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PortalPlayer loses flash-based iPod deal [updated]

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By LC Angell

Contributing Editor
Published: Wednesday, April 19, 2006
News Categories: iPod

iPod chip maker PortalPlayer informed investors late Thursday that it has not been selected by Apple to power certain future flash memory-based iPods. In a statement, PortalPlayer said that “the follow-on to its PP5021 System-on-Chip, which is expected to be available in the second half of 2006, has not been selected by Apple for use in their mid-range and high-end flash based iPods.” (Emphasis ours.) The company said it believes the PP5021 will continue to be used “in other members of the iPod family.” While PortalPlayer’s non-selection announcement may seem out of the ordinary, publicly-traded companies are legally obligated to make certain positive and negative disclosures to investors. As Apple is believed to account for 90% of PortalPlayer’s revenue, such a loss could greatly impact the company’s performance.

Update: Following the warning announcement, shares of PortalPlayer tumbled 41 percent, or $9.46, to end Thursday trading at $13.13. “We were clearly surprised with the change,” PortalPlayer CEO Gary Johnson said on a conference call with analysts. “We are shipping in today’s video iPod’s, (but) the visibility for us has become more clouded.” Analysts said the news is the company’s worst nightmare. “This is a disaster,” said Jeffries & Co. analyst Adam Benjamin in a note to clients, who estimated that Apple represented 95 percent of PortalPlayer’s revenues in the December quarter. “We cannot overstate enough how disastrous this announcement is to PortalPlayer’s fundamentals as well as the stock price.”

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Comments

1

Intel Inside ?

Posted by Steph on April 19, 2006 at 11:43 PM (PDT)

2

What exactly does “mid-range and high-end” mean, considering that there’s currently only TWO flash DAPs in the inventory?

Another flash DAP on the way to augment that side of the iPod house? Or is Apple under the dillusion that the Snuffle and its bland-sounding SigmaTel processor is “mid-ranged”?

As much as I prefer how the most recent PortalPlayer processors sound (especially in the 5G), improvements can and should be certainly strived for if Apple re-ups with them on future HD-based iPods. The amount of ambient background audio noise with the iPod (the hiss one can hear with little or no musical signal present) could stand for some improvement; with some cans it’s almost intolerable on my 5G; even on my nano it’s seems less noticeable but it can still be irritating.

Posted by flatline response on April 20, 2006 at 12:24 AM (PDT)

3

Oh, I forgot the following:

Whether its with the processor or with the amp circuitry, Apple could still work on this “Hi-Fi” premise kick that they’re currently on. It’s bad enough that we (generally) deal with compressed content and STILL have that referred to as “hi-fi”. It’d be nice if the hardware purported as being capable of producing “hi-fi” output really did so as well. After all, one can only stand for the erosion of such definitions and values up to a certain point before ‘screaming from the trees’ therapy is manditory…

Posted by flatline response on April 20, 2006 at 12:33 AM (PDT)

4

One presumes that as any digital format is technically a compressed version of the anologue signal originally created (inherent in that process) that by your definition no digital format could be termed true Hi-Fi? However I think that 95% of listeners would not make anologue the pre requisite for the term ‘Hi-Fi’ (though some ‘audiophiles’ would) so I suppose the point in a digital format that Hi and Lo Fi interact is somewhat subjective.

Posted by spyinthesky on April 20, 2006 at 12:54 AM (PDT)

5

“As much as I prefer how the most recent PortalPlayer processors sound (especially in the 5G), improvements can and should be certainly strived for if Apple re-ups with them on future HD-based iPods. The amount of ambient background audio noise with the iPod (the hiss one can hear with little or no musical signal present) could stand for some improvement; with some cans it’s almost intolerable on my 5G; even on my nano it’s seems less noticeable but it can still be irritating.”

I couldn’t agree more on that. With my UE-5c earphones the noise is a somewhat irritating. The treble on the nano is better, predominantly due to it being flash based, but it suffers greater distortion than the 5G.
I wouldn’t expect Apple to do any serious work on this. Most people who buy iPods do so because it’s a fashion accessory and use the stock ear-buds, so it’s not really worth the effort for Apple.

Posted by stadidas on April 20, 2006 at 5:31 AM (PDT)

6

@spyinthesky
what about electronic music that was produced on the computer only? I assume that this would be true hi-fi. What do you think?

Posted by mike on April 20, 2006 at 8:59 AM (PDT)

7

digitally mastered recordings is HiFi since there is no distortion thats usually associated with the analog process.  i think what flatline response is talking about is when you compress the file into a 128kbps mp3 (or whatever format), thats when it becomes “not HiFi” and no matter how good of a speaker system you have, your iTunes purchased song will sound degraded

Posted by Man on April 20, 2006 at 10:17 AM (PDT)

8

The audio quality & differences can mostly be attributed to the audio codec (Wolfson chips) not the PortalPlayer CPU.

Where’s all the talk of Broadcom in this?  The 5G uses their SOC which already provides functionality similar to the PP5020 (although it is currently restricted to video processing on the iPod).

Posted by Bernard Leach on April 20, 2006 at 10:50 AM (PDT)

9

Bernard,

I guess I’m confused; does the audio CODEC do the D-A conversion as well, or just handle the compression/decompression of the data stream? If so, what does the CPU do? Merely run a DAP’s OS? If it’s the latter, then why was such a big deal made a while back of the PortalPlayer CPU’s built-in processing compatibility with WMA?

Coming from the old(er) school of audio, I’m used to the A/D and D/A conversion as having the most significant influence on how the digital musical signal will sound. Even with the aspect of handling data compression, I just assumed that the D/A conversion task was done by the CPU.

Posted by flatline response on April 20, 2006 at 1:26 PM (PDT)

10

Digital Music 101:

Getting music into digital form comprises two steps:

Step 1 - converting the music from analog to digital, using some form of analog-to-digital converter (DAC).  In most cases today, this is done for us at the recording studio. 

Step 2 - take the digital data and store it in some compressed/uncompressed lossy/lossless format.  This is done via a coder/decoder (codec).  An example of codecs are MP3, MPEG, AMR, etc.  These codecs all differ in compression ratio, complexity, size, etc.  Codecs can be implemented as hardware chips or run as software using your PC CPU.

Going from this audio format back to music that you hear, follows the reverse process.  First the data is uncompresses (decoded) and then put through a digital-to-analog converter and amplified for playback through speakers or headphones.

The components used at each step can greatly influence the quality that you eventually hear.

With lossy codecs like MP3, etc, the resultant audio is never the same as the original digital signal, which means that the resulting analog signal is not nearly the same as the original analog signal.  High fidelity boils down to how close the audio that you hear is to the audio that was recorded.

Then we haven’t even started discussing jitter, sampling rates, yada-yada-yada.  It’s not a simple system, and every single this affects the final sound quality.

Bottom line - all that is important is: do YOU like what you hear grin.

Posted by kokketiel on April 21, 2006 at 12:18 PM (PDT)

11

kokketiel: this analog codger at heart thanks you for the lesson, and yes, I did take proper notes… wink

Posted by flatline response on April 22, 2006 at 12:30 AM (PDT)

12

i have an ipod video but i dont know how to burn my movies in it. can you tell me how.

Posted by abraham on April 23, 2006 at 9:05 AM (PDT)

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