Apple 2.0

Snapshot of the iPhone App Store: One year later

2009-07-10T13:12:28Z

Apple’s (AAPL) App Store opened early on the morning of July 10, 2008 with an update to iTunes, although it wasn’t until the next day — with the launch of iPhone OS 2.0 — that the applications it contained could be downloaded and put to use on iPhones or iPod touches.

There were more than 500 third-party apps in the store that morning. One year later, there are more than 56,000, according to 148Apps.biz, and that doesn’t include the thousands of apps offered in the store’s 60 or so foreign branches.

Jeff Scott, who runs 148Apps (named for the maximum number of applications that could be displayed on the original iPhone) gathers his information from the store itself by running a variety of automated data grabbers. His latest count, as of July 10, 2009:

Total Active Apps (currently available for download): 56,667
Total Inactive Apps (no longer available for download): 4,005
Total Apps Seen in US App Store: 60,672
Number of Active Publishers in the US App Store: 14,935

According to Apple, the one billionth app was downloaded at approximately 4:50 a.m. on April 23, 2009, by Conner Mulcahey, 13, of Weston, Conn. There is no official explanation for what he was doing up so early in the morning, checking out a game called Bump, but for his pains Apple awarded him an iPod touch, a Time Capsule, a MacBook Pro and a $10,000 iTunes gift card.

Growth of the store, as represented by the bar graph below, has been accelerating fairly steadily, with an average of 135 new app submissions every day. There were 1,630 submissions in August 2008 and 8,762 in June 2009.

The average price of an app, including both the 12,754 free apps and the most expensive app (a video surveillance program called iRa with a $899.99 price tag) is $2.57.

If you wanted to buy every app in the U.S. store today, according to 148Apps, it would cost you $145,885.87.

The most popular category in the store is games, with a total of 10,346 to choose from, closely followed by Entertainment (7,852) and Books (7,564). There are 9097 finance programs, 663 medical apps, 306 weather applications, and according to Krapps.com’s Alex Miro, at least 50 fart apps.

Coming later today to CNNMoney.com: Our picks for the 10 dumbest iPhone apps.

See also:

Dr. LSD to Steve Jobs: How was your trip?

2009-07-09T14:12:07Z

“Dear Mr. Jobs,” begins the 2007 letter from Swiss scientist Albert Hofmann to Apple’s (AAPL) CEO. “I understand from media accounts that you feel LSD helped you creatively in your development of Apple computers and your personal spiritual quest. I’m interested in learning more about how LSD was useful to you.”

Hofmann, as students of the sixties will recall, was the chemist who first synthesized, ingested and experienced the psychedelic effects of lysergic acid diethylamide.

Steve Jobs, as readers of John Markoff’s “What the Dormouse Said: How the Sixties Counterculture Shaped the Personal Computer Industry” may remember, dabbled in psychedelics in the 1970s and has called his LSD experiences “one of the two or three most important things I have done in my life.”

“I’m writing now,” Hofmann’s letter continues, “shortly after my 101st birthday, to request that you support Swiss psychiatrist Dr. Peter Gasser’s proposed study of LSD-assisted psychotherapy in subjects with anxiety associated with life-threatening illness.”

Hofmann, who died last year at age 102, was writing at the request of his friend Rick Doblin, founder of the nonprofit Multidisciplinary Association for Psychedelic Studies.

Doblin was hoping for a financial contribution from the billionaire co-founder of Apple. What he got instead, according to Ryan Grim, who posted the previously unpublished letter Tuesday in the Huffington Post, was a half-hour telephone conversation with Jobs. As Grim describes it:

“[Jobs] was still thinking, ‘Let’s put it in the water supply and turn everybody on,’” recalls a disappointed Doblin, who says he still hasn’t given up hope that Jobs will come around and contribute.

Grim got permission to publish Hofmann’s letter from the chemist’s estate. Grim’s Huffington piece is adapted from his book “This Is Your Country on Drugs: The Secret History of Getting High in America.”

Albert Hofmann photo courtesy of Wikipedia Commons.

Below the fold: a snapshot of the letter.

Mac vs. PC: Microsoft lowers the bar to $700

2009-07-09T09:38:21Z

It’s been three and a half months since Microsoft (MSFT) put owners of Apple (AAPL) computers on the defensive with the first (and perhaps the best) “Laptop Hunters” ad — the one featuring a perky actress named Lauren who does a price comparison and decides she’s “just not cool enough to be a Mac person.”

Lauren, you may recall, started with a $1,000 budget but ended up with a $699.99 Hewlett Packard (HPQ) machine.

Someone in Redmond must have liked the way that $700 price point played in the focus groups because a cut-down version of the original Lauren ad was back in heavy rotation last week, and this week it was joined by a new TV spot in which an equally photogenic laptop hunting family starts with a $700 budget, rejects the $999 white MacBook, and ends up, like Lauren, with an HP Pavilion dv7.

