JPMorgan: MacBook Sales Up, PC Sales Down

Filed under: Apple Financial, MacBook, MacBook AirAccording to a recent posting on Phillip Elmer-DeWitt's Apple 2.0 column over at CNN, JPMorgan analyst Mark Moskowitz has issued a "cautiously optimistic" report on Apple based primarily on "stronger-than-expected" MacBook sales" for the quarter ending in March. According to Moskowitz, computer sales usually fall-off after Christmas, but Apple has actually had a sales increase -- albeit a small one at only 0.2%. However, that increase is still...

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August 2007 Zoon Awards for Technical Ignorance and Incompetence

Daniel Eran DilgerIn an effort to recognize the spectacular efforts of individuals and organizations promoting the regression of human achievement in the field of technology, a series of nominations await your vote to determine the recipients of August 2007 Zoon Awards.Meet the Zoons.Segregated by color, the various Zoons highlight the world's absolute worst in small minded ignorance, paid to say propagandism, and blind devotion to products without merit.The Pink Zoon is awarded for a spectacular effort in fear-based propagation of uncertainty and doubt, or efforts to infect headlines with false information with the primary goal of preventing innovation, competition, and the emergence of new ideas, or simply to make a quick profit. The White Zoon is awarded for the blinding glare of a shiny blank brain, particularly when such ignorance is presented with authoritarian emphasis by an individual or news source operating well outside its abilities. This award may also be assigned to a company or organization in recognition of epic failure. The Brown Zoon is awarded for squirting extraordinary amounts of intentionally noxious misinformation, whether dredged from an impacted recollection of twenty years ago, sucked from the trusty bucket of canned responses, or simply invented as needed to create an intolerable outburst of stink.These should not be considered as first, second and third placements, as each tie for an equal standing in the Zoon Hall of Shame. It is also possible to award multiple parties for the same award, either as shared participants or, in the case of an unclear majority vote, tied nominations.Meet the Zoon Nominees.As one might imagine, determining the most fitting recipient might be difficult given the wide range of potential candidates standing in line. Here's a brief background on the nominations for August.Troy Wolverton, San Jose Mercury News.A writer for the Street and most recently, the San Jose Mercury News, Wolverton always manages to dig up an unattractive headline for any news related to Apple. A series of articles documented his negative spin and inaccurate reporting, particularly when the subject related to Apple.Wolverton promised me and other readers that he would answer the questions related about his shoddy journalism record, then cowardly ran away. He also wrote emails to RDM readers assuring them that he was only ever honest and unbiased, and that RoughlyDrafted should be read with great suspicion.[10 FAS: 8 - San Jose Mercury News’ False Apple Scandal][Troy Wolverton Documents Faux Apple Shareholder Outrage]Wolverton is nominated for a White and Brown Zoon.Neil Cavuto, Fox News.While actually based on reports from the end of July, I wrote about Cavuto in August, qualifying his nomination for arrogantly complaining about how Apple purportedly over promised iPhone shipments it then failed to deliver. In reality, Apple didn't indicate any sales goals for its first weekend. Cavuto also confused AT&T authorization numbers with Apple's sales figures. Fox News subsequently corrected his comments to suggest that he hadn't made the error, but still failed cover up the core problem that Cavuto's entire rant been a specious bit of ignorant rambling delivered--rather hypocritically--with far too much arrogance than the subject required.Cavuto is nominated for a Pink and White Zoon.[10 FAS: 9 - Troy Wolverton, Neil Cavuto, and the Apple Stock Scandal]Jim Cramer, Scott Moritz and Brett Arends, the Street.After documenting how he would spin false information to manipulate the market as a hedge fund manager, Cramer praised his apprentice Moritz for publishing a string of articles dredging up or simply inventing false information about the iPhone with the intent to knock value from Apple and suggest that Apple's phone was not competitive, not selling as expected, and that Apple's deal with AT&T was an unprecedented deal earning unconscionable profits. Arends is thrown in for good measure after delivering similar work directly from the mouths of Street-savvy Verizon shill, Roger Entner of IAG Research.Cramer, Moritz, and Arends are nominated for a White and Brown Zoon.[More on Scott Moritz and the Jim Cramer Street Misinformation Engine][The Street's Flaccid Campaign Against the iPhone][Unraveling Anti-Apple Panic: the iPhone Launch Success]George Ou, ZDNet, CNET.Nominated in August primarily for his article misrepresenting typography technology and falsely portraying Mac OS X as incompetent in the area of text rendering, Ou deserves extra reason to earn your Zoon vote for failing to admit that he falsified his report, and instead attacking those who pointed out his error.[Tech: Zoon for George Ou]After posting the article detailing why he was wrong and establishing a pattern of his consistently inaccurate and tilted writing, someone who appeared to be Ou emailed me to say:“If you're gonna do a hit piece, at least do it accurately... I'm not going to get uptight about a little man like you chewing on my feet and I'm not even going to bother cursing at you for writing a blatant hit piece on me. It's not worth my time.�?Assuming that the author was unlikely to actually be Ou, I did a search on the email and found an online comment from the same address mentioning being a former ballet dancer. To determine if the author was Ou or just simply a joker trying to get a response, I wrote back, “Hi George, What was inaccurate in my article? Are you really a ballet dancer?�?Ou tu?In reply, Ou wrote, “I was a professional Ballet dancer up till 2000 and I still try to perform now and then,�? but didn’t note anything that was incorrect in the article. When I asked for the correction again, I got two emails, one insisting that, “The 'FreeBSD community' is essentially Sam Leffler. Sam pretty much wrote all that wireless code. Sam is an employee (contractor) of Atheros. Atheros is involved in that FreeBSD code.�?The second said, “You don't even understand the fact that the same Atheros ‘team’ led by Sam Leffler that wrote Apple's wireless drivers is the same team that wrote the open source MadWiFi drivers for Linux and FreeBSD. The same wireless drivers Apple said there was no problem on had to be patched three times a month later. And here you are slandering me because I defended two researchers against a billion dollar corporation.“When you smear my photograph and slap a "SHILL" on top of it, that is slanderous and insulting. You're accusing me of taking payola which is a crime and only a ‘little man’ would slander someone like that. It's one thing to disagree with me or not like a certain piece I wrote, but smearing someone's photo with accusations of shill is nothing but the act of a coward. Unprofessional? There's nothing unprofessional about calling trash like you little and I'd say that to your face.�?Pearls Thrown.How could a professional writer fail to understand his subject matter, fail to grasp basic logic, and then be so arrogant about it on top? I wrote, “George, I don't have to prove that people from FreeBSD did not contribute to Apple's driver. I never stated that, and it has no relevance to statements I made. You had to prove that Atheros did not deliver the driver, and that it came directly from FreeBSD without Atheros' involvement. That was the question, and your misunderstanding of the architecture of Mac OS X helped you to confuse the situation.“The truth is that Atheros contracted with an expert to port some of the FreeBSD code for use in its driver for Mac OS X, which only shares significant similarities with FreeBSD in its userland environment. Atheros had to deliver unique work for Apple to offer a working driver for Mac OS X, and paid a contractor to complete that work.“You maintained that Atheros simply wasn't involved at all, and that Mac OS X's driver just came from the FreeBSD repository. That was wrong. Your explanation of why this was the case was also wrong. It is clear you still do not understand the situation entirely. That's why you shouldn't be writing about it as if you are an expert, simply because someone told you something that sounded believable off the record. You don't understand the issues involved, but operate under the assumption that everything you think up as a plausible idea is also the truth. It isn't.“Slander, as noted in my article, is spoken. Libel is written. Just FYI. Also, a shill doesn't necessarily need to be paid, so calling you a shill isn't ‘accusing you of payola.’ Also, payola really only is illegal in broadcasting. There are plenty of people who are paid to say things, and nobody is arresting them. The company you work for largely serves advertisers; that isn't illegal, or all of CNET would be shipped off to jail.“There is nothing cowardly about pointing out that you are a shill and then documenting your attempts to spread misinformation in efforts to make Vista look good and Apple look bad. There is something very cowardly about fuming that you've been outed, and rather than apologizing and correcting your error, and then maintaining that you're simply better that others so your misinformation campaigns don't matter.“I don't have a little man complex, so repeating that doesn't really bother me. It does make it clear that you have some size issues in addition to your general lack of professionalism and technical incompetence.�?To which Ou elegantly replied, “Go find yourself a bathhouse in the city where you belong. You have no business writing.�? Using the same address, Ou responded to several other online sites defending himself and ignoring the errors of his article. How does Ou have a job? Ou is nominated for a Pink, White, and Brown Zoon, and his winning will also earn a Zoon for ZDNet and its CNET parent.Windows Genuine Advantage, Microsoft.After choosing a delightfully ironic name for its software DRM system, Microsoft then bungled its validation system for users worldwide. The hundreds of millions of PCs running Windows XP and Windows Vista phone home to Microsoft at regular intervals, but the company set up the system with a single point of failure. An inevitable failure prevented the company from maintaining resilience to downtime--something the company highly touts as an Enterprise feature of Windows Server--but it also highlighted the problem of validating software in general using a system that assumes guilt when there is any question in reaching the validation server. Windows users who tried to verify their genuine software had software features remotely turned off because of the WGA problems.[Tech: WGA the Dog]WGA is nominated for a White Zoon.Oliver Rist, InfoWorld, IDG.Suggested by reader Robert de Bie, Rist yesterday wrote an article titled “Does Mac OS X suck? Apple's desktop platform has impressive technical chops, but it falls short from a business perspective.�?Never mind the sophisticated and professional headline, the real question is, did Rist back up his headline, or simply cower in a bed of second hand fear, uncertainty and doubt? No need to guess, really; this is InfoWorld, a rag primarily useful for its ads. No competent IT manager wastes much time reading the ramblings of such stuffshirt columnists.Rist brings up the idea that Mac OS X is really just Unix with some frosting, making it easy to coo about, but not really ready for real business. Unfortunately, Rist offers no basis for anything that he says. In fact, his headline and (forgone) conclusion don't even match what he writes in between. Under the subject of networking, Rist says, “OS X has an excellent networking client, both wired and wireless — due in large part to FreeBSD rather than anything coming out of Cupertino.�? But wait, does FreeBSD write the Mac’s Apple File Protocol? Does it maintain Samba for Windows networking? Wrong on both counts. By spouting the dittohead myth that Mac OS X is just FreeBSD with an Apple logo, Rist has already established that he knows nothing about the subject he's pretending to be an expert in. He then says nothing else about networking, granting that Mac OS X has no real issues.Security Absurdity. On the subject of security, he says “It's a pretty secure system. Yes, ever since OS X has become more popular, attacks and breaches on the platform have become more numerous. And, yes, those numbers are high enough that if I were managing a portfolio of MacBooks I'd be installing anti-virus on them.�? Rist linked his comment to another IDG article reporting on a Mac OS X worm threatened by the anonymous "InfoSec Sellout," which turned out to be a fraud. That's the extent of the acceleration in Mac OS X “attacks and breeches,�? a crank call? There are yet no viruses for Mac OS X, and all the malware that exists is proof of concept ideas hatched in a lab. Strike two for Rist in trying to write about security issues. Even so, he concedes, “once the personal firewall is up and the AV installed, I'd fully expect to see far, far fewer security-related problems from my Mac clients than my Windows clients.