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Cooper, a former Motorola executive, on April 3, 1973 placed what is widely believed to have been the first public call from a portable cell phone. Earlier this week, on the anniversary of that occasion, I chatted with him for the CNET News.com daily podcast.

To hear the podcast segment with Cooper and Harris, click on the link below (and please forgive the occasional random clanking noises; sometimes, as well all know, technology just behaves badly).

“It was huge. It weighed 2-1/2 pounds. It was about 10 inches high by an inch and a half wide by perhaps 3 inches deep,” Cooper recalled. “The battery lasted only 20 minutes, but that was no problem because you couldn’t hold it up for more than 20 minutes.”

AUDIO

As creator of the Jitterbug, Harris has given much thought to what consumers need and want in a cell phone. She says she imagines future phones incorporating more features that track health and wellness, such as the button on the Jitterbug that calls emergency services. “In our company in particular,” she said, “we are very focused on what else we can do with cell phones that will actually improve the quality of life, and not just by delivering a new ringtone.”

(Credit:
GreatCall)

Also on the line from Del Mar, Calif., was his wife Arlene Harris, an inductee into the Wireless Hall of Fame and founder, along with Cooper, of GreatCall. In 2006, the company launched the Jitterbug, a cell phone with features, such as a large backlit screen, geared toward seniors. This week, GreatCall announced that the Jitterbug won the “Best Small Business” award from the American Society on Aging.

Marty Cooper and Arlene Harris: wireless power couple.

Standing on the corner of New York’s 56th and Lexington 35 years ago Thursday, Marty Cooper was nearly run over. And no wonder. Drivers were hardly used to seeing people gabbing on the telephone while walking down the street. Not to mention that the phone was impossible to miss.

LISTEN UP
Marty Cooper and Arlene Cooper talk cell phones past, present, and future.
Download mp3 (5.50MB)

In his talk with Microsoft employees on May 1, Ballmer said:

CEO Steve Ballmer understands that Microsoft’s dominance, gained primarily in the 20th century, is eroding. While Microsoft revenue continues to climb across its various business units, it trails in the online world. And, the online world of ads and subscription services is the future engine of growth and prosperity.

Since 2005, Oracle made more than 40 acquisitions, totaling more than $20 billion. Microsoft, IBM, HP, Sun Microsystems, and Cisco Systems have each made dozens of acquisitions in the same time frame.

In the Internet era, the consolidators want to be the data center infrastructure providers to the giant Web colonizers–Google, Yahoo, Microsoft, AOL, eBay, Amazon, etc.

In this saga, it’s difficult to tell who is the white knight for whom. The two companies are concerned about the Google juggernaut. But Yahoo is considering getting in bed with Google, allowing its rival to sell ads on its service, as a way to avoid Microsoft’s embrace. On the other hand, Yahoo appears to welcome Microsoft’s embrace for the right price.

Consolidation is a sign of the mature phase in an industry, in which the biggest players stake out more territory as a way to increase share of wallet from customers by fusing together more complete solutions. It’s the proverbial “one throat to choke” approach to enterprise computing.

The commercial Internet is relatively young, rearing its head with Netscape in the mid-1990s. But consolidation is already taking place, driven by Google’s meteoric rise with search and advertising revenues. Instead of one throat for CIOs to choke, the Internet giants aspire to dominance in online ad serving and want to serve as the home base for billions of Web users on the planet.

The future of the way people consume information, the way people socialize and connect is going to change a lot more in the next 10 years even than in the last 10. How you find information, how you consume it, how you share it and connect with your friends while you’re in the middle of that, how it gets paid for using advertising and other techniques, dramatic changes. We are absolutely committed to be the leading player in that endeavor.

In the most recent quarter Google has $5.19 billion in revenue from its ad and search business. Microsoft had less than $1 billion for its entire online business, and Yahoo less than $2 billion, including a $401 million gain from its Alibaba investment.

For starters, the big advertising networks have been scooped up. Google paid $3.1 billion for DoubleClick, and Microsoft picked up aQuantive for $6 billion in cash. Microsoft’s lust for Yahoo is in a similar vein. Google has 60 percent share of search market, and it keeps growing, and a Microhoo is the best offense from Microsoft’s point of view.

We are not today the leading player. We are not irrelevant, but we are not the leading player. We’re committed to go do that.

At the close of the 20th century and the beginning of the 21st century, the tech industry experienced a massive consolidation, culminating 40 years of market and technology development, from the mainframe to client/server computing and now the Internet.

But the deal has to be based on more than just price. If they don’t get along and share the same vision, they will both suffer the consequences of a bad marriage, and Google wins anyway.

