New Market Forecasts For Video Game Industry

worldwide

DFC Intelligence Releases; The new video game console systems from Microsoft, Nintendo and Sony are expected to increase worldwide interactive entertainment software sales from about $18 billion in 2004 to about $26 billion in 2010. The forecasts have three independent scenarios for industry growth, a best case scenario for the Sony PlayStation 3, a best case scenario for the Nintendo Revolution and a best case scenario for the Microsoft Xbox 360. Under each scenario, sales for interactive entertainment software surpass the $25 billion level in 2008.

The video game industry continues to exceed our expectations. The next generation of console systems will connect to broadband networks right out of the box and this should significantly expand revenue possibilities.There is room in the marketplace for all three major systems. With a true worldwide marketplace and increasing ownership of multiple systems, this is not a winner take all situation. Instead it is about how profits can be maximized across the unique installed base of different console, portable, PC and location based platforms.

Nevertheless, tthe Sony PlayStation 3 has very strong sales. With the PlayStation 2, Sony raised the bar on what a game system can do in terms of sales. Until Sony makes a major mistake we have no reason to believe they will not continue that success with the PlayStation 3.” On the other hand, from a pure market share basis, DFC forecasts that Microsoft and Nintendo will increase market share in the next generation.

The Online Game Market, and Market Leaders in the Video Game and Interactive Entertainment Industry. Publ 20050629

70 Million Broadband Households are Predicted in the US by 2008

US

Research and Markets: More optimistic than most other research firms, we predict that there will be nearly 70 million broadband households in the US in 2008. Broadband households will grow at a compound annual rate of 19.4% between 2004 and 2008, and household penetration will increase from 23.1% to 56.3% over the same period. This explosion won't merely affect high-speed Internet access, it will create an entirely new market, including voice and video transmissions, where cable and telecom companies will fiercely compete -- a market worth ten times the value of the Internet access business alone. This report is for the attention of ISPs, Cable and Satellite Companies, Telecoms, Online Content Providers, Game Manufacturers, Music and Film Producers and Advertising Agencies.

The North America Broadband report explores the changing dynamic of the broadband market and its effects on the communications and entertainment industries. "Convergence," once only a dream of tomorrow, is happening in homes across the continent, and it is changing the character--and product offerings--of some of the most powerful corporations in North America. No longer is the broadband market merely about high-speed Internet access. The new market, in which cable and telecom companies are competing, also includes voice and video--a market worth nearly ten times the value of the Internet access business alone.

Telecom companies are offering video services, cable companies are offering voice services and the company that controls the broadband connection will largely control the future digital home. The current scrambling for position is a precursor to the real battle about to begin between cable and telecom companies as they encroach on each other's traditional territory. "You want a piece of me? I'll take a piece of you!" could well be the catch phrase of this new era.

Billions of dollars of revenue are in play. The business decisions that are made over the next 12 to 24 months will determine whether massive corporate entities--like dinosaurs or wooly mammoths--thrive, survive or disappear. North America Broadband report Publ 20050628

Beyond Cellular - The Evolved Wireless Cocktail

global Research and Markets: As the mobile industry starts the mass roll-out of 3G, it is prescient to ask: where does the mobile industry go from here? Incredibly, the mobile services market has grown to 1.4 billion users worldwide and revenues of $500 billion with little deviation from the classic mobile operator business model which has existed since commercial cellular services started in the early 1980's. However, wireless technologies are in the market today and on the imminent horizon which offer superior speeds to wide area cellular technologies and are completely IP-based. This threatens to disrupt the conventional cellular service model, and in the process shift the competitive positioning of mobile operators worldwide. Over the coming years, step changes in the wireless industry will not be characterised by a serial overlay of evolved cellular technologies, such as the move from 2G to 2.5G and now 3G. Instead, it will be marked by the addition of evermore advanced wireless standards to a mixture of local, metro and wide area wireless technologies. These wireless technologies will consist of Wi-Fi and Ultra Wide Band (UWB) in the local area; broadband wireless access technologies like WiMAX, UMTS-TDD and Flash-OFDM in the metro area; and 3G cellular technologies like CDMA 1xEV-DO, W-CDMA and HSDPA in the wide area. This is set to create the "wireless cocktail", a mix of multiple wireless standards combined into a single service platform for the consumer. Beyond Cellular - The Evolved Wireless Cocktail to their offering Publ 20050629

New Research Shows There Will be Sufficient Consumer Demand to Support the Sale of 23 Million Fashion Handsets by 2010

global Research and Markets: In developed mobile markets, consumers are becoming more sophisticated in their selection of handset, and this is driving a market for stylish and fashionable mobile phones. In this research report, it shows that there will be sufficient consumer demand to support the sale of 23 million fashion handsets by 2010. There was a time when companies such as Nike, New Balance and Reebok produced 'running shoes'. Now these pieces of footwear sell in fashion boutiques, and vintage lines can trade for huge market premiums. The mobile phone is following a similar path, and fashion boutiques have become the point of sale for handsets from Siemens/ESCADA, Nokia/Versace, Vertu and the now defunct Xelibri. In addition, fashion designers such as Kimora Lee Simmons, Diane Von Furstenberg, Anna Sui and Vivienne Westwood have readily extended their design expertise onto handsets from Motorola and Samsung.

A fashion handset is one where the consumer's purchase decision is based primarily on the aesthetics of the device, and the primary conduit for fashion and style into the handset market today are the handset vendors themselves. In an age of standardised handset platforms, it is increasingly difficult for Tier One vendors to differentiate their products by simply adding enhanced technology features. For the consumer faced with a range of seemingly identical devices from a technical perspective, the aesthetics of a device can generate an emotional response to which they will ascribe a value and for which they will pay a premium.

Fashion and Style in the Mobile Handset Publ 20050629

Buzz Continues To Build Around MPEG-4 AVCs, But MPEG-2 Still Strong

worldwide

In-Stat : Enthusiasm is still building around the nascent MPEG-4 AVC market, but the use of advanced video decoders does not mean that MPEG-2-only decoders will disappear from the market soon. In fact, MPEG-2 unit shipments are expected to experience growth until 2009, though declining ASPs for MPEG-2 solutions will cause revenues to decline, the high-tech market research firm says. Buzz is really all there is to MPEG-4 AVC currently. The market will be small in 2005, as many decoder IC suppliers have been conducting interoperability testing with encoder suppliers. We expect widespread availability of MPEG-4 AVC decoder ICs beginning in 2006.