Brace yourself for another round of Pavilion dv7 bashing (“It is the epitome of what people dislike about PCs,” wrote Computerworld’s Seth Weintraub when Lauren bought hers) and statements of the obvious: if you start at $700 you’ve already priced yourself out of the Apple notebook market.

More to the point, perhaps, is that none of this seems to have put a dent in MacBook sales, as All Things Digital’s John Paczkowski pointed out earlier this week. The 13-inch MacBook Pro, starting at $1,199, seems to be selling particularly well. Piper Jaffray’s Gene Munster called around and found that it was out of stock in 7 of the 10 stores he telephoned (see here).

Here, in case you missed it, is the latest Laptop Hunters ad. The original “Lauren” spot is pasted below the fold.

See also:

Apple, Palm seen cutting into BlackBerry sales

2009-07-08T18:33:19Z

Growing competition from new smartphones carved into Research in Motion’s (RIMM) June sales, according to a report to clients issued Wednesday by Piper Jaffray’s T. Michael Walkley.

RIM’s BlackBerry still has a huge market share — nearly 20% of the worldwide smartphone market, second only to Nokia (NOK), according to Gartner — but Walkley’s retail checks found some erosion in BlackBerry position last month.

The problem, according to Walkley, is that carriers like Verizon (VZ), Sprint (S) and T-Mobile (DT) have been soft-peddling the BlackBerries and promoting new devices from Apple (AAPL) and Palm (PALM).

In particular, Walkley’s checks found that:

BlackBerry Curve sales declined slightly at Sprint due to “solid sales” of the Palm Pre.
Apple’s new iPhone 3GS and the $99 price point for the old iPhone 3G “impacted” BlackBerry sales at AT&T (T), with June’s numbers coming in below May’s.
Verizon ended its buy-one-get-one-free offer for BlackBerries last weekend and Walkley’s checks indicate slightly slower BlackBerry sales and more action in the LG department, where Verizon started a similar promotion for their devices.

Walkley doesn’t see consumer interest in the iPhone or Palm Pre going away any time soon, and he sees more competition coming down the road. In August, T-Mobile is scheduled to roll out the G2 — the latest phone based on Google’s (GOOG) Android platform — and there are more smartphones due in the second half of ‘09 from LG, Nokia, Motorola (MOT) and Samsung.

The one bright spot in RIM’s near future, says Walkley, is the launch of the BlackBerry Tour, due out later this month. He thinks it will do quite well.

“In fact,” he writes, “we expect the Tour will sell very well to Verizon’s installed BlackBerry subscriber base, as this is Verizon’s first product that is competitive with the Bold at AT&T. Sales of the Tour are key in our opinion, as our checks indicated RIM may need strong July and August sales to meet its guidance.”

If so, RIM cannot be pleased with the early review of the Tour that appeared Wednesday morning in Silicon Alley Insider.

“It’s a solid gadget that any plastic-keyboard-addicted BlackBerry devotee should consider upgrading to. The screen and browser are especially nice compared to older BlackBerry models like the Curve,” writes SAI’s Dan Frommer. “But after a year on the iPhone, setting up a new BlackBerry was like figuring out a puzzle. It shouldn’t have to be.

“Setting up email, for instance, was a 20-minute pain — versus a 2-minute breeze on the iPhone. If I weren’t a relentless nerd, I would have had to contact customer service to figure it out, wasting Verizon’s time and money.”

It gets worse. To read Frommer’s full review, click here.

Steve Jobs’ health: Where’s that SEC probe?

2009-07-08T12:01:35Z

It’s been nearly six months since Bloomberg News, which had been leading the pack investigating the vagaries of Steve Jobs’ health problems, reported that Apple (AAPL) was facing a “review” by Securities and Exchange Commission.

On Wednesday, team Bloomberg revisited the story and reported that Apple’s disclosures about Jobs’ health “remain under scrutiny” by the SEC.

But the 1,039 word piece, reported by Connie Guglielmo, David Scheer and Karen Gullo, offers no new information about the government probe, what it’s after or what progress it has made.

The story quotes a former SEC lawyer, a former SEC enforcement attorney, a securities law professor, and the author of a paper on advocating CEO health disclosures.

The pivotal question, as the experts point out, is what happened in the nine days between Steve Jobs’ Jan. 5 announcement that he had a “hormone imbalance” and his Jan. 14 statement that he was taking a five and a half month medical leave.

Connie Guglielmo led the Bloomberg team that reported in January that Jobs was considering a liver transplant. The fact that Jobs had the surgery — and had been sick enough to go to the head of the transplant waiting list — was not revealed until June 20, a few days before he returned from his medical leave.

Given that her sources had nothing new to say about the SEC review, it’s not clear why Guglielmo chose to revisit the story today, less than two weeks before Apple is scheduled to release earnings for what analysts think will be a strong quarter.

There was one nugget of news in the piece, however. It had been widely reported that members of Apple’s board were being briefed by Jobs’ doctors on his condition. The Bloomberg story names them: Art Levinson, former CEO of Genentech, and Bill Campbell, the former CEO of Intuit.