Yahoo would add scale and expertise to Microsoft’s online initiatives, and some interesting ways to build a social layer into the Microhoo fabric of somewhere between 600 million and 800 million unique users (which will certainly get flagged by regulators if the deal happens). The alternative for Microsoft is to go it alone, but that strategy so far hasn’t yield the desired results. Hence, the consolidation route.

The Canadian telecommunications equipment company posted a quarterly loss of $113 million, or 23 cents a share. That compares with a loss of $37 million, or 7 cents, a year ago. The results included $67 million in restructuring charges.

“In the second half, faced with a challenging business environment, we will continue our focus on execution and on delivering accelerated growth in key segments in order to achieve our financial objectives for the year,” CEO Mike Zafirovski said in a statement.

The company also warned that it faces increasing challenges amid concerns about the economy and lower spending by certain North American CDMA customers. But it asserted that revenue is expected to grow in the low single digits in 2008.

Meanwhile, Nortel’s competitors are facing hurdles of their own. Earlier this week, Alcatel-Lucent announced that CEO Patricia Russo and Chairman Serge Tchuruk are stepping down later this year as the company continues to struggle with losses and more competition from Asian suppliers.

Shares of Nortel Networks sank as much as 17 percent on Friday after the company reported a wider second-quarter loss and warned that it faces challenges ahead.

All public libraries in the United States will be offered a free online portal to Google’s digitized collection, said Aiken, and patrons will be able to print an unlimited number of pages for a per page fee. Google will also be offering institutional subscriptions to colleges and universities. Google Book Search services available outside the United States will remain the same, Drummond said.

Updated at 11:15 a.m. PDT to include new information.

Currently, users of Google Book Search are able to view snippets of books online. The settlement agreement allows Google to make whole pages of copyright works available to online searchers. Users will be able to preview up to 20 percent of a book and purchase the book if they choose to, said David Drummond, senior vice president of corporate development and chief legal officer for Google.

Google is digitizing the works from many major libraries, including the New York Public Library and the libraries at Stanford and Harvard universities, and is making those texts searchable on pages with advertisements. The Authors Guild, which represents more than 8,000 authors, sued Google in September 2005, alleging that the company’s digitizing initiative amounted to “massive” copyright infringement. Five large publishers filed a separate lawsuit as representatives of the Association of American Publishers.

The settlement enables authors and publishers to receive compensation for online access to their works.

Under the terms of the settlement, Google has agreed to pay the authors and publishers $125 million. It will also be responsible for selling access to copyrighted works in its repository. Most of the revenues from such access would go to the authors and publishers.

Paul Aiken, executive director of the Authors Guild, called the settlement “the biggest book deal in U.S. publishing history.”

Google will be paying authors and publishers $125 million as part of a settlement agreement that resolves a suit against its Google Book Search initiative, the Authors Guild and a group of publishers announced Tuesday.

However, anyone who does buy an iPhone between now and late June will be able to get the added features of the iPhone 2.0 software as a free upgrade. Analysts peppered Oppenheimer with questions about the need to defer iPhone revenue until the software is ready, but forget about that: it has no impact on the potential iPhone customer.

A CNET News.com reader wrote in Tuesday night, wondering if he could turn in his recently purchased iPhone after learning that a new model is probably on the way. You can, assuming that you bought it within 14 days, but if more and more people decide that they don’t want to buy an iPhone until the 3G model comes out, Apple could have a short-term demand problem during its third quarter that could bounce back, once the 3G model arrives.

The coming software updates to the iPhone and iPod Touch should boost demand after they are released in late June.

The current quarter might be the only one that dings Apple, though the company actually seems bullish, by its standards. Apple is notorious for undercutting Wall Street’s guidance heading into a particular quarter, but unlike the previous quarter, when Apple slashed expectations, its current guidance is closer to the industry view.

It seems, however, that people like Apple’s current products just fine. Apple’s fiscal second-quarter revenue and earnings far outpaced analyst expectations, and the company sold more Macs and iPhones in the quarter than had been expected. iPod sales were slow, with only 1 percent growth compared with last year, but the sales figures were in line with Wall Street expectations as the product matures.

Even Wu recanted just before Apple’s earnings report Wednesday, cutting his expectations for the company amid concerns about the economy and the fact that Apple isn’t expected to release any significantly new products until the 3G
iPhone.

The
Mac. The star of Apple’s second quarter was clearly the Mac, with shipments of 2.3 million units, an increase of 51 percent compared with last year. Portable shipments increased 61 percent, and even desktop shipments were up significantly, at 37 percent.

People continue to discover the Mac, and Apple's bottom line continues to grow.

And in the second half of the year, Apple should have a 3G iPhone, a second-generation iPod Touch, and a new notebook design. And that’s, of course, assuming that the company doesn’t have a wild card up its sleeve with a mobile Internet device, a Mac tablet, or a gaming console, all of which have been rumored this year.