• The worldwide MPEG Video IC market revenues for 2004 were US$ 3.8 billion.

• MPEG-4 Video ICs will appear in more and more mobile handsets as mobile video delivery systems based on standards like DVB-H and DMB are deployed around the world.

• In the MPEG-2 consumer encoder IC market, NEC Electronics had the top unit share in 2004 for the second year in a row, mainly due to its design wins in DVD recorders.

• STMicroelectronics had the highest MPEG Video IC revenue again in 2004, for the fifth straight year.

MPEG Video ICs: The Buzz Around MPEG-4 AVC ( Publ 20050629

A New Study by The Radicati Group Forecasts Rapid Growth in the Emerging Corporate Anti-Spyware Market

Radicati Group: Corporate Anti-Spyware Market, 2005-2009 provides an in-depth analysis of the desktop and gateway-based corporate anti-spyware market, including revenue and installed base market share data and four-year market forecasts. The corporate anti-spyware market will experience explosive growth over the next four years. The installed base of the corporate anti-spyware market will increase from 16 million seats in 2005, to over 540 million seats in 2009.

The corporate anti-spyware market is driven by security concerns, including regulatory compliance risks posed by spyware threats, and the impact that spyware has on the productivity of employees. That the cost of managing spyware is quickly rising as spyware programs become increasingly devious. The administrative cost of dealing with spyware-infected computers will reach about $265 per user in 2005.

Corporate Desktop Anti-Spyware Solutions and Corporate Gateway Anti-Spyware solutions. Publ 20050629

Broadband Carriers to Spur Home Networking Market beyond Retail Sales

US Parks Associates: : Data connectivity, VoIP, and multimedia capabilities drive deployment of advanced customer premise equipment. The number of broadband households with a residential gateway (RG) will reach 69% by 2009, driven in large part by service providers.Home networking, as both equipment and service offerings, will be a major component in the competitive strategies of broadband carriers in the next five years. During that time, cable, DSL, and other broadband vendors will take aggressive steps to deploy voice-over-IP (VoIP) and multimedia services, which will boost the market for RGs. Home networking equipment is shifting from low-cost and relatively limited devices sold at retail to integrated modem and router platforms that offer multimedia applications and advanced management software. Broadband carriers are beginning to dictate the pace of the market for home networks, creating significant opportunities for third-party vendors to support more advanced features via customer premise equipment (CPE) and software solutions.

Many broadband providers, once reluctant players in the home networking arena, now view the deployment of network- and multimedia-capable CPE as a significant move to promote customer retention, lower support costs, and ultimately produce higher revenues. In addition to building a more loyal customer base, the RG helps reduce support costs by providing a solution more integrated with a carrier’s unique network and business needs. Software partners who can assist both the carriers and equipment vendors in developing cost-effective CPE and provisioning services will be key partners in the home networking value chain.. Home Networks and Residential Gateways: Analysis & Forecasts Publ 20050625

Broadband Carriers to Spur Home Networking Market beyond Retail Sales

US Parks Associates: : Data connectivity, VoIP, and multimedia capabilities drive deployment of advanced customer premise equipment. The number of broadband households with a residential gateway (RG) will reach 69% by 2009, driven in large part by service providers.Home networking, as both equipment and service offerings, will be a major component in the competitive strategies of broadband carriers in the next five years. During that time, cable, DSL, and other broadband vendors will take aggressive steps to deploy voice-over-IP (VoIP) and multimedia services, which will boost the market for RGs. Home networking equipment is shifting from low-cost and relatively limited devices sold at retail to integrated modem and router platforms that offer multimedia applications and advanced management software. Broadband carriers are beginning to dictate the pace of the market for home networks, creating significant opportunities for third-party vendors to support more advanced features via customer premise equipment (CPE) and software solutions.

Many broadband providers, once reluctant players in the home networking arena, now view the deployment of network- and multimedia-capable CPE as a significant move to promote customer retention, lower support costs, and ultimately produce higher revenues. In addition to building a more loyal customer base, the RG helps reduce support costs by providing a solution more integrated with a carrier’s unique network and business needs. Software partners who can assist both the carriers and equipment vendors in developing cost-effective CPE and provisioning services will be key partners in the home networking value chain.. Home Networks and Residential Gateways: Analysis & Forecasts Publ 20050625

It Number Of VoIP Subscribers Worldwide Will Grow from 2.8 Million in 2004 to 97 Million in 2009

worldwide US

Research and Markets: Residential VoIP will emerge as one of the most disruptive services in the telecom industry during this decade. The number of VoIP subscribers worldwide will grow from 2.8 million in 2004 to 97 million in 2009. The US market is best positioned for growth in VoIP services due to the large available market, high availability of broadband access technology, and consumers' willingness to accept the risk of unproven technology to cut telephony cost

VoIP and its impact on OSS Publ 20050623

Broadband A Bright Spot In Lagging Telecom Market

US

In-Stat: Consumer service revenues for telecom providers in the US are expected to deteriorate over the next several years, falling to $106.7 billion in 2009 as decreasing revenues for voice services and dial-up outweigh revenue increases for both cable TV and broadband services, reports In-Stat (). Broadband, however, will be a significant revenue growth generator, with market penetration growing from 28.6 percent of the population in 2004 to nearly 50 percent by the end of 2009, the high-tech market research firm says. The migration from dial-up to broadband is good news for service providers, as the monthly fees for broadband will remain substantially higher than for dial-up- With $13.7 billion in broadband revenues in 2004 versus $10.9 billion in dial-up revenues, broadband has already outpaced dial-up as a revenue-generating opportunity.

• Total consumer spending on communication services, including local voice, long distance, cable TV, dial-up, and broadband was $114.8 billion in 2004.

• By 2009, broadband services will generate $15 billion more per year than dial-up.

• According to In-Stat’s 2005 Consumer Telecom Survey, 35 percent of respondents currently purchase multiple services from a single provider.

