(Another) One bites the dust: Boxee sold to Samsung

Yesterday, over-the-top Internet set-top box maker Boxee confirmed that it had been acquired by Samsung. The rumored acquisition price was around $30 million--about the same amount as the company raised in venture financing, meaning that at best, investors got their money back. According to VentureBeat, Boxee will continue to support owners of Boxee Box and Boxee TV devices "for the immediate future," but Boxee's Cloud DVR service will be discontinued on July 10th and recorded television shows will be deleted.

Samsung has been one of the biggest potential customers for set-top box technology companies such as Google and Roku. Now, it's very likely that Samsung will integrate Boxee's technology into future HDTVs, Blu-Ray players and other devices. For Roku in particular, the number of companies that are both likely to integrate its technology into their devices and are big enough to represent a major business opportunity are dwindling. Sony and Vizio are already Google licensees, and Samsung is now on board with Boxee. Panasonic, Sharp and LG are still in play, but beyond them, the remaining players are second- and third-tier brands.

I'm still not convinced that there's a broad market for standalone Internet set-top boxes. Boxee couldn't find one, Google's licensees are struggling, Apple TV is supposedly beyond the "hobby" stage (but not far beyond) and Roku is putting more emphasis on its "streaming stick" and software licensing deals than its set-top boxes. As much as I like the idea of over-the-top video, unless Apple or Intel can come up with something both revolutionary and highly desirable, Internet video will remain a "second screen" application for PCs, tablets and smartphones.

Is Apple becoming a victim of its "reality distortion field?"

Earlier today, Apple announced a new 13" MacBook Pro, refreshed its Mac mini and iMac product lines, and introduced not one, but two new iPads: The 4th Generation 10" iPad, and the long-rumored iPad mini. The biggest news came from the iPads, and the financial markets are already reacting negatively.

The iPad mini has a 7.9" display and an A5 processor, but other than that, it's essentially an iPad 2 in a smaller package. Apple took pains to compare the iPad mini to Google's Nexus 7; Apple said that its tablet's display has 35% more area, and that it offers a "tablet experience" while the Nexus 7 offers a "scaled-up phone experience." Apple left a few things out of its comparison, however: The Nexus 7's display has higher resolution than the iPad mini, 1280 x 800 vs. 1024 x 768, which should be noticeable on the iPad mini's larger display. The Nexus 7's quad-core Tegra 3 processor should be faster than the iPad mini's Apple A5, and most importantly, the 16GB Nexus 7 sells for $199 (U.S.), while the 16GB iPad mini is priced at $329.

The Nexus 7 isn't Apple's only problem: Amazon's 16GB Kindle Fire HD also sells for $199, while Barnes & Noble's 16GB Nook HD is $229. In fact, Amazon's 32GB model is only $249 vs. $429 for the 32GB iPad mini, and the 32GB Nexus 7 is expected to be announced by Google next week for $249. Price isn't everything, of course, but it's very important, especially for 7" tablets. Apple's pricing raises an interesting question: Do people buy 7" tablets because they're seven inches, or because they're cheap? If they buy because they're seven inches, then Apple's in great shape, but if they buy because they're cheap, the iPad mini could spell trouble for the company in two ways.

The first issue is that price-conscious customers need to justify spending $130, almost twice the price, for a tablet with the Apple name on it. I'm far from convinced that the iPad mini is worth the premium that Apple is asking, and the financial community, which expected the 16GB model to be priced at $299, isn't convinced, either. Apple could justify a $100 premium and keep the iPad mini under the psychological $300 threshold with a $299 price. An additional $30 doesn't make a huge difference, but pricing the entry-level model over $300 does. The second issue is that a lot of consumers will look at the iPad mini and realize that it's all they need, for $170 less than a comparable 4th Gen iPad. That will result in the iPad mini cannibalizing sales of the more expensive and more profitable 10" iPad.

And, what about that new 4th Generation iPad? It replaces the 3rd Generation model, which had only been on the market for six months. It has a faster A6X processor, which Apple claims has twice the CPU and graphics speed of the A5 processor in the 3rd Generation model, and it also has a Lightning connector. Other than those two changes, the 3rd and 4th Generation models are essentially identical, which is leading some pundits to call the new model the "iPad 3S." The 4th Generation model, although not a complete surprise, will throw some uncertainty into consumers' future iPad purchase decisions. There's fairly reliably been a year between new iPad and iPhone models, but now we've gotten a new iPad just six months after the release of the previous model. Does this mean that Apple is speeding up its product replacement cycle, or is this a one-time event to get the Lightning connector into wider use?

