Wednesday, July 30, 2008

Photoshop Lightroom 2 released as Adobe's first 64-bit Mac app

Published: 09:45 AM EST

Following an earlier open beta, Adobe on Tuesday released version 2.0 of its Photoshop Lightroom post production photography software, which stands as the company's first application to run 64-bit-native on Apple's Mac OS X Leopard operating system.

The San Jose-based software developer is particularly proud of the accomplishment given that Lightroom's main competitor, Apple's Aperture, has yet to see native 64-bit support.

Adobe has committed to delivering 64-bit versions of Photoshop and its other Creative Suite applications, but said earlier this year that those updates will take considerably longer due to Apple's decision to scrap plans for a 64-bit version of its Carbon developer tool set.

For Lightroom 2.0, 64-bit support will allow the application to address large amounts of memory in excess of 4 gigabytes, which will speed up overall performance for photographers dealing with large scale images that must be swapped into and out of memory during processing-intensive operations.

The software also aims to streamline and accelerate photographers� workflows through an enhanced Library module featuring the ability to visually organize images across multiple hard drives. A Library Filter Bar and Suggested Keywords feature work towards simplifying the search and retrieval process.

Two other highly touted features of Lightroom 2.0 are dual-monitor support for maximizing workspace and more efficient printing tools. For instance, the software now arranges photos of multiple sizes on one or many pages with customizable templates to maximize paper and ink. Intelligent algorithms then automatically determine optimal sharpening for screen or print, producing crisper images faster.

Adobe is also rolling out new RAW technology that gives photographers access to flexible camera profiles that will help reduce unexpected changes in the quality of their photographs.

"Camera profiles are the visual starting point for the raw processing workflow, but image preferences vary for every photographer," the company siad. "To minimize surprises, Adobe is supplying default camera profiles that closely emulate the visual looks that photographers are used to seeing from their favorite camera, while also providing the ability to create highly customized profiles to suit different tastes."

Camera profiles are available for immediate download on Adobe Labs for use with Lightroom 2 and Camera RAW 4.5, along with a DNG Profile Editor for the community to test and create their own profiles. The tools currently support over 190 camera models including the Olympus E 420 and E 520 models.

Adobe Photoshop Lightroom 2 is available for immediate download (or shipping) through the Adobe Store in English, French and German with the Japanese language version planned to be released at a future date. New licenses cost $299 and upgrades fetch $99.

Rogers commits to purchasing $150M in iPhones from Apple

Published: 12:00 PM EST

Rogers Wireless said Tuesday it wasn't expecting the opportunity to market the iPhone to its Canadian customers this year, but jumped at Apple's sudden offer with a commitment to purchase at least $150 million worth of the handsets.

Company president Nadir Mohammed made the revelation during a conference call covering Rogers' fiscal second quarter results for the three-month period ended June 30, in which the carrier said it earned C$301 million, or 47 cents per share.

"We didn't anticipate that we would launch that device under any model this year," he said.

Mohammed noted that demand for his firm's usual array of handsets "slammed on the brakes" on June 9th, the same day Rogers announced plans to begin selling the Apple phone the following month.

Subscriber interest in the iPhone eventually led Rogers and Nokia to half the price of Nokia's similarly-equipped 8GB N95 handset to match the 8GB iPhone's $200 price tag in a bid to re-stimulate demand.

Mohammed also acknowledged that the discount Rogers is offering on each iPhone is the largest in the company's history. Still, Apple's approach is said to be "highly, highly attractive" given that the carrier expects the iPhone's higher average revenue per user to more than make up for its initial subsidy investment.

The executive said non disclosure agreements with Apple prevent him from revealing the number of subscribers who switched to the carrier to obtain an iPhone compared to those who simply upgraded. He did, however, reveal that Rogers' agreement with Apple included an up-front commitment to purchase $150 million worth of the new 3G handsets.

Assuming an average non-subsidzed price of $450 per handset, Rogers would have agreed to purchase approximately 333,000 of the new iPhones.

The carrier said it's prepared to expand upon that momentary commitment as necessary.

RIM's iPhone rival rumored for October with Rhapsody tie-in

Published: 03:45 PM EST



Related AppleInsider articles:* Apple wants over-the-air music downloads for...
* Swiss iPhone rumor; BlackBerry Thunder; Apple...
* BlackBerry Bold stands as 3G iPhone's chief...
* Vodafone inks deal with Apple to sell iPhone...
* MTV and Real to join forces against Apple's...

Blackberry maker Research In Motion is reported to be readying Thunder, its answer to Apple's iPhone, for an October release alongside a partnership with Real's Rhapsody music service.

Also known as the Blackberry 9500, the new device will reportedly sport a 480x320 touch-screen, 3.2 megapixel camera, and a MicroSD memory expansion slot.

New iPod touch hidden in firmware; Microsoft's pro-Vista videos

Published: 06:30 PM EST

A simple reference in the beta of Apple's latest firmware could hint at a significant remake of the iPod touch. Also, Microsoft has posted the controversial "blind taste test" videos that promote an improved Vista, and a Wyoming county's schools will receive 3,000 MacBooks.



New iPod touch referenced in iPhone 2.1 firmware

Although the mention is short, a text string in the iPhone 2.1 beta firmware could have a significant impact on the iPod touch, according to a discovery made by iPhone Atlas.

While Apple has used "iPod 1,1" to describe the current iPod touch as the first OS X-based iPod and the only minor revision, multiple files now contain references to "iPod 2,1" -- a number change which, for past Macs, has referenced a major revision instead of a minor tweak..

For contrast, the iPhone 3G is simply listed as "iPhone 1,2" despite its new features and indicates that the design underneath is largely identical.

The company has in recent years reserved either August or September to start updating its iPods and this year launched a back-to-school promotion that gave away free iPod touch players to students buying a Mac at the same time, triggering a shortage that has helped Apple keep its touchscreen iPod supply in check.

Microsoft kicks off Vista first-hand experience videos

Microsoft's promised campaign to restore Windows Vista's reputation has begun in earnest through a special promo website.

Now nicknamed the "Mojave Experiment," the promo campaign hosts videos of Windows XP owners who Microsoft says had a very negative perception of Vista but were shown the current version of the operating system under the fake "Mojave" name to gauge their reactions without media- and friend-made preconceptions in the way.

According to Microsoft, over 90 percent of these users came out with a complete changed, positive outlook on the operating system now that its initial kinks have purportedly been resolved a year and a half after its debut.

The company doesn't, however, say what customers were allowed to try during the test. While performance has been improved with recent patches, other complaints have centered around backwards compatibility with hardware and software.

Wyoming school district to get 3,000 MacBooks

One of Apple's larger, more recent educational deals for Macs will roll out in the least populated state in the US, says a local report by the Casper Star-Tribune.

Over 3,000 MacBooks are being distributed to K-12 schools in Natrona County. Casper's Kelly Walsh High School gets the lion's share with 1,400 of the notebooks, while the remaining number will be divided largely equally between older students at CY Middle School and Dean Morgan Junior High as well as younger ones at Ft. Caspar Academy, Manor Heights Elementary and Park. Teachers also receive their own units.

The schools plan to launch a one-to-one program where each of the older students has access to a personal system that will help them learn, including through Internet materials.

Natrona County's deal also gives the teachers some education: each of those at Kelly Walsh has gone through a one-week learning process to help those who might still be unfamiliar with how to use online information in a classroom, including keeping students honest with online assignments.