See also:

iPhone wait reduced to 30 minutes in New York City

2009-07-08T11:40:25Z

There were only four customers in the queue to buy an iPhone 3GS when I showed up at Apple’s (AAPL) flagship Fifth Avenue store in Manhattan Tuesday afternoon for what I’d been told would be the lunch-hour crush.

This is where I’d hoped to see iPhone demand collide with iPhone supply. I saw nothing of the sort.

Although Apple’s availability widget shows red “sold out” lights for selected models in every state where Apple has retail outlets (see here), there seemed to be plenty of product on hand today.

Less than three weeks after the launch of the iPhone 3GS, the lines that once snaked in front of the big glass cube had dwindled to the point where the customers that showed up could fit comfortably between a few retractable belt posts within the store itself.

Justin, one of the teal-shirted Apple employees manning the stanchions Tuesday, said that the big lines had disappeared within a week or so and that what crowds there were now didn’t start to gather until later in the day — around 4 p.m. As I watched for a half-hour, the queue grew until it held a dozen people. At that point it seemed to reach a steady state, with customers leaving with their new iPhones in hand at roughly the same rate as new ones joined the line.

The rest of the store, meanwhile, was hopping with its usual mix of office workers, tourists, foreign visitors flush with Euros, parents with kids in tow, and out-of-school students hunched over the laptops on display. I estimated the crowd at between 200 and 300.

There were no lines in front of the nearest Sprint (S) store, 10 blocks down Fifth Ave, and no crowd inside, either. It’s not a fair comparison because there are thousands of Sprint outlets and only 240 Apple Stores, but this Sprint store was very quiet. Of the two staff on duty, one was dealing with the sole customer, and the other was reading a book. She looked up to confirm that yes, they did have the Palm (PALM) Pre in stock.

See, by contrast:

Two weeks later, New Yorkers wait 4 1/2 hours for an iPhone 3G

[NOTE: An earlier version of this story confused Sprint with T-Mobile. Apologies to anyone who was mystified by the switch.]

Demand for new MacBooks outstrips supplies

2009-07-07T15:56:35Z

The new MacBooks are hot — and we’re not talking about the lap-scorching temperature of their aluminum unibodies.

Apple’s (AAPL) online store is currently showing a 7- to 10-day delay in shipping two models of the MacBook Pro — the high-end ($1,500) 13-inch and the entry-level ($1,700) 15-inch.

According to Piper Jaffray’s Gene Munster, who tracks product lead times, Apple has never had a 7-10-day delay in the 13-inch MacBook — the one recently re-named the MacBook Pro. The most significant delay he’s seen was a record 5-7 days, set more than two years ago.

In addition to the shipping delays, he says, some Apple retail stores are experiencing shortages of selected 13-inch MacBook Pros. Of the 10 stores his team contacted, seven were sold out of at least one 13-inch model.

In a note to clients issued early Tuesday, Munster wrote that this “sign of strong demand for Apple’s most popular computer” gives him “increased confidence” in his estimate of 2.2 million Mac unit sales for the fiscal quarter that ended June 27.

Munster also notes that NPD’s surveys of U.S. retail outlets showed Mac sales down only 3% in April and May — considerably less than the 10% he had anticipated. When NPD releases its numbers for the June quarter — which will include June sales — Munster expects them to be up 1%.

We’ll learn more when Apple reports its third-quarter earnings on July 21. Tune in here for live coverage of the company’s earnings call with analysts scheduled to begin at 5 p.m. EDT (2 p.m. PDT).

Where have all the white iPhones gone?

2009-07-08T17:42:12Z

It’s the reverse of Henry Ford’s line about the Model T. Today you can buy any iPhone you want, as long as it’s not white.

Apple (AAPL) has been having trouble keeping the entry-level white iPhone in stock since the new 3GS went on sale two and a half weeks ago. But as of Tuesday morning, it has all but disappeared.

The 16 GB model — apparently the most popular — is out of stock in the 31 of the 41 states in which Apple has stores.

It’s available in only one of California’s 45 Apple Stores, 1 of 9 in Massachusetts, 1 of 7 in Illinois, 1 of 6 in Virginia and 1 of 3 New York City.

It’s not clear whether demand for the white 16GB model is unusually high, or if Apple just isn’t making enough of them.

When we last looked at iPhone availability, there were red “sold out” lights for selected models in all but six states (see here). Today at least one model is out of stock in every state.

The only store in Delaware — located in Newark’s Christiana Mall — is completely sold out.

According to Apple, there are $99 iPhone 3Gs available in all stores, and the 3GS models are restocked “on most days.”

To check availability in the Apple Store nearest you, click here.

AT&T (T) has had 3GS supply problems from Day 1, but Apple’s availability widget doesn’t cover their stores.

Below: A snapshot of the situation in Texas as of Tuesday morning.

Antitrust: Apple and AT&T in DOJ’s sights

2009-07-07T23:01:02Z

The U.S. government agencies in charge of policing antitrust violations — long dormant under the Bush administration and newly revitalized under Barack Obama’s — seem to be circling closer to Cupertino.

