Despite all that’s stored, it appears the Internet has little memory. Exuberance for shiny new things often overtakes our willingness to remember how we got here.

This could be both good and bad. Not fully understanding how difficult a problem is can sometimes translate into a fresh perspective that can slay intractable problems. Understanding history, however, provides an appreciation of evolution, scale, velocity and effort that can help solutions come to fruition in the marketplace.

One of the shiniest memes around recently has been the incessant banging of the “Apple’s evil” drum. Most notably written in endless self-indulgent and self-righteous detail about how one self-important person or another gave up the iPhone…because “Apple’s evil.”

A farce…in five parts

There are several leitmotivs. One is that the iPhone fell short of their ideal of what a smartphone has to be. Another is their perception that Apple’s recent growth and profitability necessarily make it evil much the way Google is also considered as such, because all large companies must be, like Microsoft, evil. Of course, Apple is controlled by a single person named Steve Jobs, who, if you’re wondering, is evil. In their topsy turvy world, Apple is evil because it’s proprietary and closed; it doesn’t even blog. Clearly, on the “Apple’s evil” planet value doesn’t count: Apple is grossly expensive for no reason. Apple’s evilness is best demonstrated finally by the App Store, where somehow a rejection rate of less than 0.03% out of 65,000 apps makes Apple…evil.

This list of evil absurdities goes on. And could perhaps be interesting and informative if the self-important promoters of the “Apple’s evil” meme were somehow uniquely qualified to bring technical insight or business understanding to the subject that we haven’t heard before.

Apple just doesn’t get it

When one doesn’t grok the very core of what makes Apple Apple there’s really no room for reasoned discussion. For two decades, Apple — and sadly Apple alone — carried the flag of software-hardware-service integration against an industry that bought into Microsoft’s “My Windows, Your hardware, What service?” business model.

Even Microsoft has recognized what a joke this is when forced to compete in consumer markets. But “Apple’s evil” promoters still insist that Apple sever its integrated model; license its OS; tear down the App Store; let anyone load any app on the iPhone; turn a blind eye to competitors leveraging its iTunes platform without compensation; give up the subsidies from AT&T and jump into bed with CDMA that will be sunset in a year or two; and allow any number of slow, ugly and battery-consuming competing runtimes proliferate on the iPhone. Because not doing so would be…evil.

They know better

These Apple-hating self-promoters neither fully understand nor care much about Apple or how iPhone’s unique ecosystem and user experience are what makes nearly 50 million touch platform users the most satisfied bunch in the industry by a mile, year after year. The iPhone isn’t perfect, but these self-promoters have a megaphone…so there!

Needless to say, no company is immune to making mistakes. Not even the company that just created the world’s largest and first massively-popular mobile application store essentially in a single year. Just think about the logistics involved in that effort and the obvious fact that no other company has yet come close. But for the self-righteous few, that’s not enough…because “Apple’s evil.”

Remembrance of Things Past

So for a more reasoned perspective, let us take a breath and remember what the world was like before Apple introduced the iPhone:

1. Carriers ruled the industry with an iron fist
2. To access carriers’ networks handset makers capitulated everything
3. Carriers dictated phone designs, features, apps, prices, marketing, advertising and branding
4. Phones were reduced to cheap, disposable lures for carriers’ service contracts
5. There was no revenue sharing between carriers and manufacturers
6. There was no notion of phone networks becoming dumb pipes anytime soon
7. Affordable, unlimited data plans as standard were unheard of
8. A phone that would entice people to switch networks by the millions was a pipe dream
9. Mobile devices were phones first and last, not usable handheld computers
10. Even the smartest phones didn’t have seamless WiFi integration
11. Without Visual Voice Mail, messages couldn’t be managed non-linearly
12. There were no manufacturer owned and operated on-the-phone application stores as the sole source
13. An on-the-phone store having 65,000 apps downloaded nearly 2 billion times was not on anyone’s radar screen
14. Low-cost, high-volume app pricing strategy with a 70/30 split didn’t exist
15. Robust one-click in-app transactions were unknown
16. There was no efficient, large scale, consistent and lucrative mobile app market for developers large and small
17. Buttons, keys, joysticks, sliders…anything but the screen was the focus of phones
18. Phones didn’t come with huge 3.5″ touch screens
19. Pervasive multitouch, gesture-based UI was science fiction
20. Actually usable, multi-language, multitouch virtual keyboards on phones didn’t exist
21. Integrated sensors like accelerometers and proximity detectors had no place in phones
22. Phones could never compete in 3D/gaming with dedicated portable consoles
23. iPod-class audio/video players on mobiles didn’t exist
24. No phone had ever offered a desktop-like web browser experience
25. Sophisticated SDKs and phones were strangers to each other

