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  • Newsletter Issue #646

    April 16th, 2012

    THIS WEEK'S TECH NIGHT OWL RADIO UPDATE

    You had to expect that there were consequences to Apple's stellar growth in recent years. Take malware. Mac OS X has been relatively free of serious outbreaks, though there have been a few issues, such as a Trojan Horse here and there. With Flashback, it became serous, with an estimated 600,000 Macs, about 1% of the number estimated to be in use these days, reportedly infected.

    While Apple hasn't confirmed that number, it's a sure thing they've finally reacted in a serious fashion, after an unaccountable delay. So there have been several recent Java security updates, first to replace Java with a fixed version free of the security leak that was being exploited by Flashback, and later with a version that removed the infection. There is now an official Flashback malware removal tool from Apple that is meant to help those who were infected without actually connecting to a site using a Java applet. I suppose that takes care of that, unless or until the criminals behind Flashback devise yet another method of doing their misdeeds.

    Time will tell how Apple will enhance OS X's security beyond the levels promised for Mountain Lion, whether there will be an official security app, or whether third parties will be the ultimate resource to protect your Mac from malware. There are already several credible Mac security apps out there, regularly updated, that ought to help. It's not unreasonable to assume that malware authors will now target the platform in greater numbers.

    Meantime, on this week's episode of The Tech Night Owl LIVEMacworld's "iTunes Guy," Kirk McElhearn, brings you up to date on ongoing iTunes problems, and also gives you the full story behind the recent Flashback malware outbreak.

    From TidBITS and Take Control Books, Michael E. Cohen speaks about the Department of Justice's antitrust lawsuit against Apple and five major book publishers for alleged price-fixing. I'll have more to say on that subject later on in this issue.

    Macworld Senior Editor Dan Frakes also discusses the Department of Justice antitrust action, along with iTunes syncing problems and other issues, plus the best way to recharge your new iPad, which has heftier power needs because of the Retina Display, LTE wireless networking, and other  components.

    On this week's episode of our other radio show, The Paracast: Gene and Chris present independent researcher Thomas P. Fusco, who has devoted nearly three decades investigating the relationship between mind, physics, spirituality, parapsychology, scientific anomalies and paranormal phenomena with the goal of uncovering the unifying cosmological framework that has eluded mankind for generations. On this episode, he'll be discussing the theory of supergeometry presented in his book, "Behind the Cosmic Veil: A New Vision of Reality," which integrates reality, spiritual, and the supernatural, including UFOs and other strange events.

    Now Shipping! The Official Paracast T-Shirt -- Now with New Design! 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 huge selection of additional special custom-imprinted merchandise for fans of our show, along with a redesigned storefront.

    STILL NOT READY: MICROSOFT OUTLOOK FOR MAC 2011

    I've had a rough time with Outlook for the Mac 2011, which is Microsoft's attempt to build a business-grade email and contact management app. It was meant to be a leg up from Entourage, with more comprehensive support for Exchange servers, but actually getting it to work has been a job and a half.

    With the release of the Office for Mac 2011 Service Pack 2, I had hopes that the worst offenses of Outlook would be eradicated, that perhaps Microsoft would begin to focus on making the app actually usable. For me, it hasn't been, and I can only begin to summarize the problems.

    At first blush, it seemed a fairly promising app, though the implementation of Microsoft's infamous ribbon, a new take on the traditional contextual toolbar, is poor. Buttons appear to have been thrown together without a true sense of design, though the key functionality is there. That assumes, of course, that the functions actually work, and therein lies a tale.

    The original release of Outlook was problematic in many ways. Some features, such as the ability to redirect an email to another recipient, were unaccountably absent. You'd think Microsoft had more than enough time to bring over legacy features from Entourage (certainly they seem to share the same sluggish email engine). Worse, the first couple of releases crashed constantly, particularly if you had large numbers of messages to store. It took a while to get that right, but I still ran into serious difficulties.

    Even with updates every few months, it's certain that Microsoft isn't capable of doing things in a reasonably swift fashion, so perhaps you should be pleased that they are at least trying to make Outlook work better. At the end of the day, however, it's still not ready for prime time.