According to a report Monday in the Wall Street Journal’s online edition, the Department of Justice has begun an initial review of the U.S. telecommunications industry to determine whether the two dominant players — AT&T (T) and Verizon (VZ), which together control 90 million U.S. landlines and 60% of the country’s 270 million wireless subscribers — are abusing the market power they have amassed in recent years.

Although not a primary target of the probe, Apple (AAPL) could get ensnared in it, according to the Journal’s report.

“Among the areas the Justice Department could explore,” writes the WSJ’s Amol Sharma, “is whether wireless carriers are hurting smaller competitors by locking up popular phones through exclusive agreements with handset makers, according to [people familiar with the matter.] In recent weeks lawmakers and regulators have raised questions about deals such as AT&T’s exclusive right to provide service for Apple Inc.’s popular iPhone in the U.S.”

The same sources suggest that the DOJ could also review whether telecom carriers are unduly restricting the types of services other companies can offer on their network. The features provided by the iPhone’s 50,000 apps are a key competitive advantage over its rivals.

“Antitrust problems with telecom consolidation have been evident for a while — it’s not just wireless,” says Gary Reback, an antitrust attorney at Carr & Ferrell in Palo Alto, Calif., and author of the famous “white paper” that laid out the antitrust case against Microsoft (MSFT) in the 1990s. “There has been a lot of public opposition to the consolidation, but the Bush Administration just shrugged it off.”

This is the second time this spring that Apple’s name has come up in a federal antitrust probe. In May the New York Times reported that the Federal Trade Commission had begun an inquiry into whether the ties between the boards of directors at Apple and Google (GOOG) could violate antitrust laws.

The companies share two directors — Eric E. Schmidt, chief executive of Google, and Arthur Levinson, former chief executive of Genentech.

Apple has also caught the eye of the Securities and Exchange Commission, which investigated — and ultimately exonerated — Steve Jobs for his role in the options backdating case. The SEC is also reported to be looking into whether Apple was sufficiently forthcoming earlier this year about the severity of Jobs’ health problems.

Asked for comment on the report of a DOJ probe, an AT&T spokesman wrote:

“We are not aware of any formal investigation by the Department of Justice, nor have they asked us to provide any information. The U.S. wireless industry is highly competitive and, as a result, delivers terrific innovation, many choices and attractive pricing for all customer segments.”

Analyst: China Mobile still an iPhone contender

2009-07-06T16:38:02Z

China Unicom is the front runner in the “battle” between China’s two largest cellphone carriers to win exclusive rights to sell Apple’s (AAPL) iPhone in China, but giant China Mobile is “not out yet.”

So says Kaufman Bros.’ Shaw Wu in a note to clients issued Monday. “We checked in with our industry and supply chain sources,” he writes, “and as expected, details are hard to come by as Apple keeps a tight lid on its future plans, but we were able to gather some data points that Apple followers may find useful.”

China Unicom is hungrier: “It appears that China Unicom is more willing to provide larger subsidies and cede more control to Apple to grow its subscriber base of 133 million users vs. 488 million at China Mobile.”
Wireless protocols are key: China Unicom has made it easier for Apple by launching plans to deploy 3G coverage to 284 cities using basically the same UMTS/WCDM technology AT&T uses. China Mobile has gone its own way, with plans to launch 3G service in 238 cities using lower-cost but incompatible TD-SCDMA protocols.
Apple has several options: It could sell its current iPhones to China Unicom; it could re-introduce the original 2G phones compatible with both carriers’ GSM networks; it could make new multi-baseband phones that work with both carriers’ 3G networks.
China already has iPhones: 1 to 1.5 million of them, Wu estimates, even without an official carrier. The “official” way to buy one, he hears, is through Hong Kong’s Hutchinson Telecom, which struck a deal with Apple last year.
China’s business model is different: “From our understanding, customers in China are more willing to pay more for the hardware so the subsidy is likely smaller as well as monthly fees from the service plan. Service plan pricing is much lower than the U.S. In Hong Kong, it is approximately $25 compared to $70 here in the U.S. In China, it is as low as $10 though Internet data plans are fairly new in China.”

China’s 687 million mobile subscribers represent the biggest prize on the planet for cell phone makers — the last missing piece in Steve Jobs’ master plan to blanket the earth with iPhones. According to Wu, cell phone penetration there is 51% — compared with 85% to 95% in developed countries — so there is plenty of room for growth.

See also:

NY Times: Fixation on Steve Jobs’ illness ‘unhealthy’

2009-07-06T13:41:00Z

“Next February,” writes David Carr in Monday’s New York Times, “when Steven P. Jobs — knock on wood — does his big reveal at Macworld, the geegaw people will most want to see probably won’t be on display.”

So begins a piece by one of my favorite business columnists on a subject dear to my heart — Wall Street’s and the tech world’s obsession with the health of Apple’s (AAPL) CEO and, in particular, the “geegaws” of this story: Steve Jobs’ troubled pancreas and borrowed liver.