�?[10 FAS: 10 - Apple’s Mac and iPhone Security Crisis.]Many Words, Little Point.On the subject of reliability, Rist beats up Artie MacStrawman for insisting that Mac OS X apps never crash. He then provides some recollected figures for estimating how many times he has noticed a Mac app crash compared to Vista crashes. He passes by saying, “Apple's probably less crash-prone overall.�?On the subject of software compatibility, Rist says Apple “treats third-party developers like the proverbial redheaded stepchild, which results in significantly fewer third-party software options for Apple users than Windows users,�? then follows up with the genius, “When it comes to mission-critical, vertical-type business software, Windows clients far outnumber Apple clients. If they didn't, Macs would be populating a much larger number of corporate desktops.�?How does this guy get work writing? By the end of page one, Rist had said nothing at all. On page two, Rist really gets going. He starts off referring to "Apple jihaders," as if he has a fundamentalist shock radio show rather than a column designed to inform IT managers. Rist says people don't want to retrain employees to use Macs, and then suggests that retraining users for the significantly different Vista would not be an issue. He gives the Mac a “grudging�? pass again and moves to hardware. [Paul Thurrott's Merciless Attack on Artie MacStrawman]Mac OS X’s Hardware Features.He says that Gateway has more USB ports and a finger print scanner in the same form factor for less cost, without outlining his comments with any factual basis. He then complains that his MacBook suffered a hard drive failure after four months. “That's a pretty short time frame for serious hardware failure,�? Rist wrote. It's odd that hardware issues are being outlined in an article about “why Mac OS X sucks,�? but someone writing to an audience of experienced IT users should be aware that computing hardware--particularly hard drives--is most likely to fail in its first few months. Past that break in period, most hard drives typically have a relatively stable three year life span, after which problems become statistically more likely to occur. It's called the bathtub lifespan curve, because like the contour of a tub, it starts high, then drops low for a long stretch, then begins to rise again. Clearly, Rist doesn't know what he's talking about at all, even when complaining about consumer Mac hardware in the context of Mac OS X as a business operating system.Dude, You’re Being a Shill.After "passing" all of his categories, Rist then fails Mac OS X in “business orientation.�? There are good and justified reasons for faulting Apple in the IT arena, but Rist doesn't mention a single one. Instead, he prattles on about Apple's consumer ads, and how they portray the typical Mac user with a “SOHO, I'm-cooler-than-you, coffee house image.�? For all the dittoheads who like to repeat this idea, I'd like to remind you all that Dell's memorable mascot was a smirky pothead who couldn't finish sentences beyond, “Dude, you're gettin’ a Dell! (excited thumbs up).�? That had no impact on Dell's Enterprise sales, because serious enterprise users don't make their decisions based on watching prime time TV and deciding whether they like the advertisements targeted at families. So please shut up about the Justin Long and John Hodgman Get a Mac ads. Enterprise Worthy Dell Pothead Vs. the Too Good for You Coffee Drinking Mac.Highly Unqualified.Rist is a “senior senior contributing editor�? at InfoWorld. With this sort of incompetence and ignorance, it makes one wonder what kind of single celled organisms must pass for junior editors at IDC and its various ComputerWorld, PC World, and InfoWorld properties.While writing “a column devoted to running Microsoft technologies in medium and large enterprise environments,�? Rist only notes experience in running a small Microsoft-oriented software business and writing for rags like Computer Shopper. That qualifies him as a Microsoft shill, but not as a columnist offering advice about ‘medium and large enterprise’ IT environments.Rist is nominated for Pink, White and Brown Zoons.Microsoft’s Pseudo-Philanthropy in New Orleans.Bob Emery notes that Microsoft is offering free software for hurricane-hit businesses in the devastated New Orleans area. However, in order to qualify, users have to sign up for a three year plan, of which Microsoft only covers the first year. A local paper noted “For the typical small business of 50 employees and 25 personal computers licensing Microsoft Windows Vista and the Office 2007 suite of programs, the free year can result in savings of as much as $12,050.�?Of course, what that really means is that recovering small businesses will actually have to shell out $24,100 just for software licenses, in addition to buying computers capable of running Vista. One might think that a company earning $50 billion in revenues might be able to offer more than an advertisement to struggling businesses, particularly since software costs Microsoft nothing to deliver.[Microsoft gives free software to hurricane-hit businesses - New Orleans CityBusiness]Votes toward Microsoft's headline friendly, fake philanthropy will help the company earn its White Zoon for its WGA fiasco.Vote in the Forum and add your comments.Official awardees: Pink : George Ou, ZDNet, CNETWhite : Windows Genuine Advantage, MicrosoftBrown : George Ou, ZDNet, CNETWhat do you think? I really like to hear from readers. Comment in the Forum or email me with your ideas. Like reading RoughlyDrafted? Share articles with your friends, link from your blog, and subscribe to my podcast! Submit to Reddit or Slashdot, or consider making a small donation supporting this site. Thanks!
Microsoft's Mojave Attempts to Wet Vista's Desert

Daniel Eran Dilger Nearly two years after Windows Vista was finally released, Microsoft has remained unable to shake off its reputation as being slow, incompatible with existing hardware and software, and generally a poor and overpriced product that nobody wants. Microsoft is now trying to reverse Vista's bad reputation by insisting that the software's problems are not technical but rather just the fault of ignorant customers duped in part by Apple's “Get a Mac” campaign. What's Vista's real problems, and will Microsoft's “Mojave Experiment” help solve them? Blame Apple! Microsoft CEO Steve Ballmer has joined Windows Enthusiast pundits in theorizing that Vista's image problems are primarily the result of Apple's advertisements that regularly poke fun at the problems in Vista. The company has now taken aim at shooting at the messenger with a $300 million ad campaign. In July, Brad Brooks, Microsoft's VP of Windows Vista consumer marketing, addressed the company's business partners at its Worldwide Partner Conference, saying, “We've got a pretty noisy competitor out there. You know it. I know it. It's caused some impact. We're going to start countering it. They tell us it's the iWay or the highway. We think that's a sad message.” Another sad message Brooks had to deliver was that Vista's problems aren't really the fault of Apple. “We broke a lot of things,” Brooks admitted. “We know that, and we know it caused you a lot of pain. It got customers thinking, hey, is Windows Vista a generation we want to get invested in?” Vista: Pay it Forward! Brooks also noted that “Windows Vista is an investment in the long term. When you make the investment into Windows Vista, it's going to pay it forward into the operating system we call Windows 7.” Pay it forward? Is Windows 7 going to be a free upgrade to Windows Vista users, in the same way Apple is expected to offer the next Mac OS X 10.6 Snow Leopard release to existing users of 10.5 Leopard? That's highly unlikely, as Microsoft can't sustain its egregious profits collected through the Windows monopoly by giving away updates for free. Windows Vista raised the price of Windows, putting a new definition on the phrase “pay it forward.” Myths of Snow Leopard 7: Free?! Microsoft Admits Windows Vista Mistakes, Criticizes Apple Ads - InformationWeek Reality Impairment at Microsoft Talking out one's ass appears to be a job requirement for all Microsoft executives, starting at the top. A serious case of reality impairment has resulted in the paradox of the company both admitting that Vista is flawed and “broke a lot of things,” while at the same time maintaining that Vista's reputation is entirely the fault of stupid customers and a comically unflattering portrayal by its competitor. In the “Mojave Experiment,” Microsoft plans to dispel the notion that Windows Vista is problematic and incompatible by publishing a series of videotaped interviews with users who arrived with negative impressions of Vista and left excited about the new operating system. This was achieved by presenting the users with a demonstration of “Mojave,” a new operating system that Microsoft later revealed to be Vista, much to the surprise of the interviewed users who'd heard so many bad things about it. However, the Mojave Experiment is so full of false information and saccharine gloss that it couldn't possibly appeal to anyone smart enough to turn on a PC. Even setting aside the fact that the ad experiment basically seeks to blame users for being dumb, the attempt by Microsoft to paint over Vista's problems is transparent and flawed, for a number of reasons. What's wrong with Mojave. Microsoft can't seem to decide whether it wants to admit that Vista has problems or not, and its waffling back and forth just makes the company look increasingly disingenuous. Is Vista a poorly launched, flawed product that the company is working to fix as quickly as possible, or is it awesome and wildly successful and just the victim of bad press? Microsoft tries to tell both stories at once, which is purely dishonest. In contrast, Apple said from the start last year that its Apple TV product was a “hobby” attempting to break into a difficult market. Critics lambasted it for not immediately taking over the market like the iPod had or iPhone later did. Apple's more recent problems in launching MobileMe were quickly noted by the company along with the intent to address complaints about it rapidly. Microsoft isn't alone in being able to stumble, but its complete lack of candor makes it hard to understand if the company realizes that it even has problems to solve. With Vista, Microsoft has issued a flurry of giddy press releases claiming widespread adoption based on the number of licenses sold and naming it “the fastest selling operating system in Microsoft history,” ignoring the fact that Windows sales are increasing simply because they are tied to PC sales. Microsoft has no competition in the PC operating system market due to its monopoly position, so it could release Windows Wet Toast and still sell it faster than XP and ME and 98 Special Edition and every other version of Windows in the past that was tied to an increasingly younger and smaller hardware market. Vista Sales to Non-Users. Many of Vista's “sales” were free vouchers distributed with PCs sold in the holiday season prior to its launch. Even more than a year and a half later, PC makers continue to put Windows XP on their systems, even those sold with a Vista license, while corporate users almost always remove the default Vista to install an earlier version of Windows. There's also a busy third party industry developing around removing Vista for consumers. In late July APCMag cited Jane Bradburn, a manager for commercial notebook sales at HP, as saying, “From the 30th of June, we have no longer been able to ship a PC with a XP license. However, what we have been able to do with Microsoft is ship PCs with a Vista Business licence but with XP pre-loaded. That is still the majority of business computers we are selling today.” The arrangement is supposed to end by January 2009, but HP is trying to extend the deadline because customers simply don't want Vista installed. EWeek also noted that between April 2007 and May 2008, its survey of business users indicated that Vista climbed from 2% to 5%, but that Windows XP jumped from 74% to 83%, three times the adoption of Vista. That growth came from migration from older versions of Windows. Even in its wildest projections, EWeek says Vista will only reach 28% adoption in businesses by the end of 2010. CNET reported that a Jully 2008 survey by systems management appliance company KASE found that 60% of companies surveyed have no plans to deploy Windows Vista, a ten percent increase in disinterest from late 2007. A full 42% were actively exploring Vista alternatives, and 11% had already made the switch to Mac OS X or Linux. Microsoft is simply lying about the level of Vista excitement, and it's gotten too obvious for the company to continue to do so. XP still killing Vista in sales volume: HP 60 percent skipping Vista, so Ballmer looks to Apple | The Open Road The Truth Is… oh Look a Distraction! At the same time, Microsoft notes on its Vista website “we know a few of you were disappointed by your early encounter. Printers didn't work. Games felt sluggish. You told us—loudly at times—that the latest Windows wasn't always living up to your high expectations for a Microsoft product.” That's some brutal honesty for a company with a knack for spinning wild fantasies about fictitious product enthusiasm for a product never actually put to use in many cases. At the same time however, in trying to