Even though 56 percent of U.S. households have high-def, more than 80 percent of television viewing is still done in standard definition, according to a report this week by Nielsen.

We at Digits were surprised by this number and wondered why people with HD TVs would watch so much non-HD programming. Nielsen explains that most people with HD TVs also have non-HD televisions in the house, and a full third of programming is viewed on those standard sets. (This is where your Digits blogger differs from these other HD viewers: She has just one television.)

Even on HD sets, though, about 20 percent of programs are viewed through non-HD feeds.

Children’s programming is the least likely to be watched in high-def, Nielsen says. Part of the reason for this could be that the TVs in kids’ rooms are often these secondary, non-HD sets.

Read the rest of this post on the original site

“In the short run, people gotta want these phones. I think they’re going to look pretty good. That’s the most important thing. If we start the popularity chain, and start kind of the buzz around these things, we’ll be able to make some money off of them.”

– Microsoft CEO Steve Ballmer

With the launch of Windows Phone 7 today, Microsoft is taking another shot at a market even its CEO, Steve Ballmer, concedes it stumbled in. “We were ahead of this game and now we find ourselves No. 5 in the market,” he said during our D8 conference in June. “We missed a whole cycle.”

Badly, too–as this exchange at the company’s 2009 Public Sector CIO Summit painfully illustrates.

Questioner: With platforms like the Google phone and iPhone coming out, it’s really tough to continue to stand behind Windows Mobile when our employees are bringing these consumer devices into our environments,” the questioner explained. And in your presentation you put Windows Mobile right in the center there, but it was a phone that doesn’t work in America and an operating system that you haven’t released. I’m wondering what your commitment is to continuing to get newer versions of the operating system in our hands so that we don’t have to fight this battle on the ground.”

Steve Ballmer: We have a significant release coming this year. Not the full release we wanted to have this year but we have a significant release coming this year with Windows Mobile 6.5….We still don’t get some of the things that people want on the highest-end phones. Those will come on Windows Mobile 7 next year. Certainly I’m not, um–there’s opportunities for us to accelerate our execution in this area, and we’ve done a lot of work to really make sure we have a team that’s going to be able to accelerate. With that said, we did sell more Windows Mobile devices last year than Apple did iPhones–just an important factoid to have. Blackberry was a little bit ahead, and Google was nowhere to be seen, except in Silicon Valley, I’m sure. But we’ll do our best to help you with that challenge.”

But Microsoft’s “best” at that point wasn’t nearly enough.

Intended as a stopgap, Windows Mobile 6.5 ended up being another damning monument to Microsoft’s failure to innovate in mobile and the ugly strategic misstep that made it an afterthought in a market that had already lapped it once and was well on its way to lapping it a second time. Just last week Verizon (VZ) President and COO Lowell McAdam dismissed Microsoft as a player in the mobile market. “We like our relationship with Microsoft,” he told News.com. “But clearly in the U.S. there are three major mobile operating systems: RIM, Google, and Apple….Microsoft is not at the forefront of our mind.”

If Windows Phone 7 doesn’t put it there, Microsoft (MSFT) might as well hand its fast-diminishing portion of the smartphone market to Apple (AAPL), Google (GOOG) and RIM (RIMM), because they’ll take it soon enough.

But that’s not likely to happen. Because from what I’ve seen, Windows Phone 7 is as slick an OS as has ever come out of Microsoft–easily enough to keep the company in the mobile game, assuming it hasn’t lost it already.

For one thing, WP7 is not simply a rejiggering of Windows Mobile 6.5, it’s an entirely new OS. For another, its interface is unique enough to differentiate it in an already crowded market. It’s smart, too–perhaps even smart enough to give it a leg up on some rivals. Its hubs and tiles GUI, which aggregates applications and content according to subject and delivers real-time information to the home screen without the need for user involvement, is elegant and intuitive.

Add to this a media experience basically identical to Zune HD, very smart social media management, seamless Xbox live and SharePoint/Office integration and high minimum hardware requirements for OEMs and you’ve got a pretty compelling OS–even if it doesn’t yet support cut-and-paste and true multitasking (the company tells me those are coming). The challenge for Microsoft will be to convince a market that saw Windows Mobile made a laughing stock by iOS, Android and webOS, that Windows Phone 7 isn’t just more of the same.