Tuesday, July 29, 2008



Related AppleInsider articles:* Steve Jobs: it's time we design our own iPhone...
* Confirmed Intel delay will push back MacBook...
* Apple notebook lines to see major design...
* Next Apple notebook refresh rumored for June
* Intel to grow next-gen notebook chip offerings

A new generation of personal computers on the way from Apple Inc. may sport some of the most significant architectural changes since the Mac maker made the jump from PowerPC processors to those manufactured by Intel Corp., AppleInsider has learned.

As part of its move to Intel chips in early 2006, the Cupertino-based company largely abandoned its practice of using custom motherboard chipsets to support the primary CPU in its Macs. Instead, it began to rely on slightly tweaked versions of industry-standard chipsets offered by Intel to the broad range of PC manufacturers that develop Intel-powered systems.

For instance, while Apple's existing line of MacBook and MacBook Pro notebooks are unique in that they run the Mac OS X operating system, they're architecturally based on the same run-of-the-mill processors and chipsets from Intel's Santa Rosa mobile platform also employed by Windows-supporting rivals, such as Dell and HP.

However, with Apple striving to maintain Mac sales growth of more than two times the industry average, it's again looking to differentiate the architecture of its personal computer systems through alternative technology that will afford it an advantage beyond the reach of its competition.

As such, people familiar with these plans say an upcoming generation of Macs, lead by a trio of redesigned notebooks, won't adopt the Montevina chipset announced as part of Intel's Centrino 2 mobile platform earlier this month. What's more, those same people suggest the chipset employed by the new wave of Macs may have little or nothing to do with Intel at all. (This should not be confused with the primary CPU, which will continue to come from Intel.)

Exactly what alternative Apple has chosen remains unclear. However it's believed that Intel, which declined to comment for this story, would need to have established a licensing agreement with the firm responsible for manufacturing an Intel-compatible chipset, be it Apple or one of the company's third party suppliers.

Assuming the chipsets in the new Macs are not based on Intel technology, that would leave Apple with only a handful of viable options. The company could return to a practice common during the years of PowerPC-based Macs in which it developed proprietary chipsets to support the primary processors in its systems.

Another option is that Apple could forge a relationship with one of the other established third party chipset manufacturers, such as NVidia, AMD or Via, in a move that would allow the company to build its next-generation systems using technology cherry-picked from the best of both worlds.

Apple Notebook Design Revision History

A move by Apple away from Intel chipsets may also be tied to concerns over the power-hungry nature of the chipmaker's more recent mobile chipsets. The Mac maker has been working to reduce the size and weight of its notebook offerings while simultaneously extending battery life and introducing new features not accessible to its rivals.

During a recent quarterly conference call, Apple chief financial officer Peter Oppenheimer uncharacteristically made references to ongoing investments in new product technologies that would pressure the company's profit margins but leave competitors scrambling by the side of the road.

"We have some investments in front of us that I can�t discuss with you today where we�re going to be delivering state of the art new products that our competitors just aren�t going to be able to match," he said, "and as a result, I would see gross margins being about 30 percent and that�s � that�s all I can tell you at this point."

Since Apple's new Mac notebooks aren't necessarily following the same rollout schedule as competitive offerings based purely on standard Centrino 2 components, people familiar with the next-generation systems say it will be at least another 6 to 8 weeks before the company makes an official announcement.

Next-gen MacBook Pro
An authentic photo of Apple's next-gen MacBook Pro casing.

Next-gen MacBook Pro

Apple recently de-committed on notebook inventories for a two-week period to retail partners such as Best Buy, which spurred speculation of imminent upgrades. The move, however, is believed to be a result of orders related to the ongoing educational buying season, which typically puts a strain on Mac supply for a period of several weeks each year beginning in mid July.

Anti-DRM protest at Apple stores; Verizon on iPhone 3G's impact

Published: 06:45 PM EST

Open-source campaigners are planning a flood campaign against Apple retail they believe will pressure the iPhone maker to open up its devices. Verizon, meanwhile, only believes the iPhone 3G has had slight impact on its sales, and Doom's creator wants to create an exclusive iPhone game.

DRM opponents hope to overwhelm Apple retail

In a symbolic gesture, the Free Software Foundation plans a new campaign, nicknamed the Apple Challenge, that it thinks will pressure Apple into opening its software code.

The organization is asking supporters to book a Genius Bar appointment at an Apple retail store on Friday or Saturday and ask the technicians questions about the company's broader corporate policy regarding iPhone 3G and its software under the belief that any copy-protected hardware or software is "defective."

Among the questions several few technicians would be likely to answer, including those asking why Apple doesn't allow iPhone developers to publish source code, why Apple continues to sell protected iTunes music, and why the company doesn't support open media formats like FLAC, Ogg Theora, and Ogg Vorbis.

The questionnaire goes so far as to suggest that closed-source software for GPS would allow Apple to track customers' locations without their knowledge.

Although Apple currently uses and promotes some open-source software through Mac OS X, the company has more often refrained from a similar policy with its portable devices. Chief executive Steve Jobs, however, has endorsed cross-platform formats but has only mentioned AAC and MP3, which still require licensing and are patented in a way that makes open-source modification impossible.

Verizon downplays iPhone 3G's effects

iPhone 3G's rollout has had just a "minimally short-term impact" on Verizon's sales, if the company's statements during its quarterly results call prove true.

Though it stops short of handing out any statistics, the cellular service provider alludes to the Apple phone making a small dent in Verizon sales in the days following its launch but that it was "disproportionately less" than the company's market share, which is smaller than that of exclusive iPhone provider AT&T.

The company also fires a direct jab at AT&T, noting that its wireless strategy doesn't depend on "any one device" and claims the iPhone actually spurred a rush of smartphone sales at Verizon.

id Software's Carmack eager to develop iPhone exclusive

John Carmack, the co-founder of game development house id Software, says his company is planning to develop an iPhone-exclusive title that would show off the abilities of the platform, Forbes says.

While it's too early to reveal details, the game would be based on an existing storyline from the company such as Doom, Quake, or Wolfenstein but would be a "graphical tour de force" that shows off the visual prowess of the iPhone and iPod touch's PowerVR hardware.

"The iPhone, as a device, is in the same generation power-wise as the PS2 or Xbox," Carmack says. "The graphics are a little lower but the RAM is a lot higher."

Apple's handhelds also have considerably more storage than the cellphones id Software has developed for so far, with many games coming in over 10MB while a typical mobile game is often 300KB.

At present, his only immediate lament is not having time to create a launch game. "I really regret not having something at launch," he says.

Sunday, July 27, 2008

Apple chief Jobs settles health worries

Published: 11:40 AM EST

In a rare discussion of his personal health, Apple co-founder Steve Jobs has privately revealed to a journalist exactly what conditions led to his overly thin appearance at the Worldwide Developer Conference this year.



After receiving multiple statements from Apple's press relations that simply echoed the company's official position that Jobs' health "is a private matter," the New York Times' Joe Nocera received a personal phone call from Steve Jobs that appears to have settled some of the doubts about his physical condition.

The company luminary insists that the precise details be kept off the record, but according to Nocera has virtually confirmed earlier reporting by the Times' John Markoff that claims Jobs had new surgery earlier this year to address a nutritional problem causing weight loss.

The particular issue is a "good deal more" substantial than the "common bug" Apple spokespeople have used as their most detailed explanation, but is described as far less disastrous than perceived by some shareholders, who triggered a stock sell-off this past week.

The circumstances "weren�t life-threatening and [Jobs] doesn�t have a recurrence of cancer," Nocera says.