Common Cents: Consumer Telecom & Technology Spending, 2004-2009 Publ 20059622

As Market Consolidation Continues, Top 5 ERP Vendors Account for 72% of Revenue

AMR Research: ERP market revenues increased 14% in 2004. Approximately one-third of the growth in the overall market was due to fluctuations in currency exchange rates. While the ERP market has grown in revenue, consolidation continues to change the industry. In 1999, the top five vendors (J.D. Edwards, Baan, Oracle, PeopleSoft, and SAP) in the ERP market accounted for 59% of the industry’s revenue. The top five vendors in 2005 (SAP, Oracle, Sage Group, Microsoft, and SSA Global) to account for 72% of ERP vendors’ total revenue. The ERP market showed solid organic growth in 2004 as IT spending improved. The market was also affected by consolidation within the segment, as well as ERP vendors acquiring best-of-breed players to broaden their portfolios.

While many ERP vendors struggled in 2004, SAP AG increased overall revenues by 17% and license revenues by 20% - without any acquisitions. SAP’s ERP market share increased to more than 40%. Oracle nearly doubled the size of its application business through the acquisition of PeopleSoft, but AMR Research expects SAP to finish 2005 with more than twice the revenue and market share of the combined Oracle-PeopleSoft.

• The ERP market is entering another major technology transition phase. Service Oriented Architectures (SOA) may have the same disruptive effect that other technologies have had on the market, such as the emergence of client-server systems had in the 1990’s.

• The pace of acquisitions shows no sign of slowing down. Oracle’s purchase of Retek and vendors like Sage Group, SSA Global, Infor Global Solutions, and Epicor have all been very active in the M&A space and have grown more rapidly than the overall ERP market.

• The midrange ($50M - $1B in annual revenue) and SMB (less than $50M in annual revenue) markets continue to be a major focus area for many of the ERP vendors. Midrange solutions and channels are critically important for penetrating China, India, Eastern Europe, and Latin America.

• ERP buyers have moved away from large, upfront purchases. Now most tend to license user seats and functional ERP modules incrementally as they deploy a product. Along with widespread discounting, this has led to smaller average deal sizes

Enterprise Resource Planning (ERP) market. Publ20050622

The Time Has Come For a Mandated Home Networking Standard

Global

ABI Research: Wi-Fi, UWB, Bluetooth, powerline, multimedia-over-coax: a wide variety of technologies now exist (or will arrive). There is a place for most of these technologies in the future of home networking. Each method's proponents may say that their way is the one that will eventually win out, but that is not realistic, and nobody is asking, How can we all coexist? Consumers are increasingly confused about how to purchase and install home networking systems, while home entertainment equipment manufacturers are hesitant to commit to formats that may quickly become obsolete, or even fail commercially. The need for a universal standard, on which a multi-network translator/adaptor could be built, will eventually be recognized. But where will such a standard come from? Not from networking technology vendors, with their own separate agendas. Not from the IC makers creating the chips for home entertainment devices.Digital Home Media Networking Publ 20050623

Pay-Per-Call to Reach US$1.4 Billion by 2009

US

Kelsey Group: Pay-per-phone-call (PPCall), performance-based online advertising that delivers telephone calls rather than clicks, will generate revenues of US$1.4 billion by 2009.” PPCall could generate revenues as high as US$4 billion by 2009, depending on the average price per call and actual market penetration, which the firm estimates could range between 5 percent and 15 percent by 2009.Consumers are accustomed to making phone calls to contact local businesses and local businesses are similarly used to closing leads over the phone,. A performance-based online medium that delivers calls rather than clicks therefore makes sense for the local market.Digital Home Media Networking Publ 20050622

Connected Devices: Machine-to-Machine Markets Solidifying

Global Europe UK ABI Reserch: 2004 and 2005 have seen a sharp increase in telecommunications carriers' interest in cellular machine-to-machine (M2M) communications, M2M involves the use of cellular communications to connect remote sensing and monitoring devices to central networks wirelessly. It is often used for industrial process monitoring, usage metering and security applications. Carriers can opt for involvement in M2M communications on three levels: providing only bandwidth and airtime; offering limited services and outsourcing others; or attempting to be a full end-to-end services provider. Many, he says, are still figuring out where best to position themselves on that spectrum. In the UK the four major wireless carriers — O2, T-Mobile, Orange and Vodafone have expanded their M2M offerings. Orange could be seen as adopting a more 'expanded services' model, while Vodafone has chosen a more limited offering. Across the rest of Europe, he adds, carriers and MVNOs are making similar choices, while in North America, there has been increased commitment from Cingular, Sprint and Verizon. The deployments of higher-speed networks such as GPRS, EVDO, and EDGE has helped raise interest. M2M's ARPU is lower than that of voice services, but so are its marketing costs; there is much less churn, network deployments are generally less expensive, and feature longer life cycles. Companies are sending a message to Wall Street: there are two pieces to our enterprise — voice and data — and we must address them separately.

Cellular Machine-to-Machine (M2M) Networks Publ20050622 GPRS?

Broadband A Bright Spot In Lagging Telecom Market

US

In-Stat : Consumer service revenues for telecom providers in the US are expected to deteriorate over the next several years, falling to $106.7 billion in 2009 as decreasing revenues for voice services and dial-up outweigh revenue increases for both cable TV and broadband services, reports In-Stat (). Broadband, however, will be a significant revenue growth generator, with market penetration growing from 28.6 percent of the population in 2004 to nearly 50 percent by the end of 2009, the high-tech market research firm says. The migration from dial-up to broadband is good news for service providers, as the monthly fees for broadband will remain substantially higher than for dial-up. With $13.7 billion in broadband revenues in 2004 versus $10.9 billion in dial-up revenues, broadband has already outpaced dial-up as a revenue-generating opportunity.

• Total consumer spending on communication services, including local voice, long distance, cable TV, dial-up, and broadband was $114.8 billion in 2004.

• By 2009, broadband services will generate $15 billion more per year than dial-up.

• According to In-Stat’s 2005 Consumer Telecom Survey, 35 percent of respondents currently purchase multiple services from a single provider.