That shouldn’t be too hard given the nearly half-billion dollars in marketing the company is rumored to be throwing at it (check out one of the first ads below) and the quality of the OS itself.

My colleague Peter Kafka will be covering the New York City launch of Windows Phone 7 later this morning. Join him here at 6:30 am PT/9:30 am ET for live coverage.

The new version of the device, 80 percent smaller than its predecessor, allows users to stream all sorts of media through Airplay–HD video, music and photos. First-run Hollywood titles in HD will rent for $4.99, and some will be available on the same day as the DVD release. Individual TV show episodes will go for 99 cents. Netflix (NFLX) members will gain access to the streaming videos in their queue, and Web entertainment fans can pull in videos from YouTube and photos from Flickr.

The TV show rentals may sound pretty disruptive, but as Peter Kafka noted when the rumors started flying, the venerable tube has withstood challenges before, and so far, at least, Apple (AAPL) has only Disney (DIS) and Fox (FOX) lined up to participate. Still, he noted, with a $99 price and the Apple name, things could get interesting.

The iPod touch–the No. 1 portable gaming machine in the world, Jobs said–is getting the Retina Display and A4 chip of the iPhone 4, along with HD video recording and a front-facing camera with support for FaceTime video chatting. And there’s a new ad tagline for the touch: “All kinds of fun.” The 8GB is available for $229, the 32GB for $299 and the 64GB for $399. Preorders begin today.

The new iPod nano is 46 percent smaller and 42 percent lighter than its predecessors, thanks to the elimination of all those bulky controls and the addition of a little multitouch screen. A colorful selection will go for $149 for 8GB, $179 for 16GB.

As to the iPod shuffle, Jobs said customers missed the controls on the current buttonless model, so the new version is getting a click wheel. Price is $49 for the 2GB gadget.

Weighing in at just over a pound, the Cius “offers HD video streaming and real-time video, multi-party conferencing, email, messaging, browsing, and the ability to produce, edit and share content stored locally or centrally in the cloud,” according to a Cisco (CSCO) news release (in full below). The pitch to IT departments is that the tablet offers a lower-cost alternative to laptops and desktops for mobile workers. No details yet on price or carrier arrangements.

By the way, Cius is pronounced “see-us” (and for heaven’s sake, don’t transpose the vowels when you’re typing; a cuis is a guinea pig-like rodent).

Cisco Simplifies Mobile Collaboration with First-of-its-kind HD Video-Capable Business Tablet

New Android-based Computing Device Uses Cisco Collaboration Architecture and Virtual Desktop Integration to Deliver Mobile Computing, Collaboration and Communication Services

LAS VEGAS – June 29, 2010 – Cisco today unveiled Cisco Cius , a first-of-its-kind mobile collaboration business tablet that delivers virtual desktop integration with anywhere, anytime access to the full range of Cisco collaboration and communication applications, including HD video.

Cisco Cius is an ultra-portable device weighing just 1.15lbs (0.52kg) that extends the productivity benefits of Cisco collaboration applications to a highly secure mobile platform. In addition to full telepresence interoperability, Cisco Cius offers HD video streaming and real-time video, multi-party conferencing, email, messaging, browsing, and the ability to produce, edit and share content stored locally or centrally in the cloud.

Based on the Android operating system, Cisco Cius is an open platform for communication and collaboration whose form factor and applications are designed to more securely connect employees on-the-go with the right people in real-time, and to provide those workers with the ability to access and share the content they need from any place on the network.

Cisco Cius offers IT professionals new options when it comes to equipping mobile workers with computing devices. Through virtual desktop integration, Cisco Cius offers flexible computing options with cloud-based services, providing dramatically lower capital costs and cost-per-user for desktop maintenance.

Businesses can also tap into the growing Android developer community that is building business-class productivity applications with appropriate IT controls. The combination of applications and flexible computing options provides a compelling alternative to today’s PC-on-every-desktop paradigm.