refute away Vista's real problems, Microsoft uses a variety of tactics that just return to blind fantasyland. Microsoft is a Marketing Company, not a Tech Company. The company plays its Mojave Experiment hand on a new website, incidentally designed using Adobe Flash rather than the company's own Silverlight. Despite the site's oddly designed, usability-impared interface, it's still possible to pull out lots of details from the experiment that say as much about Microsoft's crafty, misleading marketing as they do about its technical problems, underling the simple fact that Microsoft is first and foremost a marketing company that flogs third rate technology products. Mojave took 140 people and asked them to score Windows Vista. The average response was 4.4. After demonstrating Vista SP2 under the name “Mojave,” respondents ranked Vista at 8.5, a stunning improvement. But what were they ranking? Microsoft notes that “many said they would have rated it higher, but wanted more time to use it themselves.” That sounds good at first blush, but it really indicates that the responses were biased by hyped up enthusiasm rather than facts, and that participants realized it, reserving their final judgement until they could actually see more. The “Mojave Experiment” What does Mojave Prove? Mojave tries to represent that Vista's bad reputation is the fault of ignorant consumers who have heard bad things that aren't true about Vista, and have made up their mind without getting the facts. At the same time however, Microsoft also publicly admits that Vista “broke a lot of things” and that specifically, “Printers didn't work. Games felt sluggish.” Did Mojave clear up mistaken notions for participants, or did it just erect smoke and mirrors in a carefully controlled demonstration that skirted around Vista's real problems, including those Microsoft admits? That's a question that answers itself. Mojave didn't send uses home with Vista in a Mojave package and then ask them how well it worked with their existing peripherals and games, or how fast it was in comparison to their existing PC software. This is Not the Droid You're Running Vista On. Instead, Microsoft sat them down in front of a HP Pavillion DV 2000 with 2GB of RAM. That's what HP called its “entertainment powerhouse” laptop, although HP only shipped it with 1GB RAM. Microsoft maxed out the RAM for the purposes of the test, making the laptop a bit more expensive than its usual street price of around $1050. According to Windows enthusiast Joe Wilcox, PC laptops actually cost $700, “half as much” as Apple's laptops. At least that's the Average Selling Price for consumer retail PC laptops according to NPD's Stephen Baker, compared to Apple's $1500 ASP. Wilcox insisted that his spin on NPD's figures couldn't possibly be biased because he wrote his article on a MacBook Air running Leopard. However, his $2,700 laptop did help drive up Apple's stellar ASP for its laptops well above the entry price for Mac Books, discounting his theory that revolved around the assumption that every Mac buyer pays the average price of all the laptops Apple sells. Wilcox and Microsoft are both disingenuously dancing on both ends of the truth. Many consumers are actually buying cheap laptops at Target that can't run Vista ideally, while Microsoft demonstrates its Vista on a considerably better equipped system in the Mojave Experiment to suggest that Vista doesn't have the performance problems that users have heard about from the majority of their peers who bought cheap PCs and are seeing Vista run particularly sluggishly on them. Should You Pay Twice as Much for a Mac? I Did! You Get What You Pay For. The fact that Apple sells more high end laptops to pro users at retail, and that it does not sell anything in the range of the cheap junk being hawked at big box retailers like Wilcox' Target both result in Mac laptops fetching a higher ASP. That fact also means that Mac buyers will be happier with their purchase and have a more favorable impression of Mac OS X because they're running it on a better system. That's all obvious stuff. However, selling people cheap laptops that don't work well, and then demonstrating a fake “new operating system” that appears to work well when running on a faster machine full of RAM is simply a dishonest bait and switch scam. Wilcox does nearly admit that PC makers are already stretching their credibility as they attempt to sell cheap boxes based on price alone, citing Baker as saying, “We aren't seeing any particularly substantive moves down in price on the Windows side, either in desktops or notebooks.” PCs can't get cheaper because they're already unprofitable and consumers are already disgusted with their performance when running the increased overhead of Vista. Wilcox also sets up a tilted comparison between a Dell PC desktop with integrated graphics and an iMac with dedicated graphics and claims a price advantage for Dell, although noting that, while “Dell offers more for less than the iMac,” “that 'more' also means Windows Vista, which won't satisfy some shoppers.” Why Aren't Shoppers Satisfied with Vista? Like Microsoft, Wilcox and his Windows Enthusiast pundit friends can't seem to decide if Vista has any real problems or if it's all just an unfair taint suggested by Apple's Get a Mac ads. However, while Apple has taken shots at Vista's incompatibility with printers and other hardware and its scarce updates that have been few and far between over the last year and a half of its being on the market, Apple also notes in its Get a Mac ads that Macs can run Vista, and can run it faster than PCs. So Apple isn't inventing and publishing false reports on Vista, it's merely advertising its Mac hardware as superior to PCs. The Vista flaws Apple's ads have referenced are flaws Microsoft itself has admitted to its partners, so the Get a Mac umbrage frequently voiced by Windows Enthusiasts is both hypocritical and ridiculous. However, in the Mojave Experiment, Microsoft downplayed those well-known faults by only carefully demonstrating certain features on a high end machine, and without actually exposing Mojave/Vista users to 'a lot of things Vista broke,' 'printers that didn't work', or 'games that felt sluggish.' It Can't Even Print. In response to complaints that Vista doesn't work well with existing PC hardware, Microsoft's Mojave website says that “the Windows Vista Compatibility Center lists compatibility status for over 9,000 products (5,500 devices and 3,500 software programs).” It even notes 2,000 printers, 200 scanners, and 500 cameras specifically. That sounds good until you realize that Apple ships support for over 3,100 printers in Mac OS X Leopard, a product that is targeted primarily toward education and consumers and which is not expected by users to run on any old hardware that might be in use by PC users. Vista is supposed to run on 95% of the world's PCs, and yet it doesn't even match the printer drivers that ship with Leopard, a number which does not include all of the third party drivers available for the Mac. Oh, but there's more. Not only did Microsoft dance around the truth to feed its Mojave Experiment participants a carefully controlled stream of garbage, but it also inadvertently revealed more serious problems related to Vista, which I'll consider in the following article. Did you like this article? Let me know. Comment here, in the Forum, or email me with your ideas. Like reading RoughlyDrafted? Share articles with your friends, link from your blog, and subscribe to my podcast (oh wait, I have to fix that first). It's also cool to submit my articles to Digg, Reddit, or Slashdot where more people will see them. Consider making a small donation supporting this site. Thanks!
Apple's Q3 Financials: Best Quarter Ever

Did you hear? Each and every one of Apple's offerings print money--or at least you'd think so after listening in on the company's third quarter financial results released this afternoon via Quicktime, phone and as a good-old fashioned PDF earlier this afternoon.Listening in, you just knew it was going to be good news (as if there was ever any doubt) from the enthusiasm in Peter Oppenheimer's voice as he made a few state of the union comments surrounding Apple's third-quarter, which ended in June, before getting down to the nitty-gritty.�"We are extremely pleased to report outstanding results for the June quarter...we're thrilled to announce today our highest quarterly revenue ever," Oppenheimer stated. He added that this quarter surprassed the previous record set in the most recent holiday quarter.During Q3, or the June quarter if you prefer, Apple had its hands full. Cupertino shipped iPads to an eager horde of customers in 10 different countries, launched iPhone 4 and fired off iOS 4 to boost the feature set of their existing smartphone handsets (provided those handsets happened to be of the 3G or 3GS variety). On top of it all, the company managed to set a new quarterly record for the number of Mac computers sold, thanks to the growing popularity of both the iMac and MacBook Pro lines. According to Apple, of those individuals who opted to purchase Macs during the June quarter, half could be attributed to computer users who'd never owned a Mac before.�Getting down to the meat of the financial details, Oppenheimer reported revenue to be $15.7 billion--that's an increase of 61% over the prior June (2009) quarter's results. What was behind all those Benjamins? According to Oppenheimer, the iPad's popularity had a lot to do with it, as well as strong sales of the iPhone and Mac lines. Apple's Q3 operating margin was $4.23 billion, representing 26% of revenue. Apple's net income during Q3 was $3.25 billion, which marks a 78% increase over the year ago quarter, making for an earnings per share number of $3.51.�As for how each of Apple's products did in the past quarter, here's the break down:MacsDid they sell any? You betcha. Apple moved 3.7 million macs into the hands of consumers during Q3. That's a quarterly record for them. Oppenheimer also reported record sales to educational institutions and business, despite shrinking purchasing budgets in both sectors.iPods9.4 million iPods were sold during the June quarter, compared to 10.2 million in the year ago quarter. Despite the deceptively lower numbers, iPod revenue went up by 4%. The iPod's share of the MP3 player market still remains high at over 70%. The iPod line also continues to gain bigger and bigger market shares internationally. Hail to the King.�iTunesThe iTunes Store's revenue exceeded $1 billion dollars, and showed growth of 25% year-over-year. The App Store currently boasts over 225,000 Apps--11,000 of those are specifically designed for the iPad. iDevice users have collectively downloaded over 5 billion Apps. That's a whole lotta Doodle Jump.iPhoneApple sold 8.4 million iPhones in the last quarter, including 1.7 million iPhone 4 handsets. That represents 61% year-over-year growth and is higher than was expected by analysts. All in, Apple realized revenues of $5.33 billion from handset and accessory sales as well as carrier payments. The sales value of iPhones alone was approximately $5 billion. Apple currently distributes the iPhones with 184 carriers in 88 countries. When asked about whether there was any dip in sales that could be attributed to the antenna problems surrounding the iPhone 4, the response from Apple's Chief Operating Officer Tim Cook was blunt. "Let me be very clear on this," Cook said. "We're selling as many as we are making."�iPad3.27 million iPads were shipped by Apple by the end of the June quarter. Recognized revenue from sales of the iPad and iPad accessories during the quarter hit $2.71 billion. The iPad alone made close to $2.1 billion.�Apple Retail StoresApple's retail arm made $2.58 Billion during Q3, marking a revenue increase of 73% over the same period a year ago. Apple opened seven new stores during the quarter, making for a total of 293 stores. Average revenue per store during the quarter was $9 million. 6.5 million people visited Apple Retail locations in the last quarter. That is, you guessed it, a new record as well.Apple reported quarterly operating expenses of $1.9 billion, which given the amount of cash they've been drawing in, ain't all that bad. What's more, Oppenheimer could hardly contain the glee in his voice as he reported that the company had close $ 45.8 billion in cash from short-term and long term marketable securities. Cash flow from operations was $4.8 billion. Oppenheimer told those listening that Apple's investment priorities for all those greenbacks was preservation of capital and "continuing to focus on relatively short-dated, high-quality investments."�Not surprisingly, Apple has opted to defer inclusion of any profits made from the sale of iPhone 4 bumper cases for the time being. This of course, is due to the fact that they'll be giving scads of the things away for free to iPhone 4 owners who'd like to have one on hand in order to resolve any reception issues they may be suffering as a result of the antenna issues associated with the handset. Oppenheimer told listeners that the financials surrounding the bumper cases would be readdressed in September.That's the broad strokes, folks. If you've got a hankering to hear the full Apple Q3 financials conference call, the audio is available to stream over Quicktime for the next few weeks. For a deeper look at what's behind all that money, you might also want to turn your attention to the company's recent SEC submission [PDF link].
