Seagate is buying Samsung's hard disk-drive business in an agreement worth about $1.4 billion in cash and stock.

Samsung will get 45.2 million Seagate shares, or a 9.6% stake, worth about $687.5 million as part of the deal, the two companies said in a statement on Tuesday.

Seagate will supply Samsung with hard drives for computers and consumer electronics and Samsung will supply Seagate with flash memory chips, and the two companies will extend a cross-licensing patent agreement in a strategic partnership as part of the terms of the sale.

Another element of the deal calls for a Samsung executive to be nominated to join Seagate's board of directors after the deal closes, which is expected to take place by the end of the year after approval from U.S. and international regulators.

The move follows an agreement by Western Digital, the largest hard-drive maker, to buy Hitachi's storage business for $4.3 billion last month.

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Photo: A Samsung Electronics hard-disk-drive Credit: Truth Leem/Reuters

Japan's massive earthquake has affected the production and distribution of an important component in many cellphone cameras, the CMOS (complementary metal-oxide semiconductor) image sensor, from Sony and Toshiba.

Toshiba's Image Sensor fabrication facility in Iwate, Japan, has been shut down because of the earthquake from which much of Japan is still working to recover, according to the technology research firm IHS iSuppli. Toshiba's Iwate plant manufactures logic chips and CMOS sensors for cellphone cameras.

Sony, on the other hand, has had to delay the delivery of its CMOS sensors to cellphone manufacturers, IHS iSuppli said in a report issued Thursday morning.

IHS iSuppli did not have information on how long Toshiba's plant would be closed or how long Sony's sensor deliveries would be backed up and officials at both consumer electronics companies were not available Thursday morning to comment on the firm's report.

In 2010, Toshiba was the fifth-largest supplier of image sensors for phones with an about 12% share of worldwide revenue, according to an estimate from IHS iSuppli. Last year, Sony came in sixth with about 8% share of the global market for image sensors, the research firm said.

Combined, Toshiba and Sony made up about 20% of the cellphone image sensor market in terms of revenue, IHS iSuppli said.

"With [its] low cost and easy integration with other electronics, CMOs has long been the technology of choice for cellphone cameras," said Pamela Tufegdzic, an IHS analyst, in a statement. "The Japan earthquake and subsequent logistical challenges have disrupted a portion of the supply of this key component."

IHS iSuppli said that a replacement part, albeit a higher-end option, is available in the form of another image sensor technology called CCD (charge-coupled device), which has been unaffected so far.

Sony and Toshiba are major CCD suppliers, as are Japanese competitors Fujifilm, Panasonic and Sharp, the firm said.

"Because of their higher image quality, CCDs are commonly employed in digital still cameras," IHS iSuppli said in a statement. "In contrast, CMOS sensors predominately are used in cellphones and often in other devices where the camera is secondary to other functions."

Digital camera manufacturers Altek and Ability Enterprise, both based in Taiwan and both of which make cameras for major Japanese brands, told IHS iSuppli that they have yet to see any decrease in CCD supply from Japan.

Ability receives about 90% of its CCDs from Sony and Altek buys about 70% to 80% of its CCDs from Sharp, IHS iSuppli said.

"Sharp's CCD plants in Japan are far from the worst-hit zones, while Sony's CCD plants are located in Thailand," the research firm said."Because of this, CCD supply in the future should not face any immediate supply issues. The situation may change over the long term, however, as CCD makers could experience challenges with their own upstream material suppliers and encounter problems with transportation and power."

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Photo: A Sony logo is displayed at an electronics shop in Tokyo. In the wake of Japan's earthquake, Sony has had to delay the delivery of one type of cellphone camera sensor to manufacturers. Credit: Kim Kyung-Hoon / Reuters

Cisco Systems is flipping the off-switch on the Flip camcorder.

On Tuesday the computer networking giant said it was shutting down its Flip Video unit as a step toward narrowing its business -- a reversal after years of looking to diversify its product offerings.

About a week ago, John Chambers, Cisco's chief executive, promised "bold steps" to refocus the company, declaring that missteps were "unacceptable." Analysts then criticized Cisco for being too dependent on state and local governments for its revenue.

The shuttering of Flip cam operations will mean the loss of about 550 jobs and about $300 million spent across the first half of Cisco's fiscal year, the company said in a statement.

Cisco bought Pure Digital Technologies, the maker of the Flip cam, for $590 million in 2009.

The Flip camera line had been a popular seller among consumers for its easy-to-use controls and its swift ability to get video on the Web as well. Pocket-sized camcorders from Sony, Kodak and Polaroid hit the market over the last couple years, due in part to the Flip's success.

Though Cisco will stop producing the Flip camera, it will still support its FlipShare video-sharing services "with a transition plan," Cisco said, not offering further details.

The San Jose-based company said it was preparing to making further moves to focus on four "key company priorities": core routing, switching and services; collaboration; data center architectures; and video for business customers.

"We are making key, targeted moves as we align operations in support of our network-centric platform strategy," Chambers said in a statement Tuesday. "As we move forward, our consumer efforts will focus on how we help our enterprise and service provider customers optimize and expand their offerings for consumers, and help ensure the network's ability to deliver on those offerings."

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Photo: A lineup of Flip Mino cameras. Credit: Cisco Systems via Flickr

The new Commodore 64 computer, first released in 1982, appears the same on the outside, but is much different beneath the surface.

It's still taupe and it's still basically a big keyboard with a full working computer sitting beneath it -- mouse and monitor aren't included.

But while it has its retro looks intact, it's also quite new, with modern features even some of today's computers (Apple, we're looking at you) haven't caught up to, such as HDMI outputs to connect to a HDTV and the option of a combination Blu-Ray and DVD player.

"It looks just like the original Commodore 64, with even the old-style keyboard," said Barry Altman, chief executive of Commodore USA, LLC, the company making the new all-in-one PCs. "In fact, that keyboard was the biggest accomplishment of all, so far. The keys look like a piece of clay that you pushed a marble into -- so it fits your fingertip."

The price for the new Commodore 64 basic model is even the same as it was for a similar base unit in 1982 -- $595.

Of course, with larger hard drives and that high-definition video Blu-Ray player, a new 64 can cost as much as $895. A $250 model will get a wanting consumer what amounts to just a Commodore 64 shell for those who want to add their own motherboard, DVD player and other innards.

The new Commodore 64 went on sale on the company's website for the first time Tuesday and sold out within about 24 hours, though Altman isn't saying just how many have been produced to date.

"We expected our audience to be the nostalgia crowd and that's true, a lot of people buying them owned an original Commodore 64 back in the '80s, like me," he said. "But we're also finding that there are young kids who are geek geniuses who have iPhones and iPads and things like that and they're looking at this thing and they're into it. They've actually been a big part of our customer base so far too. It's been a surprise."

A second run is selling now, but won't ship until about May or June, he said.

"We're having a hard-time keeping our online store up, because the servers are getting overloaded from the amount of traffic," Altman said. "That's been a bit of a surprise, too."

A surprise that he said reinforces his idea to bring back the Commodore brand, which is a passion project for the man who spent 25 years working in the satellite telecommunications industry, which is where he first ran into the small keyboard-box computers.

"Almost 30 years ago, we were filing our paperwork and even payroll manually -- we couldn't afford the expensive IBM machines at the time," Altman said. "And someone showed us a Commodore and it worked incredibly well to do what we needed to do and we used it for about five or six years and then we upgraded like everyone else, but I've always had a love in my heart for that product."

Just over a year ago, Altman formed Commodore USA LLC and licensed the rights to the Commodore trademark in September precisely to bring back the old box he had a passion for.

The new Commodore 64 maintains the spirit of the old computers, he said.

"It's a good basic computer for work, for email, for multimedia use, for even basic gaming," Altman said. "It's more like a Mac Mini than a little netbook."

The new machines feature a dual-core Intel Atom 1.8GHz processor, a Nvidia Ion2 graphics chipset, and as much as 4GB of RAM and 1TB of memory. The units run on Ubuntu, an open-source operating system, but are also capable of running Microsoft's latest OS, Windows 7.

The original Commodore 64 had 64 kilobytes of memory, which was enough to do basic word processing and play video games which would be considered basic by today's standards.

And the new Commodore 64, like the old one, is built in the U.S. -- in Florida, where the Ft. Lauderdale company is based.

"It's 99% American made -- everything except the motherboard is American made," Altman said. "It just didn't seem right to have the Commodore 64 become a Chinese import, though we sell other computers that are and they're just fine. It probably goes back to a nostalgia thing, and we don't have the benefit of the less expensive labor, but we felt strongly that it was the right thing to do for this model."

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Apple iPad 2 replicas burned, sent to the afterlife in Chinese Qingming festival

-- Nathan Olivarez-Giles

twitter.com/nateog

Apple's iPad 2 is in high demand in a few Asian countries this week as the Qingming festival gets underway.

In the annual tradition, ethnic Chinese families burn paper replicas of items their dead relatives would enjoy in the afterlife, such as designer purses, plush furniture, cars and clothes.

This year, young Chinese are bringing paper replicas of Apple's iPad 2 into the mix, according to a video report from Reuters. (The device isn't yet on sale in much of Asia.)

However, the push for consumer electronics -- including smartphones and TVs -- isn't exactly embraced by older Chinese, one of whom said in the video below that many relatives wouldn't even know how to use an iPad because the gadgets came out after they died.