Common Cents: Consumer Telecom & Technology Spending, 2004-2009 Publ20050622

Cumulative Shipments of Portable Multimedia Players to Top 13 Million Units by 2010

U.S

Parks Associates: High prices and limited video content will inhibit demand for HDD (hard disk drive) portable multimedia players (PMPs), which will reach only 17% of U.S. online households by 2010, Competition from existing devices such as portable DVD players and mobile phones with multimedia functions will also limit adoption of HDD-based PMPs, as reported in this new study, which estimates the cumulative U.S. shipments of these devices will reach 13 million units by 2010. The PMP market will not experience the rapid growth typical of portable MP3 players,. We anticipate a flatter adoption curve and lukewarm demand over the next two years, with meaningful increases in consumer interest by late 2007 or early 2008.Portable Multimedia Players: Analysis and Forecasts, Publ 20050625

Wireless Operators Now Pushing Location-Based Services

North America

ABI Research: Location-based services have been promoted by equipment and service vendors such as Qualcomm, Global Locate, Telcontar, MapPoint, Navstar and TomTom for some time, but wireless operators — at least in North America — have until recently resisted offering them to their customers. Until a couple of months ago, only Nextel was offering commercial Location-Based Services (LBS) in the United States. But athat situation is changing fast, with Sprint recently introducing an operator-assisted direction-finding service, and other operators set to join the LBS bandwagon in the near future. The process is under way already, and will gather momentum very quickly in 2006. LBS enable navigation services, location tracking for field service staff and accurate billing for the on-site work they carry out, shopping and entertainment (in some world regions), and personal location tracking for employees, family and friends. Operators in Japan and Korea, which have been supporting LBS for several years, are expanding the range of services available while European operators are rolling them out as well. When it comes to LBS, we’ve moved quickly from a walking pace to a run. As we forecast last year, GPS — an essential element for LBS — is starting to be included in GSM and WCDMA handsets as well as CDMA. Location-based serviceswill proliferate along with a variety of other services. Gaming, 411, SMS, MMS, photography — will all be bolstered and powered by LBS. Some LBS vendors will prosper on their own, says Hyers; others — particularly smaller firms and those developing BREW and Java applications — will do well to rely on a wireless operator as a distribution network. Location-Based Services Publ 20050622

Western European IP Telephone Market Continues High Growth Pace in 1Q05

Europe

IDC:: During the first quarter of 2005, the European IP telephone market increased to a value of $79.3 million, compared with $77.1 million in the fourth quarter of 2004. Shipments of IP telephones experienced higher growth than that of revenue; IP telephone shipments increased by 17.9% from roughly 250,900 units in the fourth quarter of 2004 to around 297,500 units in the first quarter of 2005, while revenue for IP telephones only increased by 2.9% because of price erosion. This trend is expected to continue to impact unit prices and shipment numbers over the coming quarters. The trend of decreasing unit prices and increasing shipments can be related back to the fact that IP telephones with full functionality are only being deployed at those locations that make business sense, and that IP telephone hardware vendors currently discount hardware used in IP telephony implementations," said Rogier Mol, senior research analyst at IDC's European IP Telephony research service. IP telephones are increasingly being deployed across multiple vertical market segments in the first quarter of 2005, for example in the pharmaceutical, automotive, and transport segments. In terms of market share, 1Q05 was again a quarter of high growth for Cisco, and the company managed to maintain the highest market share in both revenue and unit shipments. In total, Cisco increased its shipment market share by 0.6% to 52%. Avaya finished second in the quarter, and increased its shipment market share by 0.9% to 12.6%.

Western European IP Telephone Tracker 1Q05 Publ 20050621 Publ 20050621

Raises Forecast to 2.0% as Inventory Levels Improve

Worldwide Semico: Worldwide semiconductor revenue shipments will increase 2.0% in 2005 to $217.3 billion, a slightly more positive outlook on the market than the previous forecast. An upward adjustment in the forecast was spurred by recent improvements in inventory levels, and Semico’s Inflection Point Indicator (IPI) pointing to strength in the fourth quarter. Semico’s IPI, which is designed to forecast the market 8 to 9 months in advance, registered 15.1 in April, down from 15.8 in March. The April IPI points to the December 2005 and January 2006 timeframe. Revenue shipments are expected to peak in November. Additional analysis indicates that although December is forecast to be weaker than November, revenue shipments will still be amongst the highest all year, resulting in fourth quarter growth. We remain cautious about pricing and inventory levels in the second and third quarters. April data showed a fairly significant softening in pricing, with aggregate ASPs falling 9.5%, from $0.53 to $0.48. As a result, we continue to forecast the second quarter to be weaker than the first quarter, with revenues declining just under 2%. Third quarter will mark the period in which OEMs and ODMs place orders to replenish inventory, but the bulk of these shipments will not occur until the fourth quarter. Semico forecasts a slight revenue dip of 1.1% in 3Q05, followed by positive growth of 2.1% in the fourth quarter. http://www.semico.com/press/press.asp?id=144 Publ 20050621

Worldwide Consumer Scanning Market Shows Signs of Stabilizing after Market Consolidation and Fierce Competition from All-in-Ones, According to New Rep

worldwide

InfoTrends/CAP Ventures: The worldwide mass scanner market continues to evolve as digital imaging vendors vie for consumer mindshare. Today’s challenge is to continue differentiating single-function scanners from low-cost, multifunctional, inkjet based all-in-one devices. The combined functionality and rock-bottom price points offered by all-in-one vendors have recently made the price/performance of single-function scanners less attractive to prospective buyers, particularly in North America. The adoption of digital cameras in North America has also shifted the predominant use of scanners away from capturing and sharing photos. Nonetheless, photo enthusiasts who still use or have film pictures continue to benefit from the built-in photo and film scanning features that many scanners offer. An important factor to single-function scanner sales and revenues has been the evolution of all-in-one offerings, which have come down significantly in price . “Even in this very competitive environment, however, single-function scanner vendors continue to develop products that attract consumers. For example, consumers are starting to scan more documents, allowing vendors to market new and advanced features that will drive increased sales. A sizable market remains for manufacturers who are committed to tapping into the opportunity. Europe and the rest of world (ROW) regions continue to follow the trends set in North America . Despite market consolidation, ROW markets are expected to grow in importance in the coming years, helping to stabilize worldwide shipments and revenues. Worldwide Mass Market Scanner Forecast and Analysis Publ 20050621

Perpendicular Magnetic Recording to be Key to HDD Industry's Future

global

IDC: Perpendicular magnetic recording (PMR) technology will be key to the hard disk drive industry and its adoption cannot be delayed. The transition to PMR and to the new heads and media required for this technology will begin late in 2005 and will be broadly adopted in products by the end of 2007. PMR will be ubiquitous in the 630 million hard drives shipped in 2009. The transition to PMR and to other new technologies should demand renewed focus on company business models, partnerships, and strategies. The required increase in investments (e.g., R&D spending, new manufacturing capacity, etc.), will drive further industry consolidation.

