Biz Break: IDC says smartphone sales facing flat times

Top Of The Order: 

Smartphones Go Flat: According to technology research firm IDC, the market for smartphones during the first three months of the year barely budged from a year ago.

IDC said worldwide smartphone shipments came in at 334.9 million units between January and March. However, that amount was just barely more than than the 334.3 million smartphones that shipped during the same calendar span last year. So what gives?

Well, in part, Samsung and Apple are on the wane.

IDC said Samsung’s worldwide shipments of 81.9 million units slipped from 82.4 million a year ago, while Apple’s 51.2 million iPhones shipped fell more than 16 percent from the 61.2 million it moved a year ago. IDC said such declines add to evidence that the smartphone market is close to the saturation point in developed markets like the U.S.

However, IDC said the biggest market change came in the form of the rise of two Chinese brands, in particular, Oppo and Vivo (yeah, I’d never heard of them, either), which are almost unknown outside of China. They’ve pushed better-known names like Lenovo and Xiaomi out of the top five vendors worldwide due to their relatively low costs. Oppo and Vivo make phones that typically cost less than $250, and in China, which is still considered to be a developing market, cheaper phones made by local names are carving out a huge swath of a market so important to the likes of, well, Apple and Samsung.

All you need to do to see the havoc that those Chinese names are wreaking upon Apple and Samsung’s game is look at how Oppo and Vivo’s sales are growing. IDC said Oppo’s worldwide first-quarter shipments surged by 153 percent, to 18.5 million units, while Vivo sold 14.3 million smartphones, a gain of 124 percent over a year ago.

Just this week, Apple Chief Executive Tim Cook spoke with confidence that the iPhone still has bright days ahead. If the so-far small-time Chinese smartphone makers keep growing like they have, then Apple, and Samsung, too, may need those “bright days” to start shining sooner than they originally hoped for.

Middle Innings: 

Call It Pay To Post:  Everyone knows Facebook is minting money. The social-networking giant made $1.5 billion, on $5.2 billion in sales, during the first quarter. And now, some people want Facebook to fork over some of its dough if it wants them to keep posting stuff that appeals to the 1.65 billion (and growing) Facebook users worldwide.

Specifically, Facebook wants live video that’s posted via its own Live video product. According to BuzzFeed, Facebook is paying $250,000 to certain media companies and celebrities to post 20 Live videos a month for three months. It’s all part of an acknowledgment that in the social-networking age, original content is as important as it is to video-streaming companies like Netflix and Hulu, or traditional TV networks.

Twitter has also reportedly been talking to many of the “stars” of its Vine service about ways to pay those who have managed to build an audience of thousands of watchers of their six-second long videos. Many of those Vine celebrities are said to have marched in to Twitter’s San Francisco offices to demand payment for their content or they said they would stop posting Vines and take their talents elsewhere.

Bottom Of The Lineup: 

Here’s a look at how some leading Silicon Valley stocks did Thursday…

Movin’ On Up: Dolby Laboratories flexed its muscles, as its shares rose almost 13 percent. Gains also came from NetGear, FormFactor, Medivation and Facebook.

In The Red: Silicon Graphics shares plunged more than 34 percent after the Milpitas-based server and storage-technology company lowered its outlook for the current fiscal year. Losses also came from Infinera, Cavium, Xilinx and Symantec.

The SV150 Index of Silicon Valley’s biggest companies fell 1.3 percent to 1,624.

The tech-focused Nasdaq Composite Index shed 1.2 percent to close at 4,805.

The blue chip Dow Jones Industrial Average gave up 1.2 percent to end the day at 17,830.

And the broad-based Standard & Poor’s 500 Index shed almost 1 percent to finish at 2,075.

Quote Of The Day: “To be completely candid, the board and even the executive staff have urged me to bring new blood into operations.” — T.J. Rodgers, founder and CEO of Cypress Semiconductor. On Thursday, Rodgers stepped down from his CEO post after 34 years.

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Photo: Apple CEO Tim Cook introduces the iPhone 6s during an Apple media event in San Francisco, Sept. 9, 2015. (Josh Edelson/AFP/Getty Images)


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