This list too could go on. But it’s sobering to remember that a single device by a company with zero experience in the industry and against all odds caused such a tidal wave of change. Change didn’t come because of Nokia, Microsoft, Sony Ericsson, Samsung, RIM or any other player in the market for the past 15 years bet their company on it. Android and webOS weren’t there before the iPhone. But it’s convenient to forget all this when the meme demands Apple to be smeared with the evil brush.

Yes, “Apple’s evil”…except for all the others.

If you’re the owner of a general store in a small town of 83 people at some corner of a goldenrod state, you’d know the name of every man, woman and child there, where they live and when, where and what they shop. As far as marketing is concerned in that sleepy Nebraskan town, you’re God.

Now imagine a company that sells 50 million home mortgages all over the world. That naturally comes with very valuable financial background information on buyers that can be leveraged for additional products and services, where permitted.

And imagine further that this company not only has mortgage-related financial data, but can actually track furniture, clothing, electronics, food, financial, entertainment and pretty much any other kind of product or service purchased by all 50 million home owners in real time. Also consider that no other company has remotely the same access to such information. Finally, imagine that the company gets a 30% cut on all purchased items by all 50 million home owners. In anybody’s marketing world, this company would indeed be considered transcendent.

Welcome to Apple’s World

One of the jewels in the upcoming iPhone OS 3.0 SDK:

Of course, those fixated on the rear-view mirror are reliably unimpressed: “Apple has made no more than $20-45m in revenue from the app store.”

This, however, is the same App Store that offers third party developers such features as:

Flexible payments.

In app purchase gives you the flexibility to support a variety of business models. You can offer your customers additional services and content within your paid app.

For example, you can create a subscription magazine app where you ask for payment on a monthly, yearly or periodic basis of your choice. Sell extra levels to extend the experience of your game. Build a general-purpose city travel guide app and let your customers pick the city guides they want to purchase. This new capability opens up many new business opportunities.

You create the app, we’ll bring the cash register.

The new Store Kit framework provides the functionality to process payments via the iTunes Store. You submit items to the store and set their price. When a customer chooses to purchase an item, your app creates a payment request and sends it to the iTunes Store for processing. After the iTunes Store verifies and approves the payment, your app is notified so that it can provide features or additional content.

Familiar business terms.

In app purchase uses the same business terms used for apps sold on the App Store. You receive 70% of the purchase price of each item you sell within your app, paid to you on a monthly basis—no credit card fees apply.

At the rate of projected growth, Apple will amass about 50 million iPhone and iPod touch users within a year. Unlike any other mobile device vendor in the world, the vast majority of offerings in Apple’s App Store will work identically on all its devices. For Apple’s ecosystem partners, that’s one OS, one market, one store and one transaction model aligned with one company, around just a couple of nearly identical devices.

It’s not your father’s business model

While other vendors are just now realizing that when they were busy haphazardly cramming specs and features into low-margin hardware, Apple has been laying the foundations of a moat strategy around its mobile platform.

Combined with the Push Notification service, Apple’s In App Purchase gives the company a level of visibility into customer behavior, purchase patterns, social networks and dynamics of mobile marketplace that’s unprecedented in the technology business.

Imagine 50 million users with credit card purchase history: apps they buy; how long and how often they use them; what they purchase within the apps; what personal connections they make; what email/text and app notifications they get, and how often and where; what traffic patterns emerge at what times; what applications are crying to be developed; what’s a good time to introduce products and services; what price levels are sustainable; what happens when prices are increased or lowered; and myriad other analytical insights that any CEO with half a brain would happily sign a “$20-45m” check for with his own blood. And that includes Google CEO Eric Schmidt and, when he wakes up from his consumer-markets induced coma, Microsoft CEO Steve Ballmer.