Carr is a smart and plugged-in observer of digital media, and once he gets over the glaring problem with his first sentence — Apple has already announced that it won’t be doing any more Macworlds, with or without Steve Jobs — he offers a useful perspective on what he calls our “unhealthy fixation” with Jobs’ illness: that of a fellow cancer survivor.

From that perspective — one shared by 10 million Americans, according to Carr — the “keening on the blogs, in the news media and in the investment community” for full disclosure from Apple about the state of Jobs’ health after his 2004 surgery for pancreatic cancer and more recent liver transplant, looks less like a legitimate financial concern and more like “the prurience … that drives most people’s interest in the illness of others,” especially celebrities.

“The same sense of entitlement that leads many to think that it is right and proper to suck the marrow from Michael Jackson’s bones pertains to the living, as well,” writes Carr. “There is an expectation that if you are both famous and sick, you will open up a vein and let the blood flow toward everyone. Farrah Fawcett invited everyone into her sickroom as she died of anal cancer and received the faux adoration of millions in return.”

That most of the sources Carr interviewed for his column — especially fellow Timesman Joe Nocera — felt there were legitimate reasons for asking whether Steve Jobs would be returning as scheduled from his medical leave, didn’t seem to faze the columnist. Carr kept calling until he reached someone who agreed with his thesis. “Everybody knows that Steve has a grave illness,” the futurist Paul Saffo helpfully volunteered. “This is sleazy entertainment, a sideshow.”

But sideshows, as Carr points out, are what the modern media do best. And Steve Jobs is a celebrity, he writes, with a particularly high-touch relationship with consumers:

“He sits at their fingertips, in their ears, connects them with friends … [And] because he seems to know us so well, or at least our needs, we like to think we know him back, even though nothing could be further from the truth. He is as inscrutable as Buddha and reportedly no barrel of monkeys to be around.”

Besides, Carr concludes, “Steve Jobs doesn’t want your love. He wants you to buy his stuff.”

See also:

Photo: Getty Images

Survey: The iPhone is No. 1 in Japan – Updated

2009-07-06T00:17:40Z

Gauging the iPhone’s popularity in Japan is not easy.

Just ask Brian X. Chen. He wrote a piece for Wired.com last April called Why the Japanese Hate the iPhone suggesting that despite the long lines that greeted the iPhone 3G last summer, the device was a big flop in Japan.

“Apple’s iPhone has wowed most of the globe,” he wrote. “But not Japan, where the handset is selling so poorly it’s being offered for free.”

Chen had to issue an apology to readers and two major revisions after his piece was torn apart in AppleInsider by Daniel Eran Dilger, writing under the byline Prince McLean, for getting initial sales estimates wrong and badly misquoting a couple key sources. But neither Dilger nor Chen had a good handle on how the iPhone was actually selling.

Which is why there was some interest this week in a survey of 2,300 Japanese retail stores conducted by the market research company BCN, reported by nikkei.net and picked up Friday by the English language TG Daily.

According to this survey, cellphone sales are plummeting in Japan but sales of smartphones have grown 80% in the past year, with Apple (AAPL) clearly in the lead.

The survey listed the top 10 bestselling smartphones cellphones in Japan. Heading the list at No. 1 was the 32GB iPhone 3GS. Second in line was the 16 GB model.

According to TG Daily, Apple has sold 1 million iPhones since July 2008 through Softbank, its exclusive Japanese carrier. But take that number with a grain of salt; it sounds suspiciously like the initial sales estimate that got Brian Chen in so much trouble last April.

No. 3 in the BCN survey is the NTT DoCoMo Aquos SH-04A, designed by Sharp. Research in Motion’s (RIMM) BlackBerry Bold came in No. 6. Rounding out the top 10 list were four smartphones made by HTC.

UPDATE: On Sunday, Asiajin’s Akky Akimoto published an analysis of the survey that provides more detail and context — and corrects several errors in the initial report.

The BCN ranking turns out to be a weekly top 10 list of bestselling cellphones (not just smartphones) for the June 22 to 28 — the week the iPhone 3GS went on sale in Japan — and it was the new iPhones, not the old, that were the Nos. 1 and 2 bestsellers in Japan that week. Curiously, the new iPhones also appeared on a BCN survey the week before they actually went on sale, coming in at No. 174 (32GB) and No. 189 (16GB), respectively.

You can see the original BCN list in Japanese here.

Photo courtesy of Information Architects.

How many new iPhones did AT&T sell?

2009-07-03T12:30:43Z

AT&T’s (T) widely leaked “best-ever sales day” memo ticking off the records set on June 19, 2009 — the day it began selling the iPhone 3GS — is packed with superlatives but notably lacking in numbers. (See memo below.)

Unlike Apple (AAPL), which reports on a quarterly basis how many iPhones it has shipped, AT&T keeps its unit sales figures close to its chest.

The new memo trumpets the fact that iPhone sales on June 19 “exceeded sales recorded on 2008’s iPhone launch day,” without saying how many phones it sold on either day.