    One particularly curious problem with the latest Outlook, which bears version 14.2.0, is the disconnect between the changed features at the Help menu. So, for example, the IMAP setup and preferences have been highly simplified in the new release. From a usability standpoint, that's a good thing, because you shouldn't have to waste time configuring barely understandable options just to set up an email account. However, the Help menu still has the old text. Surely that's something that could have been fixed in a day or two, so why didn't Microsoft's Mac Business Unit bother?

    A really annoying problem with the previous versions was the inability to properly map the core IMAP folders with the ones on the email server for the system you're using. This problem afflicted Gmail and other services, and involves the basic "sent," "spam," "draft" and "trash" folders. If you don't map these folders on your Mac to the ones on the email server, the server won't store the messages you send, flag as junk, or even delete.

    With Mail, Apple expects you to do the heavy lifting, which is unfortunate. You have to use a feature in the Mailbox menu -- "Use This Mailbox For…" -- to perform this function, after selecting the email folder you want to map to one of those key functions. With Outlook, it would simply create folders on its own, and you'd have to go into the account's Advanced preferences, under Folders, to set things right.

    Well, the Service Pack 2 edition seems to have resolved that problem for the most part. Using accounts from several different email systems, including Gmail, iCloud and a business email host, PolarisMail, the new Entourage had it mostly right. That's progress, and it actually works better than Mail. But Microsoft's Mac BU still has plenty of work to do.

    The larger problem is that it's just so slow. Mail can process a short message sent to most email servers in a couple of seconds, depending on the speed of your Internet connection of course. Outlook takes two or three times longer, typically. It doesn't seem altogether faster than Entourage, and has gotten no more efficient even as OS X has matured, and Macs have become far more powerful. You'd think Microsoft has more experience at this game, and should be making their apps snappier, but that never seems to happen.

    Another quibble, perhaps a minor one, is the interface design. When you delete a message, Outlook moves to the previous message rather than the next one. This seems sort of a reverse logic to me, and is the opposite of how Mail handles messages displayed with the most recent ones at the top of the list. But maybe I'm behind the curve here, because Mozilla's Thunderbird does the very same thing. That's one reason why I don't use Thunderbird.

    Indeed, unless you require an Exchange feature not available in Apple Mail, I can't see any reason to use Outlook. Yes, it's getting better, but until Microsoft cleans up the loose ends and makes a concerted effort to fix the performance lapses, I cannot recommend this app.

    APPLE AS A MONOPOLIST

    For so many years, Apple was regarded as a tiny niche player in the tech industry. The OS wars were over, and Microsoft was the winner. Steve Jobs said so himself some years back when Microsoft agreed to invest $150 million into Apple. But imagine if Microsoft held onto that stock until now, because that tiny investment would be worth billions, enough to cover a fair portion of the money the company has bled on various failed projects over the years.

    Even when Apple dominated the digital music player market with the iPod and first brought the iPhone to market, many tech pundits still wouldn't take them seriously. Then came the iPad, and now, with Apple worth more than any other company on the planet, they have therefore earned intense scrutiny from all the wrong places.

    The stringent curation of the App Store and now the Mac App Store, along with the tight integration among all the major products, from Apple TV to a Mac, has created the "walled garden" that some demonize. At the same time, Microsoft has its own walled gardens, for the Xbox gaming console, the failed Zune music player, and even Windows Phone devices. Sauce for the goose and all that.

    The U.S. government has also paid close attention, scrutinizing the activities of large multinational corporations as never before, well at least in some industries. This past week, Apple found itself joined at the hip with five major book publishers in confronting a civil lawsuit from the Department of Justice. Their offense was alleged price-fixing of ebooks. The complaint contends that all these companies banded together to support the so-called "agency model," where publishers would set minimum prices for all book vendors. That meant that you'd pay pretty much the same for an ebook from Apple, Amazon and other vendors.

    Despite the fact that three of the publishers quickly caved, Apple and two others, including Macmillan (which published my first book way back in 1994 by the way) said no. Apple's argument is that this new pricing scheme was created to combat an alleged monopolist, Amazon. According to Apple PR rep Tom Neumayr, as expressed to Macworld and other media outlets: "The DOJ’s accusation of collusion against Apple is simply not true. The launch of the iBookstore in 2010 fostered innovation and competition, breaking Amazon’s monopolistic grip on the publishing industry. Since then customers have benefited from ebooks that are more interactive and engaging. Just as we’ve allowed developers to set prices on the App Store, publishers set prices on the iBookstore."