Nonetheless, the journalist also questions why it requires a direct yet unspecific intervention from Jobs to settle concerns rather than more official channels. Reiterating the claims both of Markoff and of analysts, Nocera maintains that companies have a responsibility to disclose key executives' illnesses when they will clearly influence the day-to-day operations of the company, even if they believe health is normally something to be kept from the public.

This is seen as especially crucial for an electronics maker like Apple. As much of the company's success in recent years has been attributed to Jobs' direct management of many facets of the business, a sudden resignation or worse would be immediately damaging to share value, even if the company reveals a succession plan.

For Nocera, the notion that Jobs would rather settle a score with a journalist (one who was initially labeled a "slime bucket" making factual errors) than make an official statement to defend his company is baffling. If anything, the writer believes, one would expect Jobs to do what it took to have shareholders hold on to their investments in the company.

"You would think he�d want them to know before me," Nocera says. "But apparently not."

Apple stores now open at 8 A.M. to handle iPhone 3G demand

Published: 12:00 PM EST

All of Apple's US retail outlets are now in a permanent launch mode and will open as much as two hours earlier each day to accommodate the unprecedented demand for the new iPhone. Also, at least some locations are now giving customers rainchecks for the day's iPhone 3G stock.



The company's availability page now tells customers that stores that normally open at 10 A.M. will now open at the new time and are adding new employees to their ranks to process customers at a faster rate.

"To accommodate demand for iPhone 3G, all Apple Retail Stores will now open at 8:00 a.m. every day but Sunday," Apple says. "We're also adding staff to help you get up and running as quickly as possible."

While the change will do little to alleviate queues at the company's flagship stores -- many of which already open earlier -- the move gives Apple more time to clear queues for iPhone 3G at its locations that often continue to last for hours even two weeks after the official launch.

Additionally, AppleInsider has confirmed first-hand that at least some stores are changing their approach to selling iPhone 3G.

While Apple until now has only promised iPhones to customers as long as they stay in queue at the store, the company is now pre-qualifying customers who line up at the store and will set aside an iPhone 3G to be picked up later, when it's more convenient for them to do so. In many cases these buyers have until 6 P.M. to collect their purchases.

The method should stagger the appearance of iPhone customers throughout the day and head off potential disappointment from customers who may have to quit the line early due to other commitments.

Friday, July 25, 2008

Apple seeds iPhone 2.1 with directional GPS, push notification

Published: 10:15 PM EST

Apple is already providing developers with a new iPhone firmware beta with enhanced location-finding that could lead to true navigation as well as the roots for background push services.

Those with hands-on access to the beta 2.1 code at Gear Live note that Core Location can now recognize the cardinal direction of an iPhone with GPS as well as its velocity, both of which are ingredients necessary to providing turn-by-turn directions.

The additions confirm statements recently by Apple's Greg Joswiak, who rejected earlier claims that iPhone 3G's GPS antenna wasn't powerful enough to handle navigation and in turn explained that "complicated issues" are holding the device back from serving as a true navigation unit.

Separately, AppleInsider has also confirmed that Apple is implementing a rough version of its background push notification service in the 2.1 firmware.

Announced at the Worldwide Developers Conference, the feature lets third-party native programs receive data such as alerts or new messages without actively running. The measure saves processing power without interrupting some apps that depend on constant access to the Internet.

The inclusion of this early version of the code alludes to the 2.1 update becoming public at the same time as the push notification service itself, which is tentatively due for September. In the meantime, Apple and its US partner AT&T are known to be testing iPhone 2.0.1, a maintenance release that likely fixes some of the outstanding bugs with the initial 2.0 release.

More information about 2.1 is expected to appear soon, though developers committed to shipping production apps are being warned to hold off testing the new release and its accompanying SDK as it will prevent them from submitting programs to the App Store.

Apple board obligated to disclose material changes in Jobs' health

Published: 11:00 AM EST

Investment bank Piper Jaffray is assuring Apple investors Friday that the company's leadership would be required to disclose in a timely fashion any changes that would prevent Steve Jobs from maintaining his role as chief executive.

"We believe Steve Jobs commands attention from investors given his high profile as founder of the company and his hands-on approach to Apple's products," wrote analyst Gene Munster. "As such, we believe that Apple's board has a responsibility to disclose any changes that may impede him to continue to serve."

Specifically, Munster cited the nature of Jobs' public appearances and his active participation in the development of products like Macs and iPhones as some of the more noteworthy qualities that make him material to the company.

Similarly, the analyst said, one of the company's most competitive advantages is its executive team as a whole, who "share a collective track record of consistently outpacing their competitors in terms of hardware and software innovation coupled with robust product marketing and financial discipline."

Given his level of involvement and the fact that he is a cancer survivor, Apple shareholders have remained focused on Jobs' capacity to continue to serve as the company's leader.

During Apple's quarterly conference call Monday, chief financial officer Peter Oppenheimer was asked to comment on status of Jobs' health given a news report by the New York Post that renewed focus on the matter. He refused to do so, however, citing the co-founder's right to privacy, which in turn weighed on Apple shares.

Since then, however, the New York Times has reported that Jobs is actively reassuring some of his closest associates that rumors of his health are greatly exaggerated.

Given the due responsibility of Apple's board and the fact that no announcements have been made to date, Munster told clients there is "no reason to believe that Steve Jobs will not continue to serve as Apple's CEO."

As such, the analyst maintained his Buy rating and $250 price target on shares of the Cupertino-based company.

Copy & Paste references spotted in existing iPhone frameworks

Published: 11:50 AM EST



One developer burning the midnight oil has stumbled upon references to copy and paste in the frameworks of Apple's first beta of iPhone Software 2.1, potentially offering new hope for one of the most requested and conspicuously absent features of the company's mobile software.

The findings, contained within the English-language 'Localizable.strings' file located in 'System/Library/PrivateFrameworks/WebKit.framework' are also accompanied by references to the Spotlight search, text-to-speech, file uploads, and the Finder.

Therefore, it's unclear whether those references represent the groundwork for upcoming iPhone features or simply exists as carryovers from the WebKit frameworks used to develop applications for the Mac and Windows PCs.

Other findings by the same developer include preferences to an Apple MobileRadio application, which has also yet to surface.

When asked earlier this month about the absence of copy and paste functionality in the iPhone software, Apple vice president of product marketing Greg Woswiak said the feature was not a priority and that engineers simply hadn't gotten around to it yet.

iPhone SDK

iPhone SDK

Yahoo! Music's death at age 3 warns of DRM's risk

Published: 09:40 PM EST

Yahoo did its best to stage a rival to Apple Inc.'s iTunes, but after three years of lagging results, the Internet icon is putting its Yahoo! Music service to rest and leaving subscribers with copy-protected music libraries that can't be transfered to new computers.



After trying everything to attract customers from rock bottom pricing and all-you-can-eat subscription specials to news and original programming, Yahoo in an email to customers warned that it would close its Yahoo! Music online store permanently as of September 30th.

While any such store closing is unfortunate for those who shop regularly at the store, the news is proving to be especially damaging for customers of the company's Yahoo! Music Unlimited service, which offers both an all-you-can-eat subscription as well as the option of paying extra for permanent downlods. Yahoo at the end of September will shut down the servers that grant licenses for the digital rights management (DRM) that protects the music files, allowing playback of these longer-lasting songs and barring unauthorized copying.

Although this music will continue to play after the store shutdown, the lack of a license server after that date effectively creates a time bomb for customers: reinstalling the operating system or making other changes that erase the licenses on the computer will render the songs unplayable regardless of the user's backup copies. Yahoo is aware of this and is pushing many of its customers to burn pure audio CDs and remove the restrictions before it's too late.