But by extrapolating from previous quarters and reading between the lines, we can make some rough estimates. Here are the data points as we understand them:

June 29 and 30: Apple launches first iPhone, and AT&T and Apple together sell 270,000 units in two days. In its Q2 earnings call the next month, AT&T CFO Rick Lindner says his company activated 146,000 iPhones in the last day and a half of the quarter.
Oct. 2007: Apple announces that it has sold a total 1.39 million iPhones; AT&T says it has activated 1.1 million of them.
Jan. 2008: Apple says it has sold 4 million iPhones; AT&T says it has activated about 2 million (sparking much hand-wringing about the “missing” 2 million iPhones)
July 11, 2008: Apple sells more than 1 million iPhone 3Gs in 21 countries over the space of three days. AT&T later says its stores sold nearly twice as many iPhones that weekend as they did the weekend of the first iPhone launch. Even if AT&T’s sales equaled Apple’s, that can’t be more than 270,000.
Oct. 2008: Apple announces that it sold 6.9 million iPhones in its September quarter. AT&T says it activated 2.4 million of them, about 35%. (Overseas sales and unlocked iPhones presumably making up most of the difference.)
Jan. 2009: AT&T says it activated more than 4 million iPhone 3Gs in the previous six months. In that period, Apple had sold 11.25 million iPhones. Again, AT&T’s activations represent about 35% of the total.
June 2009: Apple launches the 3GS and again sells more than 1 million iPhones in the space of three days, but this time in only 8 countries, not 21.
July 2: AT&T’s memo says it sold more iPhones over the June 19 weekend than it did over the July 11, 2008 weekend. That makes sense, given that the U.S. (and thus AT&T) share of Apple’s sales was larger this year.

Assuming the 35% ratio holds up, it’s not unlikely that AT&T will eventually activate about 350,000 of the new iPhones sold the weekend of June 19 — many of them Apple Stores — and that actually unit sales at AT&T outlets that weekend could easily exceed 300,000.

AT&T’s public relations department announced that it sold “hundreds of thousands” through its pre-order process prior to launch, and would say no more.

Photo courtesy of AppleInsider.

Below the fold: The iPhone portion of the AT&T memo, as leaked to MacDailyNews.

“iLaunch day 2009 was one for the record books, as AT&MP;T customers scrambled to get their hands on the fastest, most powerful iPhone yet.

Here’s a look at some of the milestones we achieved:

Best-ever sales day in our retail stores
Second-largest traffic day in our retail stores
Most transactions processed via our IT systems in a single day
Most upgrade eligibility checks in a single day
Largest order day in att.com history
Largest features sales day in att.com history

On this year’s launch day, iPhone sales exceeded sales recorded on 2008’s iPhone launch day, Black Friday 2008 and Dec. 26, 2008 — all heavy-volume sales days. In fact, this year we surpassed 2008’s launch day sales at about noon Central time, and sustained our previous peak hour record, also set in 2008, for 11 straight hours.” (link)

The iPhone App Store takes a bad turn

2009-07-02T20:43:39Z

I’d heard about this new iPhone app, but it wasn’t until AT&T’s (T) sales pitch landed in my inbox Thursday morning that its significance hit home.

It’s called the AT&T Navigator — a turn-by-turn GPS navigation system for your car that runs on an iPhone 3G or 3GS. From the press release and early reviews it sounds like it’s packed with features, from voice activation and spoken directions to the ability to search for the nearest Wi-Fi hotspot and the cheapest gas.

The problem with the application is how you pay for it. Downloading the Navigator is free. Owning it is expensive: $10 added to your monthly bill — even if you delete the app — until you contact AT&T and shut off the service.

Over the life of a two year AT&T contract, this one application could set you back $240, more than you paid for the iPhone itself.

Welcome to the world of subscription pricing, one of the more than 1,000 new application programming interfaces (APIs) added to the iPhone’s software development kit (SDK) last March.

“Included in these APIs,” promised Apple’s (AAPL) press release at the time, “is the ability to leverage the incredible purchase model of the App Store within apps. In-App Purchases will allow developers to offer subscription content and provide the ability to sell new content and features in a simple and secure process.”

Senior vice president for iPhone software Scott Forstall, when he talks about subscription purchases, likes to use the example of a book publisher who might want to charge customers $10 or $15 to download a new title. That seems fair. AT&T’s Navigator does not.

[See Adam Frucci's prescient Why iPhone In-App Transactions Could Be a Disaster, posted in Gizmodo way back in March.]

CLARIFICATION: Although iPhone 3.0 allows subscription pricing, it does not permit developers to sell add-ons to free apps. As several readers have pointed out, AT&T is not billing Navigator users through the App Store; rather, it is taking advantage of its position as the iPhone’s exclusive U.S. carrier to add the fee to customers’ monthly bills.

Color me old-fashioned, but when I buy an iPhone app — or for that matter, a GPS navigator for my car — I want to own the thing outright. I don’t expect to open my wallet to a Trojan Horse that’s going to ding me $10 a month for the rest of my days.

