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Phone Won’t Connect With Your Car’s Infotainment System? You Are Not Alone: Study

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By Reuters | Updated: 1 September 2021

Problems getting smartphones to connect properly with vehicle infotainment systems are now the No. 1 gripe among consumers according to the latest study of new model quality released on Tuesday by market research firm J.D. Power.

Overall, J.D. Power says electronic and infotainment system malfunctions are the cause of six of the top 10 complaints from US buyers of 2021 cars, sport utility vehicles and pickup trucks, despite years of effort by automakers to better integrate digital technology.

Stellantis NV’s Ram truck brand for the first time led the rankings in the J.D. Power Initial Quality Study, and the French-Italian automaker’s Dodge muscle car brand was second. Lexus, the Toyota Motor luxury brand and a regular winner of the Power survey, was third. Full results of the study are here.

The new Initial Quality Study underscores the challenges automakers confront as they try to transform their vehicles into smartphones on wheels.

While complaints about mechanical defects have generally declined, consumer frustration persists with complex dashboard screens, radios without physical volume knobs, and now phones that will not connect seamlessly with dashboard system software, Dave Sargent, J.D. Power’s vice president of automotive quality, told Reuters.

For 2021, the top problem reported by respondents was failure of a smartphone to connect wirelessly to Apple CarPlay or Android Auto software in the vehicle. Those systems are supposed to emulate the driver’s smartphone screen in the vehicle’s dashboard display.

Wireless smartphone emulation technology, offered on about a third of 2021 models, is creating challenges “for virtually every automaker that offers that to consumers,” Sargent said.

“Automakers and tech companies are kind of pointing fingers at each other, and consumers are caught in the middle,” he said.

Ranking second on the list of customer complaints received from nearly 111,000 respondents were voice recognition systems, which had been the No. 1 problem since 2012. Sargent said it dropped down because motorists are using voice commands on their phones, bypassing in-vehicle systems.

In third place are complaints about dashboard touch screens, Sargent said.

“Consumers don’t think there’s a better way of changing the volume on a radio than twisting a knob,” he said.

J.D. Power’s Initial Quality Study is used by automakers as a scorecard for product design and manufacturing quality performance. Automakers use top ratings for brands or models in advertising. Detailed results from Power’s 223-question survey are often used to rework manufacturing processes or vehicle system design.

© Thomson Reuters 2021

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Samsung’s Posts Best Quarterly Profit in 3 Years Amid Rising Chip Prices

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By Reuters | Updated: 8 October 2021

Samsung Electronics on Friday flagged a 28 percent jump in its third-quarter operating profit to the highest in three years, driven by rising memory chip prices and display sales for new flagship smartphone launches. The preliminary result was up 26 percent from the second quarter, although just below forecasts, while the market reaction was further muted as analysts pencilled in a flat or slightly lower result this quarter on an expected fall in memory chip prices.

The world’s largest memory chip and smartphone maker estimated its July-September profit at KRW 15.8 trillion (roughly Rs. 99,190 crores), below a Refinitiv SmartEstimate of KRW 16.1 trillion (roughly Rs. 1,01,080 crores). It is the highest quarterly profit since the third quarter of 2018.

“The mobile business’ operating margin might have been lower than the market expected,” said Park Sung-soon, analyst at Cape Investment & Securities. “We will have to see marketing costs and what the mix of products Samsung sold was like.”

Rising memory chip prices and shipments, plus a jump in profitability at Samsung’s chip contract manufacturing business, likely raised the chip division’s operating profit by about 79 percent from a year earlier, analysts said.

Semiconductors accounted for about half of Samsung’s operating profit in the first half of the year.

Samsung shares pared early gains to be up 0.4 percent in afternoon trade. It is due to announce detailed earnings later this month.

The stock has fallen about 12 percent so far this year versus a 3 percent rise in the wider market, hurt by losses in September when US peer Micron said its memory chip shipments would slip in the near term.

Analysts said prices for memory chips are expected to tumble this quarter as demand for personal computers drops amid an expected easing in global lockdowns that have helped power sales, while smartphone shipments may also decline.