"We highly recommend that you back up the purchased tracks to an audio CD before the closing of the Store," Yahoo says. "Backing up your music to an audio CD will allow you to copy the music back to your computer again if the license keys for your original music files cannot be retrieved."

The experience underscores the potential risk behind DRM, which by its nature is dependent on a company's willingness to maintain an Internet server ready to authorize access. For customers of Microsoft's long defunct MSN Music service, the experience is already a familiar one: many of its purchasers were threatened with losing their collections a month ahead of Yahoo until public pressure forced Microsoft to keep its DRM servers running until 2011.

It's this danger that prompted two of Yahoo! Music's chiefs to clamor for unprotect music before their departures, though the hesitance of major labels to offer freely copyable music at the time contributed to their departure.

Apple's iTunes Store is unlikely to face the same situation in the future given its relative success in music sales, but its own FairPlay-protected songs hold a similar danger for users who restore or replace their Macs and PCs. The company also has no provision to automatically restore missing songs and usually only grants a one-time exception for those who lose their music without a backup in place.

Still, pressure from Apple and other online providers are making it increasingly unlikely that stores as fragile as MSN Music or Yahoo! Music will reappear. The iPod maker's chief executive, Steve Jobs, has said in an open letter that removing DRM was essential to offering interoperability in music that would eliminate these restrictions and promptly followed suit with unguarded iTunes Plus songs, which now make up a large portion of Apple's catalog. Amazon MP3 and a slew of other stores have taken the same direction and offer some or all of their music DRM-free.

Montreal flagship to headline weekend of Apple store openings

Published: 09:00 AM EST

Canadians will get their first taste of a high-profile Apple retail store this weekend when the iPhone maker takes the wraps off a spacious, double-decker flagship shop in downtown Montreal. The company will also open its first store in South Carolina and its fifth in Arizona.

Apple Store Sainte-Catherine

In a little under a year, Apple has transformed a gloomy, tree obscured MENS fashion retail outlet at 1321 Ste-Catherine Ouest into a bright and airy two-story flagship shop aimed at luring shoppers passing through the heart of Montreal.

Massive glass panels framed by grey limestone serve as a giant window into the store, offering wall-to-wall street views of its interior. Inside, the store is clad in stainless steel and shoppers will find all the amenities of a typical Apple flagship shop, including a glass staircase and sprawling second-floor Genius Bar.

Apple is believed to have signed a $1.2 million annual lease on the 9,300-square-foot property, which sits just blocks from McGill University and within striking distance of Montreal's 3.6 million other residents.

However, alternations noted in AppleInsider's breaking reports (1, 2) on the flagship shop last summer suggest usable retail space will come in around 8,000 square feet when store finally opens for business on Friday at 5:00 p.m. Among those alterations were spaces cordoned off for offices, a back-end stock room, and bathroom facilities.

Apple also raised the ground floor slightly, relocated a couple of structural columns near the store's entrance, and threw down a new roof. Photos comparing the space before and after the renovations can be seen after the glamour shot, below.

Apple Store Sainte-Catherine
Apple Store Sainte-Catherine will open in Montreal this Friday at 5:00 p.m.

Apple Store Sainte-Catherine
Apple Store Sainte-Catherine before (left) and after (right).

Apple Store King Street & Apple Store Arrowhead

Separately, Apple will open both Apple Store King Street -- South Carolina's first -- and Apple Store Arrowhead -- Arizona's fifth -- on Saturday, July 26 at 10:00 a.m. local time.

Tight supply of iPhone 3G leaves customers waiting for hours

Published: 11:00 AM EST

Two weeks after it launched on July 11, the iPhone 3G is still hard to find in the US. Many Apple retail stores have no supplies at all, leaving buyers to track down the stores that do have remaining stock and wait in slow moving lines that stretched out for five hours.

The 3G iPhone Availability web page, run by Chris Barnes using updates from Apple's retail store availability feed, indicates that less than half of the US Apple retail stores are currently reporting units in stock. Of 188 US stores, 51% had inventories of the white 16 GB model, 44% had some 8 GB units, and only 40% had the black 16 GB version.

Apple only reports whether each store will have some units available the next day, not how many each store has or will be receiving; supplies can run out quickly, and sometimes the availability report isn't even accurate, as some stores have indicated that they had supplies when they did not. Flagship locations such as the landmark store on New York's Fifth Avenue and the Union Square San Francisco store appear to receive more stock, but also sell out quickly due to high foot traffic.

On Wednesday, only one of the three Apple retail stores in San Francisco had any units in stock by late morning; the Chestnut and Union Square stores were completely sold out, leaving hopeful customers the only option of standing in line waiting for an estimated "three to five" hours at Stonestown Galleria. AT&T's retail stores also reported being completely sold out in the City.

The line at the Apple Store in the Stonestown mall, located deep in the southwest residential corner of San Francisco and far from any tourist attractions, appeared to only be fifteen people deep at the door (below top), but the line continued outside the mall on the sidewalk (below bottom), with Apple store employees shuttling in waiting users a half dozen at a time as space allowed inside.

Apple Retail Store iPhone Wait

Apple Retail Store iPhone Wait

One enterprising young man standing toward the front of the line was trying to sell his spot for $400, but said if he'd known from the start that he'd have to wait five hours to get there, he wouldn't have waited. A food court fortune cookie suggested that the wait would be worth it: "Your labors will bear sweet fruit."

Apple Retail Store iPhone Wait

Delayed by activation issues

While supplies of the iPhone 3G are constrained worldwide due to strong demand, The primary reason for the long lines has been the added requirement for in-store activation. Unlike the original iPhone, the new model must be set up with a contract in the store. Last year, some users ran into problems with Apple's novel home activation process through iTunes, but the process was quite smooth for most buyers. Those who had problems didn't delay those who didn't. This year, problematic activations are holding up everyone.

The downside to home activation with the original iPhone was that it allowed users to buy iPhones and unlock them for use with other carriers, either T-Mobile in the US or any other GSM provider worldwide. Apple received a mobile service revenue share from iPhone sales, but only those activated with AT&T or its official partners in Europe. Pundits complained that Apple could potentially eventually "lose" a billion dollars in mobile service revenue from unlocked phones, but the company's own executives downplayed the problem, noting that they only viewed unlocked phones as evidence of strong demand overseas.

The iPhone 3G requirement for in store activation removes the unlocking issue, but the real reason for binding a mobile contract sale to the phone purchase is that Apple is now selling the iPhone with a traditional mobile provider subsidy, which allows the company to advertise a much lower price, either $199 for the 8 GB version or $299 for the 16 GB model. The end result is that the few users who run into activation problems delay everyone else buying the iPhone 3G.

Some customers fail credit checks or arrive without identification or their social security number or lacking a credit card in their name. Some existing AT&T users have a phone contract on a business account or family plan, which can pose a problem if they are not the primary account holder. Others have a discount mobile plan related to their employer, which must be removed prior to signing up for an iPhone account.

AT&T customers who have already received a subsidized price for new phone within the last several months may have to pay a higher price to migrate over the iPhone 3G, although existing iPhone users do not face any penalty.

Mobile launch crisis

However, the biggest problems related to new iPhone 3G activations have plagued users from other carriers hoping to move their existing number to a new AT&T plan. Mobile providers in the US are supposed to offer number portability on demand, but many customers don't realize they'll need their existing mobile account number, resulting in a prolonged, in-store telephone transaction in order to set up their new plan.

