter and became a famous inventor.

Semiconductor upswing?

Can a company survive an 80 percent drop in sales? Apparently it can, at least if the drop doesnâ''t last too long.

ASML, which makes the lithography tools that chipmakers need to make chips, had Q1 sales this year of just $184 million, compared to $919 million in 2008.

But back on April 15th, Aaron Hand reported in Semiconductor International that things should start to pick up.

Second-quarter sales are expected to fall in the range of â'¬210-230 million, but more considerable pick-up in demand is figured for the second half of the year, when ASML expects quarterly revenues to reach â'¬400-500 million to enable customersâ'' shrink roadmaps.

Transitions to new nodes are forcing installed base upgrades, [CEO Eric] Meurice said. â''As of last year, only the leaders had invested a bit of capacity in 45 nm flash, 55 nm DRAM, or 45 nm foundry logic. The rest of market is now organizing their conversions during this year, 2009. And during this year, the leaders themselves, who had already started these conversions, are now involved in even more aggressive conversion â'' namely 35 nm flash and 45 nm DRAM development. And these things will materialize also this year.â'' Improved foundry capacity utilization and Taiwanese DRAM consolidation are also enabling the current level of activity, Meurice said.

(By the way, if you get all confused about flash versus DRAM node sizes, as it happens, Bill Arnold, ASMLâ''s chief scientist, sorted it all out in this monthâ''s Spectrum in Shrinking Possibilities.)

Anyway sure enough, the Wall Street Journal reported on Friday that

European semiconductor companies will be hoping the worst of the slump may be over after Intel Corp. (INTC), the world's largest chip maker, recently indicated that sales of personal computers bottomed out during the first quarter.

Apple Inc. (AAPL) also reported a surprise gain in net income for its second fiscal quarter Wednesday, as sales of the company's iPod and iPhone products came in ahead of expectations.

Still, chip companies may have some time to wait for a full recovery. Microsoft Corp.'s (MSFT) chief financial officer Chris Liddell said Thursday he sees no immediate letup in the difficult trading environment, warning that it will persist through this quarter and "potentially through the calendar year."

The view from Microsoft may a bit misleading, though, and thereâ''s no contradiction in the disparate fortunes of Apple and Microsoft. In fact, on Saturday Daniweb columnist Ron Miller commented on that very thing.

The quarterly numbers are in the books for Google, Apple and Microsoft , and while Apple and Google made money, Microsoft failed to report a profit for the first time in 23 years as a public company.

It seems unfathomable that Apple continued to do well in this recession, but as I wrote on Thursday in Apple Earnings Continue to Defy Logic, while Apple's computer sales dipped, and iPod revenue (as opposed to sales) remained flat, the iPhone and the App Store carried the day. Meanwhile, the National Business Review reports that at a recent earnings call Google reported a very respectable 8.9 percent increase in profits.

Microsoft on the other hand had a devastatingly bad quarter compared to its biggest rivals. Microsoft's reported 32 percent profit plunge was all the more shocking since they had never reported a loss as a public company.

Ron shouldnâ''t be entirely surprised. Last July, Francis McInerney, corporate analyst and investor extraordinaire, explained exactly why Appleâ''s star was on the rise, and Microsoftâ''s was falling.

A Tale of Two Innovators

New York â'' Here is an intriguing tale of two innovators. Apple gets a NORTH RIVER MANAGEMENT GRADE A+ and Microsoft gets an A-. Since 1999, Apple has seen sales grow by four times and stock by fifteen times. Microsoft, by contrast, has seen sales grow 2.7 times and its stock fall 40%. The big difference: how they innovate.

Apple has a well-defined brand message: we manage your entertainment. Microsoft once had a clear message: we manage your work experience. But, once the company attacked Netscape with its Explorer web browser in 1995, the company lost its way and fell into a â''Let a thousand flowers bloomâ'' strategy. The latest thing is to be in the search and advertising businesses. Why? Who knows. But it is what it is.