    Now some independent so-called legal experts say that the DOJ has a large mountain to climb in proving a case of collusion against Apple and perhaps some of the other defendants. While the complaint talks of supposed dinner meetings where the publishers reportedly conspired to fix ebook prices, it's not at all certain whether Apple was involved in those discussions, or simply supported the outcome, since it served their interests.

    You see, before the agency model was enacted, Amazon held an over 90% share of the market, and often sold ebooks as loss leaders for less than even the wholesale price. That served to the detriment of other book vendors that depended more on book sales to stay in business. With Amazon, you can get an ebook or a Kindle reader real cheap, but maybe you'll buy a new Mac, an air conditioner, or a pair of Guess jeans at regular prices as part of the same shopping tour.

    Under the old system, the publishers suffered, because they got less per book. Worse, the people at the very end of the food chain, the book authors themselves, fared even worse. Their meager royalties were even more meager. You see, very few authors earn the big bucks. For every John Grisham, there are thousands of us who struggle to eke out a living. For most of us, writing books has to play second fiddle to a more lucrative day job, if you can find one.

    If the DOJ emerges victorious, it will mean that Amazon will be free once again to dominate the market by cutting prices to the bone. They will become the powerful monopoly that can kill off other book sellers. Sure, Apple won't lose that much, but consider the plight of Barnes & Noble and other companies in the shrinking book seller market.

    So by halting alleged price-fixing, the DOJ may just end up allowing a monopoly to prosper instead. You'd think they could find targets who really impact the health and welfare of society. What about oil speculators, who drive up the price of gas willy-nilly at the hint of a real or imagined energy crisis?

    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: Sharon Jarvis



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    11 Responses to “Newsletter Issue #646”

    1. [...] Continue Reading… Related Posts: Newsletter Issue #606: Some Mac Users Locked Out of Lion [...]

    2. Kaleberg says:

      I was under the impression that publishers set their prices for Amazon, so no matter what price Amazon charged, the publisher would get the same payment per book. If Amazon sold at a loss, the publisher and author might still do well and profit from the increased sales. The agency model requires all sellers to sell at fixed prices, and that seems to be anti-competitive. Some sellers may have lower overhead or better customer interface than others and should profit from it.

      I don't see how Amazon could build a monopoly that way as anyone who wishes could either offer similar low prices or some other features, for example, in app purchasing, that would draw customers. I think the big anti-competitive issue is DRM lock in which prevents users from switching their library from one app to another.

      Reply To This Comment

    3. dfs says:

      The problem here is that monopoly laws were written to protect the consumer. Traditionally monopolies have been used to keep prices artificially high. But since Amazon's monopoly is used to keep prices artificially low it would probably be impossible to convince a court of law that the consumer has suffered any injury. Other parties, such as authors, may indeed suffer, but, as I say, the laws are not designed to protect their interests.

      Reply To This Comment

      Gene Steinberg replied on April 16th, 2012 at 2:05 PM:

      @dfs, Exactly. Worse, if fewer authors write books, particularly the good ones, it means fewer books, so all readers suffer.

      Peace,
      Gene

      Reply To This Comment

    4. Peter says:

      Under the old system, the publishers suffered, because they got less per book.

      Try that again. Under the old system, Publishers made more money per book. FTA:

      "Book publishers, meanwhile, are volunteering to limit their digital profits. In the model that Amazon prefers, publishers typically collect $12.50 to $17.50 for new e-books. Under the new agency model, publishers will typically make $9 to $10.50 on new digital editions."

      So, under the agency model, I assume those poor starving authors are receiving less money, also.

      By the way, if this is such a good idea, why didn't Apple do it with music? Why don't they let the music companies set the prices? Gee, it's not like Apple has a monopoly-like share of the music industry (Apple has over 70% of the download market). If the music companies have more money, then so will those poor starving musicians you seem so concerned about.

      Reply To This Comment

      Gene Steinberg replied on April 16th, 2012 at 2:39 PM:

      @Peter, Are you referring to wholesale or retail? Seems the latter.