• Vertically-integrated companies will have smoother and less costly transitions to perpendicular recording and other new technologies, but must bear R&D costs on their own.

• The large majority of small form factor hard drives shipped by 2008 will leverage perpendicular recording for capacity requirements.Suspension technology like secondary actuation already has limited implementation and is not targeted for broad-based implementation until 2007.Within 5 years, PMR will reach areal densities of four to five times that of today’s technology.GMR CPP is now expected in 2007, not before Femto or TMR.

2005 Hard Disk Drive Industry: Component Technologies and Business Models Publ 20050621

Edge/Core Router Market Sales To Double By 2009

Worldwide

In-Stat: Driven by demand for new business VPN services, upcoming consumer triple-play services, and evolution to converged networks, the combined edge and core router market’s sales are forecast to grow from $3.8 billion in 2004 to about $8.4 billion in 2009, according to . Core router sales will grow at a stronger rate than edge router sales over the next five years, the high-tech market research firm says. Most major carriers plan to migrate from their existing multiple networks for different services to a converged MPLS core network that carries multiple types of traffic such as Layer 2 (Frame Relay, ATM, Ethernet), IP, and voice traffic. This trend will spur sales of core routers. Multiservice edge routers will be in demand to support both business services and residential triple-play services, and to enable service providers to consolidate multiple edge functions on a single box. High-capacity core routers will carry multiple types of traffic in the backbones of service provider converged MPLS core networks.

• Worldwide edge router sales grew by 37% in 2004 from 2003 to $2.1 billion. Worldwide core router sales grew by 30% in 2004 to $1.7 billion.

• Cisco remained the dominant vendor in edge and core router sales in 2004, and Juniper was the second-leading vendor in both markets.

• The number of edge router vendors has increased substantially, and this is creating a much more competitive market.

Edge/Core Router Vendors Focus on Triple-Play, VPNs, and Convergence Publ 20050621

Booming Digital Audio Player Market Tops $4.5 Billion

global

In-Stat : The exploding market for both hard disk drive and Flash-based portable audio players is expected to reach over 104 million units by 2009, up from 27.8 million units in 2004. Drivers for this booming market include falling prices, the availability of legitimate subscription and pay-per-download online music sites, smaller hard disk drives, and increasing Flash memory capacities. As competition heats up, vendors are striving to differentiate products by offering a wide range of price points, memory capacities, and features. As a result, we are seeing increased segmentation. For example, the hard disk drive (HDD) digital audio player segment can be sub-divided into two categories: the 1-inch or smaller segment and the 1.8-inch segment.

• Revenue for both HDD and Flash-based MP3 players reached approximately $4.5 billion, a remarkable increase of almost 200% over 2003.

• Apple is the leader in worldwide portable audio players with 30.2% of the combined HDD and Flash-based portable audio player market.

• Other leading vendors include Rio, iRiver and Creative.

• 1GB capacity or greater Flash MP3 players will represent just over 20% of all Flash-based MP3 player shipments worldwide by the end of this year.

• Consumer survey data shows that the percentage of US respondents owning a digital audio player has increased from 16% in 2001 to 25% in 2005.

Portable Digital Audio Players: Moving to the Beat of a Booming Market Publ 20050621

Voice over Wi-Fi Gets a Push

U.S. UK ABI Research: Voice over Wi-Fi got a boost recently as BellSouth announced a trial of a converged system in the enterprise environment of Grey Worldwide's Atlanta, Georgia office in the U.S. Not long afterwards, British Telecom launched their "Bluephone" service which, while it uses Bluetooth rather than 802.11 for its local connection. The British communications giant has recently announced its decision to become an all-IP operator, and,the Bluephone is their precursor to a fully Voice over Wi-Fi solution which would have a much better range than the Bluetooth radio installed in most mobile handsets. Back in the USA, SBC has stated that they will start to roll out VoWi-Fi to consumers by the end of 2006, so we should see North American market penetration starting early in 2007. Many dual-mode (cellular and VoWi-Fi) handsets exist already, Solis adds, and more are set to come out within the next year.So is VoWi-Fi "the wave of the future"? Cellular coverage is far from ideal indoors. Most people would greatly prefer to have one phone that works just as well in the depths of a large building as it does outdoors. Moreover, it's a cheaper way for carriers to transmit calls, and it provides natural synergies and extra revenue opportunities where there are linkages joining wireless and wireline companies such as SBC and Cingular. So it's a tool for bundling that also provides cheaper services to consumers. 's study "Voice over Wi-Fi: Market Dynamics for Enterprise and Consumer VoWi-Fi, and Dual-mode Cellular/VoWi-Fi Handsets" Publ 20050621

Nordic Companies are Moving Fast Towards New Storage Technologies

Scandinavia

IDC: The Nordic market for storage solutions is quite mature. The market for disk, tape, and storage software only grew by 5% to reach a total value of €744 million in 2004. While this growth is moderate, a number of new technologies grew significantly faster, indicating a strong change in the way storage is deployed by Nordic companies. Some of the areas showing significant growth in 2004 were storage area networks (SAN), network attached storage (NAS), iSCSI storage, tape automation, and storage resource management software. Growth in these areas was generally in the region of 10% to 20% last year.

Nordic Storage Products

	Year
	2003	2004	2005	2006	2007	2008	2009
Value (€M)	709	744	778	802	819	836	853
Source: IDC, 2005

The growth of information that needs to be stored and managed is an ongoing challenge for most organizations. Disk storage systems are the foundation of organizations' critical data. Consequently, investment in a network storage infrastructure supported by suitable storage software and storage and data management practices is becoming mandatory, and an essential ingredient in a cost-effective and flexible storage solution.

IDC’s Nordic Storage Systems 2004 Vendor Shares and 2005–2009 Publ20050620

FIRST DECLINE IN DVD PLAYER REVENUES PROJECTED

Global US Europe and Japan

Strategy Analytics: One Percent Decline to $19.8 Billion Expected in 2005 Despite Unit Sale Growth. Global DVD player revenues will fall for the first time ever this year. Retail revenues in 2005 will fall by 1 percent to $19.8 billion, after peaking at $20.1 billion in 2004. Higher value DVD recorders are beginning to replace players, but this trend will not prevent a continued fall in overall revenues. The global transition from play-only DVD players to DVD Recorders is well under way. High prices and product complexity have held back demand for DVD Recorders, but these factors are now diminishing.