It’s a metadata universe

Apple has had a taste of large-scale customer data mining with the iTunes Store for audio and video products. But that’s a more limited, less lucrative domain of pre-packaged, static content. The App Store offers applications, which are far more open-ended in their commercial scope. Most apps can upgrade, connect to other apps and services, offer in-app purchases and leverage the ecosystem. With the App Store, in addition to its 30% cut from every transaction, Apple gains something else equally valuable: insight.

Insight breeds systems design intelligence, which is the core of Apple’s competency. Needless to say, not all transactional data will be available to or retainable by Apple due to privacy and regulatory reasons. But even a peek at aggregated metadata (without personal identification) would give Apple an enormous and unique advantage.

With the possible exception of Google, no other vendor is currently playing for the same stakes in the mobile arena: not Nokia, not RIM, not Microsoft, not any of the Asian manufacturers and not Sun’s daydream, Vector Java App Store. Google is keenly aware of the power of data analytics, but Android will, by its open-source nature, remain fragmented over many different vendors, business models and competing corporate goals.

It’s not publicly known if Apple has put in place the necessary infrastructure to gather, retain and analyze such massive metadata and has the brainpower to mine for insights, but as the mobile market separates along device peddlers vs. platform vendors, it’s once again Apple’s war to lose.

Synergy cuts both ways

When Steve Jobs started his repositioning of Apple a decade ago, he used to repeat at every chance he got how much he admired Sony — the company that sold close to half a billion Walkman devices over the years, but missed the digital media era later by letting Apple dominate it with its iPod line.

One of the critical mistakes Sony made was to rely on its own propriatery Atrac audio compression technology instead of the popular MP3 format. Sony has been a major music label and it wanted to make money on both ends of hardware and content sales, so it crippled its players in various strategic ways until it was too late. Apple had no content to sell and thus it didn’t care what was on its iPods as long as people wanted to buy the hardware. The iTunes store was there to help sell iPods, not the other way around. If the primary format for shared or pirated music happened to be MP3 that wasn’t a major concern for Apple (as it also offered FairPlay DRM to music labels).

Nearly a decade later, we have a similar scenario unfolding, this time involving books, newspapers and magazines. To be sure, eReaders from Rocket, Gemstar, iRex, Sony and others have been around for a better part of a decade, but Amazon’s Kindle is considered to be the most successful one (even though no sales or profit figures have been released by the company yet).

DX is the new AOL

Amazon’s latest model Kindle DX ups the previous model’s screen size to 9.7 inches, adds native PDF support, and comes with an accelerometer for landscape viewing. Combined, these three new capabilities expand Kindle’s reach into technical publishing, magazines, newspapers and education.

What gives Kindle the edge among current eReaders is its unique integration of hardware, software and services. Amazon is not merely a device manufacturer like most of its competitors. Already synonymous with online book merchandising, Amazon is also America’s largest online retailer. It not only boasts a 275,000-book digital storefront, it’s also a leading mover of consumer electronics. Amazon has the reach in distribution and it isn’t afraid of leveraging it. Here’s what Dallas Morning News Publisher and CEO James Moroney said at yesterday’s U.S. Senate subcommittee hearing on the future of newspapers:

“The Kindle, which I think is a marvelous device, the best deal Amazon will give the Dallas Morning News — and we’ve negotiated this up to the last two weeks—they want 70% of the subscriptions revenue. I get 30%, they get 70%. On top of that they have said we get the right to republish your intellectual property to any portable device. Now is that a business model that is going to work for newspapers?

Moroney is not alone. News Corp. Chairman and CEO Rupert Murdoch also spoke on the crucial question of price and control:

“We will not be ceding our content rights to the fine people who created the Kindle. We will control the prices for our content and we will control our relationships with our customers. Any device maker or website which doesn’t meet these basic criteria on content will not be doing business long-term with News Corporation.”