      Ask even the famous authors and musicians how the industry manages to make sure their talent behind those works earns as little money as possible -- even the major authors and musicians will often file lawsuits so they can get what they believe is due them. Lots of creative accounting in those businesses.

      Peace,
      Gene

      Reply To This Comment

      Peter replied on April 16th, 2012 at 5:44 PM:

      @Gene Steinberg, I'm referring to how much money the publishing companies for each book--the unit price that was paid by Amazon to the publishing companies, per the quote the from the article:

      "Publishers typically collect $12.50 to $17.50 for a new e-book."

      Now whether they get that all up-front (ie, when Amazon buys 1,000,000 copies) or on each sale is beside the point. They make less money per book on the agency system then they do under a wholesale system.

      As for how the publishing and music industry screw creative people, yes, I believe that wholeheartedly. But you say, "Worse, the people at the very end of the food chain, the book authors themselves, fared even worse. Their meager royalties were even more meager." So shouldn't you be railing against the publishing companies that chose to accept less money--and therefore pay less royalties--to these authors?

      And shouldn't you be just as upset at Apple for forcing a 99 cent price on the music industry meaning that those artists get paid next to nothing? After all, 1% of 70 cents (after Apple's 30% cut) is far less than 1% of, say, $2.79 (say, $3.99 after Apple's 30% cut)?

      I know the current Apple groupthink is "Apple did nothing wrong and even if they did, they had our best interests at heart." But you really need to work the logic on this one a bit more.

      Reply To This Comment

      Gene Steinberg replied on April 16th, 2012 at 5:49 PM:

      @Peter, I'm happy to rail against the publishing companies, having dealt with them for a number of years. The worst was waiting months for a check to arrive.

      Since I am not a musician, I am not involved, but if I were, I'd complain about them too. But the price today for digital music should be less than physical media; it's mostly profit minus Apple's, the artist and the songwriter percentages.

      Peace,
      Gene

      Reply To This Comment

      Peter replied on April 16th, 2012 at 7:46 PM:

      @Gene Steinberg, so go for it. Let's hear the complaint that the publishing companies conspired with Apple to raise book prices. But, wait, it was Apple that was involved and we all know that they only have our best interests at heart.

      And wouldn't e-books also be "mostly profit"? As an author, you should be able to answer that. Heck, musicians need complicated audio processing to get the right sound, studios, instruments, etc. Meanwhile, I would imagine that most authors get by with a word processor and a really good story. While the costs of recording professional audio have certainly come down from where they were 10 years ago, I'd argue that a good word processor can be had for $19.99 and a pretty good computer to run it on could be had for as little as $999. A moderately decent one could probably be found for less (but then you'd have to use Windows...)

      See, to me, it's somewhat hypocritical to say that it's a good thing that Apple stepped in and saved the publishers from the evil Amazon who were selling e-books for $9.99 (as a loss leader in order to drive other on-line book sellers out of the market) while hoping people would buy other higher-priced fare from them, yet praise Apple for teaching those music industry jerks a lesson by selling music for 99 cents (running just about break-even and driving most other on-line music sellers out of the market) while making serious bank selling computers and music players to play that music.

      About the only difference I see is that Apple was late to market because, as Steve put it, people don't read anymore.

      Reply To This Comment

      Gene Steinberg replied on April 16th, 2012 at 7:58 PM:

      @Peter, You're looking in the wrong place. After the initial production expense, it costs the same to deliver one digital copy as 10 million. Hence mostly pure profit.

      Peace,
      Gene

      Reply To This Comment

    5. dfs says:

      By the way, I may have been victimized by another e-pub. business practise. Google Books lists at least one of my books and as part of its presentation makes many pages of extracts available online, wildly in excess of the copyright law’s definition of “fair use quotation.“ I say I MAY have been victimized because in this case the copyright is owned by the publisher and it is possible that Google obtained the publisher’s permission, although, if so, the publisher certainly did not bother to inform me. But I have a strong hunch that plenty of these lengthy extracts made available by GB are unauthorized, and so are flagrant copyright violations.

      The reason I mention this is that I find it curious that the DOJ is going after Apple and the publishers but is evidently giving Google a free ride. In theory, the DOJ is in the business of enforcing copyright as well as monopoly laws. So I have to ask myself, what's the real motivation behind this prosecution?

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