I suspect that Apple may be believing some of its own hype--it can demand a premium price for the iPad mini just because it's an iPad. However, the 7" segment is by far the most competitive segment in the tablet market, and Apple is a late entrant. Apple will sell lots of iPad minis, but I doubt that they'll sell as many as they or analysts expect

Wishful thinking: "Silicon Valley Will Write The Next Big Check For Original Video Content"

At TechCrunch's Disrupt Conference today, Dana Brunetti, Kevin Spacey's partner in Trigger Street, a motion picture and television production company, said that "...Silicon Valley will likely become a major funding source for original content soon. For a company like Google, after all, offering a few million dollars to produce the next episode of a show like Mad Men and to put it on YouTube is pocket change." Perhaps, but that in no way means that it would be money well spent.

For decades, Hollywood producers and movie studios have solicited investment from people outside the entertainment business. The "term of art" for this kind of investment is "stupid money." Producers and studios go from country to country, convincing government leaders that tax breaks and credits for investment in films would results in thousands of jobs, not to mention great publicity for their countries. That's why you see credits for production funds you've never heard of and production sites far from Los Angeles in the end titles of movies. Germany, South Korea, Canada and the U.K. are just some of the countries that have been tapped for production money and tax credits over the last two decades. Almost every U.S. state has offered some form of movie production tax credits or incentives at one time or another. These programs dry up as lawmakers learn that the jobs created and revenues generated don't compensate for lost tax revenues. Producers look for more stupid money elsewhere, and the cycle repeats.

Individuals who invest in movies very rarely get a positive return on their investments. Entertainment industry accounting makes integral calculus look like simple arithmetic. Once money becomes available, a seemingly limitless number of hands reach out for it. Last week, for example, director Christopher Nolan had to file suit against his current and former talent agencies so that a court could decide which ones he must pay commissions to, as well as how much and on what projects. No one in their right mind would build a movie or television production system, or rules for employment, as they work today.

The approach that YouTube has taken with its channels makes sense. YouTube originally funded each of 100 channels with up to $1 million (some channels were rumored to have received as much as $2 million.) That's enough to "move the needle," but not enough for anyone to get rich on. The funding was an advance on advertising revenues, not an unrestricted grant. As YouTube gets actual performance numbers on each channel, it's offering additional advances to some, cutting others off and identifying new candidates for funding.

I have very real doubts about Netflix's original content strategy, which has funded House of Cards, a television series produced for Netflix by Trigger Street. The network television production model calls for hundreds of scripts, which are culled down into dozens of pilots, which are further cut to become the new shows for the next television season. Even at the most successful network, the success rate is pretty low. Netflix is cutting out most of the process and is going directly to production on the basis of scripts and the people involved. Choosing on the basis of name talent is far from a sure bet--for example, look at HBO's Luck, which had Dustin Hoffman in the lead and the directing/writing team of Michael Mann and David Milch. It was a disaster, and not just because three horses died during production.

If you want to invest in a movie so that you can rub shoulders with stars or see your name in the credits, and you have some "mad money" lying around that you can afford to lose, then by all means enjoy yourself. On the other hand, if you're investing in content in order to generate revenue, you've got to be a lot more systematic and much more hard-nosed.

The Apple-Samsung Verdict: Ultimately, it's better for everyone (except, perhaps, developers)

Yesterday's overwhelming court victory by Apple over Samsung in U.S. Federal Court is only one of many such cases being tried around the world, but it may be the most important. The jury's decisions may eventually be revised or overturned on appeal, but the results give a blueprint for how other such trials between Apple and Android licensees are likely to play out.

[Update, August 26, 2012: Groklaw reports that the speed of the jury's decision, given the 109 pages of jury instructions and 700 questions that the jury had to answer, and the speed with which the jury reconciled two obvious inconsistencies in its verdict, suggest that the jury raced through the judgment process without the necessary consideration. That conclusion is supported by a quote (albeit hearsay) in the blog The Verge: "The foreman told a court representative that the jurors had reached a decision without needing the (Judge's) instructions." CNET carried another quote, from a jury member, suggesting that the foreman led the jury to make a speedy but insufficiently considered set of judgments against Samsung. For these and other reasons, Groklaw believes that the jury's ruling won't stand.]