Worldwide sales of DVD recorders rose to 8.9 million units in 2004, generating $4.8 billion in retail revenues. DVD recorder sales will continue to grow rapidly, overtaking play-only devices in 2008 and reaching annual sales of 90.9 million units in 2010. The US market is trailing both Europe and Japan in adoption of DVD recorders, in part reflecting faster US adoption of set-top box DVRs. DVD recorders that are integrated with a hard disk drive dominate the Japanese market, and this trend is expected to spread to other regions. This feature enables time shifting as well as television program archiving in one device.

DVD Players and Recorders: Global Market Forecast Publ 20050620

Computer Industry Almanac: Mobile PCs-in-Use Surpass 200M; Over 25% of Worldwide PCs Are Mobile PCs

-worldwide US

Computer Industry Almanac: In 2005 the worldwide number of mobile PCs-in-use are projected to reach nearly 230M units -- up from 31M mobile PCs ten years ago. In the next five years this number will more than double to over 480M mobile PCs-in-use by year-end 2010 -- a compound annual growth rate of 16%. Mobile PCs are gaining market share and will account for over 25% of worldwide PCs in use in 2005 -- a near doubling from 13.7% in 1995. By 2010 the installed base of mobile PCs are projected to account for 36% of all PCs in-use.

                                   1995     2000     2005     2010
  ----------------------------------------------------------------
  Worldwide:
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  PCs In-Use (#M)                  226      530      898    1,338
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  Mobile PCs In-Use (#M)            31       96      229      481
  ----------------------------------------------------------------
  Mobile PC In-Use Share (%)      13.7     18.1     25.5     36.0
  ----------------------------------------------------------------
  PC sales (#M)                     58      131      190      267
  ----------------------------------------------------------------
  Mobile PC Sales (#M)            10.0     28.3     60.0      104
  ----------------------------------------------------------------
  Mobile PC Sales Share (%)       17.2     21.6     31.6     39.0
  ----------------------------------------------------------------
  USA:
  ----------------------------------------------------------------
  PCs In-Use (#M)                 84.5      177      230      290
  ----------------------------------------------------------------
  Mobile PCs In-Use (#M)          13.2     34.4     68.5      125
  ----------------------------------------------------------------
  Mobile PC In-Use Share (%)      15.4     19.4     29.7     43.0
  ----------------------------------------------------------------
  PC sales (#M)                   21.4     46.0     57.3     68.7
  ----------------------------------------------------------------
  Mobile PC Sales (#M)             4.1     10.4     20.4     30.1
  ----------------------------------------------------------------
  Mobile PC Sales Share (%)       19.1     22.7     35.6     43.8
  ----------------------------------------------------------------

In the USA mobile PCs have grown from a market share of 15.4% in 1995 to nearly 30% in 2005 with further growth to 43% projected for 2010. Mobile PC sales are increasing even faster and will top 35% of total PC sales in the USA and 31.6% worldwide in 2005. These are some of the results from two new market research reports by Computer Industry Almanac. One report has PCs and mobile PCs-in-use estimates for 57 countries and six regions of the world from 1980 to 2004 and projection for 2005-2010. A second report has yearly PC sales for PCs and mobile PCs for the USA and six regions of the world from 1990 to 2010.

Computer Industry Almanac market research reports for the PC, Smartphone, and Internet industries.Publ 20050620

Market For Cell Phone Use on Airplanes Is For Data, Not Voice

worldwide

IDC: The FCC has recently proposed lifting the ban on cell phone usage during airplane flights. While the passage of this proposal appears to offer solutions to the wireless industry, it has spawned disapproval among some consumer groups as the potential for in-flight usage would create disturbances to passengers. The results of a recent worldwide survey asking respondents for information on their preferences surrounding the use of mobile phones on airplanes. Only 11% of 50,000 respondents indicated that they are in favor of cell phone use for voice calls on planes, whether in unlimited or designated calling areas. However, 64% of respondents approved of passengers using their mobile phones in-flight for activities other than voice calls. The removal of the in-flight ban on mobile phone use would potentially stimulate the market by providing new opportunities for wireless carriers and airlines to brand and market mobile commerce, drive increased data usage and ARPU, spur development of new channels, and spike demand for data-enabled phones and smart phones. . Of the 11 specified activities, in-flight text messaging (SMS) was the most popular. Interestingly, there was a correlation between the level of interactivity of a service and the respondent’s interest in using that service. It demonstrates that interactivity is a foundational element for successful mobile phone applications among the surveyed segment. Whether a mobile device vendor is interested in the in-flight market or not, the key finding from this survey remains the same: By comprehending the needs and criteria specific to the user segment and location, mobility companies can enhance their products to better serve and target the desired customers and market segments.

In-Flight Voice Phone Calls Grounded Before Takeoff? Publ 20050620

Independent Memory-IP Market Will Have Double-Digit Growth Through 2009

worldwide

In-Stat: The worldwide market for independent memory intellectual property (IP) will reach $410.4 million in 2009, for a compound annual growth rate (CAGR) of 12.3% from 2004 to 2009. Whether the IP is licensed from an independent provider, a design services company, or an independent device manufacturer (IDM), it now represents the foundation for virtually every integrated circuit being designed, says In-Stat. And independent IP providers are filling a growing niche in the memory market. We estimate there are approximately 20 independent IP providers, for all types of memory functions, with some just competing in their own regions. Although new companies will continue entering this market, the rate of entry will be considerably slower than in the past. In all probability, many of these companies will be acquired by either IDMs or larger IP providers, such as ARM, or by one of the design-services providers.

• worldwide revenue for independent memory-IP providers grew by 21.2% in 2004, from $189.3 million in 2003.

• Of the 20 or so companies participating in this market, the vast majority will remain relatively small, with total revenues staying below $10 million.

• Companies in the Americas will continue to dominate IP licensing, followed by companies in Japan and the Asia Pacific region, respectively.