A bright spot next year is expected to be Samsung’s chip contract manufacturing business, which on Thursday announced plans to start producing cutting-edge, 3-nanometre chip designs in the first half of 2022, as it races against industry leader Taiwan Semiconductor Manufacturing Co to preempt advanced technology and win clients.

For Samsung’s mobile business, estimated sales of 2 million new foldable smartphones within a month showed demand for its foldable handsets captured more of the mass market than last year, analysts said.

However, this was likely offset by marketing costs and higher component costs due to the global chip shortage.

Samsung’s display unit likely saw solid results as key customer Apple ramped up orders before its late-September launch of the iPhone 13 series, analysts said.

Overall revenue likely rose about 9 percent from the same period a year earlier to a record KRW 73 trillion (roughly Rs. 4,58,230 crores), Samsung said in a filing.

© Thomson Reuters 2021

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Samsung Electronics Likely to Ride Rising Chip Prices, Phone Sales to Report Best Quarterly Profit in 3 Years

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By Reuters | Updated: 6 October 2021

Samsung Electronics is likely to turn in its best quarterly profit in three years and a record revenue, on rising memory chip prices and brisk sales of its new foldable smartphones, analysts’ estimates show.

Operating profit for the world’s biggest memory chip and smartphone maker likely jumped to KRW 16.1 trillion (roughly Rs. 10,000 crores) in the quarter ended September, according to a Refinitiv SmartEstimate from 16 analysts, weighted toward those who are more consistently accurate.

That would be up 30 percent from KRW 12.35 trillion (roughly Rs. 77,300 crores) a year earlier and the highest since the third quarter of 2018. Revenue likely rose 11 percent to 74.6 trillion won (roughly Rs. 4,67,000 crores), a record high.

An unprecedented global shortage in semiconductor chips amid the pandemic has underpinned Samsung’s results and shares, which soared 45 percent last year and hit a record high at the start of 2021.

But the stock has dropped since then, compounded by losses in September when US peer Micron warned its memory chip shipments would slip in the near term, amid industry views that chip prices will tumble after peaking in July-September.

“Samsung shares have fallen due to Micron’s guidance but unlike Micron, Samsung internalises major components … and has other businesses like mobile and foundry to buoy performance,” said Hanwha Investment & Securities analyst Lee Soon-hak.

“Memory (chip) prices are seen rebounding next year after a short period of decline,” Lee added.

Samsung will announce preliminary results on Friday.

Chip division, smartphones

Samsung’s chip division is likely to report an operating profit of KRW 9.9 trillion (roughly Rs. 61,970 crores), an average of six analysts’ forecasts shows, up 79 percent from a year earlier, helped by rising memory chip prices and shipments.

Prices of DRAM chips, used in servers, mobile phones and other computing devices, jumped 7.9 percent versus the June quarter, while those of NAND flash chips that serve the data storage market rose 5.5 percent, data from research provider Trendforce shows.

Analysts also forecast a double-digit operating margin for Samsung’s chip contract manufacturing business as clients rush to secure production capacity.

Its mobile division likely saw about KRW 3.7 trillion (roughly Rs. 23,160 crores) in operating profits, analysts said, down from KRW 4.45 trillion (roughly Rs. 27,840 crores) a year earlier but up from the prior quarter’s KRW 3.2 trillion (roughly Rs. 20,020 crores) on foldable smartphones sales.

An estimated 2 million Galaxy Z Fold 3 and Z Flip 3 models were sold in a month since launching in late August, with South Korea topping sales followed by the United States, said Jene Park, senior research analyst at Counterpoint.

Market participants will be scouring Samsung’s full results later this month for an update on its planned $17 billion (roughly Rs. 1,26,800 crores) US semiconductor factory after sources said it was drawing closer to finalising the construction.

© Thomson Reuters 2021

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Google Slams Antitrust Regulators for Ignoring Apple After Being Fined Over Its Android Dominance

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By Reuters | Updated: 27 September 2021

Alphabet unit Google on Monday criticised EU antitrust regulators for ignoring rival Apple as it launched a bid to get Europe’s second-highest court to annul a record EUR-4.34-billion (roughly Rs. 37,520 crores) fine related to its Android operating system.

Far from holding back rivals and harming users, Android has been a massive success story of competition at work, representatives of Google told a panel of five judges at the General Court in Luxembourg at the start of a five-day hearing.

The European Commission fined Google in 2018, saying that it had used Android since 2011 to thwart rivals and cement its dominance in general internet search.

“The Commission shut its eyes to the real competitive dynamic in this industry, that between Apple and Android,” Google’s lawyer Matthew Pickford told the court.

“By defining markets too narrowly and downplaying the potent constraint imposed by the highly powerful Apple, the Commission has mistakenly found Google to be dominant in mobile operating systems and app stores, when it was in fact a vigorous market disrupter,” he said.

Pickford said Android “is an exceptional success story of the power of competition in action”.

Commission lawyer Nicholas Khan dismissed Apple’s role because of its small market share compared with Android.

“Bringing Apple into the picture doesn’t change things very much. Google and Apple pursue different models,” he told the court.

“Google’s conduct denied any opportunity for competition,” he said, citing agreements which forced phone manufacturers to pre-install Google Search, the Chrome browser and the Google Play app store on their Android devices, and payments to pre-install only Google Search.

Android, free for device makers to use, is found on about 80 percent of the world’s smartphones. The case is the most important of the European Union’s three cases against Google because of Android’s market power. Google has racked up more than 8 billion euros in EU antitrust fines in the last decade.

German phone maker Gigaset Communications GmbH, which is backing Google, said its success was due to Android’s open platform and lamented the negative impact of the Commission’s decision on its business.

“The licence fee for the Play Store that Google now charges as a result of the contested decision represents a significant portion of the price of Gigaset’s smartphones aimed at price-sensitive consumers,” its lawyer Jean-François Bellis told the court.

Lobbying group FairSearch, whose complaint triggered the Commission case, was however scathing about Google’s tactics with phone makers.

“Google adopted a classic bait and switch strategy. It hooked (them) on a supposedly free and open source operating system subsidised by its search monopoly, only to shut that system to competition through the web of restrictions at issue in this case,” its lawyer Thomas Vinje told the court.

A verdict may come next year. The case is T-604/18 Google vs European Commission.

© Thomson Reuters 2021

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Apple, Tesla Suppliers Suspend Production in China to Comply With Power Usage Norms

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By Reuters | Updated: 27 September 2021

Several Apple and Tesla suppliers have suspended production at some Chinese factories for a number of days to comply with tighter energy consumption policies, putting supply chains at risk in the peak season for electronics goods.

Two major Taiwanese chipmakers, however, said their China facilities are operating as normal.

The development comes as tight coal supplies in China and toughening emissions standards have triggered a contraction in heavy industry in several regions, dragging on the country’s economic growth rate, analysts have said.

Apple supplier Unimicron Technology late on Sunday said three of its China subsidiaries stopped production from midday on September 26 until midnight on September 30 to “comply with the local governments’ electricity limiting policy”.

The Taiwanese maker of printed circuit boards said it did not expect significant impact as other plants would make up production.

Eson Precision, an affiliate of Taiwan’s Hon Hai Precision Industry (Foxconn), in a statement said it suspended production from Sunday until Friday at facilities in the Chinese city of Kunshan.

Concraft Holding, a supplier of speaker components for Apple’s iPhone and which owns manufacturing plants in Suzhou city, said it would suspend production for five days until noon on Thursday and use inventory to meet demand.

Chipmakers United Microelectronics Corp (UMC) and Taiwan Semiconductor Manufacturing Co told Reuters there was no impact at their China plants.

“UMC’s Hejian fab in Suzhou is currently running at full capacity utilization of 80,000 plus wafers per month,” said the Taiwanese firm, whose clients include Qualcomm Inc.

Two people familiar with the matter told Reuters that facilities in Kunshan of contract manufacturer Foxconn have seen a “very small” impact on production.

