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Summary:

GPS chip maker SiRF Technology has reduced first-quarter sales estimates and implemented a cost-savings plan that will cost about 50 people their jobs and result in the closure of SiRF’s offices in Stockholm and South San Francisco. Aside from general economic malaise softening demand for personal […]

GPS chip maker SiRF Technology has reduced first-quarter sales estimates and implemented a cost-savings plan that will cost about 50 people their jobs and result in the closure of SiRF’s offices in Stockholm and South San Francisco. Aside from general economic malaise softening demand for personal navigation systems, the other whammy for SiRF was a lousy mobile-TV market. According to the release, it’s getting out of the market altogether.

“Although SiRF has made considerable progress on the development of its mobile TV technology, the market for mobile TV has been slow to ramp up. In view of this, the Company has stopped further product developments in the mobile TV space and will focus its efforts on its core business.”

Much of the data has pointed to this, but companies, such as Broadcom, which has pushed its mobile TV chips into higher-volume production and Dish Networks, which recently bid $712 million for spectrum that can be used for mobile television, still haven’t gotten the memo. Either they can afford to play now at a loss, in hopes of a slow market eventually arriving, or they know something we don’t.

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  1. Americans like 42 inch screens.

    Americans like small/thin cell phones.

    I don’t know enough about the market in the rest of the world to have an opinion.

  2. Has anyone actually bothered to go out and ask people if they really want mobile TV? And I mean telling them the real conditions – so far, I believe the following was asked:

    “Would you like to watch TV on your mobile device just like you do at home?”

    when the question should be

    “Would you pay to watch low-resolution, noisy and now-you-have-signal-now-you-don’t, limited-selection TV on your tiny little mobile device’s screen which will actually kill the battery and leave you without phone for the rest of the day?”

    I think tons of money can be saved every year by just asking the right questions, instead of force-feeding products to people who will have a look and completely ignore them. Mobile TV over 3G was the furor at the 3GSM a couple of years back – nobody talks about it now, basically, because it has been a commercial failure. Nobody ever used it past the free trial given by operators.

  3. Why the GPS Party Is About to End – GigaOM Tuesday, March 25, 2008

    [...] (0) SiRF Technology (SIRF), a San Jose, Calif.-based maker of GPS chips, this morning said it was cutting jobs and trying to restructure its business due to softening consumer demand. Already the worst [...]

  4. Stacey,

    This isn’t surprising at all. As I noted in your post yesterday regarding mobile tv, this market is much smaller than many entrepreneurs, chip companies, and VC investors would like to believe (at least in the US). As Mike noted above, the broadcast quality is poor, but I don’t think it matters in the end as the US prefers large screen viewing with social interaction.

    Expect more casualties in the mobile tv marketplace.

  5. Don’t know the issue as related to SiRF, but Mobile Video (including Mobile TV) is becoming popular.

    Take a look at

    http://www.orange.com/en_EN/finance/invest-analysts/meetings-conferences/att00003205/TV_Mobile_strategy_and_update_VD.pdf

  6. - Why the GPS Party Is About to End Monday, March 31, 2008

    [...] Technology (SIRF), a San Jose, Calif.-based maker of GPS chips, this morning said it was cutting jobs and trying to restructure its business due to softening consumer demand. Already the worst [...]

  7. Orange is boasting about Mobile TV but not a single TV channel make decent revenue from it and the turnover for Mobile TV, 4 years after its kickoff, is still ridiculous. furthermore, the all you can eat option is not sustainable for the content owners; They all focus on DVB-H now and will not make a dime from it either.

  8. The New iPhone’s New Winner – GigaOM Friday, May 30, 2008

    [...] But whether it’s a new 2G model or a super-fast 3G, there is one thing that’s for sure: The new iPhone has Global Positioning System (GPS) built into it, thanks to legal requirements put in place by the FCC. The company supplying the GPS to iPhone is going to be a big winner in this space; according to my sources, the contract has been nailed down by Broadcom, a relatively new entrant into the GPS market. The Irvine, Calif.-based chip company had acquired Global Locate in July 2007 for $143 million in cash and $80 million in incentives. In the past such a deal would have gone to someone like SIRF, which is in a bit of pain these days. [...]

  9. I’ve seen the take up rate of mobile TV (T-DMB) in Korea, and it is phenomenal. Japan is also taking off. However, people need to understand that in those cultures a sigificant number of people use public transit where the use of these devices makes sense. I am not sure that success in Japan and Korea willl translate to success in the US market.

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