If you think back before Apple released the original iPhone, there was enormous diversity in mobile phone design. Motorola shook things up with its Razr; LG had its Chocolate phones, and Danger designed innovative early smartphones. And, of course, there was RIM with its keyboard-based BlackBerry models. Now, at least when they're turned off, there's very little difference between the smartphones from Apple, Samsung, LG, Motorola, Nokia and many other vendors. They're rectangular, fairly thin phones with touchscreens. Even RIM's new BlackBerry 10-based smartphones are going to be keyboard-free.

The Apple-Samsung ruling means that Android licensees are going to have to carefully scrub their smartphones of user interface features similar to those of Apple. Google is going to have to deliver a base version of Android that does the same thing. In addition, the physical designs of smartphones are going to have to become much more diverse. I see that as an opportunity, not a liability. Cars all have the same basic functional elements, but a Fiat 500 looks dramatically different inside and out than a Mercedes E-Class sedan.

There's a lot of room for creativity in smartphone design, and it's time for Apple's competitors to exercise that creativity. Phones could have displays that are designed to be used in landscape, rather than portrait, mode. They could fold up and have a top and bottom display. They could have displays on the front and back. There's a lot of creativity in Japanese phone designs, and that could become a model for the rest of the world.

The biggest problem facing smartphone designers is maintaining a consistent environment for app developers. Android developers are already confronted with a bewildering combination of screen sizes and versions of the operating system. There are over 1,000 different devices that developers could write for, but the reality is that they target a few popular devices and hope for the best. The problem will only get worse with more screen sizes and Android user interface customizations, and Google and its licensees are going to have to make it easier for developers to accommodate those variations.

It's time for someone to think outside the box and design a smartphone that makes the iPhone look outdated.

Will Nikon's Coolpix S800 be the first Android-based camera?

Nikon Rumors reports that Nikon submitted its Coolpix S800 to the Indonesian Communication Agency for approval. According to the blog, the Coolpix S800 is expected to run Android Gingerbread (2.3.X) and will run all Google Play apps that are backward-compatible with Gingerbread. Nikon Rumors writes that the Coolpix S800 could be announced on August 22nd.

The S800 makes no pretense of being a professional camera--it's a point & shoot. Here are a few of the expected specifications:

• 25-250 zoom lens
• 3.5" OLED display
• Built-in GPS and Wi-Fi

What makes the S800 interesting is that it's based on Android. What could app developers do with a real camera, instead of having to make do with the limited functionality of the cameras in today's smartphones? Even more interesting is the possibility of a DSLR or mirrorless interchangeable lens camera that runs Android, and whose functionality can be modified with third-party apps.

Shades of things to come, if you live in Kansas City

Engadget reports that Google has officially launched its Google Fiber service in portions of Kansas City. The service breaks down as follows:

1. A $300 "construction fee" (temporarily waived for monthly subscribers) gets customers a set-top box, a Storage Box DVR with a 2TB hard drive that can store 500 hours of HD video, a Network Box with a four-port Ethernet router and 802.11n Wi-Fi, and a free Nexus 7 tablet to serve as the system's remote control. 
2. For $120/month, subscribers get "hundreds" of television channels, and most importantly, a fiber Internet connection with download and upload speeds of 1Gbps; only a few Internet Service Providers around the world offer Internet connections this fast. 
3. The 1Gbps connection is available by itself without television for $70/month. 
4. Any consumer willing to pay the $300 construction fee can get basic 5Mbps internet service free for "at least" seven years. 
5. "Key institutions" (most likely local government and schools) will get the full 1Gbps service for free, 

Kansas City is the first city to get Google Fiber, but it won't be the last; the company is conducting a "rally" where the city with the most people who pay $10 to preregister for service will get Google Fiber next.

