By Agence France-Presse | Updated: 20 October 2020
The world’s second-largest chipmaker, South Korea’s SK Hynix, on Tuesday announced a $9 billion (roughly Rs. 66,000 crores) deal to buy Intel’s flash memory chip operation as it seeks to bolster its position against rival behemoth Samsung Electronics.
SK Hynix is already the world number two maker of DRAM chips, used in computers and servers, and the second-largest chipmaker overall.
But it has lagged in the market for flash memory, or NAND chips, which are used in everyday devices such as smartphones and USB storage drives, as well as industrial and medical equipment.
In a regulatory filing, SK Hynix said it will acquire Intel’s “entire NAND business division excluding the Optane division” for KRW 10.3 trillion (roughly Rs. 66,300 crores), with Intel’s factory in Dalian, China, included in the deal.
SK Hynix ranked fourth by global NAND sales in the second quarter this year, according to market researcher Trendforce. Intel was sixth.
Their combination will see SK Hynix leapfrog Japan’s Kioxia and Western Digital of the United States into second place with a market share of more than 23 percent, the Trendforce numbers showed.
The NAND and DRAM markets are both dominated by Samsung Electronics, and global chip demand has boosted profits for the two South Korean firms in recent years.
The pair compete to supply chips to American giants such as Apple, Dell and HP, as well as Chinese companies.
The Intel acquisition would strengthen the NAND operations of SK Hynix, which have “not been as strong as its other businesses”, said Ahn Ki-hyun, vice-president of the Korea Semiconductor Industry Association.
“With the deal, the company has firmly cemented its second-largest position in the global semiconductor industry,” he added.
“In the long run, the deal paves a way for it to become more competitive against Samsung.”
The founding company of SK Hynix was originally part of the Hyundai group, one of the family-controlled conglomerates known as chaebol that dominate business in the world’s 12th-largest economy.
In 2012, a multi-billion-dollar merger saw it become part of the SK Group, the third-largest of the chaebols, headed by Chey Tae-won, who is currently married to the daughter of late South Korean president Roh Tae-woo.
SK Hynix has grown to become a major company in its own right and is the second most valuable company listed on Seoul’s KOSPI stock market with a market capitalisation of KRW 62 trillion (roughly Rs. 3,99,220 crores), behind only Samsung Electronics.
But SK Hynix shares were down more than two percent on the announcement in morning trade.
Its CEO Seok-Hee Lee said in a statement that the Intel acquisition will enable the firm to “proactively respond to various needs from customers and optimise our business structure”, and make its NAND flash market position “comparable with what we achieved in DRAM”.
The statement cited Intel CEO Bob Swan saying the deal allows the US firm to focus on “differentiated technology where we can play a bigger role in the success of our customers”.
The acquisition will be paid for in cash, funded through existing reserves and borrowing, SK Hynix said.
Dell Stops Some US Gaming PC Shipments Over New Energy Efficiency Rules
By Reuters | Updated: 29 July 2021
PC maker Dell said it has stopped shipping some versions of its powerful gaming systems to California and five other states because the products do not meet new energy efficiency standards.
The regulations affect “select configurations” of its Alienware Aurora R10 and R12 gaming PCs, Dell said in a statement sent to Reuters late on Tuesday.
Gaming PCs made by Dell and others use powerful chips for cutting-edge graphics in video games. Those components mean gaming systems typically consume far more electricity than an average computer.
Dell said it planned to have new models and configurations that “will meet or exceed these regulations, in line with our long-term focus to address energy and emissions.”
It did not give details on why specific models did not meet energy standards, what it planned to change and or when new models would be introduced.
The affected models contained graphics processing units from Advanced Micro Devices and Nvidia, along with central processors from AMD and Intel.
The Alienware Aurora Ryzen Edition R10 gaming desktop, which is among the affected products, costs $1,819.99 (roughly Rs. 1.3 lakhs), according to Dell’s website.
California’s toughened efficiency regulations for computers went into effect on July 1. The state has said the new standards will help reduce greenhouse gas emissions that cause climate change and will also lower electricity bills for consumers.
Residential computers and computer monitors account for up to 2.9 percent of the electricity consumption in the most populous US state, according to a California report.
In addition to California, Dell will no longer ship the products to customers in Colorado, Hawaii, Oregon, Vermont, and Washington state.
The California Energy Commission, which wrote the new standards, did not immediately respond to a request for comment.
© Thomson Reuters 2021
Samsung Rides COVID-19 Pandemic-Led Demand for Chips to Report Over 70 Percent Surge in Profits
By Agence France-Presse | Updated: 29 July 2021
Samsung Electronics’ net profits surged more than 70 percent in the second quarter thanks to higher memory chip prices fuelled by pandemic-led demand, the South Korean tech giant reported Thursday.
Coronavirus-driven working from home boosted demand for devices and appliances powered by Samsung’s memory chips. The company said that “memory shipments exceeded previous guidance and price increases were higher than expected”.
The world’s biggest smartphone maker saw net profits rise 73.4 percent year-on-year to KRW 9.6 trillion (roughly Rs. 62,280 crores) for the April to June period, the company said in a regulatory filing.
Operating profit increased 54.3 percent to KRW 12.6 trillion (roughly Rs. 81,730 crores) from KRW 8.1 trillion (roughly Rs. 52,550 crores) a year earlier, more than half of which came from the firm’s semiconductor business.
The strong results come despite an on-quarter decline in Samsung’s earnings from its smartphone business because of supply chain problems that disrupted global production.
Samsung Electronics is the flagship subsidiary of the giant Samsung group, by far the largest of the family-controlled empires that dominate business in South Korea, the world’s 12th largest economy.
The conglomerate’s overall turnover is equivalent to one-fifth of gross domestic product.
Analysts say the chip unit’s proportion of the firm’s profit is likely to grow in the months ahead.
“Samsung will benefit from memory chip prices that are likely to go higher in the third and fourth quarter,” Park Sung-soon, an analyst at Cape Investment & Securities, told AFP.
The firm anticipates favourable market conditions for the rest of the year, with continued demand for memory chips in the server and mobile markets.
But it warned that pandemic-fuelled uncertainty would persist in the second half, noting “continued disruptions in component supply”.
Samsung is expected to showcase the latest foldable smartphone models of its Galaxy Z and clamshell Galaxy Z Flip next month.
Makers of foldables are increasingly competitive, and include rivals such as Huawei and Xiaomi.
Samsung aims to solidify its position in the smartphone market “with the rollout of its premium mobile lineups as well as cheaper models in the third quarter”, said James Kang, senior analyst at Euromonitor International.
But Kang said the company could face headwinds next year, as consumer demand is likely to be weaker than in 2021.
Samsung also faces legal challenges.
Its leader Lee Jae-yong is currently on trial, charged with manipulating a takeover to smooth his succession at the top of the Samsung group.
Lee was separately jailed in January over a sprawling corruption scandal that brought down former president Park Geun-hye.
South Korea’s corporate leaders and scholars say a leadership vacuum could hamper the firm’s decision-making about large-scale investments, previously key to its global rise.
Lee is eligible for parole next month after completing more than half of his two-and-a-half year jail term.
LG Display Rides Pandemic-Led Demand for TVs, Laptops to Beat Q2 Profit Estimates
By Reuters | Updated: 28 July 2021
South Korea’s LG Display on Wednesday posted a better-than-expected second-quarter profit as pandemic-led demand for TVs and laptops drove up panel prices, pushing its shares up as much as 4.2 percent in morning trade.
The display maker, whose customers include Apple, reported an operating profit of KRW 701 billion (roughly Rs. 4,517 crores) in the April-June quarter, beating an average analyst forecast of KRW 599 billion (roughly Rs. 3,861 crores) from Refinitiv SmartEstimate. Revenue rose 31 percent on-year to KRW 7 trillion (roughly Rs. 45,124 crores).
Prices of LG Display’s mainstay 55-inch liquid crystal display (LCD) panels for TV sets more than doubled in the April-June quarter from the same period a year earlier, according to market data from TrendForce’s WitsView.
Still, panel prices are slated to fall in the latter half of the year, as Chinese panel makers ramp up production on the back of a slight easing in the shortage of semiconductor parts, especially display driver integrated circuits (DDI), analysts said.
As well, vaccinated people around the world are venturing outdoors and watching less TV, prompting TV makers to take a conservative view on demand and lower panel procurement levels, analysts said.
“We are planning to operate our business on the assumption that IT panel prices might be partially mitigated and decline,” Chief Financial Officer Suh Dong-hee told an earnings briefing, citing issues including competitors’ panel production capacity and the parts supply situation.
Market demand for LCD TVs was likely to decline more quickly than for IT devices, which would likely lead to weaker panel prices for LCD TVs, Suh said.
Apple on Tuesday said a global chip shortage that has bit into its ability to sell Macs and iPads will start to affect iPhone production and forecast slowing revenue growth.
Analysts said the global chip supply crunch has pushed up prices of consumer electronic gadgets, including laptops, TVs and smartphones as manufacturers adjust prices to reflect component cost increases in their pricing, however, prices were unlikely to continue to rise as the chip shortage is expected to ease in the second half of the year.
LG Display’s stock has risen more than a fifth so far this year, versus a 12.5 percent rise in the broader market. The stock was up 2.2 percent in late morning trade.
© Thomson Reuters 2021
Microsoft Says Israeli Group Created and Sold Tools to Hack Windows
By Reuters | Updated: 16 July 2021
An Israeli group sold a tool to hack into Microsoft Windows, Microsoft, and technology human rights group Citizen Lab said on Thursday, shedding light on the growing business of finding and selling tools to hack widely used software.
The hacking tool vendor, named Candiru, created and sold a software exploit that can penetrate Windows, one of many intelligence products sold by a secretive industry that finds flaws in common software platforms for their clients, said a report by Citizen Lab.
Technical analysis by security researchers details how Candiru’s hacking tool spread around the globe to numerous unnamed customers, where it was then used to target various civil society organisations, including a Saudi dissident group and a left-leaning Indonesian news outlet, the reports by Citizen Lab and Microsoft show.
Attempts to reach Candiru for comment were unsuccesful.
Evidence of the exploit recovered by Microsoft suggested it was deployed against users in several countries, including Iran, Lebanon, Spain, and the United Kingdom, according to the Citizen Lab report.
“Candiru’s growing presence, and the use of its surveillance technology against global civil society, is a potent reminder that the mercenary spyware industry contains many players and is prone to widespread abuse,” Citizen Lab said in its report.
Microsoft fixed the discovered flaws on Tuesday through a software update. Microsoft did not directly attribute the exploits to Candiru, instead referring to it as an “Israel-based private sector offensive actor” under the codename Sourgum.
“Sourgum generally sells cyberweapons that enable its customers, often government agencies around the world, to hack into their targets’ computers, phones, network infrastructure, and Internet-connected devices,” Microsoft wrote in a blog post. “These agencies then choose who to target and run the actual operations themselves.”
Candiru’s tools also exploited weaknesses in other common software products, like Google’s Chrome browser.
On Wednesday, Google released a blog post where it disclosed two Chrome software flaws that Citizen Lab found connected to Candiru. Google also did not refer to Candiru by name, but described it as a “commercial surveillance company.” Google patched the two vulnerabilities earlier this year.
Cyber arms dealers like Candiru often chain multiple software vulnerabilities together to create effective exploits that can reliably break into computers remotely without a target’s knowledge, computer security experts say.
Those types of covert systems cost millions of dollars and are often sold on a subscription basis, making it necessary for customers to repeatedly pay a provider for continued access, people familiar with the cyber arms industry told Reuters.
“No longer do groups need to have the technical expertise, now they just need resources,” Google wrote in its blog post.
© Thomson Reuters 2021
Microsoft’s Blue Screen of Death Will Be Changing to Black in Windows 11
By ANI | Updated: 3 July 2021 13:06 IST
American tech giant Microsoft will be changing its famous Blue Screen of Death (BSOD) to a black one in its upcoming Windows 11 operating system.
According to The Verge, the software giant started testing its new design changes in a Windows 11 preview earlier this week, but the Black Screen of Death isn’t fully enabled yet. This new switch for Windows 11, is in pace with the new black logon and shutdown screens.
It’s the first major change to the BSOD since Microsoft added a sad face to the screen in Windows 8 in 2012, and QR codes in 2016. Microsoft first introduced the BSOD in Windows 3.0, offering
A BSOD is Windows’ own kernel error or bug check, and it usually includes a dump of data that can help system administrators analyse what system fault caused the blue screen.
While Microsoft will be switching to a Black Screen of Death in Windows 11, the screen is identical to the one found in Windows 10 otherwise.
The sad face remains, as does the stop code and crash dump. The current preview of Windows 11 includes a green BSOD, a colour that Microsoft has been using for Windows Insider builds since 2016.
It’s not entirely clear as to why Microsoft is changing the colour from blue to black, and the company isn’t commenting on the change yet.
Still, as per The Verge, there are some theories. Microsoft is overhauling many parts of Windows 11, with a fresh approach to the OS. It’s likely because Windows 11 includes a visual overhaul to modernise the OS in key areas, including classic parts like the Start menu, File Explorer, and now even the BSOD.
Qualcomm’s New CEO Cristiano Amon Eyes Dominance in the Laptop Markets
By Reuters | Updated: 2 July 2021
Qualcomm’s new chief thinks that by next year his company will have just the chip for laptop makers wondering how they can compete with Apple, which last year introduced laptops using a custom-designed central processor chip that boasts longer battery life.
Longtime processor suppliers Intel and Advanced Micro Devices have no chips as energy efficient as Apple’s. Qualcomm Chief Executive Cristiano Amon told Reuters on Thursday he believes his company can have the best chip on the market, with help from a team of chip architects who formerly worked on the Apple chip but now work at Qualcomm.
In his first interview since taking the top job at San Diego, California-based Qualcomm, Amon also said the company is also counting on revenue growth from China to power its core smartphone chip business despite political tensions.
“We will go big in China,” he said, noting that US sanctions on Huawei give Qualcomm an opportunity to generate a lot more revenue.
Amon said a cornerstone of his strategy comes from a lesson learned in the smartphone chip market: It was not enough just to provide modem chips for phones’ wireless data connectivity. Qualcomm also needed to provide the brains to turn the phone into a computer, which it now does for most premium Android devices.
Now, as Qualcomm looks to push 5G connectivity into laptops, it is pairing modems with a powerful central processor unit, or CPU, Amon said. Instead of using computing core blueprints from longtime partner Arm Ltd, as it now does for smartphones, Qualcomm concluded it needed custom-designed chips if its customers were to rival new laptops from Apple.
As head of Qualcomm’s chip division, Amon this year led the $1.4 billion (roughly Rs. 1,480 crores) acquisition of startup Nuvia, whose ex-Apple founders help design some those Apple laptop chips before leaving to form the startup. Qualcomm will start selling Nuvia-based laptop chips next year.
“We needed to have the leading performance for a battery-powered device,” Amon said. “If Arm, which we’ve had a relationship with for years, eventually develops a CPU that’s better than what we can build ourselves, then we always have the option to license from Arm.”
Arm is in the midst of being purchased by Nvidia for $40 billion (roughly Rs. 2,99,440 crores), a merger that Qualcomm has objected to with regulators.
Amon said Qualcomm has no plans to build its own products to enter the other big market for CPUs – data centers for cloud computing companies. But it will license Nuvia’s designs to cloud computing companies that want to build their own chips, which could put it in competition with parts of Arm.
“We are more than willing to leverage the Nuvia CPU assets to partner with companies that are interested as they build their data center solutions,” Amon said.
Phone chips accounted for $12.8 billion (roughly Rs. 95,790 crores) of its $16.5 billion (roughly Rs. 1,23,480 crores) in chip revenue in its most recent fiscal year. Some of Qualcomm’s best customers, such as phone maker Xiaomi, are in China.
Qualcomm is counting on revenue growth as its Android handset customers swoop in on former users of phones from Huawei, which was forced out of the handset market by Washington’s sanctions.
Kevin Krewell, principal analyst at TIRIAS Research, called it a “political minefield” due to rising US-China tensions. But Amon said the company could do business as usual there.
“We license our technology – we don’t have to do forced joint ventures with technology transfers. Our customers in China are current with their agreements, so you see respect for American intellectual property,” he said.
Another major challenge for Amon will be hanging on to Apple as a customer. Qualcomm’s modem chips are now in all Apple iPhone 12 models after a bruising legal battle. Apple sued Qualcomm in 2017 but eventually dropped its claims and signed chip supply and patent license agreements with Qualcomm in 2019.
Apple is now designing chips to displace Qualcomm’s communications chips in iPhone devices.
“The biggest overhang for Qualcomm’s long-term stock multiple is the worry that right now, it’s as good as it gets, because they’re shipping into all the iPhones, but someday, Apple will do those chips internally,” said Michael Walkley, a senior analyst at Canaccord Genuity Group.
Amon said that Qualcomm has decades of experience designing modem chips that will be hard for any rival to replicate and that the void in the Android market left by Huawei creates new revenue opportunities for Qualcomm.
“Just for the premium tier alone, the Huawei addressable market is as big as the Apple opportunity is for us,” Amon said.
Another challenge for Amon, a gregarious executive who is energetic onstage during keynote presentations, will be that Qualcomm is not well known to consumers in the way that Intel or Nvidia are, even in Qualcomm’s hometown.
“I flew into San Diego and got an Uber driver at the airport and told him I was going to Qualcomm. He said, ‘You mean the stadium?'” Krewell said, referring to the football arena formerly home to the San Diego Chargers.
Amon has started a new branding program for the company’s Snapdragon smartphone chips to try to change that.
“We have a mature smartphone industry today. People care what’s behind the glass,” he said.
© Thomson Reuters 2021
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