Independent Memory IP Providers: A Volatile World Going Non-Volatile Publ 20050620

European Market for ERP Vendor to Grow from $8.8B in 2004 to Over $12B in 2009

Europe

AMR Research: Enterprise Resource Planning (ERP) market. Enterprise Resource Planning, 2004-2009 revealed that European ERP market revenues will increase 7% annually through 2009. The ERP market has grown in revenue, but consolidation continues to change the industry. In 1999, the top five vendors (J.D. Edwards, Baan, Oracle, PeopleSoft, and SAP) in the ERP market accounted for 59% of the industry’s revenue. AMR Research expects the top five vendors in 2005 (SAP, Oracle, Sage Group, Microsoft, and SSA Global) to account for 72% of ERP vendors’ total revenue.

Global ERP vendor revenue grew by some 14% in 2004, although a substantial portion of this can be attributed to favourable Euro to U.S. dollar exchange rates. There was, however, substantial organic market growth of between 8-9% in 2004, regardless of exchange rate issues.

While many ERP vendors struggled in 2004, SAP AG increased worldwide revenues by 17% and license revenues by 20% - without any acquisitions. SAP’s ERP market share increased to more than 40%, with a substantially higher market share position of 50%+ in Europe. Oracle nearly doubled the size of its application business through the acquisition of PeopleSoft.

The market growth reflects a focus on innovation and regulatory compliance. The spotlight on innovation and the concern of non-compliance has driven large companies to put the last nail in the coffin for aging legacy systems. Large companies are consolidating fragmented IT environments and small and mid-sized businesses are investing in their first true integrated business systems.

ERP vendors ranked by 2004 worldwide ERP license revenue can be seen in the chart below. The top ten ERP vendors by revenue include the following companies:

• The ERP market is entering another major technology transition phase. Service Oriented Architectures (SOA) may have the same disruptive effect that other technologies have had on the market, such as the emergence of client-server systems had in the 1990’s.

• The pace of acquisitions shows no sign of slowing down. Oracle’s recent purchase of Retek makes it very clear that PeopleSoft was simply the first of what is likely to be a series of purchases. Vendors like Sage Group, SSA Global, Infor Global Solutions, and Epicor have all been very active in the Merger and Acquisitions (M&A’s), and as a result have all been growing more rapidly than the overall ERP market.

• ERP buyers have moved away from large, upfront purchases. Now most tend to license user seats and functional ERP modules incrementally as they deploy a product. Along with widespread discounting, this has led to smaller average deal sizes.

Market Analytix Report: Enterprise Resource Planning, 2004-2009 Publ 20059620

Eastern european television is full of promise

Central and eastern Europe

Informa Telecoms & Media: Central and eastern Europe is to experience a major move towards digital TV. According to the ninth edition of Informa's , 22.5 million of the region's homes will receive digital signals by end-2010 - more than five times the 2004 figure.

Digital TV households (000)

	2004	2005	2010
Czech Rep.	90	97	707
Hungary	140	182	988
Poland	1,085	1,268	4,228
Romania	2	68	1,320
Russia	1,091	1,444	8,445
Rest of Region	1,828	2,188	6,763
Total	4,236	5,247	22,450

Digital penetration will exceed 15% of the region's TV households by 2010. Digital cable is on the verge of widespread rollout in Hungary, the Czech Republic and Poland and cable subscriptions will have 26% penetration by 2010, with satellite and digital terrestrial at 3.2% and 2.5% respectively. By 2010 IPTV will be present in 0.9% of eastern European TV households.

Digital penetration of TV households in 2010 (%)

	2004	2005	2010
Czech Rep.	2.4%	2.5%	17.9%
Hungary	3.6%	4.7%	24.8%
Poland	8.6%	10.1%	33.0%
Romania	0.0%	0.9%	17.4%
Russia	2.1%	2.7%	15.9%
Total	3.0%	3.7%	15.4%

Although growth will be pretty spectacular over the next few years, with 15% penetration by 2010, digital TV will still have plenty of potential for growth. As you would expect, satellite, digital terrestrial and IPTV will be most popular in countries that have low cable penetration. However, DTT roll-out has been delayed in some countries, so target dates for analogue switch-off may not come to fruition. By 2010, the region will still have 89 million homes that receive analogue terrestrial or analogue satellite signals. About 63% of homes - or 145 million - will take digital terrestrial, digital satellite, IPTV and cable (both analogue and digital services). Cable subscribers, both analogue and digital, will account for 36% of TV households. Eastern European Television - 9th Edition. Publ 20050617

European International VoIP Bypass Calls Top $31 Billion in 2005

Europe

Insight Research: International callers from Europe will spend more than $31 billion on Voice over the Internet Protocol (VoIP) bypass this year. Since EU telecommunications companies have brought their international rates into line with actual costs, the attractiveness of VoIP as an arbitrage opportunity has already peaked and will gradually diminish. Thus, VoIP bypass will become a smaller percentage of all European international calls by 2011. According to the market analysis study, “,” in 2005 VoIP bypass calling revenue represented almost one-third of the $100 billion spent in Germany, France, the UK, and other European countries on international calls. By 2011, VoIP bypass is expected to account for only $43.8 billion out of some $151 billion spent on international calling. Of the estimated 94.3 billion European international calling MOUs generated in 2005, nearly 31 percent will be attributable to VoIP bypass; by 2011, VoIP as a percent of all European international calls will drop to 28 percent. Once international settlements are in line with the real costs to deliver service, arbitrage opportunities like VoIP bypass become less compelling. Take Russia, the exception in Europe: in 2005 international calling revenue is expected to amount to $3 billion, of which $2.1 billion was lost to VoIP bypass. Because we don’t see Russian rates coming in line with real costs any time soon, we expect that VoIP bypass will remain upwards of 50 percent of all international calling revenue in 2011. Telecommunications and VoIP in Europe and Africa: A Market Perspective on the Major Economies 2005-2011 Publ 20050606

Telcos Sacrifice Margins For Market Share As Cable’s Broadband Lead Slips

US

Strategy Analytics: Lower Prices and Bundling Will Bring Broadband to 78 Million Homes by 2010. After years of dominating the US market, cable operators' share of broadband Internet customers will decline steadily over the next five years . The report, "Broadband Internet Services in North America: Market Outlook & Analysis," notes that although cable remains the leading broadband platform in the US, its share of the total base of broadband users fell from 62 to 59 percent in 2004. By the end of 2005, cable's share will slip to 57 percent, while share for telcos offering DSL and fiber services will grow from 39 to 41 percent.

