Analyst: Apple to be 'nimble' on iPad pricing, athletic on pommel horse

Apple's $499 starting iPad price tag is already lower than many people -- and a few competitors -- expected, but apparently Steve and company have left themselves a little wiggle room: Credit Suisse analyst Bill Shope says that Apple told him it'll remain "nimble" when it comes to iPad pricing, suggesting that the price could drop if sales don't meet targets. That's not a hugely surprising thing to say, considering Apple's trying to be the first to achieve real success with a 'tweener device...

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Apple May Lower the Price of the iPad: This is Not News

Sometimes I have to wonder whether everyone has taken leave of their senses. The big “news” doing the rounds in the last twenty four hours is that Apple execs have admitted they are prepared to change the price of the iPad should consumer reception (read: sales) demand it. Yeah, that’s right; Apple admitted it might revisit the price of the iPad sometime in the future, and change it according to sales performance. Shocking, that a company might operate according to a business plan designed to encourage sales and make money, eh? Apparently, that’s somehow mind-boggling news. It got started because of a report by Matt Phillips of the Wall Street Journal, who wrote; Apple intends to stay “nimble” on pricing of the iPad, possibly lowering prices if the newly unveiled tablet device fails to gain traction among consumers. (Top prize goes to Engadget for their humorous response/headline, “Apple to be ‘nimble’ on iPad pricing, athletic on pommel horse”.) Phillips quoted a note from Credit Suisse analyst Bill Shope who, following a meeting with Apple executives, said; “While it remains to be seen how much traction the iPad gets initially, management noted that it will remain nimble (pricing could change if the company is not attracting as many customers as anticipated),” This only bolsters my long-held belief that analysts are, apparently, paid for pointing out the blindingly-obvious. That tendency to wrap together common sense and “what we all knew anyway” as “something new and worthy of reporting” is usually exemplified by Gene Munster, but since he’s been quiet for the last week or so, I guess Shope will have to do. (I predict that, in the weeks ahead of the iPad launch, Munster, or some inspired analyst like him, will issue a note to the press proclaiming, “Apple’s App store sales will perform better in this quarter than in the same quarter last year.” Or it’ll be something even more obvious, like “Apple will sell more iPads this year than they did in 2009…” and I guarantee the tech press will rush to report that ‘advice’ like it’s vitally important “news.” You just wait and see.) Confidence The point here is that Apple is doing nothing revolutionary or surprising by admitting the fact that, according to the ebb and flow of consumer demand, it will revisit its pricing strategy for the iPad. This is what all businesses do with all products, all the time. Apple is always revising its prices; MacBooks, iMacs, iPods and iPhones get at least one price change on an annual basis. It’s not a big deal that they will do the same for the iPad, and it certainly doesn’t point to any lack of confidence in the product itself. Let's not forget the infamous iPhone price-cut of ‘07; after launching the iPhone with a hefty $599 asking price, Apple reduced it by a whopping $200 just a few months later. The only difference between then and now is Apple’s transparency (yeah, I can’t believe I said that either). During his keynote presentation late last month, Steve Jobs said of the iPad; “We want to get this into the hands of as many people as possible.” That is, after all, the overriding reason for the agreeably-low price of the entry-level iPad. Here Come the Trolls Sadly, the predictable fan-baiting didn’t take long, with the likes of Should-Know-Better-Than-That Windows evangelist Paul Thurrott writing, in a blog post provocatively entitled “Do Not, Under Any Circumstances, Buy an iPad”; Following news that I was right about Apple's decision to not allow iPad pre-orders would cause many potential buyers to reassess things, comes this unbelievable bit of news directly from Apple itself: The company said that it would aggressively lower prices on the iPad if/when it doesn't take off in the marketplace. Aside from the clumsy jumble of clauses and inventive use of the adjective ‘aggressively’, (as far as I can see, neither Shope nor Phillips ever used that word) I really want to point out, one last time, and for the record — this is not “unbelievable” news. Far from it. It is, in fact, the most ordinary, run-of-the-mill, standard business practice, entirely believable news one could expect from a consumer electronics company. (Quite what Apple’s flexible pricing strategy has to do with Thurrott’s theory about the inability to pre-order an iPad is beyond me; can anyone say “straw man?”) It comes down to this; the wider tech press are, inexplicably, falling over themselves to write-off the iPad as a failure before it’s even out of the starting gate. (Don’t forget, the iPod was panned by critics and tech “experts” when it first launched. The iPhone was subject to its own fair share of harsh criticism, too.) No one can say exactly how successful the iPad will be, and while there’s no harm in speculating (after all, much Apple coverage is precisely that) it’s sad to see how some corners of the tech community choose to interpret every little thing Apple does (or says it might do) as “evidence” of failure. I think I’m being rational and level-headed. You might think I’m a shameless fanboy. Either way, let me know exactly what you think in the comments below. Related GigaOM Pro Research: Web Tablet Survey: Apple’s iPad Hits Right Notes 5 Tips for Developers Targeting the iPad How AT&T Will Deal with iPad Data Traffic
10 reasons to pass on the iPad? TUAW fact check

Filed under: iPod Family, Portables, Odds and endsOver at TechRepublic's 10 Things blog, Debra Littlejohn Shinder has posted an article called "10 reasons why I'll be passing on the iPad." Some of her reasoning is sound, but quite a few of her points are easy to refute. It's worth looking at her post and the points it tries to make, because it's indicative of a widespread misunderstanding of not only the iPad's capabilities, but also its intended consumer base. 1. There's no physical keyboard Debra's correct that the iPad has no physical keyboard. But what she fails to account for is that not only will Apple sell a keyboard dock for the iPad, the device can also be paired with any existing Bluetooth keyboard. Apple's reasoning for not including a physical keyboard on the iPad is even more compelling than for the iPhone, because unlike the iPhone, you at least have the option of pairing the iPad with a physical keyboard. In order to put a physical keyboard on the device itself, there'd be two options: keep the iPad the same size and sacrifice a third of the screen's real estate, or increase the iPad's size beyond what some (including Debra) already consider unwieldy in order to include a keyboard. In landscape orientation, the iPad's virtual keyboard is nearly the size of a conventional keyboard, too, so while touch typing is going to be a challenge, it's a fair bet that typing on the iPad will be much faster and easier than the high end of 30 - 35 WPM thumb typing many people (myself included) achieve on the iPhone's far smaller keyboard. The lack of a physical keyboard on the iPhone hasn't measurably affected its sales; the iPad isn't likely to suffer many lost sales from this, either. Check out the other nine points by clicking the Read More link below. 2. One size doesn't fit all Debra claims that if the iPad is supposed to be a niche device positioned between a phone and a netbook, it should have a screen size midway between the two -- in other words, smaller than a 9.7" screen. However, that's not how Steve Jobs positioned the iPad at all during the keynote; Jobs's Keynote slide clearly showed the iPad filling a gap between the iPhone/iPod touch and a 13" MacBook. It's puzzling that in one sentence Debra complains about the iPad being too large to fit in your pocket, while in the next sentence she extols the virtues of Sony's VAIO X netbooks, which are almost exactly the same size - in terms of weight and thickness anyway. The VAIO X has an 11.1" 16:9 display, which actually makes it quite a bit larger than the iPad. One other thing about the VAIO X is quite a bit larger than the iPad: the price, which starts at $1299 -- far more expensive than even the priciest iPad. While it's true the iPad won't fit in your pocket, it's still far more portable than even a MacBook Air. Stephen Colbert even managed to pull one out of his jacket at the Grammys, so while the iPad is larger than an iPhone, it's far from the unwieldy monster many people are trying to claim it is. 3. It runs a phone OS One thing many pundits fail to account for is that the iPhone OS is actually a version of OS X adapted for a touchscreen device. No, there's no Finder, Dock, or menu bar. No, there's no Expos�, Spaces, or Time Machine. But the underpinnings of the iPhone OS are exactly the same as those of the Mac version of OS X. So when people complain the iPad doesn't run OS X, they're really pining for OS X features like the ones I already mentioned -- the Finder, Dock, menu bar, etc. However, none of those OS X features are particularly suited to a touchscreen device, especially one with a 9.7" screen. Tablet PCs running the full version of Windows have already demonstrated the pitfalls of running an OS meant for a larger device with a traditional point-and-click interface, and as a result, almost all of those devices have failed to gain traction in the market. Debra and others also cite the iPad's lack of multitasking as a strike against it. On this point, at least, I agree with them. While iPhone OS already allows for limited multitasking among Apple's own apps -- Phone, Messages, Mail, Safari, and iPod can all run simultaneously in the background -- third-party apps are still restricted to workarounds like push notifications. While restricting multitasking makes a kind of sense on devices like the iPhone 3G, with limited processing power and RAM available, on the iPad those technological limitations don't fly as an excuse. You can argue that not having multitasking on the iPad makes it easier to use for Grandma and other non-techies, but it also limits the device's potential utility. Granted, the iPad isn't positioned as a replacement for a MacBook, but the ability to run even one or two third-party apps in the background would make the device far more versatile. Personally, I would be very surprised if Apple doesn't introduce at least a limited form of multitasking in iPhone OS 4.0. Of course, I also said the same thing last year about iPhone OS 3.0, so who knows. One point bears mentioning, though: despite the introduction of iWork for the iPad, Apple is still pushing the device as a platform for consuming media, not as a productivity platform. To get any serious work done, Apple still expects you'll use your main computer, whether it's a MacBook, iMac, or PC. 4. There's not enough storage The most important question to ask on this point is, "For whom?" Debra says the 64 GB model might have enough capacity for her purposes, but she also grouses about the price of that model, comparing it to cheaper netbooks with "four times the storage." I will say that I'm puzzled at Apple's decision to top out the iPad's capacity at 64 GB, especially considering that's where the iPod touch currently tops out. A 128 GB iPad would have been very tempting indeed; unfortunately, given the price of flash memory, it also would have probably cost more than $1000. But what does 64 GB allow you to store? In my case, a 64 GB iPad would hold my entire 39 GB music library -- 19 days worth of music -- plus my entire iPhoto library of over 7000 photos, which, when optimized for the iPad's screen, would probably take up somewhere in the neighborhood of 5 GB, plus or minus a GB or two. At my most app-crazy I had about 2 GB of apps on my iPhone 3G, and "Other" space, presumably including the OS itself, takes up just over 1 GB. Added up, that equates to 47 out of 64 GB. In my case, that leaves over 15 GB of space for document storage, videos, and so forth. Let's say I store my entire Documents folder on the iPad (I wouldn't -- I use iDisk and Dropbox for that) -- 4300 documents taking up just over 2 GB of space. Now we have 13 GB left over for videos and whatever else. Even if I left myself a 3 GB buffer for whatever reason (including accounting for the GB versus GiB difference), that's still 10 GB of space for videos -- enough to store 10 two-hour films at a decent bitrate, or almost an entire season of an hour-long TV series. Let me break that down again -- a 64 GB iPad would store: -- 19 days of music -- 7000 photos -- Well over 100 apps -- A 2 GB Documents folder with 4300 items -- 20 hours of video -- Around 3 GB of space left over for whatever else (temporary photo storage, e-books, accounting for the difference between binary gigabytes versus decimal gigabytes, etc.) Granted, there are people out there with music and photo libraries larger than mine, but most of my Mac-using friends only have, on average, 1500 items in their iTunes libraries, a thousand or so photos, and maybe three pages of apps on their iPhones. 64 GB may not sound like much on paper, but practically speaking, it lets you pack around a lot of media. Unless you're going to spend weeks at a time away from your main computer, the iPad should be able to carry around enough media to keep almost anyone entertained for days on end. 5. There's no HDMI output or camera Debra claims you can't output the iPad's video to an HDTV without an HDMI connector. That simply isn't true; with a VGA adapter, you can output the iPad's full 1024 x 768 video signal to an HDTV. With a component connector, you can output a 576p PAL signal or a 480p NTSC signal to your TV. Okay, fine, it's not 1080p ultra-high-def video, but where exactly are you going to find video of that resolution anyway (besides Blu-Ray and Bittorrent)? I'll admit that it would have been nice to have at least 1366 x 768 video (1080i, in other words), but I'm betting that the vast majority of consumers aren't going to even bother hooking the iPad up to their TV at all when it's far easier to just put the screen on their laps and watch a movie on the iPad itself instead. Another point Debra brings up is the iPad's 3:4 aspect ratio, which is less than ideal for video. This has been argued all over the internet, including here at TUAW, but as many people have pointed out, the 3:4 aspect ratio is ideally suited to pretty much every other function on the iPad except video: books, documents, web pages, and photos are all laid out far closer to a 3:4 or 4:3 ratio than 16:9. Using a 16:9 ratio on the iPad would not only make the device larger than it already is, it would also leave all other forms of media on the device at a disadvantage compared to video. The iPad's lack of camera is another point Debra and others have brought out against the device, but like multitasking, this is one point on which I agree. A back-facing camera like the iPhone's doesn't make a lot of sense on the iPad -- it would be a bit unwieldy trying to take pictures or video with a device this size, rather like trying to hold up a MacBook Air to take photos with its iSight. Most people probably have a standalone point-and-shoot camera that would take better stills and/or video than the iPad's hypothetical back-facing camera anyway, and you can load those pictures directly onto the device with either the iPad-specific camera connector or SD card reader. But a front-facing camera for video conferencing definitely would have been a killer feature. Apple apparently thought so, too, because it actually included a space in the iPad for exactly such a camera, only to withdraw it for reasons known only to Apple. Whether the company is waiting for the next-gen iPad to introduce a camera or pulling a big switcheroo like it did with the original iPhone -- which was originally supposed to ship with the scratch-prone plastic face of previous iPods, but was replaced with nearly scratch-proof glass in the six months between its announcement and release -- no one can say. 6. There are no USB ports Debra's main complaints against the lack of USB ports are that you can't hook up a flash drive or a USB keyboard. As far as the keyboard goes, I've already mentioned the fact that you can purchase a keyboard dock or use a Bluetooth keyboard. As for not being able to hook up a flash drive? I can see why some people might want to do this -- expanding the iPad's storage, transferring files, etc. But I'm willing to bet that for most people this isn't going to be an issue. While I run the risk of sounding like Bill Gates's infamous "640K should be enough for anyone" by saying so (although Gates never actually said that), 64 GB of space on a device like the iPad really should suit most users' needs -- at least for the next couple of years, anyway. As for transferring files? I can think of a number of existing, cloud-based solutions, the most simplistic of which is e-mail. No, you can't transfer several gigabytes of files at a time through e-mail or "the cloud," but most people don't transfer that much data all at one go even a handful of times with a portable device, much less on a regular basis. I'm not going to go full fanboy and say it's a good thing the iPad doesn't come with USB ports. In fact, I'm kind of with Debra and the others on this one in wishing that Apple included at least one USB port. While I probably wouldn't use the port very often (if at all), it definitely falls into the category of "nice to have." I've been an iPod user for almost five years and an iPhone user for a year, and I can count the number of times I've needed/wanted a USB port on one of those devices on exactly no fingers... but I'll admit that I might sing a different tune with a bigger device like an iPad. But for most of the people who are likely to buy the iPad, i.e., the non-geek, non-techie, "I just want internet and music and movies" folks, they're probably not going to miss USB ports at all. 7. There's no flash memory slot No, the iPad doesn't have a flash memory slot. You can buy an SD card reader attachment, though, although Debra and others rail against the added cost of the connector, claiming that in order to reach "the functional equivalent of a netbook, you may end up spending a bundle." A lot of the same arguments for or against USB apply here as well; most non-geeks aren't going to miss an SD slot at all. Transferring documents via SD cards in 2010 reeks of the "sneakernet" we thought we were abolishing along with dot-matrix printers and 2800 baud modems; let's just say that most users are going to have photos and/or videos on their SD cards, most users are going to wait until they get home to their main computer to upload those files, and most users aren't going to care that the iPad's missing a dedicated SD slot any more than they cared about the iPod missing one. If anything, the argument for an SD slot is far weaker than the argument for USB. 8. The price is not right Debra claims the iPad "costs twice as much as the Kindle and other ebook readers." That's flat-out false. The $499 iPad does cost almost twice as much as the standard Kindle, but compared to every other e-reader out there, the iPad's pricing is extremely competitive once you consider all the things the iPad does that the other readers iDon't. A $489 Kindle DX, for example, while $10 cheaper than the cheapest iPad, doesn't have a color screen, has only 4 GB of storage, doesn't have a touchscreen, doesn't run apps, doesn't have e-mail, music, and so on, and so forth. The iPad's price is the one aspect of the device that few pundits have complained about; in fact, the pricing has Wall Street and other financial analysts doing cartwheels. You don't even have to compare the iPad to other companies' similar products to see how good a deal it is. The 16 GB iPad costs $300 more than an 8 GB iPod touch. That $300 gets you twice the capacity, a much larger and higher-quality screen, a more powerful CPU, better Wi-Fi including 802.11n, vastly improved battery performance, a built-in speaker and microphone, and, eventually, access to a host of apps designed to take advantage of the iPad's larger screen and higher performance. A 32 GB iPad has the same $300 price difference compared to a 32 GB iPod touch, as does the 64 GB model. Once you tack on an additional $130 for 3G wireless the price difference widens, but so does the device's utility -- access to wireless broadband anywhere there's an available 3G network, which, as iPhone users already know, is invaluable. Debra compares the fully kitted-out $829 3G-enabled iPad to "a powerful compact laptop that runs a full-fledged operating system and multi-tasks and that has USB and SD and Ethernet connectors, 4 GB of RAM, and 250 GB of storage." The "full-fledged operating system" she's talking about isn't OS X, however, and the laptop she's talking about definitely isn't manufactured by Apple. That might not make a difference to a lot of people, but if you're already in the "Macs cost too much" camp, it's no wonder the iPad doesn't hold much appeal compared to that Windows Home Edition running, plastic, bargain-bin quality laptop from Dell or HP that's almost certain to stop working in two years or less. Yes, I recognize the extremely fanboyish sound of that sentence. No, I don't apologize for it. Cheap laptops are exactly that: cheap. Call it elitism, fanboyism, Kool-Aid drinking, whatever: I'd much rather put up with the iPad's shortcomings than those of the "powerful" but oh-so-cheapo laptops of other manufacturers. 9. It's locked in "You have to buy your apps from the App Store," Debra notes. Yes, you do: from a store that has over 140,000 apps available, most of them for free, and capable of doing almost anything. Hate the App Store for some reason? Fine. Jailbreak the thing and use Cydia instead. Apple may not want you to do this, and they may go out of their way to prevent it, but if you're of the jailbreaking mindset already, that's not going to stop you, is it? A very vocal minority of people love to complain about "vendor lock-in" when it comes to the iPhone/iPod touch/iPad, even though those same people have likely been playing around with video game systems from Nintendo, Sony, and Microsoft for decades -- all platforms with "vendor lock-in" even more pervasive and insidious than that of Apple's platform. What these people don't seem to realize is that same vendor lock-in is precisely what keeps Apple's portable platforms from being riddled with viruses, malware, and apps made of more crap than code. "Security through obscurity" may be a valid(ish) argument to fall back upon with the Mac, but with 75 million plus people using the iPhone OS, it's a very high-profile target for virus writers. That same "walled garden" that Linux proponents and "open internet" evangelists whine about is what keeps the iPhone platform from being an unusable nightmare. Yes, the App Store approval process has in many cases been a pain in the nether regions, but things are improving -- apps that might have once taken days or weeks to get approved are now getting through the approval process in a matter of hours. Has the App Store's "lock-in" affected sales of the iPhone one iota? No. In fact, sales of the iPhone took way off after the App Store's arrival. Yes, "Apple as gatekeeper" gets the George Orwell fans riled. But someone has to keep the gate, because the instant the iPhone OS becomes a truly "open" platform like some people are espousing, that's the same instant the Russian mafia remote-hijacks your iPhone from a basement in Vladivostok because you just had to download that "Siberian Honeys" app from the dark alleys of the internet. Other aspects of dreaded "lock-in" that Debra's concerned about are riddled with falsehoods. "You can't run Skype to make phone calls," with the iPad, she claims. "We wouldn't want to cut into the iPhone market, after all." Say what? That must be news to the Skype team, who's already investigating an iPad-specific Skype app. It must be news to Apple, too, who no longer restricts the use of VoIP over 3G. "Nor can you download Flash to install on the browser, which means you won't be watching those YouTube videos." Say what again? Since when is the iPhone/iPod touch/iPad incapable of watching YouTube videos? Oh right: since never. No, you can't put Flash on the iPad, but according to our informal poll, 75% of people planning on buying one either don't care or are outright glad Flash isn't making an appearance. What about hardware "lock-in?" Debra says that "you can't even remove and replace the battery yourself," which has been true of every single iPod since 2001 and hasn't stopped people from buying them by the millions. She goes on and says, "if you were flying to Australia and wanted to bring along an extra battery for the extra-long flight, forget about it." Um. A two-second Google search for "iPhone external battery" might have been a good idea. Plus, speaking from personal experience, if you stay awake for a full flight across the Pacific Ocean, you're going to have a lot more pressing issues to worry about than your iPad's battery, like the fact that you're going to feel like you got run over by a truck after the plane lands. Take it from one who knows: Trans-Pacific flights are best spent in blissful unconsciousness. 10. The network Yep, the iPad's 3G connection is only available on AT&T's network... if you live in the United States. If, like me, you live in what's known informally as "the rest of the world," this argument against buying a 3G-enabled iPad holds no water for you. But let's stick to the States for a moment and analyze Debra's argument against AT&T's network. No, AT&T isn't everyone (or possibly even anyone)'s favorite US network, but the pay-as-you-go, completely contract-free plans available for the iPad are very compellingly priced. You can get 250 MB of data for $14.99 (not the $20 Debra claims in her article), which is more than enough for casual data usage. 250 MB doesn't sound like a lot on paper, but that's what my iPhone plan started out at here in New Zealand. I never once went over 100 MB or so of monthly data usage until I started using iPhone tethering, and I'd consider my data usage fairly robust. The "unlimited" AT&T plan at $30 a month is an even better deal, and even if "unlimited" only means 5 GB, you're not going to burn through that much data unless you're using the connection every waking hour of the month. Debra's argument against these plans is that it's another bill to pay on top of your cell phone bill, but that's the beauty of the iPad plans: without a contract to commit to, you can cancel the plan whenever you want. If you start out with the $30/month "unlimited" plan on the iPad, only to find out your usage isn't topping 250 MB, rather than being locked in to that plan for another 23 months, you can downgrade to the $15 plan. If you find that you don't need the 3G coverage at all, you can always buy the Wi-Fi only iPad. "Here's wishing you good luck on finding those Wi-Fi hot spots," Debra says in response to that idea, which sounds about right for us in New Zealand, where free Wi-Fi is about as rare as gold, but makes much less sense in the US, where free Wi-Fi is usually only a library or caf� away. If you absolutely must have 3G on the iPad, absolutely must not use AT&T, and are prepared to spend twice as much for the privilege of going with Verizon, you always have the option of hooking the iPad up to a MiFi (possibly -- we'll have to wait until the iPad's actually released before we know if this will work or not). Additionally, just because the iPad isn't available on Verizon right now (now now NOW) doesn't mean it never will be; Apple and Verizon are reportedly "still talking" about bringing the iPad and/or iPhone over to the network. We've come to the end of Debra's ten points, but not to the end of mine. My final point, the one that sums up all of this: like the Mac, like the iPod, and like the iPhone, the iPad is not for everyone. It's not even for me -- despite all the words I've just spent defending it, I'm not buying an iPad until next year at the earliest, and only if I decide against replacing my current, aging MacBook Pro with the same computer rather than an iMac/iPad combo. The bottom line is that the iPad can't be all things to all people. It's not meant to replace a full-fledged Mac or PC -- it's meant as an ultraportable extension of a larger device, and one with a far simpler and more intuitive interface, a "computer for the rest of us," if you will. And make no mistake: for every Debra Littlejohn Shinder, for every "open internet" geek who screams "vendor lock-in" every time Apple's name is mentioned, for every "no multitasking, no Flash, no sale" techie, for every dismissive pundit who shrugs and says, "It's just a big iPod touch," there's at least one person who has been waiting for a device just like the iPad, and those people are the ones who will make it a success. Whether you like it or hate it, the iPad is indicative of the future direction of computing. But, just for the sake of argument, let's say we can cook up a portable computer far "better" than an iPad, a dream device that has USB, 1080p output, a removable battery, runs the full version of OS X, has a front-facing camera, isn't dependent on AT&T, isn't "locked in" to the App Store, has a physical keyboard, widescreen-formatted display, and has more than 64 GB of storage. What might such a device look like? Oh. Right. TUAW10 reasons to pass on the iPad? TUAW fact check originally appeared on The Unofficial Apple Weblog (TUAW) on Thu, 04 Feb 2010 10:00:00 EST. Please see our terms for use of feeds.Read�|�Permalink�|�Email this�|�Comments Apple - iPhone - Steve Job - IPod Touch - Sony
Could iPad prices drop the way the iPhone did after launch?

Filed under: Hardware, RetailLooks like they might. That's the opinion of a note out last night from Credit Suisse quoting meetings with Apple executives. The Wall Street Journal this morning quotes Senior Analyst Bill Shope as saying "While it remains to be seen how much traction the iPad gets initially, management noted that it will remain nimble (pricing could change if the company is not attracting as many customers as anticipated)." This is a similar situation to the original iPhone launch in 2007, where the original price quickly dropped US $200 from the original $599 retail. Agitated early adopters got a $100 Apple store credit from Apple. Apple will be watching sales of the device carefully in the early days, and the company appears to have enough margin built into the iPad to take some hits if it is slow moving. On the other hand, if the iPad blows the doors off Apple stores in sales, don't expect any discounts soon.TUAWCould iPad prices drop the way the iPhone did after launch? originally appeared on The Unofficial Apple Weblog (TUAW) on Mon, 08 Feb 2010 14:00:00 EST. Please see our terms for use of feeds.Read�|�Permalink�|�Email this�|�Comments iPhone - Apple - Wall Street Journal - Credit Suisse - Unofficial Apple Weblog
Apple Event Metaliveblog: Celebrate the tablet with TUAW

Filed under: Other Events11:12 SYNCS exactly like iPhone or iPod touch.Sync everything: media, calendars, apps, etc. Connect via usb sync 11:11 Great pricing! Want! Eng: 11:11AM And the iWork demo is done. "So what are we going to charge for applications like this? We're gong to charge just $9.99 each." He means $10 for Pages, $10 for Keynote... etc. 11:11: GIZ Jason Chen: What is Apple going to charge for each of the iWork apps? $9.99 each, so $30 if you want all. 11:10: Eng: 11:10AM It looks as though these new dropdowns menus are a major part of the iPad OS. Will be interesting to see how this translates to the iPhone and iPod touch. Is there going to be room? Or will they be left out entirely? 11:10 All this entry does make us ask the question, are you expected to type only on this device, or is there some sort of external keyboard option from Apple? Because if I could take iWork with me on the road, I might not want to type that entire Pages document by touchscreen. (via Macworld) 11:10: GIZ Jason Chen: So far we've covered ebooks and newspapers (TV and movies were already there from the iPhone), but we haven't covered magazines yet. I wonder what that's going to be like. gdgt: Showing the spreadsheet-centric soft keyboard. Auto-fields and sums showing as inferred. Pretty neat for a spreadsheet. Then again, it's still a spreadsheet. 11:10 Manipulating charts is a dream. 11:09: "I could see this being used as a cash register like the new card swipe systems at the Apple Store now. Be really easy to manage inventory too." -- Megan 11:08: Data entry keyboard. This is one of the amazing thing about touch entry keyboards. Showing that there are custom keyboards, all meant to help context entry. Over 250 options built in. Help built in. Mike Jones: "Nice new 10 key keyboard." 11:07: Now numbers demo. Let's do some typical spreadsheet tasks. Showing how you can manipulate tables. But what about data entry? 11:07: Mike Jones: "there's an awful lot of space around the screen that is making me wonder if they've added touch sensitivity to the edges" Sang: "one thing i notice about this, as opposed to the courier, is the lack of "floating" palettes. iPad's paletttes are more on-demand" 11:07: Demoing the page navigator. And showing the automated text wrap features. Yes. THIS: 11:06AM New tool: Page Navigator. It's a bit like the magnification loop and lets you jump through pages. Automatic image outlines -- just drag your image and text reformats. 11:06: Sande: "Spaces is *made" for the iPad". Mel: "I think this may kill netbooks if the price is right." Mike Jones: "I'm thinking if they do multitasking they will do it immediately after iWork" 11:05: Big applause after iWork presentation. Big. GIZ Jason Chen: I suppose the iPad would be a pretty good presentation device, letting you see the screens on your device and controlling it while it's being projected onto a wall through the 30-pin dock connector. (Video out is still unconfirmed, this is just my guess.) 11:04 "What about multitasking?" -- Megan 11:04: Eng: 11:03AM We'll say this -- iWork looks really robust. Far more than an iPhone app. Lots of options, lots of ways to work with your data. 11:03: "Look! I just done a mask, an advanced technique and it's easy". Now demoing how to do animations. Easy built-in animations, scaling, translation, etc. These are transitions between slides right now. Very easy, "with just my finger!!" 11:02: Showing access to photo albums, etc. How easy it is to drag things around whereever you want. Demoing resizing handles. Want to match sizes? tap the other one while resizing. Nice! 11:01: How do you do this without keyboard or mouse? Demonstrating gestures. Sang:"how awesome would it be if steve's been doing the presentation the whole time using iPad's keynote" 11:00 Amazing software. Want to be the first to show you. Let's show keynote. It runs in landscape orientation, because that's the standard for slides.And you first see your slide library. Gorgeous templates. What you'd expect. 11:00 Completely new version of Keynote: Specifically for the iPad. Create presentations with your fingers. Most beautiful word processor you'll ever see. New version of numbers. 10:58 re: iWork: "What they came up with is really magnificent". About to do iWork demo. 10:58 And now for something exciting. Looking at creating a version of iWork for iPhone a year ago. iPhone? Really? But iPad! Win. 10:57: "i was expecting more "eye-friendly" text, i.e. e-ink. i can't picture myself staring at this screen reading a novel" -- Sang 10:56 Steve showing off the store. Book at $14.99. "And that is iBooks" gdgt: Tap right or left to change the page - or drag the page manually. Very nice! GIZ Jason Chen: You can skip directly to chapters from the table of contents, and there are photos, as you'd expect. gdgt: "We think the iPad is going to make a terrific e-book reader not just for popular books, but for textbooks as well." 10:56 Eng: 10:56AM The store is very similar to iTunes. Same modal pop-overs. Pricing doesn't look too bad. The book page display is nice. You can turn pages slowly -- really slick looking page animation. 10:56: amazon: 0.75 +1.27&lrm; (1.06%&lrm;) 10:56: "Still no mention of 3G connectivity. Is it WiFi only?" -- Mel Martinaz "Only WiFi so far" -- Mike Schramm 10:55 Five big partners...Penguin, McMillon, Simon &Schuster, and more. Mike R: Wil Shipley's head just exploded 10:54: *blink* This afternoon? Really? 10:53: NEW iBOOK STORE: Fully integrated with iBooks app. Read your eBooks right on your iPad, NY Times bestseller lists, 5 of the largest pubs in the world, all their books on the store. Open the floodgates with the rest of the pubs starting this afternoon. 10:52 Want to show you another one of *our* apps. Amazon pioneered with Kindle. We're standing on their shoulders and going further. This is reading a book on kindle. iBooks announced. 10:52: Apple iPad page still not up. 10:50 More details about Major League Baseball. By the by, the Apple Store? Still up. Nothing shipping today. gdgt Game video with overlays, this is pretty dope. If you're a baseball fan, seems like this is probably going to be your new preferred viewing experience. Scott's back. 10:49 Next App: Major League Baseball. Looking at live game experience. "unless somethign dramatic happens in the next 10 minutes it's just a flat iPod touch." -- Dave Caolo; Isn't this 90 minutes? -- Erica 10:48 It's so PRETTY! Want one, want, want, want. Engadget: "10:48AM Need for Speed Shift on screen. Looks pretty good. "Building for the iPad is a little different -- it's kind of like holding an HD display up to your face. It's really cool.", gdgt: Touch and accelerator-enabled (of course). Tap the mirror to look behind. "A game like NFS really pushes the limits, so we wanted to show you just how fast this can really go." 10:47 Demo of game. Showing really cool racing game, first person viewpoint. 10:47: EAGuy: "really excited about iPad. Showing demo. Gorgeous 3d, showing racing game. 10:46 Electronic Arts up next. Number One mobile publisher of games. 10:46: Eng: 10:46AM This is very slick -- probably the most impressive demo yet. A very sophisticated use of the screen real estate. Brushes for the iPad looks like you can go pretty deep. Available at product launch. 10:44: Showing undo/redo. Wide range of brushes, etc. Digital finger painting. Megan: "Could you imagine Photoshop on this? It'll kill the Cintiq tablet: apple-creation-0275-rm-eng.jpg" 10:44: gdgt: Next up: an app called Brushes, an art browser. Can zoom in up to 32 times. Engadget: "10:45AM "Today I'd like to show you how brushes looks on the iPad." This is nice. Context menus for brush and color options. We're loving these new pop-over menus. No more diving!" 10:44: Taking full advantage of iPad firmware 3.2 (It's 3.2, not 4.0) 10:44: gdgt: Reading [the NYT app] syncs to the iPhone app. Inline video clips. 10:43 Megan: "Needs to be designed better. HIRE ME!!" Sang: "imagine using Keynote on the iPad. it'd be money" Megan: "This is the future of newspaper design" gdgt "We're incredibly psyched to pioneer the next generation of digital journalism." Ha, Martin Nisenholtz said "psyched." 10:42 Steve showed you the NY Times website. It's beautiful. So why do a new app for iPad? Our iPhone app downloaded 3Million times. Want to create something special for iPad 10:42 "gdgt: Martin: "Steve showed you the NYT site on the iPad, it's unbelievably beautiful. Why did we come out three weeks ago to develop an app for the iPad?" Wait, three weeks? Scott said peeps had 2 weeks. Anyway! "We think that we've captured the essence of reading a newspaper... all in a native app."" 10:41 Martin Nisenholtz of NYT. Martin is EVP of digital for the times 10:40 Next up New York Times. 10:38 Really excited about poss. for devs on iPad. "The iPad version of Nova ships later this year..." Interesting. Scott is back. "Next up, the New York Times."" 10:38 Demos. "gdgt Showing a title called Nova. This looks pretty decent, but still a tiny bit choppy. But hey, this was done in two weeks, so I'm gonna cut these guys some slack." 10:38 Devs invited 2 weeks ago. Will show you what they came up with. Mark Hickey of Gameloft is up. 10:38 "By the way, if they're available today, I'll be running to the Apple Store imediatly - 4 miles away." --- Steve Sande 10:37: Rewrote all our apps for this display. New SDK supports devs for new size. Can automatically scale app to full screen, can save profiles, and have it work in both systems. 10:36: Eep. 10:36 NEW SDK OUT TODAY!!!!! Sorry, but I think I just have to *eep* 10:36 Eng: "So all of the iPhone apps will run on this. In fact when you buy it, download all the apps you have right onto the iPad. Now if the developer spends some time modifying their app, they can take full advantage of this display." 10:35 Interface Builder is going to have to be smart about using dual resolution apps. 10:35 Pixel doubling. Eng: 10:34AM Games look amazing. He's playing an OpenGLS title right now and it looks super smooth. 10:34 Showing game video, "Video works great on the iPad", And 10:33AM Gaming obviously will handle this better, but a text heavy app looks lonely or weirdly huge. 10:33: "It just works." Demoing facebook now. It just scales up. Facebook uses text, video, etc. What app really drives graphics hw? Games do! 10:33 Eng: 10:33AM "Let's start with Facebook. It just works." He's showing off the non-pixel doubled version, a small app in the middle of the screen. It's kind of silly looking. A lone app in the center of a black screen. The scaled up app looks silly as well, especially in Facebook. 10:32: Forstall: App Store huge success, 18 monts old, billions of apps, 140k apps. We built the iPad to run virtually all these apps out of the box. Pixel for pixel accuracy and also, automatically full screen via pixel doubling. YAY! I think my inner Apple fangrrl just sqeed herself out. 10:32: All new built in applications. And Scott Forstall, sr vp of iphone softwar to talk aboutApp Store. 10:30: Scott Forstall on stage. 10:30 16-64 GB of flash storage. A MONTH, a freaking MONTH of standby. I am awed. Arsenic free, green and lovely. 10:30: Eng: "All the usual suspects: accelerometer, compass, speaker, mic, dock connector. And it's got battery." 10:30 Eng: 10:30AM "What is the battery life like? We've been able to achieve 10 hours of battery life. I can take a flight from San Francisco to Tokyo and watch video the whole time. And it has over a month of standby time." 10:30 This chip will *scream*. Latest in wireless networking. "All the usual suspects: accelerometer, compass, speaker, mic, dock connector. And it's got battery." 10 FREAKING HOURS OF BATTERY. 10:29: "as mentioned in every bit of upcoming advertising." -- Dave Winograd. 10:28: Getting back to the hardware a little bit. It's realllly thin. 1/2 inch thin. Just 1.5 pounds. Thinner and lighter than any netbook. 9.7 IPS display. Super high quality display. Best multitouch sensors in the world, married to our great display. 10:26: Now showing videos, movies. That is video on the iPad. That's a little overview of what the iPad can do. 10:26: "This interface is interesting, because unlike the iPhone, it's got panes and floating windows and lots of stuff that you can do when you've got a bunch of screen space.(via Macworld)" 10:25: Let's go to youtube. Let me show you a high def video on youtube. Again, let's go to landscape mode. And that's Youtube. Again, related clips, etc. Portrait, landscape. (Steve really really likes the portrait/landscape thing today) Movies, TV Shows, Music videos, etc. 10:24 Go to our current location in the maps app (Maps demo) in San Francisco. Should findall the sushi places nearby. mmmm sushi... And here's a sushi bar. Great demo. Mild, not wild, applause. That's maps. Let me show you video. 10:24 Events, Faces, and places. Shows a big map with pins in it. Tap and hold on the pin and see all the photos there. Tap on it to open the photos. There are built-in slideshows, so yo can bring up slideshow options and pick your transition. Just starts playing music and then flips through the images.(via Macworld) 10:23 Demoing iTunes now. Looking at calendar, again? Steve Sande: "I bet 24,343 Macbooks just went up for sale on eBay" Contact, calendar, address book, Also got a great maps app. Again, the eiffel tower,tap the corner, and pinch as big as we like. 10:22 TUAW staffers wondering about possible fingerprint tech for unlocking? Dave Caolo: "gotta agree: I think there's a 'wow factor' surprise lurking" jEng: 10:22AM Steve is playing more Dylan! iTunes: 10:22: Steve finishes slideshow demo to LOUD applause. Looknow at music collection, iPod, scroll through albums, tap to play. Eng: 10:21AM This is the ultimate tease. We've got a sneaking suspicion there's a lot more to come. 10:21: NYT wonders if this is the end of the laptop. Mike Rose: "WE HAZ BROKE THE INTERNETS" 10:20 Show you a map of all the places you've taken photographs. e.g. Photos I took in Paris. Built in slide shows as well as single image display. Picka transition, pick music. (This is on the iPhone too, right now. So not a new feature.) 10:20 Really good closeup of the keyboard: 10:19 Next, the keyboard. Can look at everything in portrait and landscape. Can look at any photo. Steve is *totally* getting into the portrait/landscape thing. Metadata from maps tied into photos. Can get events, places, at the same time. All tied into maps. 10:18: Engadget: Wow, nice email display -- message list in a column on the left, full message on the right. 10:17: Steve is showing off the improved e-mail browser. Can look at the metro in paris...As an example of PDF display. All the attachment support now being demo'ed Sounds like the E-mail support is going to be absolutely rocking. 10:16 Grab the tablet in the kitchen... A whole website in the palm of your hands. Read national geographic, for example. Very, very simple. Time magazine being demos, sports, right in the palm of your hands. So that is browsing the web. Now E-Mail. 10:12 Great slide show stuff built in. Built in a calendar, see a months' activities, a days', built in, a great address book, contacts, GOOGLE MAPS, satellite view, etc. iPad is an aweesome way to enjoy your music colleciton, and of course, ...iTunes, purchase movies, apps, music, etc. HIGH DEF YOUTUBE 10:12 Whole web page. It's phenomenal. It's incredible. Focus inon a message, see your inbox, turn it sideways (landscape and portrait support), keyboard pops up. It's almost lifesize, it's a dream. Your photos, your albums, your events, etc. 10:10 Very, very thin. Can change the background, Winterboard it out the wazoo (Winterboard is the jailbreak theming app) "Best browsing experience you'll ever have with a whole web page right in front of you. Way better than a laptop, way better than an iPhone" 10:10 It's the iPad. Mike R: "My iPad, let me show it to you. PREEECCCIIOOUS." Let me show it to you. Wild wild applause. 10:10: Some people have thought about netbooks: sThe problem is netbooks aren't better at ANYTHING." Applause. "They're just cheap laptops." We think we got something better. AND WE'D LIKE TO SHOW IT TO YOU TODAY. 10:09: Something better for browsing the web than a laptop? Watching videos? Something better? Media collection, playing games? If there's going to be a 3rd category of device, has to be better at these tasks. 10:08 Is there room for a third category of device? It's the tablet, of course... Steve is making a case for the mobile niche of Apple. gdgt: "In order to create a new category of devices, those devices will have to be far better at doing some key tasks - important things - better than the laptop and smartphone. What kind of tasks? Things like browsing the web..." 10:06 In 1991,In Apple shipped first modern laptop computer. Apple invented it. With an LCD screen. In 2007, Apple reinvented the phone. 2 years later, the iPhone 3GS. Apple is laptops, Apple is smart phones. 10:05 Steve: "Apple is a mobile devices company" How does Apple stack up against other companies that sell mobile devices. By revenue, is largest Mobile Device company in the world. More than Sony, etc. 15.6B in revenue. Bigger than Nokia. "apple is larger than sony mobile products division" -- via twit gdgt: "Lastly, we started apple in 1976 - 34 years later, we just ended our holiday quarter with 15.6 billion in revenue." Big applause. "That means Apple is over a 50 billion dollar company - I like to forget that, because that's not how we think of Apple, but it's pretty amazing." 10:05: GIZ Jason Chen: Next update: App Store. There are over 140,000 applications in the App Store. "A few weeks ago we announced a user downloaded the 3 billionth app from the App Store." 10:04 gdgt: "Last holiday quarter we had over 250 million visitors to our stores." Talking about the new New York stores. "It's so wonderful to be putting these stores right in the neighborhoods of our customers. It feels good. Next update: app store." WE ARE SWITCHING TO TRADITIONAL LIVE BLOG. Cover It Live is not responding. Happy Tablet Day! Here at TUAW, we are so excited to be able to share the moment with all of you stopping by. Today, we'll be metaliveblogging all the major outlets including Engagdet, Ars, and so forth. And adding to the metaliveblogging goodness, we'll be layering TUAW's own special touch of analysis and opinion on top of the summaries we'll be scraping from other sites. So thank you for joining us. Today we'll be covering feeds from: Today we'll be covering feeds from: Engadget Macworld Ars Technica MacNN Gizmodo and more..."Our Latest Creation" The Apple Media Event TUAW MetaliveblogTUAWApple Event Metaliveblog: Celebrate the tablet with TUAW originally appeared on The Unofficial Apple Weblog (TUAW) on Wed, 27 Jan 2010 12:30:00 EST. Please see our terms for use of feeds.Permalink�|�Email this�|�Comments Apple - Engadget - Macworld - TUAW - Ars Technica
Macworld 2010 special iPad event liveblog

Filed under: Macworld, Hardware, Blogging, iPad We are live from the floor of Macworld 2010, where they're be talking about the iPad in a special event feature Jason Snell, Macworld editor-in-chief, and a panel of industry experts. We have heard that won't be an actual iPad on the show floor, so it's not clear whether we'll get to see the device, but we will hear commentary and insight on what the iPad means for Apple and the world at large. After the break, find an updating liveblog of the event as it happens, straight from Moscone Center in San Francisco.2:04PM Ted: I would like to see 1) if there will be iPhone OS changes brought back from the iPad, and what hidden features we'll see there. And 2) what options are available for printing. Dan: Can I use it as a phone? Or a camera? (laughter) No, when we saw it, we said, the screen looks kind of empty, doesn't it? You can put about six apps in the dock, so I think we'll see a newer design for the homescreen, something that takes more advantage of the extra space. Something more appropriate for the product rather than just a large iPhone.2:02PM Jason: Frasier Spiers said do you realize how amazing this will be in education? And yes, you'll see a real change there. One last question: what is your biggest unanswered question about the iPad?2:01PM Andy: It will lend credibility to the idea of computing via tablet, and Android and others will follow that path in another year or so as well. It'll finally break us free from the "type on this, look at this" paradigm we've been stuck with.2:00PM Andy: We'll also see a halo effect. Star Wars didn't invent the sci-fi movie, but it showed that sci-fi wasn't the problem, bad movies were. So tablets aren't the problem, bad tablets are, and the iPad will remind people of that.2:00PM Andy: iPad won't be a big hit until 2011 -- it will take a while after the people in this room buy them to show them off to the normal civilian, and the next time they need a portable computer, they'll remember the iPad they saw on the airplane or in the classroom.1:59PM Ted: I also think we'll be surprised. Third-party developers will surprise us. Jason: Right, apps are front and center on iPad, and we only had web apps when the iPhone came out. Andy: I don't believe that tablets have been tried and failed, I don't believe they've ever been tried. No tablet I've seen compares to the iPad -- tablets I've seen are a desktop computer in tablet form, the iPad is an actual tablet.1:58PM Ted: This is also the ultimate remote control. We'll see it controlling a more digital home in the next few years, and the iPad is the way to control it. Turn on stereo, run lights, control thermostat, the iPad is made for that.1:57PM Jason: What about people who use only a fraction of a computer -- only email or only web browsing? Ryan: Sure, it's fine if netbooks get assassinated by the iPad -- around the house computer. But it's still not going to take the place of productivity or when I need to go on the road. In addition to, but not a replacement for. Ted: Agreed, around the house computer instead of a laptop. I'm optimistic about the long-term as well -- it's not there today, but things will change. Majority of people with a computer today don't really utilize it to the full extent, and the iPad will satisfy those folks.1:55PM Ryan: I'm not so sure -- you need feedback, you need tactility, you can type fast because you need the keys and you need to know where they are. Apple did release a keyboard dock -- the tech may change, but we're not there now, and it's going to be a while before we abandon the keyboard or the traditional computer. Steve even acknowledged that it was an in-between device.1:54PM Dan: Younger people will be the one to watch. When this becomes an option, will people not bother to learn or use the traditional mouse and keyboard? We're used to it, but if you look at someone learning, you realize the challenges behind the mouse and the cursor and the traditional interface. There's a huge disconnect, and especially for kids, we'll have to see if they prefer the iPad to the exclusion of traditional computing. Their intial reaction is to touch.. which is why you don't take them to museums (laughter). When kids grow up with this, will they wonder what's wrong with us for using archaic keyboards and mice?1:52PM Jason: Time to talk about the future. What impact will the iPad have in the next five years? What about the tablet market? MS said a while ago that tablets were the future, and they're a flop so far, basically. Will we see a significant change in tablet computing or how we use them?1:52PM Jason: Some people don't mind reading on screens like the iPad, some people do. There will be options no matter what. Kindle is for reading books, iPad has more functionality. Please no, Amazon, put in an API for apps -- its strength is reading books. Ted: Will you feel that way when you have to carry two devices? Dan: I still carry an iPhone and an iPod, but then again I'm really strange.1:50PM Andy: We already have an iPad nano, it's the iPhone. If you want something with less or more functionality, you've got choices.1:50PM Dan: They can totally coexist, just like the original iPod was still around after the iPod touch. The iPad won't kill the Kindle any more than the Kindle killed the book.1:50PM Andy: The $500 price point is now radioactive if you're an ereader. But you can do very well at a lower price point. Ted: I also think there will be a cheaper iPad, just as the iPhone dropped in price after it came out. Jason: I can see a day when the Kindle is free. Ryan: Absolutely. That's the future of Amazon's business model. It's not going away.1:48PM Ryan: The question is: are you going to want to read on the iPad. Comic books make a ton of sense, but I didn't want to read a book on the iPad -- too bright, colors too vivid, I feel like the contrast on the Kindle is better for certain reading. Books will still be best read on e-Ink. Jason: I agree that even with the iPad, there's a future for something like the kindle or a more traditional ereader. Ted: I've read books on my iPhone and it's not painful by any means. I think from a price perspective, the Kindle is a hard sell. Dan: Ha, well the large Kindle is a bad investment anyway.1:46PM Dan: Bookstore wasn't even active in the iPads we used -- the icon was there, but it didn't work, we haven't even seen it yet. Jason: A Kindle app for the iPad will be interesting, too. Comic books, thanks for mentioning those, because comics on the iPad's bigger screen will be a big deal.1:45PM Andy: I'm co-authoring an app that will work as my printing press -- once the press gets built, then it's just making the content. There's always an outlet, as opposed to a third-party where you have to wait for approval.1:44PM Andy: Application-based content is here to stay -- designing your own app can help you release content your own way. Jason: Except that costs more money. Build your own app is great, but some devs can't do that. Maybe a third-party will, but not everyone can do their own.1:43PM Andy: iBooks won't be the most signficant part of the periodical delivery mechanism on the iPad -- even comic book and periodical publishers aren't supporting the iPad so much as tablet devices in general. They're using Webkit -- not platform specific, but iPad included.1:42PM Andy: The iBooks app is a quiet piece of news, but that's an incredibly significant announcement. That app that we tried that day was probably the least functional of all the apps on there -- will it freeze up, will it slow down? It's downloadable because it's not ready in time for shipping, and Apple understands that the app will have to evolve quickly and update often.1:41PM Ted: A semester's worth of books on the iPad at (hopefully) a fraction of the cost, not to mention that the used market could possibly be gone for good, a good thing in publisher's eyes. Jason: Lower the price of the new textbook, make more money back on the lost used market. If they'll agree to that, which they probably won't.1:40PM Ted: I want to get back to books for a second. Textbooks will change thanks to the iPad for sure.1:39PM Jason: There will be apps for newspapers or magazines, but it'll have to be someone else or they'll have to make their own, and that's a fractured space. Ryan: Apple could have changed the game on that, but they aren't doing that now.1:38PM Ryan: Except that book aspect here is books. There's no periodicals for the iPad right now, no iMagazines. If Apple had created a standard or introduced an app like the Kindle, maybe revolutionary. But all they're talking about right now is books. There's no solution for the industries that are having trouble.1:37PM Dan: Still, the music industry lost the battle for DRM, will that happen to book publishers? Andy: The web was an experiment that absolutely failed for books and magazines, and what it did was train the average consumer that a web browser is free -- charging for web content isn't right. But the Kindle taught that produced content by professionals does cost money, and the iPad can run that same market.1:36PM Andy: It's a computer, so it can do whatever devs and content publishers want it to do. Apple is using epub, which is remarkably flexible for sharing and lending books and licenses, even to libraries. So it could make it easier to share and borrow books -- your local public library as a version of Amazon.com. "There's a license available for Tom Clancy's book, I'll sign that out." Dan: Sure, libraries may have applications even -- if they can find the money.1:35PM Dan: It seems like the early days of the music industry's digital revolution, where publishers want to lock things down. It's a good idea for convenience -- a whole library in a device. But losing that freedom to content and sharing worries me.1:34PM Jason: When this product was rumored for months... Ryan: Years... Decades.... Jason: When Nostradamus predicted the iPad (laughter), ebooks were a big deal. What does this mean for books and newspapers and magazines?1:33PM Ryan: It's not as intimate of an experience on a laptop, but it's a little more convenient. Jason: Accessories will be key -- cradles, docks, stands. Ted: Two different modes -- primarily a consumption device, like a book. But more serious work will require a keyboard, stand, different environment.1:32PM Jason: In the testing area at the event, iPads were on raised platforms, with each one having an Apple employee told "if you let this thing out of your sight, we won't just fire you, your family will end up wondering what happened to you." Andy: Glossy front. Not a problem with a notebook, but what about a tablet? We'll see. Dan: It's easier, I can tilt the iPad anyway I want. Ryan: You also don't have to be holding your laptop at all times, but the iPad will have to be held up most of the time.1:30PM Andy: That'll be interesting to see what happens in real life though. Apple events are magic acts -- they're planned. When Steve was using that book on stage, was the chair even designed for him to hold the iPad in the right place? What will it be like to hold an iPad (1.5 lbs) while standing or trying to do something in a weird position? What about when people see what you're doing in a coffeeshop, or at a table? We will have to see.1:29PM Ted: People that are happy with an iPad today will be happy with a laptop in three or four years. Dan: That's a bold statement. There's a duality between iPad today vs. iPad in three or four years. But there is a ubiquity to computers today, and we've all adapted quickly to having them around in the same places the iPad will be -- on the couch, in the kitchen, and so on. It's nice to have something that doesn't make you feel like you have to match to it, but it matches to you.1:27PM Ted: The iPad can't do everything that a Mac can do, but the release of the iWork software was an opening salvo. You can start using this as a productivity machine -- you can't use it tomorrow, but look how far the iPhone has come thus far.1:27PM Andy: There are two checkboxes for me as a user -- I need to write a lot at any given moment, and I need to transfer files on and off of it, and the iPad meets both needs just fine for me. This will be as transformative a product as the original Mac was.1:26PM Jason: Is it right to say that Apple is taking another crack at what computers are, and is it the right approach? Andy: Yes, I think so. Computers don't have to have file systems or browsers, they just have to solve problems, and the iPad still does that.1:25PM Andy: I agree -- if you have a system level switch, it even solves the problem of support. If something breaks, make sure that override on third-party apps is turned off, and you're back to working paradise.1:24PM Dan: I'm playing devil's advocate, because I agree with you, but Apple's philsophy is that. They don't want you to be a tinkerer, because they aren't aimed at tinkerers. We don't agree with that, but it's their product, even if we're buying it. You can do what you want, if you go down the jailbreak road, and people will always find a way. But it is a lot harder than it needs to be, even if I understand why Apple is doing that.1:23PM Jason: Yeah I think there's room for non-App Store apps, but App Store apps would get preference. Ryan: Yes, the App Store is literally a revolution in software distribution. But Apple is not bugding on their philsophy at all. There's no reason why you shouldn't be able to set the override switch and do what you want.1:22PM Ryan: 3rd party apps are dangerous, but as long as you warn users, what's the problem? It is my toaster oven, right?1:21PM Jason: App Store -- will it work the same on the iPad, will we see the same iPhone issues? Andy: If it works, then great. If not, the weaknesses will be more clear. I want a computer that will potentially will always work, never crash, will always run software. The win from the App Store concept is that you get a more stable machine at the expense of freedom that you might not excercise anyway. Steve Jobs is a benevolent tyrant -- he'll give you everything you want, all he demands is absolute obedience, and you'll be fine.1:20PM Ted: What do you care, I said? And no, they say, it will degrade the experience of using the toaster oven. And one more thing, they said -- those poptarts in your pantry won't work with your toaster oven either -- you didn't buy them directly from our CuisineArts store. Plus, they'd actually rejected Poptarts from the Art Store. Extended metaphor -- if the iPhone was a toaster, Ted would have issues getting it to do what he wanted.1:18PM Ted: All of the closed things concern me as they apply to the iPad. He's telling a story about how the lower story of his house is very cold downstairs, so he decided to rig up a toaster oven to serve as a space heater. He rigged it up with an extension cord, and it didn't work. He called tech support, and said he was using an extension cord, and they asked if it had a "Made for Cuisinart" sticker on it. It didn't, so he bought a special Cuisinart cord, but it still didn't work. Called back tech support for the toaster, and finally had to admit he was using the toaster oven as a space heater. "No," they said, "you're not authorized to do that." Terms of purchase actually prohibit "jailbaking" (laughs from the audience).1:15PM Ted: On the record, I think the iPad will be a great success, so I like it, I'm buying one. But I expect the iPad is still a closed platform, and it will not replace laptops and more complex computers.1:14PM Jason: Ted is here, even though he didn't use the iPhone, because this seems like Apple saying "we're moving the ball forward" in computing. This is a new paradigm -- touchscreen, direct interaction. iWork is going from Mac straight to the iPad -- is this a netbook/laptop replacement or not?1:13PM Dan: Yeah without the bezel, there's no place to put your thumb - we're so accustomed to the iPhone that it seems like wasted space, but once you use it, it'll fade into the background like everything else.1:12PM Jason: The bezel got complaints, but we have thumbs and you need that extra not-screen space to actually hold it. Ryan disagrees -- he says the iPhone has no bezel and people hold it just find. Andy: This one I really need a grip on, though -- people may even put grip tape on the back to help you not drop it. In the tub for example. (laughs)1:11PM Ihnatko: We could probably charge $499 for these foam iPads though. If anyone wants some blog hits, just take one of these and get some blurry shots of it, you'll get thousands of hits in a few seconds.1:10PM Andy's first impression: build was high quality. It feels like a premium product -- no gaps, it really does disappear in your hand. The device itself disappears within the first five seconds -- it's all experience. Holding it is not the same as seeing it, which most of the complainers have only done.1:08PM Jason: The screen is 4:3, not 16:9 -- even when they showed Star Trek, it was a little weird, but a 16:9 device would be more uncomfortable to hold. Ryan: Right, you can't have both. Either be really wide or more traditional, and they went 4:3, and I kind of prefer it.1:08PM Ryan: Also slightly less foamy than these foam prototypes on stage. It feels really well constructed, a bit heavier than it should feel, but still portable. I do have complaints, but we'll get to that.1:07PM Jason: It helps that we've seen the iPhone interface. Ryan: Everything serves the screen. As a browser, it's nice to go in and see nothing but the content.1:06PM Dan Warren: It's suprising how natural it feels. There's something about it that feels very intuitive. Like a book, you don't pick it up and think "how can I use this?" It makes sense.1:06PM Ted is the only one who hasn't touched the iPad, but everyone else was at the event. What were your first impressions?1:05PM Panels are coming up on stage. Jason says "We don't have a real one, Apple's not here." Four of the five people on stage have used an iPad, however. Dan Warren of Macworld, Ted Landau, Mac Observer and Macfixit. Ryan Block of GDGT and our old Engadget colleague, and Andy Ihnatko.1:04PM Paul introducing Jason Snell, finishes with "We'll see you next year, right?" Hope so!1:03PM The person holding one of the balls that was bouncing around? She just won an iPad from Macworld -- they're going to give her one when the iPad actually ships. Congrats! Maybe we should have participated in the ball bouncing.1:02PM Here's Paul Kent. "Welcome to our iPad special event." He's got an iPad mockup, but it's not the real thing. "You know that this is not shipping yet?" He just dropped it as a joke.1:01PM The lights are going down.12:59PM "Ladies and gentlemen, we need to fill every seat." The hall is practically full, and still more are coming in the door. Someone behind us thinks there will be an iPad here, but we'll see. 12:57PM Four minutes out -- even the press corps is really batting these balls around. I just got hit in the head. That's what we go through for you readers. 12:54PM The crowd is bouncing around a big ball and they seem excited about the iPad. Good thing they probably don't have one -- if one showed up in the hall here, they might get mobbed. 12:50PM Once again, word direct from Jason Snell this morning is that we will not see an actual iPad at this event. But of course, you never know. 12:49PM They're showing the promotional video that's been playing all week here at Macworld. The public has just been allowed in to see the show, and seats are filling up.TUAWMacworld 2010 special iPad event liveblog originally appeared on The Unofficial Apple Weblog (TUAW) on Sat, 13 Feb 2010 15:55:00 EST. Please see our terms for use of feeds.Permalink�|�Email this�|�Comments Apple - San Francisco - Moscone Center - Jason Snell - Macworld
iPad Prices Could Possibly Change Depending On Consumer Reception

According to an analyst from Credit Suisse, Apple is planning on staying "nimble" on its pricing of the iPad, especially if it doesn't fare well with consumers on its release.The analyst note out of Credit Suisse came out Sunday after they recounted meetings with Apple executives. The Apple officials that met with analyst Bill Shope also supposedly downplayed the potential for a bit of overkill of other Apple product lines.The note read:"Apple wants the iPad to be the best device for a few key use cases. For instance, the company believes it could eventually be seen as superior to both handheld and notebook devices for browsing the Internet, using the App Store, and consuming mobile media (video, photos, and e-books). Nevertheless, in other areas, notebooks, the iPhone, or an iPod may be more appropriate. This clear segmentation of capabilities suggests that cannibalization may be less of a concern than most currently believe."Shope also continued that despite Apple's pricing of the iPad, Apple seemed to indicate that they would proceed with price cuts if device demand didn't coincide with Apple's expectations. "While it remains to be seen how much traction the iPad gets initially, management noted that it will remain nimble (pricing could change if the company is not attracting as many customers as anticipated)."Apple shares are down about 7% on the year. Since the iPad was released, the company's shares are down about 5.5%.via The Wall Street JournalImage courtesy of Public Radio�
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. Please see our terms for use of feeds.Read�|�Permalink�|�Email this�|�Comments Apple - IPhone - iWork - iTunes - IPod Touch
Ask TUAW: Shopping for new Macs, iPhone home screens, home folder on external disk, and more

Filed under: Features, Troubleshooting, Ask TUAWWelcome back to Ask TUAW, our weekly troubleshooting Q&A column. This week we have questions about whether to buy a 27" iMac or a MacBook Pro, increasing the number of iPhone home screens, moving your home folder to an external disk, and more. As always, your suggestions and questions are welcome. Leave your questions for next week in the comments section at the end of this post. When asking a question, please include which machine you're using and what version of Mac OS X is installed on it (we'll assume you're running Snow Leopard on an Intel Mac if you don't specify), or if it's an iPhone-related question, which iPhone version and OS version you have. Bayuze asks I have a iPhone 3G 8GB. There are 11 home screens on my device now and I noticed that when I install new apps they don't appear anywhere and are only available if I search for them. How can I rectify this? Does this mean that 11 is the maximum number of home screens? You are correct that the default maximum for iPhone home screens is 11, though additional apps can be accessed by searching. It turns out that there is a hack that may allow you to access more than 11 home screens. However, this appears to be unreliable and is probably not the kind of thing one should depend on. If you really consistently want more than 11 home screens I think you'll have to jailbreak your phone. Joe asks My 27" iMac's hard drive is slow. I've decided to replace it with an SSD. OS X, applications and my Aperture Library are the only things that will live on the SSD. Everything else, which is just my user's home folder, will live on a FW800 external drive.My question is this: When I get the SSD and install a fresh copy of Snow Leopard, do I create a new user with the same name as my current user then point that account to the external drive or will SL see the user account that's already on the external drive? What's important in the Advanced Options for a user account -- i.e. should I note the User ID, Group ID, Short Name, Login Shell, and UUID of my current user and replicate that with the new install? As it turns out, our own Robert Palmer discussed moving a home folder last year. It certainly can't hurt to note all of those things you mention (the easiest thing to do is just take a screenshot), but all you really should have to do is change the home folder location in the Advanced Options. Although I get the sense you're already aware of this, for everyone else you can get to these options simply by right-clicking on the account name in the Accounts Preference Pane. This will allow you to select the location of your home folder just by navigating to the external drive with the standard Open file sheet. Do keep in mind Robert's warning that "in the past, some security and software updates have been confused by the fact that a user's home folder isn't on the startup disk." amiga_tone asks I don't get the whole 3G/WiFi version of the iPad. If the device comes with BlueTooth and iPhone tethering (in general) is supported in your country then the only point of selling a 3G compatible iPad is if you don't own a mobile phone. Based on this why would you own an iPad but not a mobile phone?... If they offer no 3G tethering here in Australia then you have to pay 2 monthly service fees (iPhone and iPad) and have 2 separate caps. If tethering is allowed then you will only have to pay 1 monthly service fee but share you data cap across 2 devices - though you would be more inclined to use the iPad for data access than your iPhone - or would you? This isn't really a technical question, but I would point out a couple of things. There are lots of people who purchase USB cell modems (or MiFi devices) even though they already have mobile phones. Furthermore, in the US, AT&T still hasn't gotten around to allowing tethering on the iPhone officially, so you're out of luck if you live in the States anyway. Finally, the pricing difference really seals the deal. Again in the US, the standard tethering price for smartphones is $60/month. So if you think about it, the additional price of the 3G iPad will be made up in only a little more than four months given the much lower monthly data charge of $30/month. Given the pricing model (and lack of contract), plus the convenience of not having to set up the tether, I think the 3G iPad is definitely worth it if you're ever going to use it outside of a Wi-Fi hotspot. And I'll put my money where my mouth is once it's released. jakejohnson asks I want to purchase a new 27" iMac with the i7 processor. However, the reports of DOA units and yellow screens on various forums has me worried. I have decided to pull the trigger and buy one in the next couple of weeks, UNLESS(!) there is reason to believe that the iMacs will receive a small spec bump in the coming months. A slightly more powerful i7 chip as well as the addition of an eSATA port and SSD options have been rumors. Do I have any reason to believe that any of these rumored rumors might have some truth to them, and that I might see any one of them happening in the first half of this year? As always with Apple products, you can't really act on the basis of rumors. There's obviously no guarantee that any of those features will be included in the next revision. That said, the MacRumors iMac Buyer's Guide is a handy resource for the time since the last update. You can see that the present model is only about half-way through the normal iMac product cycle, so if you choose to wait for a new model you're likely to be waiting several months (and it may still not have those features you mention). As regard the potential problems with the 27" iMac, particularly the yellow screen issue, a good place to look is over at Gizmodo where they've been keeping track of the problems. Their recommendation at this time is that it's safe to buy a 27" iMac, but that you should run this lcd test when you get it and return it for exchange if there's a problem. sinX asks Will the ipad be able to use that NetShare app that was on the app store for a bit to connect through? Well, obviously we won't know for sure until the iPad is released, but I rather doubt it. According to this NetShare setup guide you have to create a Computer-to-Computer network for this to work. It seems unlikely to me that the iPad will be able to do that, and if so, it seems unlikely that it will work with NetShare. If you're willing to jailbreak (along with all that entails) I suspect that the iPad will be able to connect though MyWi ($10). Jay asks My MacBook Pro is getting pretty old (bought it with the first wave of MBPs back in law school - still running Tiger) so I'm considering upgrading to a fancy new model sometime soon. Seeing as how there haven't been any MBP refreshes lately, should I wait a little longer until they push out some new models? How long do you think I'll be waiting? I'm all for instant gratification, but if waiting an extra three to four weeks means a much better computer for the same amount of dough, I'm willing to put up with my current laptop for the time being. What say you, TUAW? As with the last question, you can't guarantee anything with product refreshes. However, the MacRumors Guide for the MacBook Pro suggests that an update is really due. PC manufacturers are starting to put out Core i5 and i7 laptops, which is making the MacBook Pro line look increasingly dated. Part of the problem seems to be an issue with the graphics chipset, because of a licensing squabble between Nvidia and Intel. In short, in your shoes I would definitely wait for a few weeks because the performance improvements on the Core i7 will very likely be significant. sn0man1 asks I love the idea of the 'find my iPhone' for mobileme but was wondering if there was a 'find my MacBook' feature as well? I recently had my MacBook stolen and replaced it, but would like to be prepared if it happens again. It wouldn't really be feasible for Apple to implement this, at least in the same way, because the MacBook lacks a GPS component. That said, there are third-party laptop recovery applications out there that do offer some similar protection by getting general location data through Wi-Fi or IP addresses. Check out our recent post on hidden for more information on one such service (and links to others). I should point out, though, that even Back to My Mac has helped recover a stolen MacBook. TUAWAsk TUAW: Shopping for new Macs, iPhone home screens, home folder on external disk, and more originally appeared on The Unofficial Apple Weblog (TUAW) on Fri, 26 Feb 2010 15:00:00 EST. Please see our terms for use of feeds.Read�|�Permalink�|�Email this�|�Comments Apple - iPhone - Mac OS X - Robert Palmer - Mac OS X Snow Leopard
Does 'Nimble' Pricing Suggest iPad Won't Move?

Apple surprised some company watchers with its relatively low price points for the iPad, and it appears prepared to go even lower, if necessary. It will be flexible about pricing if consumer demand for the device does not shape up as expected, according to a note from Credit Suisse reported in The Wall Street Journal. That was the take-away from a recent meeting between Credit Suisse analysts and Apple officials, according to analyst Bill Shope.
More on Apple’s Billions: This Time, It’s iTunes

Billions and billions. It’s a theme that has accompanied me all week. In fact, I imagine I know a little how Carl Sagan must have felt. After writing about Apple’s billions just a few days ago, here I am again — but this time it’s not data centers and custom silicon — it’s music. We reported here back in early February that Apple was running its 10 Billion Song Countdown Contest. Yesterday afternoon, as Steve Jobs was (probably not) blowing out the fifty five candles on his birthday cake, the odometer stopped when, according to The Loop, Louie Sulcer of Woodstock, Georgia, downloaded Guess Things Happen That Way by Johnny Cash. The download likely earned Johnny Cash the usual pittance in royalties, while Sulcer became the lucky recipient of a $10,000 iTunes Gift Card from Apple. Naturally, I’m insanely jealous. Milestone Apple is understandably keen to celebrate the milestone. The iTunes Store first opened for business in April 2003 with a little over 200,000 items available for sale. Almost seven years later, the iTunes Store boasts more than 12 million songs, 55,000 TV episodes and 8,500 movies. In April 2008, it ranked as the number one (legal) online music seller in the United States. 10 billion songs in seven years is really something — in fact, my calculator tells me it’s a touch more than one song downloaded every second of every minute, day and night, since the store was launched. People with better math skills than me can (and most certainly will) take great pleasure correcting me in the comments below. The point is, my clumsy calculations notwithstanding, the iTunes Store is big business. In fact, it must be a big, fat, cash cow for Apple, right? True Purpose Well, as it happens, no, it’s not a big, fat, cash cow. It’s more like a well-fed, contented heifer. It certainly makes a good deal of money; according to one analyst it generated revenue of $520 million in the last quarter alone. However, Apple’s CFO Peter Oppenheimer told analysts during an earnings call last month that the store wasn’t “a real money maker.” Our own Darrell Etherington wrote here about declining music sales which have undoubtedly had an affect on Apple’s earnings recently. And as far back as May last year I wrote about the problem of variable pricing in the iTunes Store. Only a few weeks ago Warner Music Group announced the news (already completely obvious to everyone except music industry executives) that iTunes music sales had slowed since higher prices were introduced. (Honestly, when will the old-school music industry just shut up and admit defeat?) So the iTunes Store might be pushing huge numbers in digital downloads (10 billion songs, three billion apps and counting) but the revenue it generates is decidedly small-frys. So why run it? Well, it’s not a loss-maker by any means, and besides, Apple claims profit isn’t the purpose for the iTunes Store. Oppenheimer said during his earnings call: Regarding the App Store and the iTunes stores, we are running those a bit over break even and that hasn’t changed. We are very excited to be providing our developers with a fabulous opportunity and we think that is helping us a lot with the iPhone and the iPod touch platform. As far as Apple is concerned, the iTunes Store exists as a mechanism for selling its hardware. iPods enjoy seamless integration with iTunes. As a relatively inexpensive software publishing and delivery platform for iPhones and iPod touches, third-party app developers (almost) couldn’t ask for more. Defense Tactic The whole “a bit over break even” business is probably preferable over a service that is wildly profitable. Think about it; Apple’s super-success with the iPod, the iPhone & iPod touch and, presumably, with the upcoming iPad, translates into an awful lot of people around the world using iTunes (and the iTunes Store) all the time, every single day. My own clunky math above tells me this already happens, but we're talking about this intense activity steadily increasing as the iPhone continues to dominate and the iPad begins to make waves. As Apple’s hardware sales soar, and as more and more of its hardware ships with, or depends upon, iTunes software and services in some shape or form, the bitter cries of “anti-competitive” and “monopoly” from major competitors will grow louder. That the iTunes Store is not a means to print its own money gives Apple the ability to play its “But It’s Not Very Profitable For Us” card when the threat of antitrust inquiries looms (and oh boy will it loom). It might not be strong enough a defense to save it from unsavory intervention by the law courts (particularly those in Europe, which can’t help but interfere with successful businesses) but it certainly can’t do it any harm. It's ironic, really; when the iTunes Store launched it was lambasted by critics certain it had no chance at success. Of course, those criticisms have since proved unfounded, yet today it seems Apple is in an awkward place, and paying a price for its success.

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