The activation situation isn't any different for other mobile phones, but the iPhone 3G launch has been particularly plagued with delays because there is far higher demand for it compared other phones, and most competing units are available from a wider selection of stores. Further, the simpler initial launch of the first iPhone last year makes the 3G model's introduction appear to be a catastrophe in comparison.

In Europe, the iPhone 3G launch has been at least as clumsy if not more so, as sales are being handled primarily by mobile partners rather than in Apple's own stores. In Switzerland, Swisscom representatives at multiple stores were refusing to sell iPhones to users who had existing contracts with the company, telling them to return in a few months when their existing contract was up. That's not the official policy of the provider, but rather an issue with sales training.

In the US, Apple has exerted more control over the launch and the training of its salespeople, down to the subtle details. While European sales agents ripped open iPhone 3G boxes to set up the units during activation, Apple Store employees followed a careful transaction script that involved handing the new box to the customer to open. Stress related to the activation complications and high demand have taken a toll on Apple's retail representatives, resulting in at least two employees being fired for walking off the job at San Francisco's downtown store.

Undaunted iPhone 3G interest

The activation complications have resulted in an average wait of 15 minutes or more per person. Even with five retail employees servicing new iPhone 3G buyers in the store non-stop, each store is limited to setting around 20 units per hour in ideal conditions. The extremely long waits and complicated transactions associated with the iPhone 3G haven't scared away customers however.

In San Francisco, around 40 people were waiting in line Wednesday afternoon at Stonestown Mall. The line included a wide spectrum of buyers, from businessmen in suits talking about corporate support for the iPhone to college students upgrading from the iPod touch. Some were current iPhone users, but most of those waiting were new to the iPhone. Apple employees frequently serviced the line, asking for information from current AT&T customers to ensure that they were eligible for the "incentive" price advertised for the iPhone 3G, and reminding users of what they'd need to complete their contract activation before making it to the front of the line.

New supply shipments should help accommodate demand in the coming weeks. Some of those waiting in line suggested ordering the iPhone 3G from AT everyone in line prior to that had waited at least five hours to receive their phone.

A few interested buyers left the line after being informed by Apple employees that their existing plan had complications they'd need to resolve with their employer before making the purchase. Others were no doubt turned away by the prospect of spending most of the afternoon waiting in line. The iPhone 3G line even left a number of store visitors confused about whether they could enter the store to make other purchases.

Microsoft sets sights on providing an Apple-like experience

Published: 01:00 PM EST

Microsoft chief executive Steve Ballmer on Wednesday issued a company-wide memo outlining his battle plan for the new fiscal year in which he singled out the Apple experience as a benchmark for future success.

"In the competition between PCs and Macs, we outsell Apple 30-to-1. But there is no doubt that Apple is thriving," Ballmer wrote in the email, a copy of which was obtained by the Wall Street Journal. "Why? Because they are good at providing an experience that is narrow but complete, while our commitment to choice often comes with some compromises to the end-to-end experience."

Going forward, Ballmer said Microsoft will be changing the way it works with hardware vendors to mimic the experience offered by the Mac maker in which there will be "absolutely no compromises." His plan calls for a similar approach in the mobile phone arena, where he hopes the company can create "great end-to-end experiences" akin to that afforded by Apple's closed ecosystem, where it maintains tight control of nearly every aspect of a product's design.

Virginia Tech's Mac Pro supercomputer to crack 29 teraflops

Published: 07:30 PM EST

A switch to newer Intel-based Apple Mac Pro workstations for an upcoming rekindling of Virginia Tech's supercomputer efforts will more than double the performance to as much as 29 teraflops and will once again put a Mac cluster in the limelight -- this time, placing it among the top 100 supercomputers in the world.



When it's completed in the next several weeks, the new project discussed with Ars Technica will rely on 324 eight-core, 2.8GHz Mac Pro towers to achieve the result, joining them across a quad-speed InfiniBand link that offers three times as much room for network traffic as the original model, dubbed System X.

Although the school is using just a third of the computers found in the earlier cluster, which at its peak has used 1,150 Xserve G5s, the fresh cluster will have a total of 2,592 cores that individually operate faster than each of the 2,200 PowerPC chips found in the older rackmount computers. The old system at most processed 12.25 teraflops and itself eclipsed the original System X, based on 1,100 PowerMac G5s.

The performance of the new Xeon-based cluster at its theoretical peak of 29 teraflops would be enough to take 65th place in the Top500 supercomputer charts from June, outpacing famous supercomputer designers such as Cray and SGI as well as scientific institutions that include CERN in Switzerland and Lawrence Livermore National Laboratory in the US.

Real-world performance is likely to dip due to performance overhead, but record-setting isn't its only reason for being, according to Dr. Srinidhi Varadarajan, director of Virginia Tech's Center for High-end Computing Systems. Instead, the Mac Pro edition will sit aside System X and will be dedicated to researching power-efficient software as well as shared-memory computing.

Even if it doesn't smash performance barriers, the new, unnamed cluster will still serve as an example of how technology has advanced both for Apple and the industry at large. While the sheer amount of power and heat from the Xserve group requires a specialized liquid-air cooling in an equally special building, the lesser power demands of the Xeons and their looser spacing in a tower format means that the institution can house the new cluster in a conventional room.

And it may also serve to humble Apple's rivals in the workstation space, according to Dr. Varadarajan. Since the Mac Pro includes so many sensors to monitor heat and power levels, it's considered better than many workstations for research where both measurements are critical to the tasks at hand. The Macs are likewise said to be fundamentally less expensive for the same level of performance than similar systems from Apple's competitors.

"The Mac Pros are highly competitive even against building a white box off the cheapest prices," the researcher notes.

Wednesday, July 23, 2008



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Microsoft this week offered a window into the first phase of a mega million dollar advertising campaign designed to clear up 'misconceptions' about the quality of its Windows Vista operating system exacerbated by in-your-face marketing efforts on the part of longtime rival Apple.

The first series of ads in the campaign were reportedly met with rave reviews last week when they were previewed at Microsoft�s employees-only Global Exchange conference.

"[I] got goosebumps - just, wow," said one insider who was privy to the preview.

While those ads have yet to surface publicly, the first instances of an associated Web campaign spotted by ZDNet suggests the Redmond-based software giant will attempt to alter the perception of Vista by liking its critics to proponents of flat earth theory.

Instead of responding directly to Apple's influential "I'm a Mac, I'm a PC" global campaign, an ad that appears on the company's website (below) recalls that "at one point, everyone thought the Earth was flat." It links to a recently established information base on the state of Windows Vista, which attempts to "clear up some confusion and lingering misunderstandings" about the XP successor while simultaneously admitting to some early missteps.

"We know a few of you were disappointed by your early encounter. Printers didn't work. Games felt sluggish. You told us�loudly at times�that the latest Windows wasn't always living up to your high expectations for a Microsoft product," the company said. "Well, we've been taking notes and addressing issues."

What follows are a series of common questions on the part of would-be Vista adopters, such as "Why do I keep reading that Windows Vista won't work with my hardware or software?," along with answers.

Microsoft and the Flat Earth Theory

"We know that's what some people are saying on the Internet," the company said, opting not to mention Apple by name. "And in its early days, Windows Vista did experience some compatibility problems. But thanks to our industry partners' efforts during the past 18 months, here's where things stand today."

According to Microsoft, Vista now supports nearly 77,000 hardware products, runs 98 of the top 100 consumer software programs, and works with all of the leading small business applications.

The security of Vista is another matter which Microsoft believes to have been exploited unfairly by Apple's marketing tactics. As such, the company's references to the Mac maker and its Leopard operating system in this regard are not as subtle.