Either way, Apple is in perhaps the best shape in its history heading into the rest of the year.

But as Wu pointed out Wednesday, Apple isn’t expected to get any kind of boost from a major product introduction in the quarter, with all the goodies expected to arrive in the second half of the year. So, let’s take a look at each segment of Apple’s business and see what might lie in store over the next couple of months.

Apple’s third quarter brings a rise in educational buying from elementary and secondary schools, Peter Oppenheimer, Apple’s chief financial officer, said on a conference call following Apple’s results. Otherwise, it’s really not much of a quarter, and it is generally considered the slowest period of the year for the PC industry.

When Shaw Wu of American Technology Research made that claim earlier in the year, I concurred with my colleague Charlie Cooper, who wondered what expensive strain of finely cultivated California parsley was in Mr. Wu’s pipe when he wrote that report.

(Credit:
Apple)

However, there doesn’t seem to be anything slowing down the Mac’s momentum on the horizon at the moment. Oppenheimer said that about half of all Macs sold in Apple’s retail stores are bought by people new to the Mac, which is the same proportion Apple has quoted for several quarters now. As long as people keep coming to the stores, and Apple maintains quality control on the Mac, that trend should continue.

The
iPod. Once the crown jewel of Apple earnings reports, the iPod is getting old. Apple’s market share has held steady, Oppenheimer said, but the overall market appears to be getting saturated, especially in the United States. A price cut in the iPod Shuffle helped stimulate some demand in the quarter, but Shuffle sales were still down for the quarter.

The full effects of any slowdown in the economy certainly have yet to hit the tech industry. Starbucks revised its outlook for the year Wednesday, citing a weaker environment, and McDonald’s reported earlier this week that sales had declined in stores that had been open more than a year. But Intel, IBM, and Google turned out strong performances last week, and Amazon.com reported a phenomenal quarter Wednesday.

Maybe Apple really is recession-proof.

(Credit:
Apple)

All kidding aside, no company really is recession-proof, except for perhaps bankruptcy law firms. If the U.S. economy takes a severe tumble in the second calendar quarter of the year (its third fiscal quarter), Apple could feel a pinch. Given the strength and appeal of its products at the moment, I wouldn’t anticipate something too severe, but Wall Street has high expectations of the company.

The iPod Touch is increasingly touted as the future of Apple’s iPod division, and Oppenheimer reiterated that stance Wednesday. He thinks that the iPhone 2.0 software–also slated for the iPod Touch–will help boost demand as new applications come to the model. But iPod shipments probably won’t show dramatic growth in the quarter.

The iPhone. The newest member of Apple’s arsenal could be in for an interesting quarter. Apple ran into supply constraints toward the end of the second quarter, after misjudging the pace of demand for the iPhone around the world.

Still, European demand–at least through official carriers–does not appear as strong as it is in the United States, as shown by the price cuts enacted on iPhones in the United Kingdom and Germany. And Apple might have a slight problem on its hands as the drumbeat increases around a 3G iPhone.

(Credit:
Sony)

Click the pic to launch the slide show.

Sony didn’t hold back this morning, announcing a massive lineup of more than 25 new portable audio gadgets and accessories. The release includes a handful of new Walkmans and speakers, but is dominated by a slew of new headphones designed with portability in mind. Perhaps the most interesting of the bunch are the sport-style earphones, all of which are water-resistant and feature unique and varied form factors to ensure a secure fit during activity. For more information, check out our slide show, which offers details on 20 of Sony’s new audio accessories. (All of the products are expected to hit shelves at the end of March.)

Another entrant in the race to produce a ducted-fan-propelled, vertical-take-off-and-landing UAV, the planned “humvee of the air” will morph to different missions and reach targets three times faster than helicopters, according to the manufacturer.

It’s also making a pitch for green appeal, by incorporating advanced MicroFire technology to give it a decidedly un-Humvee-like fuel efficiency and reduced carbon emission footprint.

Given the flying Hummer’s ability to morph from attack to recon or target acquisition and then back to combat logistics all while fighting global warming–there’s only one thing left to do. Build a stretch version in time for prom season.

The official name of the vehicle is VTOL-Swift Tactical Aerial Resource, or V-STAR. With a cruising speed of 288 knots, a 650-mile range and a 400-pound payload, the V-STAR promises to be a “breakthrough solution for frontline military logistics,” according to Broomfield, Colo.-based Frontline Aerospace. The aircraft would use a Rolls-Royce gas turbine with counter-rotating blades and “diamond-box-wing” design that transitions to forward flight when needed.

The company is touting the V-Star’s multirole flexibility. “The modular payload approach allows for rapid change-out in the field–one minute providing troops with ammo, food, water and fuel–and the next minute providing tactical reconnaissance, communications and close combat support,” according to the press release.