Google values Motorola Mobility's entire hardware business at $670 million

FierceWireless reports that in an SEC filing, Google detailed how it valued the $12.4 billion that it paid to acquire Motorola Mobility. Here's the breakdown:

• $5.5 billion for the 17,000 patents that Google acquired
• $2.9 billion for cash in Motorola's treasury
• $2.6 billion for goodwill (trademarks and intangibles)
• $730 million for customer relationships (Motorola's relationships with telecom, cable and IPTV companies)
• $670 million for "other net assets"

Those "other net assets" include Motorola Mobility's entire phone, tablet and set-top box businesses. It's no wonder that we haven't heard much about Google's plans for Motorola's hardware businesses--Google thinks that they're fairly close to worthless. Google could write off the entire hardware business and take a modest one-quarter earnings hit.

If I worked for Motorola Mobility and I wasn't already looking for a new job, I'd be firing out resumes after Google's SEC filing. Is it possible that Google will invest big bucks to turn around Motorola's hardware business? Sure, it's possible--but not likely.

Zola Books wants to partner with independent booksellers

Jeremy Greenfield of Digital Book World writes about Zola Books, a new eBook retailer that launched in beta shortly before this year's BEA. The company has raised $1.3 million from investors and plans to open its eBookstore to consumers on September 19th. Zola is offering eBook partnerships to American Booksellers Association members that have been selling eBooks through Google Books, but it's not clear whether Zola is under official consideration to replace Google by the ABA.

One ABA member, Katie Fransen of One More Page Books in Arlington, VA, said that the ABA eBook program was much too expensive. The ABA charged a monthly fee of around $200/month to program and maintain the store's website, and to act as a go-between with Google. Fransen, whose store has signed up for Zola's beta program, said that Google offered a very small percentage on sales to its independent bookstore partners. Zola, on the other hand, pays publishers 70% of each sale, and then splits the remaining 30% equally with its partners (Zola pays the 4% credit card transaction fee out of its share of the 30%.) It's a great deal for publishers, but it's significantly less than what most bookstores make on print sales. (Also, it's unclear what the business model truly is--Greenfield writes that Zola gives independent booksellers that run their own online stores 60% of the net proceeds from every sale, which, if net proceeds are measured after the publisher's share, would be a slightly better deal for booksellers.)

To date, Zola has signed up 48 bookstores for its beta test, and half of them have committed to use Zola when it launches in September, although the article says that the number of participating bookstores continues to change.

IHS iSuppli estimates Nexus 7's cost of materials is $151.75

All Things D reports that IHS iSuppli has torn down a Google Nexus 7 tablet and estimates the cost of materials for the 8GB model to be $151.75, and $159.25 for the 16GB model. That's about $30 less than the estimate released late last month by UBM Techinsights, which was made before they had a chance to tear down an actual tablet. At $151.75, IHS iSuppli believes that Google is breaking even on sales of the 8GB model ($199) and is making a nice profit on the 16GB model. Andrew Rassweiler, who runs the teardown team at IHS iSuppli, said "It’s (Google's) getting $50 more at retail for only $7.50 more in hardware cost, which sends $42.50 per unit straight to the bottom line."

The company believes that the Nexus 7 costs $18 more to build than the current Kindle Fire--which indicates that Amazon could easily release a second-generation Kindle Fire with comparable specs to the Nexus 7 at the same $199 price.

A race to the top, or to the bottom?

In the last few weeks, announcements and rumors have been flying about technology leaders launching new mobile computing products:

• Microsoft jumped into the tablet business with its Surface tablets for Windows RT and Windows 8.
• Google announced its Nexus 7 tablet, built by Asus.
• Amazon is rumored to be announcing a replacement for the current Kindle Fire in late July or early August.
• That was followed a couple of days ago by rumors from reliable sources that Apple plans to announce  a 7" to 8" iPad in September or October.
• Yesterday, Bloomberg broke a story that Amazon is working on a smartphone to be built by Foxconn, and is trying to acquire patents in order to protect itself from the widespread litigation between smartphone and software vendors.

Assuming that all the rumors are true, it means that Amazon, Apple, Google and Microsoft will be competing directly against each other with tablets and (with the exception of Microsoft) smartphones. The margins on mobile devices are very low--only Apple has figured out how to make solid margins on its hardware. Samsung is making money because it manufactures so much of its own products, and it sells so many of them. No one other than Apple and Samsung makes money on smartphones. As for tablets, Apple makes excellent margins, but according to the latest hardware cost breakdowns, Google is just about breaking even on the Nexus 7, while Amazon is making a small gross margin on its Kindle Fire.