In the meantime, many shops that sell paper replicas for the festival can't keep up with demand for the replicas -- mirroring Apple's own problems with keeping the real thing in stock in many of its stores, Reuters said.

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Photo: Paper replicas of first-generation iPads and iPhones on sale for the Chinese Qingming festival at a prayer supplies shop in Petaling Jaya, Malaysia. Credit: Bazuki Muhammad/Reuters

Forget texting and driving or talking on the phone and driving: Those extremely dangerous habits are old hat.  The new worry, says a survey released by State Farm this week, is what the insurance company cleverly calls "webbing while driving."

That means looking up Web pages, following driving directions, reading and composing e-mails, checking Facebook, and twiddling with smart-phone apps -- activities that require sustained concentration and multiple key presses.

Among the 912 smart-phone users State Farm surveyed, more than 19% of them "webbed" while driving, the company said. For those who prefer fractions, that's one smart-phone-equipped driver out of every five.

"We are working to prevent crashes and save lives," Cindy Garretson, State Farm's director of auto technology research, said in a statement. "This research takes us one step closer to understanding the driver distractions that affect everyone on our roadways."

As an insurance company, State Farm has an interest in minimizing accidents and damage payouts, but who can argue with minimizing hazardous driving?

If it makes a difference, the survey respondents said they tend to "web" while in heavy traffic, stopped at a red light, during daylight hours, or on long drives on the open road. Which covers just about everything, thanks.

As a caveat, the survey does not necessarily reflect trends in the greater population: Because it was conducted online, it is more likely to include tech-savvy individuals and younger people. And surveys without random samples are not generally scientific.

However, anyone driving in a busy city such as Los Angeles knows that every month, more people can be seen looking at their phones while on the road. What used to be the familiar sight of people holding handsets up to their ears has been replaced by the sight of people gazing down at their screens while stopped at lights. When a red light turns green, people often sit until they're honked at.

As the State Farm study points out, close to 40% of Americans have smart phones now, and that number is growing fast.  And though we are frequently reminded not to text and drive, the safety message may not have caught up to the current technology. 

What about "don't e-mail and drive," or "don't Google and drive," or "don't play Angry Birds and drive"?

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Image: A car in the 2008 Houston Art Car Parade. Credit: Mr. Kimberly

Random House Inc. on Monday ended its long stand against the so-called "agency model" for sales of e-books, a move that could pave the way for the publisher to join its competitors on Apple's iPad.

Under the agency model, publishers set prices on their e-books and keep 70% of the sale price, while digital book sellers keep the remaining 30%.

Apple released its iPad, and the Apple-run iBookStore, in April of last year.  Around that time, five of the six major book publishers -- Penguin, Harper-Collins, Simon & Schuster, Macmillan and Hachette Book Group -- agreed to the agency model. As with all content sold through Apple's iTunes store, Apple keeps 30% of the retail price of e-books.

Random House held out, and its bestselling books ("The Girl With the Dragon Tattoo," "Da Vinci Code," etc) have not been available through Apple's bookstore.

Now, that may change. Random House would not comment on whether its 17,000 e-book titles will arrive in the iBookStore, potentially when Apple announces a new version of the iPad this Wednesday in San Francisco. But it did offer the following statement:

“We are making this change both as an investment in the successful digital transition of our existing partners and in order to give us the opportunity to forge new retail relationships."

Consumer Reports didn’t like the antenna on the original iPhone 4, and it’s bashing the Verizon version of the phone for the same reason.

Reviewers found that the Verizon Wireless-connected device, released earlier this month, has a similar problem with dropped calls that the AT&T iPhone did.

In areas with a weak signal, users who block the tiny gap in the lower left side of the metal band surrounding the phone can experience connectivity issues, according to a Consumer Reports blog post. Palming the phone, a natural position, can cause the problem, typically within 15 seconds.

As it did with the AT&T version in July, reviewers said they didn’t recommend the Verizon iPhone 4. But they said that using the phone with a case alleviates the problem and that the product “performs superbly in most other respects.”

Consumer Reports engineers ran the same lab tests they use on other smart phones, throwing in a few extra ones that they developed after the initial round of dropped-call complaints.

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Philipp Humm, the new CEO of T-Mobile USA, has come from sister company T-Mobile Germany to try to boost the carrier's fortunes in the U.S.  Humm is visiting dozens of cities around the nation, holding grassroots town halls with employees to get a sense of where they feel the company should be heading.

Humm sat down with The Times recently to talk up his plans to make smart phones affordable, to get everyone a tablet, and how he'll face off against his bigger rivals in Verizon and AT&T.  He also has a few words about the iPhone (which T-Mobile doesn't yet have) and Apple's Steve Jobs. 

What is one of the more important lessons you learned from operating in the European market?

The best way of being a good challenger is by having played defense for a while.  Now you know how the defenders play the challenger game.  Back at the time in Germany we had very good challengers attacking us.  Looking at how other people attacked you is a very good way to determine how you’ll make your next attack.

The HP TouchPad, running WebOS, could be slick enough to attract more consumers than any individual Android tablets or the BlackBerry PlayBook -- but it has no shot at dethroning the Apple iPad, an analyst said Wednesday.

"Collectively, Android tablets are huge; the market is already flooded with them. But if you're looking not at the whole platform, but rather a one-to-one comparison, the TouchPad could make a good case for the No. 2 spot behind the iPad," said Sarah Rotman Epps, a tech analyst at Forrester Research. "The TouchPad could outsell the Motorola Xoom or the Samsung Galaxy Tab or the BlackBerry PlayBook."

A major advantage that Hewlett-Packard's TouchPad could have over tablets running Google's Android operating system is its screen size, Rotman Epps said.

"Every Android tablet is slightly different, and Honeycomb, the first version of Android optimized for tablets, isn't out yet," she said. "So what you've had so far is a smart-phone operating system on a bunch of tablets and not many Android apps actually built for tablet use."

The mix of inconsistent specs for Android tablets has made it tougher for developers looking to make tablet apps on Android, Rotman Epps said.

"What HP has to overcome is that the only apps out there built for tablets right now are really built for the iPad," she said. "If your tablet is going to succeed, it needs apps, and making the screen on the TouchPad the same size as the iPad should make it easier for developers to port apps over. If developers start doing that, then HP can build an app ecosystem which will attract consumers."

The screen size isn't the only specification that matches the iPad, she noted. Both the iPad and the TouchPad run on Wi-Fi and 3G Internet service, weigh 1.6 pounds and have processors running at about 1 GHz.

The TouchPad features a front-facing camera for video chat, and the next-generation iPad, which should hit retail sometime this year, is widely expected to also feature a camera on the front to utilize Apple's FaceTime video-chat standard.

"It is not at all a mistake on HP's part that the TouchPad and the iPad are so similar," Rotman Epps said. "HP is explicitly trying to compete with Apple in having its own hardware and having its own operating system. So far, Apple has been by far the most successful in the tablet space, and HP is looking to replicate that success on its own. Not with Android and not with Windows."

It's noteworthy, she said, that HP isn't offering its first consumer tablet with Microsoft's Windows 7 -- the same operating system that runs on its HP 500 Slate tablet aimed at business users.

"If you're making boxes that run Android or Windows, you have the problem of competing with all the other boxes that run Android of Windows," Rotman Epps said."But it does say something about the failure of Microsoft to position Windows 7 as a winning operating system for tablets that HP is willing to go out on its own with WebOS. This is really another missed opportunity for Microsoft in tablets."

Nothing HP announced on Wednesday puts it ahead of Apple, but the TouchPad running WebOS is a bet that its brand strength and retail channels are strong enough to compete with Apple, she said.

With HP attempting to build WebOS up as a major operating system for tablets and smart phones, the trimming of the Palm brand from the name and marketing of the new WebOS devices isn't a mistake either, the analyst said.

"People love Windows, and HP now has the challenge of convincing consumers to want HP devices that don't run Windows," Rotman Epps said. "HP is trying to differentiate itself and unbundle itself from Microsoft, and that means they're losing a bit of the Microsoft brand and marketing power that could have helped their tablets, but keeping the Palm name around wouldn't help them."

HP is a high-ranking brand and a name consumers trust, she said.

"Palm is not," Rottman Epps said. "In our studies, HP ranks pretty high and Palm always ranks pretty low. HP recognizes that in the U.S. and globally, it has a much stronger brand than Palm to try and build a tablet ecosystem on."

HP made a big deal of getting apps for Netflix and Amazon's Kindle on its WebOS phones and on the TouchPad when it announced the new devices on Wednesday during a news conference in San Francisco. Having an app for Netflix does put WebOS ahead of Android -- which still doesn't have an app that can stream video from the popular movie-and-TV-show subscription service.

But such apps are expected by consumers at this point, she said.

"Kindle and Netflix is not a differentiator, but it's necessary, and having them on board is what HP needs to do to gain serious consideration from consumers," Rottman Epps said.

And if HP can do that, then spending $1.2 billion to buy Palm last April could pay off.

Forrester has forecast that more than 24 million tablets will be sold in the U.S. in 2011, with the lion's share of them being the iPad. Apple sold more than 14 million iPad's last year, with 7.33 million units sold last quarter.

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Photo: HP Palm CEO Jon Rubinstein, shows off the new HP TouchPad tablet during a Hewlett Packard WebOS press conference in San Francisco on Wednesday, Feb. 9. Credit: Associated Press

Images: (Middle) The front of the HP TouchPad tablet and (bottom) the back of the device. Credit: Hewlett-Packard