"Windows Vista has fewer than half the security vulnerabilities of Windows XP," Microsoft said. "It's also 60% less likely to be infected by spyware or malware than Windows XP SP2. And in early 2008, Windows Vista was shown to have 89% fewer vulnerabilities than MacOS X 10.5, making it the most secure Windows release to date."

In total, it's believed that Microsoft plans to spend more than $300 million on its pro Vista, anti Apple marketing blitz before the dust settles.

Apple may be eying sub-$1000 notebook market

Published: 12:00 PM EST

Investment bank Piper Jaffray said Tuesday it believes Apple is readying new iPod and notebook products that will apply downward pressure to profit margins because they'll be priced more affordably, such as 13-inch MacBook that will fetch less than $1000.

During its third fiscal quarter conference call Monday, the Cupertino-based Mac maker caught analysts and investors off-guard by guiding average company gross margin down to 31.5 percent for the current quarter ending September, and down to 30 percent for all of fiscal 2009.

Addressing clients in a report Tuesday, analyst Gene Munster said there appear to be two primary reasons for the margin guidance, which surprised even those experts who've grown accustomed to the company's traditional low-ball estimates.

First, he said, management is likely continuing with its historical practice of guiding gross margin 270 basis points (2.7 percent) below the previous quarter's actual margin. Secondly, he believes the company is preparing to cut the prices of existing products to maintain its momentum during a time of economic uncertainty.

"We believe there is an 80% chance Apple will introduce redesigned MacBooks and possibly new MacBook Pros at lower price points," he wrote. "Specifically, Apple may re-enter the $999 price point (currently $1099) with the MacBook, or test the $1,799 price point with the MacBook Pro (currently $1999)."

The analyst also expects "slightly redesigned iPods" that will include "lower-cost touch-based iPods" in time for the holiday buying season. "We believe Apple is getting slightly more aggressive with its pricing; but overall the company is not diverting from its strategy of premium pricing," he said.

While the focus this week will be "anxiety over gross margin," Munster believes it's only a matter of time before Wall Street clears its head and looks past margin guidance to focus on fundamentals, such as the upcoming product transitions and the positive impact those new products will have on revenue growth.

The Piper Jaffray analyst reiterated his Buy rating and $250 price target on shares of Apple.

Apple issues quartet of iLife '08 updates

Published: 05:20 PM EST

Apple on Tuesday afternoon released four patches for its iLife '08 creative suite that touch on iMovie, iPhoto, iWeb, and the supporting infrastructure.

iLife Support 8.3

Apple's most universal of the new updates, iLife Support 8.3 (10MB) is said to improve the stability of the framework that underpins iLife '08 as well as address a handful of other, smaller issues.

This update, along with the others released on Tuesday, requires either Mac OS X Tiger 10.4.11 or any version of Mac OS X Leopard, and also needs QuickTime 7.5.

iMovie 7.1.4

Apple's consumer video editor has been updated to version 7.1.4 (38MB).

The fix addresses unspecified compatibility problems as well as stability and other fixes.

iPhoto 7.1.4

The only update in the collection to add more than just fixes, iPhoto 7.1.4 (74MB) adds a new set of themes for both holiday greeting cards and postcards for those who use them with Apple's Kodak-supported printing service.

Compatibility, stability, and other fixes are described as part of the release.

iWeb 2.0.4

The final update of the collection, iWeb 2.0.4 (35MB) mends compatibility, stability, and other components of Apple's visually-driven web page creation tool.

Server, connectivity problems add to Apple's MobileMe woes [u]

Published: 05:40 PM EST

A mail server crash and unexpected fiber-optic line problems are the latest in a long string of hiccups that have soured the launch of Apple's new MobileMe internet service and recently left some subscribers without email access for as many as five straight days.

Apple's support forums are rife with complaints from affected users, many of which are just as frustrated with the company's poor communication over the matter as they are with the service outage itself. Several also doubt an official assessment of the scope of the problem posted to the MobileMe support site, which states that only 1 percent of subscribers have lost access to their email.

"I know at least 10 people with MobileMe and all of them have not had access to MobileMe mail since last Thursday or Friday, including me," one subscriber told AppleInsider. "Now either it's just a coincidence that everyone I know is in the 1 percent, or Apple is flat out lying."

Subscribers aren't the only ones troubled by a lack of information. Apple's support representatives have also found the MobileMe launch to be a burden due to a lack of communication from higher-ups.

"The MobileMe transition has been pretty rough on us as well, mainly because Apple isn't telling us much of anything either," one AppleCare tech support agent explained. The agent added that a rare memo was issued to some AppleCare support teams earlier this morning.

In the memo, Apple reportedly noted two separate issues, only one of which was identified. �That issue, which has since been resolved, is said to have affected "all customers" as a result of an inadvertent fiber-optic cable cut during a previously scheduled maintenance procedure. The other, Apple said, "is affecting less than 1 percent of customers."

Although Apple stopped short of detailing the second issue, some subscribers were successful in receiving an explanation from the company's online support chat before it was overwhelmed with requests and taken offline.

"The server that supplies the mail for your account ran into issues on Friday," a support representative by the name of Lisa told one subscriber. "A repair was attempted but the issue became worse. The engineers are attempting to bring the server back online without losing any of your data."

Another subscriber that has been unable to access her email since Friday was offered a similar response from an Apple representative named Craig in the company's online support chat.

"Unfortunately, after reviewing your account, it looks like your account is part of a small group of customers experiencing a temporary �outage in mail service with MobileMe," he said. "I know it's been a few days and it is frustrating. I'm in the same boat as you, my mail hasn't been up for four days either."

When pressed for more details, Craig would only say that "Apple is working hard and has made this issue their number one priority. [...] We are experiencing a temporary issue with one of our mail servers. I'm sorry that is affecting you as well. I know how frustrating it is to be without mail."

Update: Apple is now confirming a "serious issue with one of" its MobileMe mail servers in a support document.

"This issue is currently affecting approximately 1% of MobileMe members. Affected members are unable to send or receive email at www.me.com or access email using any email client software such as Mail on a Mac or Microsoft Outlook on a PC," the company said. "We understand this is a serious issue and apologize for this service interruption. We are working hard to restore your service."

Second firm tests Apple's legal resolve with Mac OS X-ready PCs

Published: 07:15 PM EST

Ignoring action just taken against Psystar, a new company known as Open Tech says it's making Mac OS X-compatible PCs, and believes it has found a loophole that prevents legal action from Apple.



Open Tech Inc. is following in the same vein as its now well-known predecessor and is launching two purportedly "open" PCs, the Open Tech Home budget computer and the quad-core Open Tech XT, that are effectively just custom-built Intel systems based on commonly available -- and somewhat outdated -- parts.

Unlike the similarly-designed Psystar Open Computer (initially OpenMac), Open Tech hopes to promise Mac compatibility while avoiding a conflict with Apple's Software License Agreement that forbids selling Mac OS X installed on non-Apple hardware.

Instead of installing Mac OS X itself or bundling a copy with the sale, this new builder is offering its customers a mystery "do-it-yourself kit" that will guide them through installing a separately-purchased copy of the Apple software. The company itself would absolve itself of responsibility and put the focus on the user.

In making claims of compatibility with the software, however, Open Tech is nonetheless still at risk of running afoul of some of the same legal roadblocks that resulted in Apple's lawsuit against Psystar last week, full details of which have since been obtained by AppleInsider.

While Apple's core complaint in the 35-page lawsuit centers around Psystar installing (and encouraging others to install) Mac OS X without permission, the legal filing also accuses the Florida-based PC assembler, now known to be founded by brothers Robert and Rudy Pedraza of Doral, Florida, of violating copyrights by simply displaying Apple's trademarks for the operating system without permission. It also charges that Psystar misrepresents Apple by falsely implying to customers that the third party has the Mac maker's blessing.

The consequences for Psystar should it lose the trial are also more serious than first thought and would serve as a warning sign for Open Tech and other firms. Besides asking for a permanent halt to sales of any of Psystar's Open Computers preloaded with Mac OS X Leopard, Apple's lawsuit also demands that the court force a recall of any systems already in customers' hands, as they 'dilute' the Apple brand by presenting it in a less than ideal way that has included breakdowns and imperfect software patches.

While it's unlikely that Open Tech has been aware of the full nature of Apple's lawsuit against its fellow vendor, the new arrival still appears to be conscious enough of potential legal challenges and is going to great lengths to conceal its actual point of origin. Prices are listed in US dollars, but the website itself is hosted on a domain belonging to the New Zealand territory of Tokelau -- and the only known contact is Elijah Samaroo, whose only traces suggest either a UK Apple enthusiast who once made a comment at TUAW or else a young American from Davie, Florida running a computer service firm known as CPU Prodigy.

AT&T developing voice-controlled iPhone apps (video)

Published: 12:00 AM EST

AT&T has developed a software trick that will let modern mobile handsets, including Apple Inc's iPhone, recognize voice commands without the need for specialized voice recognition software.

The research project is based on a new version of AT&T's WATSON speech recognition engine, dubbed Speech Mashups, that puts the entire feature on the web as a service that can be called upon from anywhere a high-speed Internet connection is possible.

As long as the software used to access Speech Mashups obeys certain web standards, particularly an AJAX framework and JavaScript, the technology can capture voice commands, interpret them at a remote server, and send them back to the device in a language a website or program can understand -- all without installing a dedicated app or plugin.

The telecoms company says the technology can be used for IP-based TV boxes as well as BlackBerries and smartphones, but draws most of its focus to the iPhone -- a device which (unlike the BlackBerry) has no native voice recognition of its own and, until the release of iPhone 2.0 firmware, had no support for the feature even through isolated native apps.

In a prototype mobile version of the YellowPages website, AT&T in a research video shows an iPhone user entering the business name and location into text fields on the page just by speaking them at the appropriate times. �While typing would work in such a case, the company claims that voicing the information is faster and more convenient -- especially when driving.

This solution is limited and excludes iPhones without a sufficiently fast connection to AT many of Apple's own applications, for example, wouldn't function with the feature. �As-is, the technology doesn't satisfy frequent requests for voice dialing or other direct speech recognition features.

Still, while the development is limited in scope and remains in AT&T's labs, the development potentially opens up both web apps and some native iPhone apps to a feature that even Apple itself has yet to program into its own devices.

Steve Jobs in good health following second surgery - report

Published: 09:00 AM EST



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Steve Jobs is reassuring some of his closest associates that rumors of his health are greatly exaggerated, but is telling those same people that he underwent a procedure this year related to his weight loss, the New York Times is reporting.

"[In] recent weeks, Mr. Jobs has reassured several people that he is doing well and that four years after a successful operation to treat a rare form of pancreatic cancer, he is cancer free," the paper said.

However, the Apple chief executive has reportedly admitted to some of those people that he had a surgical procedure earlier this year to address an issue that was causing him to lose weight.

More specifically, the Times cites unnamed sources who say Jobs has been battling a nutritional problem in the wake of his surgery, which medical descriptions say may lead to weight and energy loss.

Jobs's health has been a renewed focus as of late, particularly on Wall Street, with fund managers and other large Apple investors expressing concern that the company co-founder's cancer may have recently returned.

Much of that fear stemmed from Jobs' gaunt appearance during Apple's developers conference last month and at other recent engagements related to the launch of his firm's new iPhone 3G handset.

Immediately following the conference, an Apple spokesperson said that a "common bug" had left Jobs feeling a little under the weather, but that he was taking antibiotics for treatment.

In its report Wednesday, the Times cited an industry executive who said Jobs ran a high fever in the week leading up to the developers conference and had considered canceling his appearance due to the illness. Ultimately, the chief executive decided to make good on his long-standing commitment to Apple's faithful and personally take the wraps off the company's second-generation mobile handset.

Uncertainty over Jobs's condition came to a head earlier this week when speculative news reports compelled Lehman Brothers analyst Ben Reitzes to respectfully ask Apple chief financial officer Peter Oppenheimer to make an official statement on the matter during the company's quarterly conference call.

"Ben, Steve loves Apple," Oppenheimer said. "He serves as the CEO at the pleasure of Apple�s Board and has no plans to leave Apple. Steve�s health is a private matter."

In the two hours surrounding the call, shares of Apple tumbled more than 10 percent. There's a debate, however, about how much of an impact Jobs' health had on the decline, given that Oppenheimer's comments, or lack thereof, on the matter came around the same time he braced analysts for significant declines in the company's gross margin through fiscal 2009.

Jobs, who is keeping his own counsel on the issue of a successor should he ever have to leave the company, is said to have taken a well-deserved vacation this week.

AT&T says initial iPhone sales double that of last year

Published: 12:00 PM EST



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AT&T said Wednesday that sales of Apple's iPhone 3G during the first twelve days were nearly double that of last year, this despite shortages that have seen backorders stretch one to three weeks at its retail stores.

AT&T made the announcement while releasing results for its fiscal second quarter, in which it said that profits rose 30 percent to $3.77 billion, or 63 cents per share, on revenue of $30.9 billion for the three months ended June 30. Those results don't include a boost from iPhone 3G, however, as the device did not go on sale until July 11th -- 11 days after the quarter's end.

The nation's largest telecoms firm said mobility, broadband connectivity and integrated services that encompass voice, data and video are driving a new wave of communications, and that it plans to enhance its premier networks and products to best deliver those emerging capabilities to both business and consumers.

"The Apple iPhone 3G is a dramatic example of this transformation," said chief executive Randall Stephenson. "In the days following our exclusive U.S. launch of this new device, powered by the nation's fastest 3G wireless network, customer response has been everything we had anticipated and more."

During the quarter, AT&T added 1.3 million wireless subscribers, which was about 200,000 shy of the 1.5 million added by main rival Verizon Wireless. Still, AT&T ended the quarter with 72.8 million customers compared to Verizon Wireless' 68.7 million, maintaining is rank as the largest US wireless provider.

Total wireless revenues increased 15.8 percent to $12.0 billion in the second quarter, and wireless service revenues, which exclude handset and accessory sales, grew 14.8 percent to $11.0 billion. AT&T said wireless revenue growth was driven by its solid subscriber gains and a greater number of customers choosing more advanced smartphones and integrated devices like the iPhone.

Those smartphone users helped more than doubled AT&T's wireless data revenues to $2.5 billion, while revenues from e-mail, messaging and data access also saw greater than 50 percent growth. At the same time, text messaging volumes tripled versus totals for the year earlier, and multimedia message volumes increased more than 170 percent. At the end of the second quarter, approximately 18 percent of AT&T's postpaid wireless subscribers had an integrated device, up from 8 percent last year.

On average, AT&T said iPhone and other smartphone subscribers produce average revenues of roughly double the company average. The carrier expects continued strong growth in wireless data services as more customers choose data plans and advanced wireless devices such as the new iPhone 3G.