Post-keynote TUAW prediction scorecard: How did we do?

Filed under: Rumors, Odds and ends, Other EventsYesterday we pooled our predictions together to try and predict what would happen at the iPad presentation today. How did we all do? Sang Tang: Sang was the closest in terms of the iPad's screen size -- 9.6" prediction vs. 9.7" actual size. However, the iPad has neither wireless HDMI nor a front-facing camera (or, indeed, a camera of any kind). Score: 1/3. Erica Sadun: Erica was off on screen size, but was correct in predicting that the iPad would look and function much like an iPod touch. However, by all appearances the iPad doesn't add any new revolutionary gestures, and without a camera of any kind, any augmented reality applications are going to be very limited in scope. She was correct in saying there'd be no "mind-blowing new tech onboard" and optional nationwide wireless with a monthly fee. Score: 3/5. David Winograd: David was also off on screen size (though just barely), cameras, and new gestures. He was correct in predicting a keyboard dock and an optional data plan, but wrong about iPhone tethering and iPhone OS 4.0. Score: 2/7. More scores and the TUAW total after the break! Steve Sande: It was a safe bet that no one would be completely happy with the iPad. Jokes are flying all over the internet just on account of its name, after all. Steve also (presumably) nailed the PA Semi-designed chipset, 64 GB capacity, 802.11n, optional 3G, an iTunes bookstore, next-gen iWork, and his prediction that most of our tea-leaf reading would be wrong. He was more than half an inch off on screen size, though, and the iPad doesn't appear to use a Pixel Qi screen. There's also no 128 GB capacity model, no universal remote app, and no iLife 2010. Score: 8/13. Dave Caolo: Dave was correct that Apple would intro and demo the tablet, that it would have access to the iTunes store, that the gaming angle would be emphasized, e-reader capabilities, and no mention of the iPhone. He was off in his predictions of the screen size, that the iPad would "work in a way none of us have guessed," a web-based iWork, iLife '10, and streaming $0.99 TV shows. Score: 5/10. Mike Schramm: Like most of us, Mike was just barely off on screen size, and he was slightly off on price. On app store compatibility, media partnerships, lack of camera and dynamic touch keyboard, the iPad basically being a bigger iPod touch, and a possible 3G connection, Mike was dead-on, although he was incorrect that you can set up with whatever provider you want; sadly, just like the iPhone, the iPad's 3G is chained to AT&T in the States... for now. There was no Verizon iPhone announced, although Mike did say they might be saving it for next year, so no points either way. Score: 6/9. Mel Martin: Mel was correct about the iPad's focus on publishing, and Wi-Fi with optional 3G. He also nailed the scaled-up iPhone games and iTunes integration. He was correct about the iPad being able to pair with a Bluetooth keyboard, but it won't pair with a mouse. Score: 5/6. Megan Lavey: Megan's "left-field" prediction that the "tablet" would be more of a software platform than a hardware platform was incorrect. The iPad is also not part of the MacBook line, nor does it replace the white MacBook. It's also nothing like "a cross between a MacBook and a really big Nintendo DS." Score: 0/4. Aron Trimble: At the time of this writing, Aron is correct in his prediction that Apple's stock price wouldn't drop post-event, although the stock price did dip during the event, and the price has been on a roller coaster all morning. Score: 1/1. Lauren Hirsch: Lauren was correct in predicting a focus on the New York Times, and the majority of her analysis of the e-reader capabilities of the iPad was right on the money. She was off-base in predicting streaming TV and the iPad being positioned as a replacement for the low-end MacBook. Score: 2/4. Chris Rawson: A lot of commenters on the predictions post seemed to think that my predictions were very close to the mark. Well, you guys should really stop listening to me, because I was almost completely wrong. Steve didn't talk about Mac sales at all, nor did he announce any updates to the Mac portable lineup. iPhone OS 4.0 wasn't announced or demoed, there was no mention of app multitasking (BOO!), and there was no "one more thing" regarding Verizon wireless being on-board with either the iPad or iPhone. I also got the screen size, thickness, and the name of the product wrong; the iSlate is dead. Long live the iPad. My pricing was close to the mark, but not close enough for me to give myself points on this one, because not only did I fail to account for different GB capacities, I also assumed that the 3G version of the iPad would be subsidised by carriers. There was no musical guest. And my future as a financial analyst has ended in its infancy: I was wrong about all three of the stock prices I predicted, because as of the time of this writing, Apple and AT&T's stocks are up, while Verizon's has lost over 1% of its value. Did I actually get anything right? The iPad does sort of look like a steamrolled version of the first-gen iPhone, and it will run iPhone apps right out of the box in fullscreen, although there is no "windowed mode" like I predicted. Steve did spend at least 20 minutes just sitting in his chair showing off the iPad's features, and I got the launch date right. My easiest prediction to make was also the most correct: PC World has indeed posted a snark-filled article about the iPad, claiming that it's "just a big iPod touch." Score: 5/22 Aggregated TUAW prediction score: 38/86 (44%) So who wins the TUAW office pool? Aron Trimble got 100% of his predictions right, but he only made one. Mel Martin wins percentage-wise, with 83% of his 6 predictions being correct. However, with eight correct predictions, Steve Sande had the most correct predictions. I'd say that between Mel, Mike Schramm, and Steve's predictions, we got closest to what was actually announced today. On the other end of the pool, the shallow end if you will: although Megan Lavey didn't get any of her four predictions correct, I'm still giving the TUAW Duncecap Award to myself. I made a lot of predictions that sounded perfectly reasonable yesterday, but I was wrong about almost all of them, and with 17 incorrect predictions, I brought our aggregated score down by a lot. Was your crystal ball any clearer than ours? Let us know in the comments.TUAWPost-keynote TUAW prediction scorecard: How did we do? originally appeared on The Unofficial Apple Weblog (TUAW) on Wed, 27 Jan 2010 17:30:00 EST. 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TUAW predicts tomorrow's event

Filed under: Apple Corporate, Odds and endsAs we count down the final tablet-free hours, we've gathered our writers together to predict what we think will be announced tomorrow at the Yerba Buena Center for the Arts. Feel free to add your own predictions in the comments below. Sang Tang 9.6 inch LED-backlit display Wireless HDMI support (to output to TV) Front facing camera Erica Sadun Tomorrow, we expect to see Apple finally launch the long awaited tablet. It will likely feature a 10.5-inch diagonal capacitive touch display and look and function much like a large iPod touch. Running iPhone OS, it may feature an enhanced vocabulary of user-interaction gestures, suitable for the larger screen size. The new tablet should offer a variety of augmented reality applications, allowing users to interact with and annotate many kinds of media including TV and movies, maps, newspapers, and more. Although I'd like to see a front-facing camera on the unit, I can easily see why Apple might omit one, so I'll take a pass on voting for or against. Looking towards the netbook market for competition, the tablet may provide optional nationwide wireless for a monthly fee. I'm keeping my prediction on the conservative side -- so I'm guessing no mind blowing new tech on-board, at least at the start with product launch. A larger iPod with good connectivity options and excellent media provider deals is enough to get the tablet going without any special OMG One More Thing items needed. It will help if the new tablet better integrate with Apple's emerging cloud services, namely Mobile Me and iWork.com. The rainbowunicornpuppies will be an optional extra for a small fee, and Uncle Steve will be giving candy to all the good little children. David Winograd The most amazing thing to me is that with thousands of rumor stories fueling the blogs, we really know nothing that's completely official. The controlled leak to the Wall Street Journal was brilliant since it gave not one detail outside of the fact that the thing is real. So, my random guesses are: 10" LED screen Cameras on both the front and back, both for pictures and iChat. Running iPhone OS 4.0 which should be announced tomorrow. Allow tethering to an iphone, maybe not for data but for the ability to use a keyboard. Hopefully no additional data plan, since I really can't see people wanting to pay another monthly bill. If there is a plan, I hope it to be optional. Lots of new gestures available. I see Verizon coming on board but not now. My guess is that it'll be announced later in the year with Phone OS 4.0. Steve Sande I'm predicting that the tablet, after all of the hype and alleged "forecasting" by every Apple fanboy, will make absolutely nobody completely happy. I also predict that many of our commenters will say that it's the stupidest thing they've ever seen, it's too expensive, and too limited in what it can do. Then we'll all go out and buy them anyway! In terms of the display, I'm thinking it's going to be something new for Apple and the industry -- they'll use a 10.5" version of the Pixel Qi hybrid screen, which will give us insanely great battery life (especially when using the tablet as an e-reader), and readability in bright sunlight. Nobody seems to talk about storage, but at the price I think we'll see at least 64 GB and probably 128 GB. It's going to be running a PA Semi-designed chip set. I can't see 3G / 4G wireless being forced upon the masses. There are too many of us who already have one or two expensive wireless plans, and the additional cost of yet another plan would be a deal-killer for many. 802.11/n connectivity will be built-in, of course, with an option for 3G / 4G wireless. The built-in apps? Mainly for media, including a Zinio-like magazine / newspaper reader with built-in browsing for books and other printed media, which will of course be located in the App Store. I think it will also have the next