ANNOUNCEMENT HIGHLIGHTS

Product Features

* The Cisco Cius is a lightweight portable business computing tablet offered with an optional HD audio station equipped with a telephone handset speakerphone, HD DisplayPort and USB ports.
* The Cisco Cius tablet features a front-mounted 720p HD camera which refreshes at up to 30 frames per second; a seven inch, high-resolution widescreen super VGA touch-target display for real-time and streamed video, and single-button TelePresence interoperability that can be utilized either when the tablet is docked, or being used remotely via Wi-Fi.
* The tablet has a 5-megapixel rear facing camera that can transmit streaming VGA quality video and capture still images, and dual noise-cancelling microphones for audio conferencing.
* Cisco Cius features an eloquent contacts-driven user experience, designed to enables users to quickly reach their important contacts.
* An on-board accelerometer readily orients applications for viewing in portrait or landscape modes as the user rotates the device to their preferred viewing orientation
* Cisco Cius supports 802.11 a/b/g/n Wi-Fi for enterprise campus mobility and 3G cellular services when off-campus. 4G services will be available at a later date. Bluetooth and Micro-USB means users can work untethered and share data with a PC.
* A detachable and serviceable battery offers eight hours life under normal usage.

“People are loving iPad as it becomes a part of their daily lives,” CEO Steve Jobs said in a statement. “We’re working hard to get this magical product into the hands of even more people around the world, including those in nine more countries next month.”

The current pace of iPad sales means Apple (AAPL) appears on track to blow the doors off most analyst estimates. Earlier this year, Bernstein analyst Toni Sacconaghi predicted sales would hit five million units in the first year, while Morgan Stanley (MS) analyst Katy Huberty was looking for more than six million. More recently, RBC Capital Markets analyst Mike Abramsky bullishly predicted sales of eight million, which at this point seem entirely realistic.

The official release below.

Apple Sells Three Million iPads in 80 Days

CUPERTINO, California–June 22, 2010–Apple® today announced that it sold its three millionth iPad™ yesterday, just 80 days after its introduction in the US. iPad is a revolutionary and magical product that allows users to connect with their apps, content and the Internet in a more intimate, intuitive and fun way than ever before.

“People are loving iPad as it becomes a part of their daily lives,” said Steve Jobs, Apple’s CEO. “We’re working hard to get this magical product into the hands of even more people around the world, including those in nine more countries next month.”

Developers have created over 11,000 exciting new apps for iPad that take advantage of its Multi-Touch™ user interface, large screen and high-quality graphics. iPad will run almost all of the more than 225,000 apps on the App Store, including apps already purchased for your iPhone® or iPod touch®.

Users can browse the web, read and send email, enjoy and share photos, watch HD videos, listen to music, play games, read ebooks and much more, all using iPad’s revolutionary Multi-Touch user interface. iPad is 0.5 inches thin and weighs just 1.5 pounds–thinner and lighter than any laptop or netbook–and delivers up to 10 hours of battery life.

[Image credit: Gizmodo commenter modestmouse]

“Yesterday, Steve Jobs unveiled, at his WWDC keynote, new iPhone 4 hardware and software,” said Kaufman Bros. analyst Shaw Wu. “While this was widely anticipated, we believe the rich features, refinement, and higher build quality are worth noting and difficult to comprehend without seeing and using the new iPhone first-hand. We believe the combination of a new form factor and software will likely serve as a powerful catalyst for iPhone 4 sales, as we have seen in the past with several AAPL products including the MacBook Pro, iMac, and iPod nano, to name a few.”

Piper Jaffray analyst Gene Munster felt much the same way. “While the announced features of the iPhone 4 were as expected, the reality is this phone is significantly more advanced than the next best alternative,” Munster wrote in a note to clients. “We see the iPhone 4 as the most meaningful revision since the iPhone 3G two years ago. As such, we believe more existing iPhone users will be inclined to upgrade to the iPhone 4 than we saw with the iPhone 3GS.”

Munster notes as well that gee-whiz features like iPhone 4’s FaceTime video calling app, its HD video camera and iMovie video editing software are together creating an integrated experience that typically requires multiple devices. “The bottom line is the iPhone is taking unit and dollar share from other device categories,” he writes.

Indeed, it was hard to watch Apple’s (AAPL) demo of the device’s HD video camera working in concert with iMovie Monday and not think that it’s going to eat the Flip Video camcorder and Kodak’s (EK) Zi8 alive as soon as it arrives at market. And things don’t look much better for Google’s (GOOG) Android “superphones,” though obviously, there’s a much bigger battle to be fought there. Certainly, the company and its hardware partners have some serious work to do in the months ahead. (Yes, the EVO’s a great start. But its battery issues are troubling, as even HTC CEO Peter Chou conceded at D8 last week.)

Said RBC analyst Mike Abramsky, “Recent competitive Android smartphone launches by Android-powered phones have raised competitive intensity; however, to us, iMovie for iPhone (demonstrated at WWDC) may be illustrative of Apple’s advantage in vertical integration (software/ hardware). We expect Apple to launch other ‘Super Apps’ on iOS that advantage the platform (multimedia, geo-positioning, touch interface, etc). Bing introduction on iOS may portend a further shift away from reliance upon Google for mobile search….The ‘repositioning’ of Apple’s iPhone OS–to iOS–at WWDC accelerates Apple’s (re)assault to lead personal computing, as the industry evolves to mobile.”

Steve Burke is about to take on a very big job: Combining GE’s (GE) NBC Universal with Comcast’s programming assets to create a television colossus. Good thing he has spent a lifetime in TV preparing for it.

But even without those responsibilities, Burke has plenty on his plate. As COO of the country’s biggest cable company, he helps steer Comcast (CMCSA) through tricky waters: Net neutrality, feisty file-sharers, sleeping tech guys, etc.

In certain circles–perhaps one you’re in sitting right now–the central question Burke and Comcast have to answer is: How are you going to survive the attempts of Google/Apple/everyone on the Web to turn you into an irrelevant dumb-pipe provider?

But the flip side of this question is just as valid: How can anyone really dislodge the company that controls the pipe that makes TV?

Liveblog

Kara starts off with the basics: Why do you want to buy NBC?

Burke: We’ve always believed that content and distribution go better together. We’ve had distribution, we’ve been trying to get content for a while. Tried to get Disney (DIS), came close to buying Universal when Vivendi owned the whole thing.

8:16 am: Kara–but lots of companies have tried marrying content and distribution. That doesn’t always work.

8:16 am: Burke–It has for News Corp. (NWS). But in our case, we already have the ability to put up 70,000 hours of content for video on demand. But we don’t have all the content we’d like. We don’t have day-and-date movies. We’d like all prime-time programming on VOD, etc. The thing that slows that down is the natural negotiations that you have to go through when you don’t own the content.

8:18 am: Kara–You’re also worried about becoming a dumb pipe, without control, right?

8:18 am: Burke: I like to think of it as opportunities. Look at DreamWorks (DWA)–they are worried about declining DVD sales, and they’d like to be able to do electronic sell-through. We’re in a position to help craft that evolution.

8:19 am: Kara–Are you sure consumers really want to watch this stuff on TVs, as opposed to iPads, etc?

8:20 am: Burke–We’re all for choice, anytime, anywhere. We believe consumers want that, too, and “it’s frustratingly slow” to get that to happen. “But I think that’s the world we’re all crashing into,” and “you can’t stop it anyway.”

8:21 am: What’s going with Hulu, which you’re going to own a piece of?

8:21 am: Burke–Whether it’s Hulu or Fancast, which we own all of, “people want their shows on the Internet. And they’re going to get their shows on the Internet.” Not sure if it’s going to be ad-supported or a paid model. “I know–I’ve read”–that Hulu is going to try a paid model.

8:22 am: We also support the TV-everywhere concept (spearheaded by Time Warner–get what you want on the Web, as long as you pay for a cable subscription).

8:23 am: Kara–you’re going to be running NBC, right?

8:23 am: When the deal closes, Jeff Zucker will run the entity. But he’ll report to me.

8:24 am: By the way, content and distribution don’t naturally work together. You have to make them work together. You have to do things that sometimes aren’t immediately advantageous for both sides.

8:24 am: Kara–Let’s talk about your individual businesses, as well as Steve Jobs’s expressed lack of interest in getting into TV. So cable is most important to you, right?

8:25 am: Burke–Cable provides the majority of NBCU’s cash flow. They’re the best part of the media landscape right now. Majority of cash at most entertainment companies comes from cable right now, and even more so at NBCU. But we also think there’s upside with Universal studio and NBC broadcast.

8:26 am: Okay, but give me an honest assessment of broadcast. What did you think of the Conan deal? Did they call you?

8:27 am: Burke–as the deal closes, it’s not our company. We can’t manage anything. To a degree, we’re watching things in the same way you are. There’s clearly a separation that exists. Because of regulators [natch].

8:27 am: Anyway, broadcast TV has been challenged for some time. But right now it looks to be on the upswing. Ads are coming back. retrans consent, where broadcasters will get money from cable operators, is coming. But broadly, if you look at TV, including cable, the overall television business is making as much money as ever.

8:29 am: Kara–do you still need broadcast networks anymore, anyway?

8:29 am: Burke–for big events, you can’t get a bigger audience. And that’s very attractive. We’re not naive. We know the business is “very challenged.” But in the next few years, there can be a real upside. We can invest in the business. If you’re in the network TV business, you have to spend the money to be competitive: on pilots, on encouraging creative people to work, etc. Note that NBC spent a lot more on pilots for this fall than they did a year ago. “If you’re in it, you have to be in it to invest and win. You can’t cut your way to success in broadcast TV.” [Which was Zucker's strategy last year. So what does that mean?]

8:31 am: Burke moves on to the Universal movie studio. It can move the existing library to different platforms, help it migrate from DVD to electronic sell-through, etc.

8:32 am: Will Burke have to do a lot of cost-cutting? When we bought AT&T (T), we did. But in this case, it’s not about costs. There’s very little overlap. It’s more of a case of trying to put everything together.

8:33 am: Kara: So will you sell anything off after the deal goes through?

Burke: No. We want the cable systems, but the other stuff has value, too. And all of the parts can work together.

8:34 am: Kara–How do you look at competitors like Apple (AAPL), Google (GOOG). What do you think of Google TV?

8:34 am: Our real competitors are the satellite companies and telcos. Right now. The real challenge is delivering all that data. You need infrastructure–pipe–for that. That’s how you deliver tonnage. And it’s going to be that way for a long time. The Web can deliver video, but not the same tonnage, in the same way. There are a lot of companies that want to get to the TV set. And I think all of them can be complementary. But people who subscribe to us want ESPN, CNBC, etc.

8:36 am: Kara–But why do need bundles and tiers, anyway?

8:36 am: Burke: The programmers we work with want full distribution. And you pay $50, $60, and you get 200 channels. And the ecosystem works very well for the programmers, and it works well for us.

8:36 am: Kara–and for customers?

8:37 am: Burke–TV in the U.S. is better than anywhere in the world. It’s natural to say you only want to pay for two channels. And we could technically do that, and we could offer a less expensive bundle. But I think the business model has evolved to be what it is right now, and it’s been successful for both sides of the equation.

8:37 am: But again, people are picking and choosing what they want on the Web. And some of them seem to be turning off cable as well. Aren’t you worried about that?

8:38 am: Burke: We worry all the time. But the fact of the matter is, it’s counterintuitive. I have five kids. And they all consume media different ways. But quarter after quarter, year after year, cable subs go up. It has never gone down. There’s no evidence that people are giving up their cable. If people want ESPN or CNBC, they’re going to subscribe. In the future, you’ll have more stuff on more devices. But at the end of the day, it’s in the programmers’ interest to get affiliate fees for their stuff.

8:40 am: Kara–But don’t you think people want a la carte?

8:40 am: Burke–I’d like to buy the first section of the Wall Street Journal, and not the rest of the paper [followed by Kara fumbling with some math].

8:40 am: In any case, you’ve got much more choice now than you had 10 years ago. It’ll be the same thing in the next 10 years.

8:41 am: Kara–which devices are important to you beyond TV?

8:41 am: Burke–The iPad, of course. We just showed off that new iPad app/TV controller that will replace the crummy search and navigation that exists on the set-top box now.

8:43 am: Kara–Is 3-D coming to the home?

8:43 am: Burke–Yep. This won’t be like HD sets, where they started off very expensive and came down relatively slowly. We’ll get a point pretty quickly where if you’re buying a nice TV set, it will have 3-D. Now there are a lot of places where 3-D doesn’t enhance the experience. And they need to figure it out. For instance, you don’t 3-D when you have overhead shots at at a football game. So we need to figure out what percent of stuff you watch will have 3-D. But it’s coming.

8:44 am: Kara–Jobs talked about collapsing windows, but windows don’t really seem to ever collapse.

8:45 am: Burke–Right. They are narrowing, but only slightly. You want to have windows, but make sure they have a purpose. For instance, I think the best place to have a movie for the general public is the movie theater. I think that’s going to be the same for a long time.

8:46 am: Kara–But what if you don’t want to go the theater?

8:46 am: Burke–I don’t know. I think there’s a real benefit to having it in theaters opening weekend. But 90 days out, I’m not sure. It probably doesn’t have to be windowed for 90 days; you should be able to get it on VOD, etc.

8:47 am: Kara–One more time: What’s the most important device, either real or overhyped?

8:47 am: Burke–The iPad. I bring it everywhere I go. It’s so elegant. And so early in its life cycle. But I’m looking forward to other tablets, too. The big picture is that all this stuff will enhance the value of great content. That’s the bet we made with NBC, that it can get to more people, over more devices, and get more valuable that way. People are always worried about technology draining value from media, but each new wave of technology has been additive.

Q&A:

Q: Do you think your pipe business will become separate from rest of your business and become commoditized?

Burke: For starters, we’re already separating programming from video (which includes TV, high-speed, etc.

Q: What about the theory that big mergers, like the ones you’re doing, are products of hubris more than business savvy?

Burke: I know that theory. We’ve done a lot of deals. “Every single time we’ve done a deal, Wall Street has said, ‘Why are you doing that?’” But we have a view that content and distribution work together if properly managed. And that a company that gets bigger can do cool things with technology, if you do it right. “But we’re totally aware that there are a lot of people saying–’Why don’t you stay where you are?’ We think we’re getting a fairly priced deal for NBCU.”

Q: Do you think there will be a market for set-top boxes that consumers buy on their own, with features they want?

Burke: Complicated question. Each MSO is a conglomeration of different technologies. We’d love it if people bought their own set-top boxes. We’d save a ton of money. But the different technologies involved make that difficult.

Q: What’s your mobile strategy?

Burke: We’ve invested in Clearwire. We’re rolling out WiMax. We’re big believers in Wi-Fi. The iPad makes you want Wi-Fi meshing in cities, and we’re working on that. But the traditional cellphone business, as a fourth product to complement TV, landline and Web, doesn’t make sense for us.

Q: You guys have been good about chasing after malware, botnets, etc. What can you do to get others to emulate you?

Burke: The Internet business is crucial for us. It’s a growth driver. So we have to provide really reliable, really fast Internet service. And we believe in open internet. But you have to deal with congestion and protect copyrights and prevent malware and spam, and we invest a lot in that. It’s a very tricky balancing act, to make sure that the highway is really fast, but also controlled.

Q: I run Hillcrest, and Hulu blocked my service. Will you do something different when you own NBC?

Burke: “It’s not time for me to answer that question.”

Kara: “Really?”

Burke: “Really.”

Q: Your customers hate you. What are doing about that?

Burke: We’re working on customer service, spending a lot of money on it. If you don’t take care of your customers, they’re going to go somewhere else. The physical networks are getting more sophisticated. But we want to improve them.

Q: Apologies, missed the question here.

Burke is explaining that TV software platform is “balkanized” compared with the Web, where it’s much easier to get stuff to work together.

A note about our coverage: This liveblog is not an official transcript of the conversation that occurred onstage. Rather, it is a compilation of quotes, paraphrased statements and ad-lib observations written and posted to the Web as quickly as possible. It is not intended as a transcript and should not be interpreted as one.

Tonight, Cisco unveiled the latest version in its popular and innovative Flip digital videocamera line, the SlideHD.

The new device, which can record up to four hours of high-definition video and store up to 12 hours of content, has a dramatic slide-up touchscreen and a slide navigation bar.

These make the new Flip much bulkier than the last version, the Mino, recalling the earlier Ultra line.

Presumably, the reason for the new look is to offer a product that consumers can use for instant playback and to hold more video.

Cisco (CSCO) said the SlideHD will cost about $280.

Here’s a video BoomTown did introducing my many old Flips to the new one: