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  • Newsletter Issue #545

    May 9th, 2010

    THIS WEEK’S TECH NIGHT OWL RADIO UPDATE

    Mac users no doubt applauded when the U.S. Department of Justice came down on Microsoft for unfair competitive practices some years back. Now it seems the shoe might be on the other foot, with reports that the DOJ and FTC may be engaged in an inquiry over Apple’s recent behavior when it changed the terms of its iPhone developer agreement, continued to block Flash from their mobile platform, and started up a new advertising facility, known as iAd. And when is Apple going to drop the “i” prefix? Is there anyone who isn’t sick of that?

    Well, it seems that the complaint was actually triggered by Adobe, perhaps in the vain hope that the government will, by threat or action legal action, force Apple to relent. Too bad Adobe doesn’t understand that they could have solved the problem long ago if they just demonstrated a working version of Flash on an iPhone that doesn’t hog resources and severely limit battery life. But maybe they can’t, and that’s their cross to bear.

    On last week’s episode of The Tech Night Owl LIVE, we explored the strange story about that alleged government inquiry into the affairs of Apple Inc. and all the side issues involved. We also covered the strange soap opera of an online publisher’s “purchase” of an iPhone prototype and the curious aftermath.

    Along for the ride were Peter Cohen, from The Loop, and Adam Engst, Editor/Publisher of TidBITS and Take Control Books. But understand that neither Peter nor Adam are attorneys, and neither plays that role on radio or TV. However, they voiced the appropriate level of skepticism about all these events, viewpoints that I share in large part.

    This week on our other show, The Paracast, co-host Nicholas Redfern, author of “Contactees: A History of Alien-human Interaction,” and Jim Moseley, editor of “Saucer Smear,” discuss the amazing claims over the years of contacts between humans and alleged alien beings.

    Now Shipping! The Official Paracast T-Shirt. We’re taking orders direct from our new Official Paracast Store, where you can place your order and pay with a major credit card or PayPal. The shirts come in white, 100% cotton, and feature The Paracast logo on the front. The rear emblem states: “Separating Signal From Noise.” We’ve also added a selection of additional special custom-imprinted merchandise for fans of our show.

    THE iPHONE REPORT: DID APPLE LOSE THE SURPRISE FACTOR?

    Apple has learned how to play the speculation and surprise game better than just about any company on the planet. They provide precious little information about forthcoming products, except to build a groundswell of interest, or to cater to the needs of the developer community.

    Sometimes they are forced to deliver a preview about a new gadget simply because the information would ultimately come from a third party, such as when submitting the iPhone for FCC certification, so they might as well control the flow of information.

    That strategy worked perfectly with the first iPhone. It took roughly six months from the initial announcement until the day it went on sale to throngs of waiting buyers. While you knew all about the look and features of Apple’s latest and greatest, there were plenty of opportunities for tech writers and so-called analysts to debate the possibilities that the product would be successful.

    You can’t buy that kind of publicity and Apple has learned how to keep us talking about them simply by keeping their mouths shut. That is, unless there’s a reason to say something.

    In recent months, co-founder and CEO Steve Jobs has devised yet another tactic to keep Apple in the news. Every so often, he will respond to a customer or reporter’s email inquiry. The statements are pithy, maybe a word or two, and sometimes even a short paragraph. In each case, they predate something Apple is about to do, and build up an incredible level of anticipation, since the quotes are spread far and wide.

    So when someone wrote to Jobs asking why it had been so long since the last MacBook Pro product refresh, Jobs said “not to worry,” and, sure enough, a few weeks later the professional portable lineup was refreshed. The announcement wasn’t even presented during a media event. Instead, you woke up one morning to see the press release, and the new product information on Apple’s site.

    Savvy Mac bloggers already knew something was afoot days earlier, when Apple stopped taking orders for the older model. In the end, three words fueled plenty of anticipation for what is probably nothing more than a modest product upgrade, but it was sufficient to propel more MacBook Pro’s into customer’s hands.

    And it didn’t require spending a dime for ads or staging a special press briefing. Sure, it’s quite possible there will be TV spots, print and online ads for the revitalized MacBook Pros, or maybe not. You don’t see a lot of advertising for the current iMac, but it seems to move in surprisingly large quantities.

    With the iPad, there had been speculation for years that Apple was developing a tablet computer. You have to wonder if they didn’t feed the speculation machine with carefully calculated leaks about the expected feature set to both mainstream and rumor outlets. In the end, yes the iPad looks like an overgrown iPod touch, but it is far more. And the fact that they can’t keep them in stock shows that the public is inclined to agree.

    The iPhone situation is more complicated. Product testing can’t be confined to Apple’s campus. They have to put prototypes in the field to check performance with Wi-Fi and mobile phone networks to confirm the components are working properly. That even means having engineers take them into homes and retail establishments, including bars, to evaluate performance. Certainly Apple is under the gun here, because they have been loudly criticized because of the decision to sign an exclusive deal with AT&T. Alas, AT&T is regarded as the lesser of the two major U.S. wireless carriers by a large margin.

    Now I don’t pretend to know what really happened when Apple engineer Gray Powell left his prototype iPhone at a bar evidently during a birthday celebration. It was a monumental screw up, but one made worse by the fact that the person who found the lost gadget sold it to the highest bidder, in this case Gawker Media, publishers of Gizmodo, for $5,000. That transaction may be a felony in California, which is why the authorities have seized computers and other gear from a Gizmodo writer and are investigating whether to prosecute.

    As far as Apple is concerned, it likely puts them in a peculiar position. If that prototype is close to the final product, the element of surprise is lost. Forgetting the form factor, the Gizmodo teardown revealed a larger camera, enhanced by a front-facing sensor, a smaller chassis and a larger battery. Those singular features were largely expected in the next generation iPhone anyway.

    Now it may be that the form factor wasn’t finalized. It was brought into the outside world strictly for performance testing, and it’s quite likely the case design that you’ve seen just represents a makeshift version. You won’t see the final form factor until Apple actually releases that next generation model.

    It’s always possible, of course, that Apple will simply choose an alternate case because of the unexpected leak, and that the new features may appear in a different form when the final version goes into production. Or maybe Steve Jobs will, teeth gritted, make light of the situation and explain at the forthcoming WWDC, “Well, I realize most of you have seen this already,” which will generate the appropriate levels of nervous laughter from the audience.

    In the end, though, this unfortunate incident actually helps Apple. They have become the victim of the crime and it also draws loads of attention to the next iPhone. Even if it looks precisely like the one you’ve already seen, I doubt very many customers will turn away in disappointment. The lines at the Apple Stores will just grow larger.

    You see, even when Apple says nothing, or limits its comments to a few pointed words from the CEO, we just can’t stop talking about them. I bet every tech company who hopes to compete with Apple in the marketplace is trying to duplicate that success. Will they “accidentally” leave their prototypes in bars next, hoping someone will find them and sell them to the media?

    IT MAKES NO SENSE FOR APPLE TO GIVE UP THE MAC

    Based on their current earnings reports, most of Apple’s income comes from mobile products, ranging from the iPhone to the iPod. The iPad is still too new to get a gander at how much it’ll contribute to the bottom line, but if demand continues to exceed production, you can bet it’ll be considerable.

    In light of this state of affairs, some people are suggesting that Apple has essentially given up on the Mac and is just in a holding pattern. I mean, you seldom see special press events about new Mac gear; it’s all about the mobile products, right? There is also that statement that Steve Jobs made years ago, before he returned to Apple, that they should do their best to market the Mac and then move on to the next great thing.

    The conclusion, here, is that the mobile gadgets constitute that next great thing. So the personal computer is on life support, and the Mac has become yesterday’s news.

    On the other hand, those mobile products don’t yet exist in a vacuüm. Your iPad, iPhone and iPods have to be tethered to a Mac or PC to sync. Mac sales continue to soar well ahead of the PC industry, with sales averaging three million per quarter, more than twice the rate of just a few years ago. If things continue in that direction, Apple may move over four million units per quarter by the end of the year. Considering that the Mac delivers a far higher profit per unit sale than anything else Apple makes, they’d be foolish to discontinue the line.

    What would they do without the Mac? Expect you to buy a PC? Does that make sense? Not to me. In recent years, roughly 50% of the sales of new Macs at Apple Stores went to people new to the platform. There’s plenty of life in that old platform yet.

    Of course, there are reasons why you might think Apple has begun to deemphasize the platform. The forthcoming WWDC, for example, already a sell-out event, seems heavily devoted to mobile products. There won’t even be an Apple design award for the best Mac app, as if that’s no longer of any importance.

    Since Apple is heavily invested now in building iPhone 4.0 for release this summer and fall — the latter for the iPad — there are also reports that development of the next version of Mac OS X has been curtailed. Since nobody outside of Apple knows anything about the company’s internal development timetables, it’s a sure thing that we can do nothing but make good guesses.

    However, Apple long ago indicated that operating system upgrades wouldn’t come quite so rapidly. Developers actually cheered the news, because each new release not only provides new or enhanced tools with which to build apps, but also the usual spate of incompatibilities. Indeed, some apps are only now becoming reasonably compatible with Snow Leopard, which was released last August.

    As you probably notice, few of the new apps actually support Snow Leopard’s most significant features, such as Grand Central Dispatch for multiprocessing and multithreading, and OpenCL to offload heavy computing tasks to the graphics chips. Yes, there is some software out there that’s now 64-bit savvy, but unless you want the system to be able to allocate more than 4GB to an app, it doesn’t make much of a difference. Yes, there may be a performance advantage, but it’s mostly for show otherwise.

    That being the case, there’s little incentive to force developers to consider a 10.7 right now. Yes, you might see a technology preview at the next WWDC, but don’t expect the real 10.7 to appear before the middle of 2011 if not later. It’s not as if Microsoft is going to deliver some new killer Windows variation by then anyway. Besides, even though Windows 7 seems to be doing well sales wise, the only feature Microsoft seems to be able to tout is the ability to pin document windows at the corners of the screen. So who cares about them anyway?

    Some day, personal computers will become unnecessary. But that will be years from now, and I’ll probably be too old to care.

    THE FINAL WORD

    The Tech Night Owl Newsletter is a weekly information service of Making The Impossible, Inc.

    Publisher/Editor: Gene Steinberg
    Managing Editor: Grayson Steinberg
    Marketing and Public Relations: Barbara Kaplan
    Worldwide Licensing and Marketing: Sharon Jarvis



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