generation of iWork built in for light productivity. I'd love to see a way to use the device with a built-in universal remote app to control all of my other devices -- think of it as a Logitech Harmony on steroids. We're also going to hear about iLife 2010, the newest and greatest version of the iLife suite, now with a new member of the suite in the form of a painting program! I also predict that most of our predictions will be totally off-base. Dave Caolo Apple will introduce and demo the new tablet, with a shipping date in June or July. It'll have a 10.5" touch display, it's own store in the the revamped iTunes, and work in a way that none of us have guessed. The device's emphasis will be on fun, not work. Yes, you'll be able to access a more web-based version of the iWork apps (tablet-friendly iLife '10 will also be introduced), but just as Apple has been promoting the iPod touch as a gaming platform, they'll really amp it up with the tablet. I also expect ereader capabilities with Apple style and flair. Gorgeous, full-color books will appear from a select group of publishers and newspapers, with lots of interaction. Finally, the new web-based version of iTunes will allow for steaming of TV shows at $0.99/pop. That will have been a concession on Apple's part, as they wanted a subscription model. Expect that to change by year's end. The iPhone will not get a mention, as this isn't its show. Mike Schramm The Tablet will appear with a 10" display, full App Store compatibility, and some groundbreaking media partnerships with lots and lots of paid content flowing through Apple's gates. No camera at all. I'd really love to see that dynamic touch keyboard, but I don't think it's going to happen, unfortunately -- this is a larger iPod touch. All kinds of connectivity though, including possibly a 3G or 4G connection on a plan set up through Apple with whatever provider you want. $1000 price tag, in stores in March. One more thing, if there is one, is a Verizon iPhone. But they may save that until later this year. Mel Martin Tablet will have a major focus on publishing, with interactive, colorful books and magazines. It may be a death blow to the Kindle if it is priced right. Clearly it will have the option of 3G access and Wi-Fi. I personally would not be enthusiastic about another monthly data plan, especially with AT&T unless it is VERY reasonable. Expect lots of games, probably scaled up from the iPhone. BT keyboard and mouse would be a good option. Expect it will be integrated with iTunes for music, movies, and probably publications. There aren't really difficult predictions to make, but I think they are close to the target. High price will kill it. Apple, are you listening? Megan Lavey I'm throwing my money in with Chris on this one. Everyone pretty much has said what I was thinking. But, I also think that Steve makes a wonderful point about everyone not being happy at all. So, I'm going to do a prediction completely out of left field. That despite the leaked specs and the speculation, "Tablet" isn't its own device at all, but a piece of software integrated with OSX and the iPhone that is like a hyper-iTunes bringing you whatever content that you desire and can be synced on any Mac you own, including the iPhone - designed to stream books, magazines, TV shows, music, etc. The 10-inch device is slated to be part of the MacBook line, replacing the current white plastic models, but is essentially a cross between a current MacBook and a really big Nintendo DS. Aron Trimble I would like to go on record saying that if Apple releases an appropriately-priced tablet, their stock price will not go down. Chris Rawson Tomorrow's event: Steve crows about Mac sales Mac portables get updated with Intel i7 processors Steve crows about iPhone sales iPhone OS 4.0 available today with "over 100 new features" Spends 10 minutes highlighting new features. Biggest new feature: app multitasking (not available for first-gen iPhone) Flashback to 2007 when Jobs said "You're lucky to make even one revolutionary product in your career: Mac, iPod, and now a third one," - "Well, three years and a lot of work later, we've got a fourth product that's going to change the industry forever." Talks about scaling iPhone OS - the most intuitive OS ever, even a one-year-old baby knows how to use it - to a full-fledged computing device. "This is really the direction computing is going to move in the future." iSlate: 10" capacitive screen. Looks like a first-gen iPhone got steamrolled. No thicker than an iPhone. Runs a modified iPhone OS. Runs iPhone apps out of the box, can be scaled to fullscreen or run in "windowed mode" for multitasking. Battery life better than iPhone. Spends a good 20 minutes showing off features. Has optional 3G wireless. Cost: 599 for model without 3G. 699 for model with 3G if you sign a contract with wireless provider, 999 without. Available in April. "One more thing" -- in order to grow both iPhone and iSlate business, expanding to additional carriers. (crowd goes crazy). Announcing partnership with Verizon wireless. iSlate will be available with AT&T or Verizon on launch day. iPhone available with Verizon starting in April. Musical guest. Apple stock goes down. AT&T stock tanks. Verizon stock goes way up. PC World publishes a snarky article about all the things the iSlate can't do and why no one should buy one Lauren Hirsch A lot of the tech specs seem to already have been leaked, so I'm going to go out on a limb and talk about some of what I think they're going to show off that it does for you: First and foremost, I strongly suspect that a good portion of the announcement speech will describe some sort of newspaper subscription service, starting with New York Times. I know it's supposed to be a "Kindle Killer," and I'm sure part of the announcement will be that there are already publishing houses on board for eBook delivery through iTunes, but I think Apple wants to ease it into your hands as a daily media device, where users can enjoy the morning paper in its full, graphic glory, just like things used to be. This would dovetail nicely with the fact that newspaper media companies have been wringing their hands for a few years on how to stem the revenue hemorrhage from loss of traditional paper subscribers, and this will be a nice way to recapture some of that market from folks who long ago stopped subscribing to a physical paper service, but will pay for cohesive, graphic content if it's delivered effortlessly and cleanly through a bright, easy media device. It also offers a bit of the nostalgia of getting "the paper" and could bring back a viable subscription model to an industry that needs revenue for the kind of investigative, research-based journalism that's starting to wane in recent years. I think its an innovative idea, and throws newspaper companies a much-needed rope. Expect some kind of overhead picture of the device displaying the New York Times in its full, print glory. I think we'll hear of the beginnings of some sort of monthly TV subscription service, also delivered through iTunes, as Apple ramps up for some kind of assault on traditional cable service. I don't think all the content is quite there yet, but I think we'll see some sort of trajectory laid out. I think Apple TV is gone, and this device will interface with your TV in some meaningful way, with subscription access to content streaming rather than local storage. Lastly, I think in terms of how the device will fit into Apple's product line, I'm starting to think that Apple might be poising it to replace the lowest end MacBook, as it'll have all the web/email/entertainment features that most people use those laptops for. Share your own predictions below, and look for a scorecard after the event. Stay tuned for our liveblog as well!TUAWTUAW predicts tomorrow's event originally appeared on The Unofficial Apple Weblog (TUAW) on Tue, 26 Jan 2010 22:00:00 EST. 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Rumor Has It: New iMacs and MacBooks Coming Just in Time for Windows 7

Apple beat Microsoft to market in terms of new operating systems (although “new” doesn't really apply in the case of either 10.6 or Windows 7), but that means Microsoft will have the spotlight uncontested when it launches Windows 7 on October 22. That's why one research firm, Wedge Partners, is predicting new MacBook and iMac hardware in the coming weeks. A significant hardware upgrade on Apple's core lineup of iMac desktops and the lone MacBook notebook would indeed go a long way towards stealing the wind from Microsoft's sails. Especially if it prices the new models lower, as the same research firm suggests it may. Normally, I don't have much patience for the ramblings of those soothsayers in the so-called “analyst” line of work, but this report struck a chord with something I heard earlier in the month, which alone wasn't substantial enough to write up. A source who works for Apple told me at the beginning of September that new iMacs were definitely on the horizon, and that retail management was being prepared for a major launch of the updated computers. No mention was made of the MacBook, but it, like the iMacs, are definitely due for a refresh, and, as Wedge Partners predicts, a visual design change as well. The aluminum and glass iMac design has been in play since August of 2007, and the white plastic MacBook case goes back to May of 2006. The specific design predictions made by Wedge partners stand little chance of being accurate, but a new look would definitely be in order. Expect Apple to leverage its unibody construction method for both, since it represents significant investment on its part. The iMac is also well behind its PC counterparts in terms of internal specs, so the prediction that it could see the introduction of Core i5 or i7 processors is probably not too far off base. We may also see Apple's first move away from NVIDIA's GeForce 9400M as the fallout from GPU-gate continues. Expect any internal hardware changes to specifically compliment user experience with the new Snow Leopard operating system. While some point to the significance of the recent iPod event as evidence that Apple would not make another major announcement so closely on its heels, it was only last year that Apple's “Let's Rock” iPod and music special event in September was followed immediately in October with its major notebook event, at which it introduced the new unibody MacBook and MacBook Pro design. Clearly, it's historically possible, and Apple has seen the financial sense it makes in the sales numbers it recorded last holiday season.
Wall Street Breakfast: Must-Know News

Stress tests may reveal banks' capital needs. As the May 4 reveal date for stress tests draws closer, officials are considering releasing assessments for each of the 19 banks and may require those that need more capital to disclose how they plan to raise additional funds. Under that scenario, lenders would have to specify whether they want to convert government preference shares, issue more stock or rely on an additional bailout. The push for disclosure is meant to help the public better discern between the health of individual banks. Sources say regulators want the banks to have at least 3% tangible common equity. Lewis: Fed, Treasury urged Merrill silence. According to a recently obtained copy of CEO Ken Lewis' February testimony to New York's attorney general, Bernanke and then-Treasury chief Paulson pressured Bank of America (BAC) to stay silent on its increasingly troubled deal to acquire Merrill Lynch. Despite an obligation to disclose any material financial hits to shareholders, officials pressed Lewis to keep quiet during government-funding negotiations to ensure important financial institutions wouldn't fail. Publicizing Merrill's losses would have allowed Bank of America's shareholders the opportunity to stop the deal and let Merrill collapse. Counter-counter-offer on Chrysler debt. After rejecting a too-rich counter-offer from Chrysler creditors, the Treasury has reportedly raised its own offer in an effort to reach a deal with lenders by the end of the month. The new deal would see lenders get $1.5B of first-lien debt and a 5% equity stake in a restructured Chrysler in exchange for the $6.9B of debt they now hold. The Treasury had previously suggested lenders write off all but $1B of the debt and receive no stock. GM to miss debt payment, idle plants. Trying to avoid bankruptcy ahead of the government's June 1 deadline, General Motors (GM) may rush to close dealerships, scrap models and could idle most of its plants for around two months this summer. The moves could help GM break even with annual sales as low as 10M vehicles. Meanwhile, CFO Ray Young said the company doesn't plan to pay off $1B of debt due June 1, and will instead swap the debt for shares or rely on bankruptcy protection. The tougher public stance towards bondholders is meant to lay the groundwork for what promises to be an ugly debt-for-equity swap GM expects to launch by next week. Hard times for Hartford. Hartford Financial Services (HIG) is said to be seeking bids from rivals including Travelers Companies (TRV) for its flagship property insurance business. Sources said Hartford has been shopping the unit after losses in its life division led to credit downgrades, and that damage from the financial crisis may ultimately lead to a breakup of the insurer. The property unit is estimated to be worth $4B-$8B. Obama meets with credit card chiefs. Obama will meet with executives from the credit card industry today, one day after a congressional panel approved legislation to curb credit card fees and limit consumer penalties. The American Bankers Association is concerned such restrictions will tighten the availability of consumer credit and make it more expensive. Bank of America (BAC), American Express (AXP), Citigroup (C), Wells Fargo (WFC), JPMorgan Chase (JPM), Capital One (COF), Visa (V) and Mastercard (MA) will be among the 13 companies represented. NY cracks down on pension agents. New York State's public pension fund will ban the use of middlemen who help private-equity funds and other investors secure its business. The state is investigating whether these middlemen, called placement agents, were involved in a scheme to receive illegal payments from firms trying to win state business. As one of the nation's largest public pension funds, New York's decision could prompt other states to follow suit. Morgan mulls TARP repayment. Despite reporting a larger-than-expected quarterly loss, Morgan Stanley (MS) CFO Colm Kelleher said the company will 'consider' repaying $10B to the government. The statement comes less than a month after CEO John Mack told employees 'it's the wrong time' to return the money. Morgan Stanley had a Tier 1 ratio of 16.4% at the end of March, or 12.9% if the bank repays TARP funds. Shares +2.9% premarket (7:00 ET). Credit Suisse profit beat. Credit Suisse (CS) posted a better-than-expected Q1 profit, bouncing back from several quarterly losses in 2008. The bank saw a net profit of 2B Swiss francs ($1.72B), more than double analysts' forecasts. Though short on details for its 2009 outlook, the bank said it is "in a position to weather the storms and perform well when market opportunities arise." Shares +10.5% premarket (7:00 ET). Apple shines on iPhone sales. Apple's (AAPL) quarterly earnings easily beat consensus estimates (see details below) as strong sales of iPods and iPhones held up despite the weak economy. Profit was also helped by declining commodity prices for key product components like aluminum and memory chips. This was the company's first quarter since CEO Steve Jobs went on medical leave. eBay gets okay on Gmarket buy. eBay (EBAY) won regulatory approval from South Korea's antitrust watchdog to proceed with its planned purchase of Gmarket (GMKT). A majority of Gmarket shareholders have already agreed to the cash tender offer. Glaxo to release study after long delay. GlaxoSmithKline (GSK) will release the first study comparing its cervical cancer vaccine with Merck's (MRK) blockbuster Gardasil at a May 10 medical meeting. The fact that the results are being released 14 months after the study concluded and at a relatively unknown meeting have left investors and analysts puzzled. Freddie CFO takes his own life. Acting CFO of Freddie Mac (FRE) David Kellerman was found dead in his home in what appears to be a suicide. Kellerman had worked at the mortgage giant for 16 years. House prices rise slightly (.pdf). FHFA's House Price Index showed U.S. home prices rose 0.7% in February M/M, bringing the twelve-month total to -6.5%. January's previously reported 1.7% gain was revised down to 1.0%. Earnings: Thursday Before Open AmerisourceBergen (ABC): FQ2 EPS of $0.95 beats by $0.06. Revenue of $17.31B (-2.5%) vs. $17.93B. Sees full-year EPS of $3.18-3.30 vs. $3.19. (PR) Alexion Pharmaceuticals (ALXN): Q1 EPS of $0.16 beats by $0.02. Revenue of $81M (+78.7%) vs. $82M. (PR) AU Optronics (AUO): Q1 EPS of -$0.71 misses by $0.04. Revenue of $1.5B (-66.7%) in-line. Expects utilization rates to improve substantially in Q2. (PR) AutoNation (AN): Q1 EPS of $0.23 beats by $0.07. Revenue of $2.47B (-35.6%) vs. $2.74B. Says it reduced debt by $500M in Q1, and remains in compliance with all debt covenants. Sees sales improving in H2. (PR) Black & Decker (BDK): Q1 EPS of $0.22 beats by $0.14. Revenue of $1.07B (-28.2%) vs. $1.16B. Sees full-year EPS of $1.50-1.90 vs. consensus of $1.79. (PR) Bunge (BG): Q1 EPS of -$1.76 misses by $2.25. Revenue of $9.2B (-26.2%) vs. $11B. (PR) Canadian Pacific Railway (CP): Q1 EPS of C$0.39 misses by C$0.09. Revenue of C$1.07B (-6.6%) vs. C$1.04B. "The unprecedented temporary decline in traffic in some of our key markets (as measured by carloads), particularly potash (-70%), Canadian coal (-30%), and automotive (-43%) has resulted in more than 2,400 employee layoffs to date." (PR) Celestica (CLS): Q1 EPS of $0.13 beats by $0.04. Revenue of $1.47B (-20%) vs. $1.51B. Q2 guidance in line. (PR) CIT Group (CIT): Q1 EPS of -$1.30 misses by $0.84. Tier-1 capital ration 9.3%. (PR) CME Group (CME): Q1 EPS of $3.20 in-line. Revenue of $647M (+3.5%) vs. $656M. Average rate per contract increased 12% to $0.83. (PR) ConocoPhillips (COP): Q1 EPS of $0.56 beats by $0.14. Revenue of $30.7B (-44.1%) vs. $26.34B. Shares +4.3% premarket. (PR) CONSOL Energy (CNX): Q1 EPS of $1.08 beats by $0.15. Revenue of $1.22B (+18.8%) in-line. "Energy companies with less than stellar financial positions could find it very difficult to obtain reasonable financing terms to maintain their operations. We believe that this will impact supply and could set the stage for higher coal and natural gas prices as early as '10." Shares +3.5% premarket. (PR) Cooper Industries (CBE): Q1 EPS of $0.47 beats by $0.01. Revenue of $1.26B (-18.7%) vs. $1.32B. Sees Q2 EPS of $0.50-0.60 vs. $0.60 and full-year EPS of $2.30-2.60 vs. $2.40. (PR) Danaher (DHR): Q1 EPS of $0.72 misses by $0.01. Revenue of $2.63B (-13.2%) vs. $2.67B. (PR) Diamond Offshore Drilling (DO): Q1 EPS of $2.51 beats by $0.29. Revenue of $886M (+12.7%) vs. $878.5M. (PR) EMC (EMC): Q1 EPS of $0.16 in-line. Revenue of $3.15B (-9.2%) vs. $3.25B. Sees global IT spending down in the low-double-digits for 2009. Expects $450M in cost reductions, up from a previous estimate of $350M, but says margins will decline due to weaker IT spending. (PR) ENSCO International (ESV): Q1 EPS of $1.56 beats by $0.04. Revenue of $514M (-9.6%) in-line. (PR) Exelon (EXC): Q1 EPS of $1.20 beats by $0.07. Revenue of $4.75B (+3.6%) vs. $4.62B. Reaffirms full-year EPS guidance. Shares +0.4% premarket. (PR) Fifth Third Bancorp (FITB): Q1 EPS of -$0.04 beats by $0.23. Tier 1 capital ratio of 10.9%. Tangible equity ratio of 7.9%. (PR) Goodrich (GR): Q1 EPS of $1.35 beats by $0.28. Revenue of $1.7B (-2.8%) in-line. Sees full-year EPS of $4.50-4.75 vs. $4.63, and revenue of $6.9B vs. $7.1B consensus. (PR) Hershey Foods (HSY): Q1 EPS of $0.38 beats by $0.03. Revenue of $1.24B (+6.5%) vs. $1.19B. Reaffirms 2009 net sales growth of 2-3%. Sees EPS increasing at less than its long-term objective of 6-8%. (PR) JetBlue Airways (JBLU): Q1 EPS of $0.08 beats by $0.05. Revenue of $793M (-2.8%) vs. $810M. Operating margin of 9.3% vs. 2.2% a year ago. First profitable Q1 since 2005. Shares +9.9% premarket. (PR) L-3 Communications (LLL): Q1 EPS of $1.66 beats by $0.03. Revenue of $3.64B (+3.7%) in-line. Reaffirms full-year guidance. (PR) Logitech (LOGI): FQ4 EPS of -$0.20 misses by $0.26. Revenue of $408M vs. $496M. Gross margin fell to 25% from 35.6% last quarter. "Our sales were negatively impacted by the combination of weak consumer demand and the accelerating reset by our channel partners of their weeks of supply." Shares -11.3% premarket. (PR) Marriott International (MAR): Q1 EPS of $0.24 beats by $0.10. Revenue of $2.5B (-14.8%) in-line. Issues downside EPS guidance for Q2 of $0.20-0.23 vs. $0.26 consensus. Maintains guidance for FY '09 of $0.88-1.02 EPS. (PR) Marshall & Ilsley (MI): Q1 EPS of -$0.44 misses by $0.11. Revenue of $M in-line. Q1 loan-loss provision of $478M. Shares +5.6% premarket. (PR) National-Oilwell Varco (NOV): Q1 EPS of $1.13 beats by $0.07. Revenue of $3.48B (+29.6%) vs. $3.29B. "Though the pace of new capital equipment orders has slowed in the short run, we believe investment in drilling equipment will resume, to enable the industry to explore new oil and gas frontiers. Nevertheless market conditions remain very challenging, and the timing of a recovery is uncertain." Shares -4.4% premarket. (PR) NII Holdings (NIHD): Q1 EPS of $0.43 beats by $0.07. Revenue of $M (+961%) in-line. Shares +2.3% premarket. (PR) Novartis (NVS): Q1 earnings of $1.96B ($0.87/share) vs. consensus of $1.89B. Sales fell 2% to $9.71B. Sees drug sales up mid-to-high single-digits. Shares +4.7% premarket. (Bloomberg) Occidental Petroleum (OXY): Q1 EPS of $0.50 beats by $0.13. Revenue of $3.07B (-49%) vs. $3.18B. Production was up almost 8% in Q1. (PR) Philip Morris (PM): Q1 EPS of $0.74 beats by $0.05. Revenue of $5.6B (-5.5%) vs. $5.48B. Reaffirms full-year guidance of $2.85-3.00 vs. consensus of $3.02. (PR) PNC Financial Services (PNC): Q1 EPS of $1.03 beats by $0.61. Revenue of $3.9B (+112.6%) vs. $3.5B. (PR) Potash (POT): Q1 EPS of $1.02 beats by $0.16. Revenue of $922.5M (-51.2%) vs. $975.5M. Issues downside EPS guidance for Q2 of $1.10-$1.50 vs. $2.21 consensus, and FY '09 EPS of $7.00-$8.00 vs. $9.65. (PR) RadioShack (RSH): Q1 EPS of $0.34 beats by $0.12. Revenue of $1B (+5.6%) vs. $0.94B. Comps were up 5% vs. Q1 2008. (PR) Raytheon (RTN): Q1 EPS of $1.11 beats by $0.10. Revenue of $5.88B (+9.9%) vs. $5.6B. Full-year