Foxconn had to “adjust” a small part of its capacity there, which includes the manufacture of non-Apple notebook computers, one of the people said, adding that the company has not seen any impact at other major production hubs across China.

The second person said the company had to move some of the Kunshan workers’ shifts in late September to early October.

Foxconn, a major Apple supplier, declined to comment.

© Thomson Reuters 2021

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Microsoft Surface Duo to Get Android 11 Before End of Year, Company Reportedly Confirms

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By ANI | Updated: 25 September 2021

After American tech giant Microsoft announced a new Surface Duo 2 this week that would ship with Android 11, the company has now committed to releasing the OS update for the original device this year.

A Microsoft spokesperson in a statement to The Verge, said, “We remain committed to providing updates to Surface Duo, and we’re working to bring Android 11 to existing customers before the end of this year.”

That’s not a firm release date, but then there was never one for Android 11 on the Surface Duo. Previous reports suggested it would land in the summer, but as we move closer to fall and there was no mention at Microsoft’s Surface event, it’s clearly taking longer than expected.

It would be exciting to see what Android 11 would bring to the Surface Duo. Android 11 has native support for dual-screen devices like the Duo, so it should improve some of the software experiences on the device.

The Verge reported that giving a brief look at the Surface Duo 2, it seems like Android 11 brings minor tweaks to Microsoft’s multitasking system, rather than an overhaul. The Surface Duo 2 now defaults to assuming that the right-hand screen is the primary one, but it’s not clear if that same change will come to the original Surface Duo.

While Microsoft has shipped a number of updates for the Surface Duo, it has still remained a fairly buggy device. Surface Duo users have complained of regular issues with multitasking and gestures, a screen turning off during book mode, and lockups using the fingerprint reader, as per The Verge.

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Lithuania Looks to Ban ‘Untrustworthy’ Phones After Chinese Censorship Concerns

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By Reuters | Updated: 25 September 2021

Lithuania’s Defence Ministry is drafting legislation to ban state institutions from purchasing “untrustworthy” equipment, after finding a censoring feature in a Chinese smartphone company’s flagship phone, Margiris Abukevicius, deputy minister at the Defence Ministry said.

The censoring capability in Xiaomi’s Mi 10T 5G phone software has been turned off for the “European Union region” but can be turned on remotely at any time, the country’s National Cyber Security Centre said in a report on Tuesday.

A Xiaomi spokesman said in a statement sent to Reuters on Wednesday its device “does not censor communications to or from its users”.

The Defence Ministry is now drafting the legislation to ban public institutions from procuring “untrustworthy” equipment, including smartphones, with a view to presenting it to the parliament for debate by the end of this year, Abukevicius told Reuters.

“It’s quite obvious that consequences of the legislation would be similar to those of the earlier legislation on 5G equipment,” he said.

Chinese telecommunications giant Huawei protested in May as Lithuanian parliament decreed only equipment approved by the government on national security grounds could be used for next generation 5G network in the country.

“It’s not news that Lithuania has made a political decision to cooperate in technology with NATO and EU countries, which are democratic and have a rule of law,” Abukevicius said.

The National Cyber Security Centre report said terms potentially subject to censorship by the Xiaomi phone’s system apps, such as the default internet browser, included “Free Tibet”, “Long live Taiwan independence” and “democracy movement.”

Shares of Xiaomi fell nearly five percent to HKD21.95 (roughly Rs. 200) on Wednesday, their biggest daily percentage drop since July 27.

China demanded last month that Lithuania withdraw its ambassador in Beijing and recalled its envoy to Vilnius after Taiwan announced that its mission in Lithuania would be called the Taiwanese Representative Office.

Taiwanese missions in Europe and the United States use the name of the city Taipei, avoiding a reference to the island itself, which China claims as its own territory.

US President Joe Biden’s national security adviser Jake Sullivan last week stressed support to Lithuania’s prime minister Ingrida Simonyte in the face of pressure from China.

© Thomson Reuters 2021

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