While they may complain about loss of revenue and distribution, what choice do publishers have, if they are not willing to reinvent themselves? Kindle is clearly an interim, propriatery, DRM-protected platform for premium print content, much as Compuserve, Prodigy and AOL served the same purpose on the way to the WWW. It both scares and cajoles print publishers. The open web offers massive distribution via atomization, syndication, aggregation and re-aggregation of content. It requires real change and restructuring vs. re-purposing and re-pricing existing content, which seems to be publishers’ preference at the moment. Jeff Bezos is from Amazon and he is here to help.

What can derail Kindle then?

The first two versions of Kindle supported a propriatery format called AZW. Amazon does offer an email-based service that converts various other formats to its own AZW, but the commercial focus of its store has exclusively been DRM-restricted AZW. With the new Kindle DX, PDF is now added to the natively supported formats.

Unfortunately for Amazon, PDF is also the primary format for the huge digital ecosystem of pirated books, magazines, newspapers and textbooks. Constantly around the globe, protected digital versions of printed material are converted to unprotected PDFs or actual prints are scanned page-by-page as collated images or scalable digital text made available in PDF.

Indeed, for print, PDF is the new MP3. Amazon is trying not to repeat Sony’s earlier mistake with Atrac vs. MP3. By making PDF natively available, it’s positioning Kindle as a universal player, just as Apple did with the iPod. And therein lies the problem.

Razor or blades?

Jeff Bezos has just announced that 35% of books that have a Kindle version are sold in the digital AZW format, up from 13% just three months ago. That level of growth could point to a near-term future where the digital version of a book could outsell its printed counterpart. If only Amazon could hang onto that revenue.

If Kindle is a good reader for DRM-protected content, it would be just as good a device for pirated, unprotected and revenue-free PDFs. After all, Apple sold over six billion songs on iTunes, but that’s still dwarfed by the pirated music scene…much of it on its iPods.

So if what happened in the music business happens in the digitized-print business, can Amazon (or anybody else) make sufficient profit selling content? If not, Amazon will have to compete mostly on the value of its reader device. And yet Amazon is an utter newcomer to the hardware business, without much industrial design expertise, supply chain control, component price advantages or ability to leverage costs over multiple product lines like other CE companies. At $489, Kindle DX will not only compete with current eReader sellers like Sony, but also combinations of newcomers and publishers like Plastic Logic, News Corp, Polymer Vision and Hearst that are expected to unveil their own devices in the next 12 to 18 months.

The multi-touch elephant in the room

The specter over Kindle’s prospects, however, is (currently) a rumor. A rumor of a color, multi-touch device, offering not only static PDFs like Kindle but likely some combination of photos, 3D, games, telephony, networking, WiFi, Bluetooth, web surfing, 40,000 apps and millions of music, movies and podcasts from the world’s largest online media store. A “category-defining” device from a company whose CEO criticized Kindle in these dismissive terms:

“It doesn’t matter how good or bad the product is, the fact is that people don’t read anymore…Forty percent of the people in the U.S. read one book or less last year. The whole conception is flawed at the top because people don’t read anymore.”

If Kindle can provide evidence that there’s a profitable repurposed-print market that can fuel hardware sales with a healthy margin, Steve Jobs would be more than ready to jump into the fray. At which point — if PDF is the format equalizer — the battle shifts largely to hardware design, back-end service, user experience differentiation and overall value. Precisely the areas where Apple is peerless. Amazon’s revisionist “bookpad” vs. Apple’s recombinant “mediapad.” Rear-view mirror into a lethargic industry vs. windshield towards a non-print centric future.

There’s a strange blindness that obscures U.S. blog and news coverage of iPhone. If the measure was mindshare, iPhone would be the world’s most important handset. But based on market share, iPhone is a tiny fish in a pond of larger, wiser fish. Nokia is biggest of them all. Marketshare matters — and it will matter more as Nokia launches its Ovi Store rival to Apple’s App Store…Nokia shipped more than five times as many handsets in a single quarter than Apple expected to ship for all of 2009. Perhaps iPhone is more water bug than tiny fish in that big pond.

Nokia is the poster child of those whose incurable fetishism is market share. It recently announced shipments of 92.3 million handsets in a single quarter, for a 38% global share. Apple, on the other hand, has sold only a total of 17 million iPhones (and 13 million iPod touches) in nearly two years for less than 2% global market share.

What if Apple operated like Nokia?

There are many differences between Nokia and Apple, of course, but none more telling than these two pictures:

Those are just a tiny fraction of more than 220 different models of Nokia phones in circulation. Apple, on the other hand, sells a single cellphone model:

That’s it. One model (with more or less memory, black or white) for all demographics and markets, here and abroad.

What never shipped

Steve Jobs has famously said that he is proud not only of the products Apple has shipped, but also the products Apple has decided not to ship. Indeed, had Apple listened to its competitors, analysts and pundits, it would have shipped a plethora of devices two years ago, including:

It’s the SKU, stupid!

With so many products, Apple would have had to research, design, manufacture, quality check, ship, stock, market, track, analyze and upgrade at a level of expenditure an order of magnitude higher than what it currently has for a single product.

SKU promiscuity is a sucker’s bet, as is the opportunity cost of behaving like Nokia. By spreading itself far too thin over 220 SKUs, Nokia inevitably fell short of a vision and ability to innovate, getting blindsided by the birth of the truly usable handheld computer, also known as the iPhone.

Indeed, Nokia’s greatest asset — its market share — has all of a sudden become an albatross around its innovation neck. The vast majority of its devices in the market are dumb phones running an aging OS, incapable of competing with web-surfing, multi-touch, multi-media and multi-purpose devices of the burgeoning ’smartphone’ genre. Reliant on volume and distribution for over a decade, Nokia has finally become the Microsoft of cellphone industry: ubiquitous, lethargic and beholden to its user base and SKU outlays.

In contrast, Apple uniquely leverages what’s essentially a single OS across desktop, server, mobile and set-top devices. Each innovation and improvement can not only quickly propagate across platforms through shared frameworks, but can also closely integrate them further to create the ‘halo effect’ that sells more Apple products. If Nokia’s strategy is ’segment and conquer’ Apple’s is ‘integrate and cross-sell.’

And one more thing…

Nokia reported a 91% drop in Q1 earnings per share.

By now the furor over DiggBar — Digg’s naked attempt at stealing link juice via URL misdirection — and frame-busting counter-measures are well-spread.

The irony, of course, is that startups like Digg are supposed to experiment and fail often by the inevitable nature of statistics of success. In old industries like banking or automative, however, when we notice failure, albeit on a grander scale, we want the CEOs and the managers who made bad decisions to be fired, not rewarded with bonuses. Those names become public and focus of scorn in editorials and their houses are ‘visited‘ by angry tax payers.

But what happens to startup people who make serious mistakes and misjudge potentially debilitating risks to their companies and brands? What, for example, happened to the clever people who concocted Beacon for Facebook, the privacy debacle disguised as an advertising platform that comes once in a century? What happened to the folks who decided to build an architecture for Twitter that couldn’t possibly handle a real-time messaging system at global scale that nearly sank the company? Who at Yahoo thought it was a good idea to pay $5.7 billion to Broadcast.com in 1999?

Indeed, what will happen to those who thought people wouldn’t notice or didn’t care that Digg would now be appropriating link destination from original sites via DiggBar to boost up its own traffic so that it can justify the recent infusion of VC money into Digg? Digg VP John Quinn boasts that DiggBar has resulted in a 20% boost in unique visitors. Is this a time for celebration and bonuses?

The objective here isn’t individual punishment, of course. It’s a matter of ethics and transparency — all the things we’re asking of the old-line industries and our politicians — as though high-tech has a firmer grasp of our brighter future.

Are we naive or just jaded?

In Only Ten Years Too Early, Fred Wilson recounts his VC investment in a “cheap internet appliance”:

The idea was that we could build a large user base and make money through advertising, marketing, and e-commerce. It was 1999 of course.

We invested something like $10mm in the business and built a team of talented engineers and business people and launched a device which we partnered with Virgin Entertainment to take to market. This is what the device looked like:

Needless to say, this was not a successful investment. The device worked but it had a number of fatal flaws outlined in this PC World review from 2000.

While this looks like a case of massive wishful thinking taking over sensible viability assessment, we can’t really be sure why the venture failed without inter-related facts and the benefit of hindsight. Fred’s conclusion? “Beware of ‘way too early’.” This does sound like good advice, except perhaps when coming from a VC, especially when contrasted to Peter Drucker’s dictum, “The best way to predict the future is to create it.”

When is it “too early”?

As is the nature of investing, a VC’s job is to bet on the future. VCs and their portfolio companies can either chase the coattails of a trend (usually beyond their control) or, a la Drucker, try to actively shape the future by creating the necessary ingredients if/when necessary:

• Google – We explored how Google created GOOG-411, a free automated directory service, to harvest phoneme data to improve their speech recognition algorithms so that YouTube videos can be indexed (and thus searched and monetized) through speech-to-text conversion. (This will be likely used in the upcoming Google Voice as well.)

• Apple – When Apple wanted to redefine what a cellphone is, it didn’t phone in yet another clunky “smartphone” with an Apple logo on it. For over a decade, the incumbents in that industry were satisfied with existing form factors, UIs, features, carrier relationships, revenue models and infinite small-minded product differentiations. Unlike Nokia or Microsoft, Apple didn’t say, “There are too many industry restrictions and technical hurdles for us to redefine this category. It’s way too early.”

Apple didn’t leave anything to time or fate. In hardware, software and services, it actively created a space for the iPhone to succeed. Where it was needed, it poured in R&D dollars, invented new things and collected hundreds of patents; gained new expertise in radio technology; bought a company specialized in multi-touch; converted a desktop OS into mobile one; created new global distribution channels; negotiated a ground-breaking arrangement with the largest carrier; and so on. In other words, instead of creating, hoping and predicting that the iPhone would somehow become a killer product, it made sure that all the supporting elements were in place to make sure that it would.

• Sun – When Java was first introduced, perhaps the biggest gripe against it was its relative slowness compared to established languages like C++. A lot of people were ready to write off JVM. Sun, it turns out correctly, bet that Moore’s law and software optimization would catch up to bring Java performance up to par, and productivity gains from a better language would outweigh the initial performance concerns. CPUs got much faster and Sun managed to further speed up Java performance. For many years now, Java performance on the server has ceased to be an issue.

• Cloud computing – Perhaps the most “hyped” growth domain today is all the ways in which we can connect our desktops and mobile devices to servers and services in the cloud. Now, any conventional IT executive or a VC in need of an 18-month exit strategy can find excuses to not fund cloud computing projects and products: security, data portability, management, reliability, performance, etc.

For example, it would be easy to claim “too early” by noticing that average consumer upload speeds last year in America via common cable/DSL conduits was only 435 Kbps, much too slow for various entertainment and medical applications, among others. This gets even worse for enterprise computing where terabyte-size datasets need to be routinely uploaded to the cloud for tracking and analysis.

Is it “too early” then to positively consider Nirvanix, Bycast, Mozy, Cleversafe, ParaScale, Dropbox and numerous other mostly consumer oriented companies for cloud storage? How about Amazon, Microsoft and Google offerings that go from simple storage into cloud-based applications and transactions? Should the column-based data warehouse company Vertica not offer an analytic DB for the cloud, because it’s “too early” to transmit gigabytes of data over a typical corporate T-1 connection?

Further, should Nvidia stop its GPU platform because major OS vendors don’t (yet) support it? Should Apple delay its GrandCentral or OpenCL initiatives because the hardware side of the equation isn’t sufficiently complete, pervasive or economic? Examples abound.

Chase or lead?

A decade ago PointCast became a canonical example of a product that was “too early” because we didn’t have pervasive broadband for a push service (though the company would have been a success if it didn’t refuse the $450M buyout offer from News Corp). Since then Apple and Google, among others, have taught us how to create the necessary conditions for their products to succeed by compressing time through strategic invention.

If VCs want to become indispensable to the companies they advise, perhaps they ought to remember that it’s “too early” only if you fail.

A short but remarkably revealing report in DetroitNews, Microsoft to chase iPhone:

Microsoft Corp. plans to bring some of the features of rival Apple Inc.’s iPhone to a broader market through its Windows Mobile software, said mobile-phone chief Andy Lees.

Microsoft will use its ties with handset makers to encourage iPhone-like functions in a range of less costly devices, Lees, a senior vice president, said in an interview ahead of the CTIA Wireless show.

In one example, the iPhone advanced the technology around so-called graphics acceleration, which allows the software design to be more fluid and movie-like, he said.

When, for well over a decade, every single smartphone manufacturer failed to even try, how did a newcomer like Apple do that?

“Apple took a bet on expensive hardware and designed the software around the hardware,” Lees said. “That allowed Apple to design a phone with superior graphics capabilities.”

In other words, Apple’s unique ability to integrate hardware and software, and being in charge of its own systems-design destiny was the secret. Why not Microsoft?

Microsoft, [Lees] said, wasn’t set up to help match that in its software.

But wasn’t the separation of hardware and software what made Microsoft the most powerful technology company in the world? Haven’t Microsoft executives (and tech pundits) been telling us this separation (choice and reliance on “partners”) was what made Microsoft’s platform superior to Apple’s foolish insistence of going it alone?

What will Microsoft do now?

Microsoft is working with its hardware manufacturers to make those kinds of innovations more rapidly available as an industry, Lees said.

Welcome to the absurdity of design coordination across several continents among “partners” with different cultures, innovation capabilities, corporate agendas and competitive pressures. Unfortunately for Microsoft to repudiate this is tantamount to repudiating its PC history, which still provides the vast majority of its revenues. Welcome to the Zune generation, Microsoft. Rock. Hard place.

From NewScientist, Vibrating touch screens spell out Braille:

In Braille, letters are encoded using a two-by-three matrix in which each character is represented by a different configuration of raised and absent dots at the six locations. To display these dots on a touch-screen device, Jussi Rantala of the University of Tampere in Finland and colleagues used a Nokia 770 Internet Tablet, which has a piezoelectric material built into the touch screen that vibrates when an electric signal is applied to it. The team installed software that represents a raised dot as a single pulse of intense vibration, and an absent dot as a longer vibration made up of several weaker pulses.

The team developed two methods: (1) the user moves a finger horizontally across the screen to detect the bumps, and (2) the finger stays still but the screen vibrates the sequence of six dots, each 360 milliseconds apart. In the latter method, once users got used to it, they could read a character in as little as 1.25 seconds.

The team’s next step, says NewScientist

will be to present entire words and sentences. Screen-reading software is already available that “grabs” information displayed as text and turns it into speech. The same information could be turned into Braille characters on phones with vibrating touch screens.

From oobject.com, 15 pneumatic message networks:

Ted Stevens was right, the Victorian Internet consisted, quite literally, of a ‘Network of Tubes’. Paris, London, Prague and Vienna had extensive networks of pneumatic tubes which delivered messages in capsules. In New York 5 million mail messages passed every day through an underground pneumatic system, and a network in Berlin delivered hot meals directly to people’s homes suggesting that kitchens would no longer be needed in the future. Today these systems can still be purchased where they are used in places like hospitals where samples are passed between departments.

USS Midway aircraft carrier pneumatic message system

New York Public Library Messaging System

Lamson pneumatic tube system

Main Control Panel for the Prague Pneumatic Post

If you have ever used one of these, as I have at an educational institution many years ago, you’ll never forget the immensely satisfying pneumatic plump sound when your payload is sucked up the tubes.

Naming any Apple product — much less the iPhone, the most iconic of them all — is no easy task.

Remember all the mindless chatter when Apple risked legal entanglement with Cisco for the right to use the name “iPhone”? Gizmodo:

Cisco rightfully owns the trademark for iPhone. And Apple can’t sue them or bully them into giving it up. The tech world had taken the title for granted, assumed it to be proper, plastered it over magazine covers, and now the name is lost. Which means Apple’s iPhone, if there even is an iPhone, will have to be named something else. It’s a big deal, if you think about what that name meant.

Apple never designated the original product iPhone 1G or iPhone 2G. Introduced as a convergence device, it was simply called iPhone. The next version last year (twice as fast, at half the price) was named iPhone 3G. The “3G” part was referencing the speed upgrade from 2.5G/2.75G (EDGE) to 3G (HSPA), not its generational order. Only after the introduction of the iPhone 3G did it make sense to refer to the original as iPhone 2G, but that’s not Apple’s nomenclature.