The results are startling. Apple will overtake Microsoft in sales in about 24 months. If current sales multiples hold â'' no sure thing â'' the company would be worth $417 billion. Microsoft would be worth $343 billion, though probably less because its market cap to sales ratio is falling with its stock price. Either way, it is likely that Apple will be worth more than Microsoft in the foreseeable future.

Microsoft still has the higher market cap, but the Q1 results make clear that McInerney had spotted the key trend correctly. Itâ''s not clear what the lesson is in all this, but well-managed companies, like Apple, Google, and ASML seem to be pulling through the economic crisis.

Sun/Oracle Deal: The Hardware Implications

The blockbuster US $7.4 billion deal bringing Sun Microsystems into Oracle Corp.'s big tent (please see Bolt from the Blue: Oracle, Not IBM, Captures Sun Micro) has more than a few wondering what the world's largest business software company will do with a firm best known for its hardware offerings.

After the merger was announced Monday, Oracle CEO Larry Ellison said the acquisition of Sun would enable his company to offer customers applications and data-storage hardware in a bundle that will be tuned to help solve their business computing needs. Yet, some industry analysts speculated that by entering the hardware field Oracle could hurt long-standing partnerships with other computer vendors (especially Dell and Hewlett-Packard), as well as challenge Oracle's management to profitably run a new unit in the notoriously competitive hardware sector, where margins are historically thin even in good times.

"We have a track record of integrating acquisitions very quickly, and this will be no different," said Safra Catz, one of two Oracle presidents under Ellison, on Monday. Catz said Oracle intends to quickly make Sun's hardware operations a profitable operating unit inside the company.

The Oracle executives said its management could wring profitability out of Sun by integrating hardware and software services synergistically in the lucrative corporate marketplace as the global economy improves in the years ahead. They noted that this systems approach to providing business solutions could generate an additional $1.5 billion a year in operating profit.

"Oracle is transforming itself into a soup-to-nuts information technology vendor," Gordon Haff, an analyst at Illuminata, a technology industry research firm, told The New York Times in the wake of the announcement. "This deal promises to revitalize a systems competitor [Sun] that IBM and H-P were writing off as dead," Haff noted in a Times article.

Yet, Catz carefully mentioned that Sun "outsources nearly all the manufacturing, assembly, and servicing of its hardware." This remark did not go unnoticed by industry pundits. In a commentary typical of computer press reaction to news of the deal, Larry Dignan at ZDNet wrote that Oracle can now "pick and choose its hardware spots, unwind some systems and sell others."

The Dignan column went on to speculate that Oracle may have deemed Sun's hardware units as insignificant and Ellison's team may have few if any plans to try to turn them around. "Look for Oracle to do a little pruning before it blows any dough on Sunâ''s hardware business," Dignan concluded generously.

However, that outlook most likely underestimates Ellison's ambitions by light years.

Ellison is a person not unlike Bill Gates and Steve Jobs in his determination to leave a profound mark on the computer industry. As most observers have gathered over the years, Ellison is fiercely determined to battle it out with the giants of the industry at whatever cost is necessary, and that means going directly after the H-Ps and the IBMs and the Microsofts of the world.

When it comes to the hardware units he will be acquiring from Sun, look for Ellison to pursue new opportunities to grow Oracle into a general computing powerhouse.

Past history will only tend to goad Ellison into being even more determined to prove successful in any future foray into the world of chips and metal. In the late Nineties, Oracle moved into the hardware sector with a stripped down microcomputer that used a network connection for all its information tools. It was called the NC (for Network Computer), and it was supposed to revolutionize low-end computing for businesses.

The set-top-box-size device, however, proved to be a flop in the marketplace, as well as an embarrassment to Ellison personally. The NC, which counted on the promise of the network literally being the computer was a product too far ahead of its time to succeed. Oracle's partner a decade ago in the doomed venture was none other than Sun.

Don't look for Ellison to make the same mistake twice. He's got an entire arsenal of weapons at his disposal now to make another assault on the future of the whole industry.

Kieron Murphy is a contributing editor to IEEE Spectrum. He has covered the computer industry for more than 20 years.