If Apple jumps into the 7" tablet market, will it compete with Amazon and Google on price, or will it add features that they don't have, such as 4G support, in order to command a higher price? How does Amazon expect to differentiate its smartphones from the pack of Android models? When Microsoft's Surface tablets make it to market, will they be competitive?

With everyone cloning everyone else and making incremental improvements, are we nearing the point where there are no clear lines of differentiation for anyone? If:

• Everyone has access to the same components, 
• Everyone's trying take advantage of whatever gaps have been left by their competitors until they get filled, and
• Android Jelly Bean's user experience is finally competitive with iOS and Windows RT,

Doesn't that mean that competition will inevitably come down to the number of apps available, customers' investments in libraries of apps (which affects switching costs) and price? That's a market that looks very much like personal computers.

Virtually no profit in the Google Nexus 7

The Wall Street Journal reports on a preliminary estimate by UBM Techinsights of $184 for the cost of components in the new Google Nexus 7 tablet, which sells for $199. That barely allows Google to break even on direct sales, and it's losing money on sales through the channel. By comparison, UBM estimated that the Kindle Fire's cost of components was $153 last November. Specifications for the rumored Kindle Fire 2 are expected to be similar to that of the Nexus 7, and the component cost will most likely also be similar. However, Amazon could probably keep the existing Kindle Fire in the product line, at least as an interim product, at $149. At the same time, however, UBM's analysis suggests that the also-rumored 7" iPad is unlikely to be sold at $199, since Apple won't be able to make acceptable margins at that price. It's more likely to come to market between $249 and $299, if it ships at all.

More details about the rumored updated Kindle Fire

The China Times has some details about the rumored next-generation Kindle Fire:

• The next-generation Kindle Fire will be announced either at the end of this month or in early August. 
• It'll still be priced at $199, will have a metal chassis instead of plastic, and the display will come from LG Displays and Panasonic. 
• The screen will be higher resolution than the current model. 
• It may have a camera, which the current model lacks, but the translation that discusses this feature is very confusing. 
• Quanta, which builds the current model and will also build the new one, has received an initial order for two million units. 
• Heavy shipments of components for the new model started in June. 

There are no details on the processor, memory, graphics, etc., but I wouldn't be surprised to see them be very similar to the Google Nexus 7.

7" to 8" iPad coming in October?

Bloomberg is reporting that according to two unnamed sources, Apple plans to launch a 7 to 8 inch version of the iPad this year, possibly by October. One of the sources said that the new iPad wouldn't have a Retina Display. Analyst Shaw Wu of Sterne Agee & Leach Inc. said that such a new iPad, priced around $199, would be "competitors' worst nightmare." The low-cost iPad would be targeted at the Kindle Fire (or whatever 7" model Amazon has at that time) and the Google Nexus 7, and would be intended to help keep those (and similar) tablets from eroding Apple's market from below. It's widely expected that the new iPhone will be released in September, so if the new iPad is real, it's likely to be announced at the same time.

Google says that the Nexus 7 went from inception to launch in four months

Engadget has an interview with Patrick Brady, Google's Director of Android Partner Engineering. In it, Brady says that the Nexus 7 tablet project actually took just four months from inception to launch. Google and Asus started with a prototype tablet that Asus previewed at the Consumer Electronics Show last January (that model was scheduled to sell for $250.) Development began in late February. The tablet was made thinner and lighter than the prototype, and some features were dropped to lower the cost, including a rear-facing camera. (Brady didn't confirm that the camera was dropped because of cost, but the January Asus prototype had one.) Brady said that the Nexus 7 is just the "first device" in the Nexus tablet range.

eBookstores (and some publishers) are tracking how their eBooks are read

The Wall Street Journal reports that retailers (and, in some cases, publishers) know far more about how eBooks are being used than they ever knew about print books. According to the article, Amazon, Apple, Barnes & Noble and Google can track how far readers are getting into their eBooks, how long they spend reading them, how often they read them and which search terms they use. If the eReader supports annotations, they also know what readers are highlighting and the contents of notes. They also know how many times readers open their tablet apps.