Give us the name

Beyond simple versioning, however, product names often foretell Apple’s ambitions with a given product. Whatever value theme Apple will wrap around the next iPhone, it will likely be reflected in its name. Let’s consider some possibilities:

• iPhone 3G+   Too nerdy for Apple.

• iPhone 3G II   Apple is not Nokia.

• iPhone 3.5G   No decimals in consumer hardware names.

• iPhone 4G   Four comes after three, to be sure. But in the cellphone industry 4G specifically refers to 4G LTE, the next major evolution in wireless speed and interoperability among mobile phone carriers. Apple’s carrier AT&T has said it would begin to upgrade its 3G network to HSPA+ this year and switch to 4G LTE by mid-2011. So the timing isn’t quite right for 4G.

• iPhone Pro   Assumes minor hardware upgrades to existing iPhone at same/lower price and introduction of a higher-end model at a higher price (like MacBook vs. MacBook Pro). So if Apple is about to expand the “touch platform” horizontally (like the iPod product line), we can expect to see a new mobile “quadrant” segregated by functionality and price among products like iPhone mini, iPhone 3G, iPhone HD, iPhone Pro, iPod touch, iPod touch HD, iPhone Business, etc. Balance that against Apple’s practice of product line simplification though.

• iPhone V (Video) or iPhone M (Media)   If Apple’s acquisition of PA Semi bears early fruit and the iPhone is turned into a multimedia powerhouse with faster CPU (ARM Cortex), multi-core GPU (Imagination PowerVR), parallel graphics processing (OpenCL), Wii-mote like 3D controls, better camera and video recording/conferencing, we can expect to see a long line of third party partners demonstrating the media prowess of the new iPhone at the WWDC. Apple knows that no other smartphone is even close to the iPhone as the mobile gaming platform, but it won’t be called iPhone G (Games) since the name can’t regress from 3G to G and association with “games” won’t help Apple battle RIM and Microsoft among business users.

• iPhone U (Universal)   Apple’s decision to open up the 30-pin port to third party developers was a central part of the new iPhone OS 3.0 SDK. This makes the iPhone a ‘controller’ of a huge range of hardware in all kinds of industries from healthcare to entertainment to transportation. Indeed, the iPhone becomes the universal front-end ‘UI processor’ to the rest of the world, and the hub of a multi-billion dollar ecosystem in the making.

• iPhone X   An opaque name, but nicely ties the iPhone via Snow Leopard (Apple’s upcoming OS, a mobile version of which will also power the touch platform) to the Mac OS X desktop world for the ultimate bi-directional halo effect. The next device in 2010 might then be called iPhone X2 and the one in 2011, iPhone 4G. How would the unwashed non-Mac users pronounce it, though, as “tɛn” or “eks”?

• iPhone <#noun>   We don’t quite see Apple losing its mind with something like iPhone Storm/Instinct/Chocolate/Rumor/Propel but if there’s in fact a unifying value theme for the next device and a semi-abstract word can capture its soul and purpose, it is certainly a possibility.

• iPhone 09   Should Apple run out of naming ideas, there’s always the introduced-in-the-year standby. However, Apple does this with software (iLife 09, iWork 09) but not with hardware. Otherwise, what would it name the one capable of LTE, iPhone 4G 11?

• iPhone   The ultimate Rorschach inkblot test. A maddening knot in the world of Cupertinology is Apple’s predilection to introduce a market defining product under one name and, over time, introduce several iterations without any name augmentation. That inevitably forces customers and tech support alike to make up names to identify Apple products such as “3G iPod fat nano with video,” “C2D 24-in iMac,” “MBP 15-in late 2008″ and so on. So there’s also a chance that Apple might decide not to add a qualifier to “iPhone” until the appropriate opportunity presents itself, like when 4G LTE is ready for deployment.

The name makes the product?

It would be easier to decipher what the next iPhone version will contain if we could get a glimpse of just the name of the device instead of spec lists and blurry pictures soon to inundate us. The name will tell all. We already know, however, what it won’t be called: “Apple MyPhone P3G-2 Millennium Live Edition 2009,” pre-hyped with a cheesy YouTube video.

What’s your prediction?