guidance in line. Shares +2.4% premarket. (PR) Royal Caribbean Cruises (RCL): Q1 EPS of -$0.17 beats by $0.17. Revenue of $1.33B (-7.2%) in-line. Sees full-year EPS of $1.35 vs. consensus of $0.97. Shares +13.5% premarket. (PR) Sigma-Aldrich (SIAL): Q1 EPS of $0.68 beats by $0.04. Revenue of $519M (-8.8%) vs. $532M. Full-year guidance in line. (PR) Suncor Energy (SU): Q1 EPS of $0.24 beats by $0.12. The decrease in earnings was primarily from lower price realizations, with benchmark commodity prices significantly weaker in Q1 '09 vs. Q1 '08. (PR) SunTrust Banks (STI): Q1 EPS of -$0.46 beats by $0.19. Revenue of $2.24B (+16.3%) vs. $2.06B. Majority of loss was due to a $715M goodwill impairment charge. Tier-1 ratio estimated at 11%, up 13 points from last quarter. (PR) Supervalu (SVU): FQ4 EPS of $0.87 beats by $0.08. Revenue of $10.82B (+4.2%) in-line. (PR) Thermo Fisher (TMO): Q1 EPS of $0.62 misses by $0.08. Revenue of $2.26B vs. $2.42B. Sees full-year EPS of $2.80-3.10 vs. $3.15, and revenue of $9.6-9.9B vs. $10.14B. "Our customers are clearly delaying their capital purchases in the current environment." Shares -7.6% premarket. (PR) Union Pacific (UNP): Q1 EPS of $0.72. beats by $0.06. Revenue of $3.42B (-20%) vs. $3.55B. "The difficult economic conditions continue to affect our business volumes. During this challenging time, we are reducing costs across the board..." Shares +2.7% premarket. (PR) UPS (UPS): Q1 EPS of $0.52 misses by $0.04. Revenue of $10.94B (-13.7%) vs. $11.44B. Sees Q2 EPS of 0.45-0.55 vs. consensus of $0.65. "Economic indicators tell us recovery in the U.S. might begin late this year, but more likely not until 2010." Shares -3.7% premarket. (PR) US Airways (LCC): Q1 EPS of -$2.28 beats by $0.10. Revenue of $2.46B (-13.6%) in-line. "Our first quarter loss reflects the weakness in the global economy that has negatively impacted revenues throughout our industry. The steps we have taken to adapt to this environment are having a significant positive impact, though, as evidenced by our significant improvement in earnings excluding special items and fuel hedges." Shares +6% premarket. (PR) Zimmer (ZMH): Q1 EPS of $0.95 beats by $0.01. Revenue of $993M (-6.3%) vs. $1B. Sees full-year EPS of $3.85-4.00 vs. $3.88. (PR) Earnings: Wednesday After Close Apple (AAPL): FQ2 EPS of $1.33 beats by $0.24. Revenue of $8.16B vs. $7.96B. Sees FQ3 EPS of $0.95-1.00 vs. consensus of $1.12, and revenue of $7.7-7.9B vs. $8.28B. Mac sales of 2.22M (-3% Y/Y). iPod sales 11M (+3%). iPhone sales 3.79M (+123%). (PR) Alliance Data Systems (ADS): Q1 EPS of $1.19 beats by $0.09. Revenue of $480M (-3.8%) vs. $488M. Sees Q2 EPS of $1.05 vs. $1.22. (PR) eBay (EBAY): Q1 EPS of $0.39 beats by $0.05. Revenue of $2.02B (-7.8%) vs. $1.94B. (PR) Equifax (EFX): Q1 EPS of $0.58 beats by $0.04. Revenue of $453M (-10%) vs. $448M. (PR) F5 Networks (FFIV): FQ2 EPS of $0.38 in-line. Revenue of $154M (-3.1%) in-line. Says Feb. sales were particularly slow, but March improved significantly. (PR) Leggett & Platt (LEG): Q1 EPS of $0.06 misses by $0.01. Revenue of $718M (-28.1%) vs. $807M. Sees full-year EPS of $0.60-0.90 vs. $0.72, and revenue of $2.9-3.3B vs. $3.39B. (PR) Lam Research (LRCX): FQ3 EPS of -$0.71 misses by $0.05. Revenue of $174.4M (-71.6%) vs. $175.9M. (PR) Noble (NE): Q1 EPS of $1.62 beats by $0.16. Revenue of $896M (+4%) in-line. (PR) Novellus Systems (NVLS): Q1 EPS of -$0.47 beats by $0.04. Revenue of $98.9M (-68.6%) vs. $101.7M. Says it's cautiously optimistic order activity has stabilized. (PR) Pactiv (PTV): Q1 EPS of $0.69 beats by $0.23. Revenue of $766M (-5.2%) vs. $732.5M. Sees Q2 EPS of $0.54-0.58 vs. $0.51 and full-year EPS of $2.15-2.25 vs. $1.89. "Compared with the first quarter of last year, we benefited from lower raw material costs, as well as lower logistics costs, and improved productivity." (PR) Robert Half International (RHI): Q1 EPS of $0.06 in-line. Revenue of $823M (-32.8%) vs. $844M. (PR) SLM Corp. (SLM): Q1 EPS of -$0.03 vs. consensus of $0.12. Loss was partly the result of ongoing dislocation in the commercial paper market. (PR) VMware (VMW): Q1 EPS of $0.25 beats by $0.05. Revenue of $470M vs. $474M. Sees Q2 revenue flat to down vs. a year ago. (PR) Xilinx (XLNX): FQ4 EPS of $0.26 beats by $0.08. Revenue of $395M (-17%) vs. $383M. (PR) Yum! Brands (YUM): Q1 EPS of $0.48 beats by $0.08. Revenue of $2.22B (-8.1%) vs. $2.33B. Sees full-year EPS of $2.10 vs. $2.08. Says Q2 likely to be its most challenging quarter. (PR) Today's MarketsOverseas markets moved higher Thursday, giving a boost to futures.
September 9th Predictions

Filed under: Other Events, One More ThingWith the September 9th "Let's Rock" event confirmed at Yerba Buena, TUAW readers seem confident that we're about to see a new iPod debut. 70% of you agreed on that point. Rumors point to a revamped nano, with a longer silhouette. This new shape makes the nano easier to hold onto without dropping, especially when running.. An updated Nike kit appears likely. Nike support is long overdue for the iPod touch and, especially, the iPhone 3G with its built-in GPS system. Rumors suggest that the update will include more biometric logging and feedback for the stats-obsessed athlete in you. Since Nike makes their money from the shoe sales, I doubt that the kit will rely entirely on iPod-based sensors though. Any update needs to retain Nike's sales interests. Maybe we'll see heart rate monitoring as well as pace feedback. If rumors hold true, Apple may also respond to Nokia's "Come With Music" promotion by introducing iTunes Unlimited. "Comes with Music" offers unlimited access to a large library of music -- plus you get to keep any music you download after the year is done. I suspect that you're limited to the music that fits onto the device at any one time, otherwise -- woo! -- people will be downloading music for 365 days straight. The iTunes Unlimited rumor refers to a standard subscription model, like the Microsoft/Zune deal. Full access to the iTunes library (except for stuff that you *really* want like Album-only extras) plus you can buy tracks to keep. We were tipped about this possibility several weeks back. The thought still appeals to me and others who prefer to sample lots of music rather than to commit to specific albums. The September event seems like the perfect time and place to add a new revenue-generated opportunity to iTunes. What says "Merry Christmas" better than a brand new iPod nano that comes pre-loaded with, pretty much, every song in the iTunes library? By offering a 15-month initial trial (yes, I'm pulling this out of nowhere), Apple could get customers hooked on re-loading subscriptions around Christmas each year, a time when people are feeling especially generous towards their families. Of course, they could also push: "Send your kids to school with iPods so they don't have to call home from jail when the RIAA gets them for pirating." iPod as "get out of jail free card" could appeal strongly to parents. A music subscription package could be that mystery "low-profit" feature that Apple hinted at at the last quarter financial projections. Apple might not make a lot of profit off each subscription but it could really sell a lot more new iPods. The iPod touch has been out for a year and could use refreshing. July 11th came and went without any touch updates. This event may bring some nice features like enhanced onboard memory and maybe built-in speakers and microphones. I'd certainly love to see the touch pick up more iPhone premium features as it deserves respect in and of itself as a great platform. (ilounge just posted some specs). Rumor has it that we're about to see at least part of the next stage of the iPhone firmware story. Firmware 2.1 should drop (current firmware is 2.0.2) offering greater stability but without some of the features that Apple discussed this summer, namely push notification. Push notification is Apple's way of providing a work-around for its no-background-processes policy. Developers put any continuous processes on their own servers. This provides a way to create live data feeds, rather than taxing the iPhone's limited resources. This works great for Mail, less great for IM, and pretty badly for any data that originates on the iPhone (such as your current location). It's reminiscent of that "sweet solution" of the iPhone's original webapp-only policy: well intended but misses the point. Along with any updated firmware, iTunes 7.8 8.0 (thanks readers) may appear as well, possibly to support any new rental/subscription features. Of course, I'd really love to see (but have near zero expectations of actually getting) the iPod Air. I've never quite given up hope that Apple would recognize how brilliant its touch platform could be when enlarged and transformed into a tablet device. Lecturers shouldn't have to stare into an audience of Apple logos on the backs of computer screens instead of meeting student's eyes. An iPod Air could merge the wins of the MacBook Air and iPod touch into a really portable yet seriously usable platform that puts computing back onto the table and away from erecting barriers between people. So what are your predictions? What do you think that Let's Rock will introduce on Tuesday? Let us know in the comments. Thanks, �ivind Kjelln�Read�|�Permalink�|�Email this�|�Comments
★ Macworld Expo Predictions

Predictions and advance commentary for tomorrow’s Macworld keynote, some based on consensus rumors, some based on no more than wishful thinking on the part of yours truly. This is all conjecture and tea-leaf-reading (well, mostly), so, please, no wagering. I keep two questions in mind when evaluating Apple product ideas: Would people run out to stand in line to buy this immediately? If not, is there a long-term strategic reason for Apple to start selling this now? If the answer to both questions is “no”, then Apple isn’t going to do it. The iPhone is a perfect example of a #1; the Apple TV is a #2. New Sub-Notebook MacBook: Yes Apple hasn’t had a small notebook in its lineup since the 12-inch PowerBook G4, which I still see in wide use. If you’re using a portable as a portable, smaller size and lighter weight make a tremendous difference. The demand for a good notebook smaller and lighter than standard MacBooks is strong; I think it’s a sure thing that Apple is set to announce one. (Of course, I said so before last year’s Macworld, too.) I say the consensus rumors are right: super-thin, no built-in optical drive, widescreen 12-inch display. It will use a hard drive, not flash memory, for storage. (Look no further than the iPod Classic to see how hard drives don’t keep a device from being super-thin). Rumors are already running strong that it’ll be called MacBook Air. (I like it, not sure though if Nike would.) Newton-y Tablet Thing: No I am nearly convinced that this product exists, at least as a project in development. My hunch is that AppleInsider has it spot-on: it’s in development, but not yet ready to launch, and, perhaps, never will if Apple can’t get it right. (Recall Steve Jobs’s statement to Walter Mossberg that he’s as proud of some of the products Apple decided not to ship as he is of the ones they did.) Like the iPhone, it runs “OS X” but not Mac OS X, does not run Mac apps, and will not be called a “Mac”. The big problem with a “tablet” computer of any sort is that 15 years of industry history indicate that people do not want to buy tablet computers. But the iPhone, arguably, is a tablet computer — a sub-tablet, if you will. The key mistake with failed efforts like Microsoft’s Tablet PC (and even Apple’s own Newton) was that these devices attempt to do too much. It’s seen as a feature that Tablet PCs run the full version of Windows. But why force software UI’s designed for traditional hardware form factors upon a totally different device? A successful tablet-like device from Apple, I think, would clearly be designed as a secondary computing device — a satellite attached and synched to a Mac or PC (probably, of course, through iTunes). There’s still the “what would I use it for?” factor. It seems to me it would need to be something more than just an iPod Touch with a larger screen — if that’s all it is, then what’s the point of buying one instead of a smaller, poctetable, iPod Touch or iPhone? I simply lack the cleverness to imagine what that hook might be — but I can’t imagine Apple releasing such a product without an obvious “Oh I gotta buy that” hook. Anyway: I do think something like this is in the works, but I don’t think it’s coming out now. I’d love to be wrong. Ubiquitous Wireless Networking for MacBooks: Please After using my iPhone for a few months, it started feeling weird that my PowerBook doesn’t have ubiquitous wireless networking: Wi-Fi when available, and seamless, instant switchover to something else when it isn’t. Just what that “something else” is, I don’t know. EVDO? WiMax? A Bluetooth connection to share an iPhone’s EDGE connection? I don’t care. But I’d pay for it. Ubiquitous networking is certainly the most intriguing thing about Amazon’s Kindle. It just feels crippled that I can’t get a network connection — even a slow one — once I’m outside the range of Wi-Fi. Wireless Time Machine Backups: Yes Time Machine is very cool; the first backup that qualifies as “you don’t have to do anything, it just works”. But currently it only works using a storage device connected via USB or FireWire. Tethered backups are irritating with notebooks — and MacBooks are the fastest-growing segment of Apple’s Mac hardware sales. The problem is that when you want to use your portable away from your desk, it’s a pain to disconnect mounted USB and FireWire drives. You can’t just pulled the plugs — you’ve got to unmount them in the Finder first. And, once you do so, to get Time Machine backups running again, you’ve got to re-tether your storage drive. Leopard developer seeds all supported network backups to USB drives connected to an AirPort base station. The feature was also demoed at WWDC. It was removed (or, better said, disabled) very late in Leopard’s development, supposedly because of a security problem that was discovered, but I expect the feature to return, perhaps in 10.5.2. It’s a terrific idea, perfect for multi-Mac homes and small offices. But so why not sell a device as a dedicated product — a big 500 GB or larger hard drive (or array of them) with built-in AirPort networking. No need to attach it to a separate AirPort base station, no temptation to use the device for anything other than one purpose: backing up via Time Machine. Just plug it into a power outlet, run through a simply configuration tool a la AirPort Utility, and it’s ready. When it first appears on your network, your (Leopard-running) Mac could prompt to ask if you’d like to use it for Time Machine, the same way it prompts when you first plug in a new USB or FireWire drive. iTunes Movie Rentals: Yes This one seems like such a done deal that it barely qualifies as a rumor. It seems obvious: Unlike with music, there’s been a strong market for movie rentals for as long as there’s been a home video market. Most movies aren’t worth watching more than once. Reports (based on leaks from studio executives) indicate rentals will cost $3-5, and will expire after 24 hours. If true, presumably that means they’ll expire 24 hours after you beginning playing them, not 24 hours after downloading. It’d be nice if the terms were a bit more flexible than that. One of the best things about Netflix, and something which makes it far more appealing than traditional brick-and-mortar Blockbuster-style rentals, is that you can watch movies on your own terms. A Netflix-style iTunes movie subscription service that lets you keep a certain number of unlocked movies open at the same time would be killer. Apple TV 2.0: Yes Jobs has called Apple TV a “hobby” for Apple. I think they have high hopes for it, but calling it a hobby is a practical way to buy time for it. What Apple did with the iPod was start as small and simple as they could — one device, in one configuration, only for the Mac, and all it did was play recorded audio — and then build the platform slowly from there. Things like Windows support, color screens, video playback, and expanding to a range of form factors all came incrementally. I think that’s the plan with Apple TV. Start simple and humble, and build from there, year after year. One obvious improvement (albeit contingent upon another rumor) would be to allow us to buy (or rent) movies and TV shows directly from the iTunes Store, right from the Apple TV. If the iPhone can do it, the Apple TV should too. I still think it’d be good business for Apple to sell their own HDTV sets with Apple TV built-in — more money for Apple, one fewer device spewing cables behind the display. DRM-Free iTunes Plus Music From the Other Major Music Labels: No I think Apple would love to have this, but it seems pretty clear that the major labels — other than EMI, of course — are convinced that it’s in their interest to withhold DRM-free music from Apple, in the hopes of helping Amazon gain market share. It actually agree that it’s in the music labels’ interest for Amazon’s music store to succeed. I’m not sure, though, that withholding DRM-free music from Apple is spiting anyone other than iTunes customers. I suspect the vast majority — an overwhelming majority — of iTunes music purchases are made by people who have at best only a vague inkling of what “DRM” is. If there’s any actual logic to it, it’s PR — withholding DRM-free music from Apple makes it easier to paint Apple as a company bent on using iTunes as a competitive cudgel to lock customers in to iPod hardware. Only a hack reporter would buy into that line, given Steve Jobs’s unequivocol “Thoughts on Music” open letter last year. One thing that would dispel any negative stories on the state of the iTunes empire, of course, would be the long-awaited debut of The Beatles catalog, exclusively at iTunes, perhaps with an on-stage visit from Paul McCartney. New iPhone Hardware: No, With a Minor Exception Apple announced the original iPhone a year ago, but they didn’t ship it until six months ago. They’re not going to announce new iPhones six months in advance again. (It was to their advantage last year to cause people to postpone phone purchases until the iPhone appeared; that’s not the case now that the iPhone is on the market.) If anything, I don’t expect new iPhones to appear until next fall, at the yearly iPod/iTunes pre-holiday season special event, leaving the original iPhone on the market for over a year. Why revise hardware for a product that, by all accounts, is selling remarkably well as-is? The only exception I could see would be a 16 GB iPhone that’s otherwise unchanged from the current 8 GB model. iPhone SDK News: No I can see the upcoming iPhone SDK getting a mention from Jobs on stage, a reminder that it’s coming and that’s it’s going to be great, but Macworld isn’t WWDC, and SDKs don’t make for splashy presentations. If I’m wrong, it’ll be because they have a demo queued up from a third-party developer with early access to the SDK. Actual third-party software (written against the actual official SDK) is demoable. Games, perhaps? The apparently-leaked 1.1.3 firmware might make for a good demo, what with the jiggly icons and whatnot. Cinema Displays With Better Resolution, Brighter Screens, and Built-In Cameras: Yes If I keep predicting it, eventually I’ll be right.
Smaller MacBook Air Would Reassure Us of Apple’s Commitment to Laptops

Rumor mills churned after Digitimes' Yen-Shyang Hwang and Joseph Tsai reported last week that Apple is readying to launch a new generation MacBook Air. This as-yet vaporous machine will allegedly sport an even more svelte form factor facilitated by an 11.6-inch display and an Intel Core i-series ultra-low voltage processor as marquee features, for release sometime in the second half of 2010. Hybrid? Hwang and Tsai cite Digitimes Research senior analyst Mingchi Kuo referencing discussions with upstream component makers, suggesting that a 11.6-inch MacBook Air will feature an even slimmer and lighter design than the previous-generation models. Technologies used for the “design and concept” are expected to be broadly used in the company's other product lines to boost its competitiveness. That phraseology implies something more than a form factor restyling and/or new feature additions, and there is speculation that Apple may be cooking up something like a hybrid machine retaining a basic clamshell laptop form factor, but with a detachable iPad-esque display panel. If that were the case, it begs the question of whether the new-generation Air would run OS X with some iOS touchscreen technology grafted in, or (very long shot I think) the iOS itself. Either way, Kuo expects shipment volumes of the new 11.6-inch MacBook to reach 400,000 units in 2010, which, depending on how late in the year it hits the channels, could be respectable enough. It seems logical that Apple could have decided that marketing three different 13″ laptops (the others being the white MacBook and the 13″ MacBook Pro) amounts to confusing overlap, and that a downsize would help differentiate the Air from its fuller-featured, more powerful, but thicker and heavier, siblings. However they would presumably want to avoid appearing to embrace the netbook concept, which senior Apple spokespersons like Steve Jobs and Tim Cook have famously scorned and dismissed, and which Apple is successfully challenging with the hot-selling iPad. If the Digitimes rumor proves accurate, it would mark the MacBook Air's first major makeover since the sleek and diminutive machine was unveiled in January 2008. Although the Air has received a couple of upgrades and refreshes, it really hasn't changed a whole lot in 2 1/2 years. Core i3 Power Digitimes' projection that the downsized MacBook Air will sport an Intel Core i-series CULV, if accurate, would make it the first Apple laptop to employ Core i3 technology, which on spec seems ideally suited to deployment in this sort of computer, but raises the question of what sort of graphics support it will have — a point not addressed in the Digitimes report. It's notable that Apple chose to stick with Core 2 Duo CPUs for the 13-inch MacBook and MacBook Pro so it could use NVIDIA’s new, faster 320M integrated GPU. But with an ultraportable machine like the MacBook Air, raw graphics performance isn't as high a priority. Few users will be inclined to do high-end graphics, video editing, or serious gaming on an Air, and Intel's in-house HD Graphics GPU would likely prove adequate for most users. At What Price? This is obviously all highly speculative at this point. One of the biggest imponderables remains price. The current MacBook Air at $1,499 can be most charitably described as something less than a bargain. For example, you can buy a white, 2.4 GHz MacBook and a base model iPad for exactly the same money as one base MacBook Air both for the same money as one base MacBook Air. The operative question: How contented is Apple for the Air to remain the low-volume boutique piece for well-heeled elites it has been up to now, or does it want to address a larger market, taking lower margins but deriving potentially greater overall profit from higher volumes? I can fantasize about an 11.6″ MacBook Air slotted in price somewhere between the high-end iPad and the 13″ MacBook Pro — logically the psychologically significant $999 of the white MacBook (or less). However, I'm doubtful that Apple will discount the entry-level MacBook Air threshold by 50 percent. As for an introduction date, we're almost past the cutoff point for the fall computer-buying spike already, but students have never been the Air's market focus anyway. More likely Apple would go with mid-fall to catch the Christmas sales wave. That is, provided a new MacBook Air really is coming this year. If so, it'll be the most exciting and reassuring development in Mac laptops since the aluminum unibodies in October 2008.

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Smaller MacBook Air Would Reassure Us of Apple’s Commitment to Laptops

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