This information is just beginning to be studied, and some retailers are sharing the information (albeit selectively) with publishers. Barnes & Noble is in "the earliest stages of deep analytics," but it's already learned some useful information:

• Nook users who buy the first eBook in a popular series tend to read the next title in the series as soon as they finish the first one. 
• Nonfiction eBooks tend to be read a little at a time and are dropped sooner than fiction, while fiction titles are usually read straight through. 
• Science fiction, romance and crime fans often read more eBooks in those genres, and read them more quickly, than do literary fiction readers. 
• Readers of literary fiction quit eBooks more often and tend to skip around between titles more frequently than readers of other fiction genres. 

Amazon has long gathered and utilized information on its customers' purchasing habits; for example, it uses that information to recommend similar titles. Digital security expert Bruce Schneier is concerned that the knowledge that tracking is going on may cause a "chilling effect" on purchases of eBooks on sensitive topics, such as sex, health and security.

Groups such as the Electronic Freedom Foundation want Amazon, Barnes & Noble and other resellers to give their customers the ability to opt-out of eBook tracking. California has a "Reader Privacy Act" that requires government agencies to get a court order before requiring digital booksellers to turn over information about which eBooks their customers have browsed, purchased, read or annotated. The ACLU and EFF are now trying to enact similar laws in other states.

Some publishers, especially those who sell directly to customers, are gathering their own data about reader behavior. Sourcebooks is experimenting with early online "work-in-progress" versions of some of its titles, and is incorporating reader feedback into the final version. Scholastic is using online message boards and interactive games connected to its "39 Clues" series to gather input from 1.9 million registered users. Coliloquy, an interactive digital publisher, is gathering information on the characters and plot lines selected by readers and forwarding it to authors for use in writing future titles.

New Kobo Vox Coming This Fall?

On The Digital Reader blog, Nate Hoffelder writes about a MobileRead post from a current Kobo Vox user who was told by an Indigo Books salesperson that a new Vox model is coming in the fall. Given Google's new Nexus 7 and the multiple rumors about new Kindle tablets coming as early as the end of July, it makes sense for Kobo to be working on a new version of the Vox.

What the heck is Google thinking?

Now that we've had a chance to see Google's latest product announcements at its I/O Conference, it's clear that the company understands software just fine but doesn't have a clue about hardware. Android 4.1, Jelly Bean, looks like a strong, if incremental, update to Android, as do the enhancements to Google+. However, the new hardware has me scratching my head:

• There's nothing exciting about the new Nexus 7 tablet. Essentially, Google looked at what Amazon's Kindle Fire lacks--a front-facing camera and faster processor--added them, and gave the Nexus 7 the same price. In doing so, Google assumed that Amazon would stand still, when multiple rumors indicate that two new 7" tablets are due from Amazon as soon as this quarter. The price of the existing Kindle Fire is rumored to drop to $149, and a next-generation model with features very similar to the Nexus 7 is almost certainly not going to be priced more than $199. With Amazon's superior distribution, it's going to be very hard for Google to compete.
• The Nexus Q media player makes absolutely no sense to me. It's an Internet set-top box with a 25-watt stereo amplifier and a single HDMI output, priced at $299. It competes with low-end A/V receivers, Internet set-top boxes from companies such as Apple, Roku and Vizio, and portable Internet receivers from companies like Sonos. Most of the devices that it competes with are less expensive ($99 or less in the case of the Internet set-top boxes.) Its round shape makes it a poor fit with audio component systems, and in use, it'll have a myriad of cords attached on both the front and back of the device. It requires another Android device as a remote control. Google says that the Nexus Q is a "social jukebox," but is there really a market for a digital audio player that lets you screw around with other people's playlists?
• Google Glasses are vaporware; Google isn't committing to deliver anything for a year, yet wants developers to pay for them now. They're almost the perfect example of a product designed by engineers who have no idea what real consumers want. Google doesn't even know what the use cases will be; it wants developers to pay $1,500 to help it find out. The market is...skydivers who want low-resolution video cameras in their sunglasses? Engineers who want to look like dorks? People who can't be bothered to look down at their smartphone to see their messages?

When you put these projects together with Google's Chrome OS initiative, which is coming apart at the seams, and pipe-dream projects like self-driving cars, it's clear that all that Larry Page has done is kill off one set of unproductive projects in favor of a different set of equally unproductive projects. All the while, Google is continuing to bleed employees, and the company is being forced to add talent through ever-more-expensive acquisitions. It would be great if Google was doing fundamental research that's inventing entirely new technologies, as Bell Labs did for decades, but most of what's coming out of Google's efforts is...junk. Google's advertising revenues are subsidizing one of the most wasteful and undisciplined product development programs in the history of high tech. 