Even as they race to launch new services, such as IP-based TV, SBC, Verizon and other telcos are using aggressive price cuts to maintain subscriber growth in DSL. But the competitive race between cable and DSL will remain neck-and-neck through 2005 as top cable operators such as Comcast, Time Warner and Cablevision roll out Voice-Over-IP (VOIP) services to target telco customers. The combination of falling prices and multi-service bundles combining TV, telephony and high-speed Internet services will drive overall adoption of broadband sharply upward over the next five years. By 2010, the report predicts that nearly 78 million US customers will use some type of broadband service. Cable operators will account for about half of that total, while telcos will serve 43 percent of subscribers through a combination of DSL and advanced fiber networks.

Broadband Internet Services in North America: Market Outlook & Analysis Publ 20050616

PC Outlook Is Still Strong, According To : Portable Adoption And Growth In Emerging Markets Remain Key Drivers

global Central and Eastern Europe, the Middle East and Africa, and Latin America Asia/Pacific Western Europe

IDC: Following another strong quarter in Q1 2005, has slightly increased expectations for the PC market in 2005 and 2006. Total PC shipments are now expected to reach 199.2 million in 2005 on growth of 11.4%, followed by shipments of 217.0 million and growth of 9% in 2006. Emerging markets in Central and Eastern Europe, the Middle East and Africa, and Latin America continue to grow by more than 20% per year while Asia/Pacific and Western Europe continue to grow in the mid- to low teens. Portable adoption and low prices remain key drivers, sustaining business replacements and boosting consumer and small business demand. Persistent double-digit growth and a fairly gradual slowdown have raised our short-term outlook. "For several quarters now the market has responded to aggressive pricing and marketing, creating opportunities for growth and maintaining market momentum. Overall growth is likely to fall to single digits, but we continue to expect steady gains throughout the forecast period in all regions."

Although U.S. growth trails that of most other regions, in 2005 the United States will add nearly 5 million units to the total it absorbed in 2004. In much of the developed world, the law of large numbers really applies. Small growth rates still translate into large incremental unit shipments.

• United States – Despite a soft first quarter for the consumer segment, consumer demand is expected to remain fairly solid, even as business growth slows toward the end of the year. Portable PC demand will continue to be the primary market driver throughout the forecast period while desktop growth will slip from mid-single digits to near zero.Western Europe – Strong consumer demand gave the market a boost in the first quarter and is expected to bolster the market through the fourth quarter. Aggressive pricing and adoption of broadband and digital entertainment are boosting the market.

• Nevertheless, overall growth should diminish later in the year as replacement demand wanes.

• Japan – Consumer demand is also likely to boost growth in Japan. However, slowing commercial growth and a fickle consumer segment are expected to limit overall growth to mid-single digits.

• Asia/Pacific – Robust demand and a booming economy in China continue to drive growth in Asia/Pacific. Despite risks from bird flu and natural disasters, strong growth in the portable, consumer, and small business segments is expected to keep growth in double digits throughout the forecast period.

U.S. and Worldwide PC Shipments and Growth, 2002-2006 Publ 20050616

Intel Hits Number One in Wi-Fi IC Shipments

global ABI Research: The volume of laptops sold every year is growing rapidly. The penetration of Wi-Fi into the laptop market is on a similar upward curve. Add the essential ingredient of an 802.11 a/g Mini-PCI solution, mix in a big dose of marketing clout, and the result is that Intel has, in recent months, been steadily taking market share away from market leaders Broadcom and Atheros. In the most recent quarter Intel grabbed the top spot in terms of Wi-Fi IC market share. Before Intel introduced their 802.11g and a/g products,. Broadcom and Atheros had most of the market for 802.11g and 802.11a/g in laptops to themselves. But Intel is able to leverage the brand recognition of Centrino to take the marketing high ground. Mini-PCI adaptors are still a large percentage of all Wi-Fi solutions, so that Intel's market share in that segment means they have a lot of shipments to their credit. But can it last? For the moment, Intel is only offering products for mini-PCI slots. Its competitors also offer chipsets for wireless access points, and for the growing markets in consumer electronics and cellular handsets. Unless they also diversify,they will inevitably hit a plateau that will allow Broadcom, Atheros, Marvell, Texas Instruments, and others to continue to grow their overall market shares.Wi-Fi Research Service Publ 20050616

Analytical Microchip Market to Enter Enormous Growth Phase

U.S.

Kalorama Information: The U.S. market for analytical microchip technologies in the life sciences is poised to experience explosive growth in the next five years, with some segments expected to see triple-digit annual growth through 2009. Current market potential in the industry is approximately $2 billion—the majority of which is in the DNA/gene microarray segment. However, protein microarrays and microbiology microarrays are becoming more prominent, and the market for tissue microarrays and analytical process chips are forecast to explode in the next 10 years. There is little doubt that these technologies will be enormously important and the market will expand. The real questions for the industry are ‘How fast will the market expand?’ and perhaps more important, ‘When will the expansion take place?’Five microchip segments: DNA/gene, protein, tissue, cell, and microbiology microarrays, analytical process chips. U.S. Markets in Analytical Chip Technology, 2nd Edition Publ 20050616

The DVD Recorder Market -Not Including Units Connected to PCs- Doubled in Size in 2004 and Will Grow by 87% in 2005

global Japan

Research and Markets : DVD recorders are beginning to drive the market for non-PC DVD hardware, a trend that keeps the overall global DVD hardware market on the rise. The DVD recorder market (not including units connected to PCs) doubled in size in 2004 and will grow by 87% in 2005. In 2004, Japan DVD player shipments declined, while DVD recorders grew by over 100%.

-- Worldwide DVD recorder unit shipments will grow from 9.4 million in 2004 to 67.7 million in 2009.

-- Digital TV tuners will be added to DVD recorders in increasing numbers in Japan, Europe, and North America. The FCC DTV tuner mandate will require a DTV tuner in each DVD recorder shipped in the US after July 1, 2007.

-- Three manufacturers are shipping next-generation Blu-ray recorders in Japan, while the first HD-DVD players will be available in the second half of 2005 along with about 90 movie titles. In-Stat expects shipments of next-generation blue laser recorders and players will reach 4 million in 2008, not including video game consoles. DVD Players, Recorders, and the Next Generation Publ 20050616 Blu Ray? Wikipedia Red Viking