(Credit:
Frontline Aerospace)

“Frankly, we are keeping our MicroFire capability somewhat under wraps at this point,” said Frontline founder and Chief Executive Officer Ryan S. Wood. “But we realize MicroFire can increase endurance and fuel economy not only for UAVs, but also create significant fuel savings for a whole class of helicopter engines worldwide–thus creating a true ‘green’ helicopter.”

MicroFire is a “high-temperature counter-flow heat exchanger that extracts heat from the hot engine exhaust and transfers it to the compressed engine air before combustion,” an operation that “can sometimes double the overall thermal efficiency of the engine,” according to Frontline.

Why did SafeNet buy Ingrian rather than simply partner? Because SafeNet has made its mark selling security widgets not security solutions. This business model holds less appeal when large organizations fold security into their global governance, risk management, and compliance requirements. With Ingrian in hand, SafeNet can compete on these kind of enterprise deals and become a more strategic vendor to customers.

Symantec looked at the market and saw a very short runway to make money. Hardware-based FDE is clearly on the horizon, led by Intel, Hitachi, and Seagate Technology. Pretty soon, laptops will ship with encryption already baked in, so the market for software solutions can be measured in the 12-to-24-month timeframe. With so little time to make an acquisition accretive, Symantec decided that partnering with an industry leader was a better business decision.

SafeNet-Ingrian is pretty straightforward, but why wouldn’t Symantec simply buy GuardianEdge? Symantec certainly has the money and the industry precedent was set when Check Point purchased PC encryption vendor PointSec while McAfee grabbed SafeBoot.

There are a lot of encryption and key management start-ups available and I expect a lot of acquisitions, partnerships, fire sales, and bankruptcies over the next few years. One way or another, users want to encrypt their confidential data sooner rather than later. Which vendors win and which lose is another story.

A few weeks ago there were two interesting announcements involving encryption technologies. First, SafeNet acquired application and database encryption leader Ingrian while Symantec announced that it will partner with GuardianEdge to provide Full Disk Encryption (FDE) for PC security.

Adding significant gravitas to the claim is the inclusion of an authentic-looking Radio Shack newspaper circular dated September 7. The ad shows price cuts across the board for all three
Xbox 360 models: the 120GB Elite for $399 (down from $449); the new 60GB Pro model for $299 (down from $349); and Xbox 360 Arcade–which lacks a hard drive–for just $199 (down from $279).

(Credit: Joystiq)

The telltale Radio Shack flyer.

The purported price cuts are exactly in line with the drops that were rumored earlier this month. If accurate, they would potentially jump-start the 360’s sales, making it newly competitive with the
Sony PS3 (which has a new $399 80GB model) and even the current market champ, the $249
Nintendo Wii.

A few of our retail contacts, some of whom have given us good intel in the past–and who all work for separate corporations–have sent us identical information regarding a price drop.

What do you think: would you take the plunge on an Xbox 360 for $300 or $200? Or are you just hoping that Microsoft’s move would spur Nintendo and Sony to drop prices as well?

Microsoft hasn’t responded to these rumors in the past, and I doubt we’ll hear anything from them this time around, either. But this one certainly seems to have a whiff of verisimilitude to it–enough that I’d certainly recommend to anybody in the market for a 360 wait until mid-September to see what happens.

According to gaming blog Joystiq, all three Xbox 360 models will be getting a price cut in the next three weeks. According to the AOL gaming blog:

Motorola has been shaking up its top management as it struggles to get its fledgling handset business back on track. The company has seen its market share in the handset market fall dramatically over the past year. The company fell from second place to third in terms of handset shipments during 2007. Meanwhile, market leader Nokia has grown market share to about 40 percent.

The biggest problem Motorola has been facing is a lack of compelling and popular handsets, especially in Europe. The company hasn’t had a hit phone since the Razr. Amid the turmoil, the company announced last month that it is considering “strategic options” to get the company back on the right track, which could include selling its handset business. Still, top executives are adamant that the company does not want to sell the handset business, and it’s looking for other alternatives.

Brown became CEO in January after former CEO Ed Zander was forced to step down amid pressure from investors due to the company’s worsening financial situation.

Mobile phone maker Motorola has named Paul Liska, a former private equity executive, as chief financial officer, the company said late Thursday.

Liska, who had been a partner for private equity firms including MidOcean Partners, CVC Capital Holdings and Ripplewood Holdings, will take the top finance spot at the company starting March 1. He will replace acting CFO Tom Meredith, and he’ll report directly to Chief Executive Officer Greg Brown.

Liska has experience helping get value out of businesses. While working in private equity, his task was to go in and help run companies, which were typically underperforming. And before working for private equity firms, Liska had been at Sears, where he ran its credit business. While there, he helped Sears sell the division to Citigroup in 2003 for $6 billion.