AT&T also said that retail postpaid churn -- or number of subscribers who left and were subsequently replaced -- moved down to 1.1 percent in the second quarter, which represents the lowest level in its corporate history.

Apple shares beaten late on concerns over CEO's health, guidance

Published: 08:00 PM EST



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Apple handily beat expectations for its fiscal third quarter Monday, but investors used a late trading session to punish shares of the Mac and iPhone maker after the company offered conservative forward-looking guidance and refused to comment on the health of chief executive Steve Jobs.

In a statement following the market's close, Apple said third-quarter profits rose more than 30 percent to $1.07 billion, or $1.19 per diluted share, on revenues of $7.46 billion, driven by record sales of nearly 2.5 million Macs and double-digit iPod growth to more than 11 million units.

However, the Cupertino-based company saw its shares tumble 10.75 percent, or nearly $18, to $148.42, as investors overwhelmingly rejected management's guidance of $1.00 in per share earnings on sales of $8.3 billion for the current fourth quarter. On average, analysts had been forecasting earnings of $1.23 per share on the same amount of revenue.

In a subsequent conference call, Apple chief financial officer Peter Oppenheimer also braced analysts for unwelcome declines in the company's gross margin going froward. He said an ongoing back-to-school promotion and an unspecified product transition during the current quarter will see gross margin fall sequentially by 330 basis points to 31.5 percent.

Oppenheimer told analysts to expect average gross margin for all of fiscal 2009 to come in even lower at 30 percent, as the company moves forward with a strategy that will see it introduce new "state of the art products" that will generate slimmer profits because they'll be offered at price points that can't be matched by rival electronics makers.

Also weighing on Apple shares late Monday were rejuvenated concerns over the health of chief executive Steve Jobs. Shares struggled in the red for most of the day after the New York Post reported that some hedge fund managers on Wall Street are finding it difficult to cope with the increasingly gaunt appearance of the company co-founder.

Jobs's physical health has been an on-again, off-again topic of concern ever since he was diagnosed with a rare form of pancreatic cancer four years ago, for which he underwent successful treatment. However, his overly haggard appearance at last month's Apple developer conference spooked a number of investors and company followers who wondered if his health had begun to relapse.

"Multiple sources who have met with - and in some cases even dined with - Jobs in the weeks surrounding the introduction of the iPhone 3G on July 11, said they came away troubled by his thin appearance," the Post reported.

When asked by an analyst about Jobs's condition on Apple's quarterly conference call Monday, Oppenheimer refused to provide any color, citing his boss's right to privacy.

"Steve loves Apple. He serves at the pleasure of Apple's board," he said. "He has no plans to leave Apple. Steve's health is a private matter."

iPhone 3G now all but sold out in 38 states

Published: 10:45 PM EST

With the iPhone 3G not even ten days old, virtually all of the Apple retail store stores open within the United States are without any examples of the device to sell on July 21st.

The shortage is severe enough in the 38 states that claim Apple stores that it's easier to count the locations that do have iPhone 3G units than those that don't.

In California, the only Apple store with any iPhones is the Pleasanton store with only 16GB black examples, while New York City's Fifth Avenue store is the only one in all of New York state known to have any examples left, with just 16GB white models in stock.

Only a single Honolulu store and the Salem, New Hampshire store can also claim to have any units available, and each only lists one model as ready for Monday.

Apple has been continually resupplying its stores with new iPhones -- in many cases on a daily basis -- but has seen fewer and fewer of its stores touting next-day availability in the several days since the July 11th debut of the handset upgrade.

The company's own outlets are already seen as the bellwethers for looming American shortages. Sellouts first crept up in late March for Manhattan-area stores but quickly spread through the rest of the country and to AT&T locations in a matter of weeks.

For iPhone 3G, shortages manifested as early as launch day and have spread much more quickly than for the end days of the first model, with AT&T running dry of any guaranteed units before the first weekend was over.

Whether or not Apple's supply will meet demand in time to prevent a repeat of May's complete stockout is also far from certain. When grilled on an unprecedented spike in preorders, Britain's iPhone carrier O2 said it might take "some weeks" before it could satisfy enough of its customers on a regular basis.

Apple Q3 preview: analysts place bets ahead of earnings

Published: 10:00 AM EST

Apple is set to report earnings for its fiscal third quarter after the close of regular hours trading this afternoon. Analysts polled by Thomson Financial expect the company to post earnings of $1.08 on $7.37 billion in revenue, fueled by sales of 2.2 million Macs, 10 million iPods and about 700,000 iPhones.

Briefly: Snow Leopard Finder icons support QuickLook

Published: 01:00 PM EST



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Apple's upcoming Mac OS X 10.6 Snow Leopard operating system will reportedly see support for the company's QuickLook technology extended from specialized preview windows to Finder icons themselves.

One person familiar with the pre-release software notes that hovering the mouse pointer over an audio file in Snow Leopard's Finder will trigger a triangular 'play' button to appear on the icon itself.

Clicking the button will allow the audio file to play within the Finder, but without opening a specialized preview window. The audio file will continue to play uninterrupted even if the user brings an application to the forefront, but will halt when another file or window selection is made from within the Finder.

As the audio file is playing, a ring will form around the play button and slowly fill to indicate the length of the track that remains. A similar technique works for video files, displaying the video within the icon itself.

For both audio and video files, Snow Leopard testers users can currently press the spacebar to alternate between the icon preview and the traditional Quick Look view as it exists in 10.5 Leopard without any playback hiccups.

For other files, such as Pages, Keynote and Number documents (and their Microsoft equivalents), similar buttons appear on Snow Leopard icons to let users flick between pages or slides in icon view.

Snow Leopard

The latter features don't appear to be much use, people familiar with the software say, unless the user has their Finder's icon size cranked all the way up.

Separately, it's reported that another change in Snow Leopard will require users to enter their administrative password twice as part of any software install process: once when the installer application launches, and again right before the actual install process begins.

Apple posts profit of $1.07B, ships nearly 2.5 million Macs

Published: 04:35 PM EST



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* Mac sales lift Apple to $818 million third...

Apple said Monday that third-quarter profits rose more than 30 percent to $1.07 billion, or $1.19 per diluted share, on sales of $7.46 billion for the three-month period ended June 28, 2008.

These results compare to revenue of $5.41 billion and net quarterly profit of $818 million, or $.92 per diluted share, in the year-ago quarter. Gross margin was 34.8 percent, down from 36.9 percent in the year-ago quarter. International sales accounted for 42 percent of the quarter's revenue.

Apple shipped 2,496,000 Macintosh computers during the quarter, representing 41 percent unit growth and 43 percent revenue growth over the year-ago quarter. The Company sold 11,011,000 iPods during the quarter, representing 12 percent unit growth and seven percent revenue growth over the year-ago quarter. Quarterly iPhone units sold were 717,000 compared to 270,000 in the year-ago-quarter.

"We're proud to report the best June quarter for both revenue and earnings in Apple's history," said Apple chief executive Steve Jobs. "We set a new record for Mac sales, we think we have a real winner with our new iPhone 3G, and we're busy finishing several more wonderful new products to launch in the coming months."

"We're extremely pleased with the growth of our business and the generation of almost $5.4 billion in cash in the first three quarters of fiscal 2008," added chief financial officer Peter Oppenheimer. "Looking ahead to the fourth quarter of fiscal 2008, we expect revenue of about $7.8 billion and earnings per diluted share of about $1.00."

Apple will conduct its Q3 2008 financial results conference call in about 30 minutes -- AppleInsider will provide full coverage.