Future owners of the Aptera 2e meet that all-electric carâ¿¿finally

IMG_3062.JPG

The hundreds of people standing patiently in line in a Silicon Valley parking lot last night were not Apple fanboys waiting for that companyâ''s latest product release. Instead, they were future owners of a new electric car, the Aptera 2e, scheduled to start rolling off manufacturing lines this fall. These folks put down deposits a year or more ago, have drooled over artists' conceptions and photos of prototypes for months, and, finally, were getting a chance to look atâ''and briefly sit inâ''working models.

The three cars parked in front of Stanford Shopping Center were not production versions of the Aptera 2e. One was prototype number two, one a preproduction model, and one a development prototype snatched from the engineering lab but not quite done. But the folks in line were happy to have any version of an Aptera in front of them at last. They touched them, they sat in them, they photographed them.

David Sweet, a programmer for Microsoft who is number 429 on the depositers' list for the hybrid, a model expected to follow the electric, told Spectrum that the big attraction, for him, is the operating cost. Because he can plug in at work and let Microsoft pay the electric bill, it will essentially be nothing. He expects to follow through on his deposit and buy the car if it gets to market before the Chevy Volt. â''Basically,â'' he said, â''the first out wins.â''

Tom Driscoll, a design consultant for Akeena Solar and holding a reservation number in the low 700s for the all-electric version, said that he is drawn by the environmental friendliness. He expects to purchase the car as soon as his number comes up.

Russ Hedgpeth, CEO of Unity Electronics and number 60 on the list for the all-electric model, is simply a car buff, and will definitely be adding an Aptera to his collection of cars and motorcycles. Hedgpeth was thrilled to see the vehicle in person. â''Pictures can only go so far,â'' he said.

The Aptera 2e is a three-wheeled all-electric two-seater, capable of driving some 160 km (officially) to 240 km (unofficially) between charges; a later model will include a small gas engine to extend its range. The 2e weighs 770 kg and has a top speed of 145 km/h. It is expected to sell from $25,000 to $40,000. Aptera, founded in 2006, is based in Vista, Calif., near San Diego, but did this first of what will be a series of showings around the country for customers in Silicon Valley, since so many of the folks who put down deposits are clustered here.

IMG_3070.JPG

The Aptera 2e looks like a white bird, particularly with its gull-wing doors open.

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Future electric vehicle owners color pictures of the Aptera 2e.

Photos: Tekla Perry

Imbibing in the Nanotech Kool-Aid

I donâ''t know anything about U.S. Rep. Daniel Lipinski (D-3) of Illinois, but I have to give him credit for providing the wackiest urging to date on why one should invest in nanotechnology: because he has â''drunk the nanotech kool-aidâ''.

Apparently, after drinking this Kool-aid, Rep. Lipinksi believed nanotech would become â''the next Industrial Revolution.â'' Oh dear, I havenâ''t heard that line since 2001.

It seems the rest of the forum held at the University of Chicago had political discussions about â''building the tax baseâ'' and â''immigration restrictionsâ''. And then got into this whole business about maintaining â''Illinoisâ'' position as a leader in the field.â'' Sometimes this stuff just makes we want to weep.

You know, for all of Russiaâ''s odd little news items about their nanotech ventures at least they recognized that they had no idea how they should be measuring the economic impact of nanotechnology, and they were going to bother to figure it out before their second full year into their initiative.

But the US government, or at least some of its officials, seems to think that itâ''s still the next industrial revolution, and some regions of the country are ahead of others, but there donâ''t seem to be any metrics on how itâ''s doing thus far.

Itâ''s sort of like bragging that your car is the solution to the energy crisis because itâ''s so efficient, but youâ''ve never bothered to figure out what its miles-per-gallon figures are.

Itâ''s time to stop drinking the Kool-aid, roll up our sleeves and figure out why the billions of dollars poured into nanotech funding have garnered us little more than strong, lightweight tennis racquets and stain-resistant pants. These things are fine, but they are long way from even hinting at the next Industrial Revolution.

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