Google announces new version of Android, new Nexus 7 tablet and Nexus Q media player at I/O Conference

Engadget reports that Google made several announcements at its Google I/O Conference today:

1) Android 4.1, also called Jelly Bean, will be released in mid-July for the Samsung Galaxy Nexus and Nexus S smartphones, and Motorola Xoom tablets. Other devices may be updated in the future, depending on whether the hardware can support the new operating system, and whether hardware vendors and mobile service providers decide to support it. A number of enhancements have been made to improve performance; the company now claims that the CPU and GPU run in parallel, enabling the user interface to run at 60fps (if the hardware supports it.) The on-screen keyboard has been improved, as has voice input, which now works in both online and offline modes.The design of the home screen has been updated, and it's now easier to add, move and delete apps and widgets. Improvements have also been made to the camera app.

2) Google is now supporting "Smart App Updates" that allow incremental updates instead of requiring entire apps to be replaced. It's also improving encryption in order to make it harder to pirate paid apps.

3) Google announced its new tablet--the Nexus 7--that also runs Android 4.1. There were no surprises--all of the specs and prices had been previously leaked. It's got a 7" 1280 x 800 display, a quad-core Tegra 3 processor, 1GB of RAM and a 1.2 megapixel front camera, for $199 for the 8GB model and $249 for 16GB. For a limited time, it also comes with a $25 credit for the Google Play content and app store. Its user interface is based on the design of the Google Play store. The Nexus 7 will ship in mid-July.

4) The new Nexus Q is a ball-shaped media streaming device for the living room. It can connect any Android device to a television set or audio/video receiver and stream music and video from the Google Play store, as well as YouTube videos from the cloud. However, it doesn't appear to support services such as Hulu, Netflix or other third-party content providers. It also has its own built-in 25-watt amplifier, so it can be used as a standalone device by connecting speakers to it. According to The New York Times, the Nexus Q is almost entirely manufactured in the U.S. The Nexus Q will be priced at $299 when it ships in mid-July; the price is three times as much as comparable products from Apple, Roku and Vizio, so it's not clear who's Google's target market or why it feels that it can justify such a high price.

Gizmodo Australia claims to have read a training manual for Google's rumored tablet

Gizmodo Australia claims to have read a training manual for Google's rumored tablet to be launched this week at the Google I/O Conference. According to the document, the tablet will be called the Nexus 7, will be built by Asus, and will use a 1.3GHz quad-core Tegra 3 processor with 12-core GeForce GPU and 1GB of RAM. The 7" display will have 1280 x 800 resolution, and the tablet will have a front-facing 1.2 megapixel camera and a battery that will give 9 hours of runtime. It will support Near Field Communication (NFC) for wireless transactions, and Google Wallet. The document says that the tablet will run Jelly Bean, the next version of Android, but it doesn't mention a version number. The Nexus 7 will be sold in two configurations, 8GB for $199 (U.S.) and 16GB for $249.

Google's intention with the Nexus 7 is to compete with Amazon's Kindle Fire and keep customers out of Amazon's ecosystem. However, if Gizmodo's story is correct and rumors about Amazon's new tablets are also correct, Google may still find itself flat-footed. The Kindle Fire's price is said to be dropping to $149 very soon, to make way for a replacement model with better specifications in Q3, which will also be priced at $149. A second 7" model, with specifications similar to the Nexus 7, is supposed to also be released in Q3 of this year, probably at the same price(s) as the Nexus 7. Given Amazon's superior distribution and support capabilities, it's unlikely that the Nexus 7 will gain much traction, at least in North America.

Google and Asus expected to unveil 7" Nexus tablet next week at Google I/O

DigiTimes reports that Google's and Asus' new 7" Nexus Android tablet, to be built for the companies by Quanta Computer (the same company that manufactures the Kindle Fire,) will be launched at next week's Google I/O Conference in San Francisco. The price will reportedly be $199, and the tablet is said to include a quad-core Tegra 3 processor and a front-facing webcam. DigiTimes also says that the tablet will be preloaded with Google's Chrome browser for Android; it's not clear if Chrome will replace or be installed in addition to the legacy Android browser.