Tom Tom, the company that was invited by Apple to demonstrate its competing navigation system at the World Wide Developers Conference keynote last month, promised to announce details regarding pricing and availability this summer but has not yet done so. If I were in the market for an iPhone navigator, I’d keep my eye on that one.

A fireside chat with Apple’s Jonathan Ive

2009-07-01T16:41:09Z

Jonathan Ive, the reclusive designer of the iMac, iPod, PowerBook G4, MacBook and iPhone, made a rare public appearance Tuesday night at London’s Royal College of Art, where he was the guest of honor and featured speaker at an “Innovation Night” dinner.

The event was by invitation only, but one of the attendees was the BBC’s Rory Cellan-Jones, who filed an appreciative report on the Beeb’s dot.life site.

“What emerged,” writes Cellan-Jones, “were some fascinating insights into the culture of Apple and the craft of industrial design. Ive was insistent that the key to Apple’s success was that it was not driven by money – a claim that may raise eyebrows amongst shareholders and customers – but by a complete focus on delivering just a few desirable and useful products.’For a large multi-billion dollar company we don’t actually make many different products,’ he explained. ‘We’re so focused, we’re very clear about our goals.’ “

The format of the talk was a fireside chat with Sir Christopher Frayling, Rector of the Royal College. Among the highlights:

“We don’t do focus groups,” Ive said firmly when asked how Apple (AAPL) decided what products to build. He explained that focus groups resulted in bland products designed not to offend anyone. (To which Sir Christopher added Henry Ford’s famous line that if he’d asked his customers what they wanted, they would have demanded a faster horse.)
Ive stressed the physicality of design — “from the Apple design workshop full of machines, throwing off a lot of noise and dust,” writes Cellan-Jones, “to visits to Japanese aluminium craftsmen to learn how that material could be crafted into a laptop casing. Yes, of course he and his team use all the latest computer-aided design tools — but he also likes to knock out a physical prototype and feel the weight of it in his hand.”
Ive told the story of how, as a young boy, he had taken apart an alarm clock and discovered inside the spare outer casing “an entire watch factory.”

“Extraordinary complexity wrapped in a simple, functional, touchable, beautiful case,” concludes Celan-Jones. “That seems to be the Apple design ethic.”

Got it in one.

Ive is scheduled to receive an honorary doctorate Wednesday from the Royal College, whose graduates include Ridley Scott (who directed the 1984 “Big Brother” Mac commercial), artist David Hockney and inventor James Dyson, designer of the Dyson vacuum.

[The photo of Ive in Apple's design shop courtesy of filmaker Gary (Helvetica) Hustwit, whose new documentary Objectified was released in March. Ive appears briefly in the trailer pasted below the fold.]

Morgan Stanley: Mac shipments on the rise

2009-07-01T14:48:29Z

According to Morgan Stanley’s Kathryn Huberty, Apple (AAPL) is the computer maker with the “most upside” as the PC market begins to stabilize after the dismal first quarter of 2009.

There’s some good news for Hewlett Packard (HPQ) and Dell (DELL) in the report to clients Huberty issued overnight Wednesday, but it’s mostly attributed to enterprise cycles and inventory restocking.

Apple, however, is a different story.

“Even before the new Macbook Pros launched,” she writes, “Apple began to outperform the broader commercial PC segment — with commercial Mac shipments up 25% [month over month] in May versus market growth of just 1%.”

The fact that the new laptops arrived in early June means that they will provide what Huberty calls “a catalyst for growth” in both the June and September fiscal quarters. She points to NPD weekly shipment data (reproduced in the chart at left) showing steady acceleration of Mac shipments over the past few weeks. “Lastly,” she concludes, “suppliers have recently noted Mac unit upside in the quarter.”

Huberty is raising her forecast for Mac sales in the second calendar quarter (Apple’s fiscal Q3) to 2.5 million units, up from 2.4 million. That would represent 12% quarter to quarter growth — less than Apple’s 14% average over the past three years, but a lot better than the 4% QtoQ decline last quarter.

For the fiscal quarter than ended Saturday, she expects Apple to report earnings of $1.16 a share on PC revenue (i.e., not including iPhones, iPods, etc.) of $3.072 billion, up a point or two from her previous estimates.

Huberty has not always been so bullish on the Mac. In fact, one of her reports last September helped trigger the sharpest one-day fall in Apple’s share price in eight years, one that wiped $18 billion off the company’s market cap in the space of 60 minutes. See Why Apple’s shares took a nosedive.

Video: The last time Steve Jobs came back to Apple

2009-07-01T09:40:48Z

To celebrate Steve Jobs’ official return to Apple (AAPL) this week, Kobi Shely has posted a YouTube clip from MacHEADS, his 54-minute “fanboy documentary” on the cult surrounding the company and its charismatic CEO.

Shely wrote, directed, co-produced and edited the film. The 2-minute 22-second segment he selected is centered around the return of Jobs to Apple in Dec. 1996 after he was ousted in a boardroom coup nearly a dozen years earlier.

The clip includes rare footage from the July 1998 keynote in which a younger, chubbier Jobs announces Apple’s return to profitability and introduces the first iMac.

It’s worth a look, if you can ignore the first 15 seconds of computer-generated weirdness, the bizarre Church of Mac segment in the middle and the young woman stroking and kissing her computer at the end.

The clip is pasted below. The full movie is available on iTunes and Amazon Video on Demand. Or you can order a DVD here.

Below the fold, a two-minute trailer for MacHEADS that includes sex columnist Violet Blue’s priceless line: “First of all, I’ve never knowingly slept with a Windows user. Ever.”

See also:

Nielsen: Apple is tops for hardware buzz

2009-06-30T09:51:30Z

Here’s an interesting measure of how effectively Apple (AAPL) can whip the tech world into a frenzy — even without Steve Jobs there to stir things up.

According to a report issued Monday by Nielsen Online, “anticipatory buzz” in May drew more than 55.7 million unique visitors to Apple’s website — more than double that of Hewlett Packard (HPQ) and 25 times the site for Microsoft’s (MSFT) Xbox.

The buzz got even louder in June with the unveiling of the iPhone 3GS. At one point between June 8 and June 9, nearly 0.6% of the nearly 100 million blogs, groups, boards, social networks and other consumer generated media that Nielsen tracks were talking about the new device. According to the report:

“the new iPhone 3G S sent blog mentions up 1,226 percent week-over-week on June 8, the day of the announcement. After the initial announcement, buzz dipped but again picked up after the phone became available to consumers on June 19, with blog mentions more than doubling compared to the week prior.”

You can actually see Apple’s buzz machine in action in the accompanying “BlogPulse” fever chart:

Nielsen Online is a division of the research company that has been measuring — and indirectly shaping — media content since it began tracking radio audiences in the 1930s and TV shares in the 1950s.

In the promotional material on its website, Nielsen offers the schematic drawing at right to suggest how its “BuzzMetrics” data mining service extracts nuggets of intelligence by harvesting raw data from sites like this one, cleaning it up, and giving it a good polishing with its relevance and analytics algorithms.

See also:

Apple: ‘Steve Jobs is back to work’

2009-06-29T19:22:40Z

Technology’s most closely watched chief executive is officially back on the job, according to an Apple (AAPL) spokesman.

“Steve Jobs is back to work,” chief spokesperson Steve Dowling told CNN.com. “He is at Apple a few days a week and working from home the other days. We’re glad to have him back.”

Jobs, who is recovering from two major surgeries — one to remove a tumor from his pancreas nearly five years ago, the second a transplant performed two months ago to treat end-stage liver disease — was scheduled to return from a six-month leave of absence before the end of June.

Apple’s share price took a hit after news of the liver transplant appeared in print on June 20, but the stock has recovered since.

Jobs was spotted on Apple’s Cupertino, Calif., campus a week ago — walking on his own without cane or wheelchair — but it was unclear whether that was a one-shot appearance or the beginning of a more normal work schedule.

Today’s statement suggests that he will be more present — and more deeply involved in managing Apple’s affairs — than many analysts suspected.

Apple COO Tim Cook has been running the company in Jobs’ absence and has won high marks Apple watchers for his steady hand.

No new photographs of Jobs have surfaced since his return (the one here was taken in June 2008). Until last week, he had not been seen in public since he hosted an Apple event in Cupertino last fall.

MacBook back on top at Amazon

2009-06-29T15:50:40Z

In a sign that should bode well for Apple’s (AAPL) earnings in its third fiscal quarter — which ended Saturday — the MacBook has clawed its way back to the top of Amazon’s (AMZN) bestseller lists.

The Mac, which once led the pack in the online retailer’s Computers & PC Hardware Bestsellers category despite its $1,000 to $2,000 sticker prices, had fallen behind the blistering sales pace set by netbooks like the Asus Eee and the Acer Aspire One, which sell in the $300 to $400 range.

By June 1, the bestselling Apple computer on the list — a white plastic MacBook — had been pushed down to the No. 14 position.

But netbooks have started to fall out favor recently — as witnessed by reports of return rates as high as 30% and an NPD study that found that 60% of consumers who bought them didn’t understand the difference between a netbook and a notebook.

Meanwhile, Apple announced on June 8 that it was refreshing its notebook line and lowering its prices. Result: its computers have become hot sellers on Amazon once again.

Apple’s entry-level 13-inch unibody MacBook, renamed the MacBook Pro, has been one of Amazon’s top 100 bestsellers for 20 days — basically since the moment it went on sale. As of Monday morning, it was the site’s No. 4 bestselling computer overall and No. 1 in the laptop category.

In fact, three of the top 10 and five of the top 20 bestselling laptops on Amazon are now MacBooks.

Apple is not the only beneficiary of what some see as growing consumer disillusion with netbooks. HP (HPQ) Pavilions, Toshiba Satellites and Samsung Mini Notebooks are also selling briskly online.

See also: