All Things Digital

With its curvier edges, stylish silver trim, half-VGA 480-by-320 pixel screen and improved iTunes compatibility, Research in Motion’s (RIMM) new BlackBerry Bold should be a big hit with IT operations professionals convinced the iPhone isn’t an enterprise-class mobile device but driven to near-aneurysm by discontented employees demanding them.

The device is largely as expected–an iPhonish-looking thing with both GPS and Wi-Fi, 1GB of permanent flash memory, a 2-megapixel camera, full HTML browsing, 3G support on GSM networks with HSDPA access and, of course, the BlackBerry’s one-trick killer app: instant, secure email. That’s a compelling combination for business users and casual ones not easily swayed by the iPhone’s hype juggernaut as well. Indeed, Citigroup analyst Jim Suva says it could boost RIM’s quarterly shipments by 200,000 to 400,000.

But perhaps not without a bit of struggle. The BlackBerry Bold won’t ship until as late as August, which means Apple (AAPL) could beat it to market with the enterprise-friendly 3G iPhone it’s rumored to be uncrating at its Worldwide Developer’s Conference in June. Which has got to worry RIM. After all, the first-generation iPhone had claimed a 28% market share by the fourth quarter of 2007. That’s still less than the BlackBerry, which holds about a 41% market share, but the iPhone hasn’t even been on the market a year.

Well, if this rumor proves true, Canada really will have to declare a national day of mourning for the BlackBerry (RIMM). When Apple (AAPL) CEO Steve Jobs uncrates the 3G iPhone a few months from now, presumably at the company’s WWDC conference in June, the device’s price may draw more oohs and ahs than its feature set.

Fortune claims AT&T (T) plans to knock $200 off the cost of a new iPhone for customers who sign two-year contracts. If that is indeed AT&T’s intention, the 8-gigabyte version of the device would likely price out at $199, the 16-gigabyte model at $399. Which is a pretty compelling value proposition given that the device will soon support Microsoft (MSFT) Exchange and run Spore, Salesforce (CRM), AIM from AOL (TWX) and a host of other third-party apps.

No wonder Apple execs seemed so comfortable reiterating the company’s goal of selling 10 million iPhones in 2008. At $199, they might be able to hit that number without the Asian markets.

In the run-up to Apple’s (AAPL) Worldwide Developer’s Conference in June, the Mac faithful are sifting entrails for portents of iPhones to come.

Yesterday the creators of the popular ZiPhone jailbreak discovered in the latest test firmware for iPhone developers a reference to Infineon’s (IFX) SGOLD3H chipset–a chipset that supports 3G wireless broadband of up to 7.2 Mbit/s.

Now “industry sources” cited by TG Daily are claiming that the next-gen iPhone that runs on that chip will debut at WWDC. And there’s more. The device will be slimmer than its predecessor (by about 2.5 mm) and it will be offered in least two configurations at current price points: an 8GB version for $399 and a 16GB $499.

It’s been 267 days since Apple last updated the MacBook Pro. That’s 81 days longer than the company historically takes between updates. Which means it was high time for an upgrade. And today we were finally given one.

This morning Apple (AAPL) refreshed both its MacBook and MacBook Pro lines, adding Intel’s Penryn Core 2 Duo chipset (up to 2.4 GHz for the MacBook and up to 2.6 GHz for the MacBook Pro). As Apple’s flagship portable, the MacBook Pro now boasts the same multitouch trackpad found in the MacBook Air and an LED backlighting option for the 17-inch model. All but the low-end MacBook feature a two-gigabyte RAM, with a build-to-order option that allows for their upgrade to a four-gigabyte RAM. New Macbooks are priced from $1,099 to $1,499, new MacBook Pros from $1,999 to $2,799.

No wonder expectations for Microsoft’s Zune run so low–the company encourages them. Touting the newest iteration of Microsoft’s digital music player in an interview yesterday with the New York Times, Microsoft Chairman Bill Gates (pictured above, right, with J Allard, VP of design and development for Microsoft’s entertainment division) described its predecessor as half-assed. “For something we pulled together in six months, we are very pleased with the satisfaction we got,” Gates said. “The satisfaction for the device was superhigh. The satisfaction on the software actually is where we’d expect to see a huge uptick this year. It was just so-so on the software side. I’m sure a year from now we’ll do even better. But I’m blown away by what they’ve been able to do in a year.”

Odd way to promote your iPod challenger, don’t you think? Apologizing for its mediocrity. “It was just so-so on the software side. I’m sure a year from now we’ll do even better.” And hey, thanks for the $250. We know you could have put it toward an iPod.

Anyway …

As expected, Microsoft unveiled an update to its line of Zune music players yesterday, adding its first flash memory-based models and debuting a new Wi-Fi feature that will automatically synchronize music, photos and videos with PCs in homes with Wi-Fi networks. The company plans to peddle the flash version of Zune with four gigabytes of storage and one with eight gigabytes for $149.99 and $199.99, respectively. A Zune with an 80-gigabyte hard-disk drive will sell for $249.99. All three will arrive at market on November 13th.

Accompanying the new players is Zune Social, an online community where Zune users can keep tabs on one another’s musical tastes and, in a perfect Microsoft world, discover new content they can sample and purchase. “The whole idea behind Zune is much broader than the devices themselves,” J Allard, vice-president of design and development in Microsoft’s Entertainment and Devices Division, told the New York Times. “The conditioned thought is around a portable device being the center point of the experience, when in fact it’s not. It really is about how do we start taking Zune beyond that device.”

Odd coincidence, this. Hours before Apple introduced its new iPods at a special event in San Francisco, Microsoft said it was knocking $50 off the retail price of its 30-gigabyte Zune music player. Effective yesterday, the price of the poor-man’s iPod is $199.

In a post to the Zune Insider Web log, Microsoft’s Cesar Menendez said the price cut was a scheduled one, and not a flaccid cry for attention in a whirlwind of Apple announcements. “It’s part of the normal product life cycle, something we’ve had on the books for months,” Menendez wrote. “We just got some research back and customer satisfaction with the 30-gigabyte device is really high (around 94%), and we expect even more consumers will now want to discover the Zune experience at the new lower price.”

The price drop comes after Mindy Mount, the corporate vice president and CFO of Microsoft’s entertainment and device division, gave the Zune a slightly above-average grade for its performance at market to date. “We all feel that last year was a good, solid effort for first year,” she said. “I’d give it a B-. Some things were really great.”

And others, how to put this delicately, … not so great.

“I feel like a $200 whore.”

That was one iPhone early adopter’s crass assessment of his feelings of self-worth, after Apple unexpectedly cut the price of the device by a third–just two months after it arrived at market. At an unveiling of a new line of iPod music and video players in San Francisco yesterday, CEO Steve Jobs said Apple was dropping the price of its 8-gigabyte iPhone from $599 to $399 to drive sales of the device over the crucial holiday selling period. “The customer-satisfaction numbers for the iPhone are off the charts,” Jobs said. “The customer-sat[isfaction] numbers are higher for the iPhone than for any Apple product ever. They love it. But we want to make the iPhone even more affordable for even more people this holiday season. So we’re going to do something about that today. We’re not going to sell it for $599 anymore.”

Now price cuts for cellphones aren’t unusual. Samsung’s Blackjack and Motorola’s Razr both saw rapid price cuts following their respective debuts. But neither was launched into a market of monomanaical loyalists willing to camp out on a sidewalk overnight just to be among the first to own one–many of whom are today feeling a bit used. “Over time I have owned a 3G iPod, original Shuffle, iBook G4, iMac, new Shuffle, 4G iPod, video iPod, iPod mini and now the iPhone,” one wrote in a post to everythingiPhone. “I can see updates to the product line being made over time, but $200 in two months is a kick in the nads to EVERYONE who bought an iPhone.”

Perhaps, especially if the cut was made possible not by a sudden drop in component prices but a calculated overpricing conceived to exploit early-adopter demand. But ultimately, those who don’t think the iPhone was worth $599 when it debuted probably shouldn’t have bought it. “That’s technology,” Jobs told USA Today. “If they bought it this morning, they should go back to where they bought it and talk to them. If they bought it a month ago, well, that’s what happens in technology.”

One last point worth noting here: Early adopters probably aren’t the only folks to be taken aback by the sudden and precipitous drop in the iPhone’s price. Apple’s rivals in the handset market must be absolutely reeling. Here they were scrambling to produce iPhone-like, and iPhone-lite devices they believed would compete with a $600 phone they could easily underprice. Now, they’ve got to compete with a $399 device that is perhaps one of the best examples of Apple’s design and engineering prowess. And they’ve got to do it in time for the holiday shopping season …

Awakened from its iPhone reverie by news of a special Sept. 5 Apple event called “The Beat Goes On,” the Apple rumor mill has regrouped and is now churning out visions of new OS X-based, touchscreen iPods and video Nanos.

“We expect Apple will enable video features on the Nano line for the first time, and the capacities will likely range from 2GB to 8GB,” Piper Jaffray analyst Gene Munster wrote in a research note published this morning. “The iPod may also be dramatically improved. Though we are less certain of the specifications for the new sixth generation iPod, it may closely resemble the iPhone (without calling features). Specifically, we expect the sixth gen iPod to be a widescreen device with multitouch technology. It may also have Wi-Fi capability and the capacity could be as high as 160GB. Apple will likely raise the lowest iPod price point back up to $299 (from $249). The fifth gen iPod is the longest-lasting iPod model ever; it was released nearly two years ago and refreshed with high capacities and a lower price last September.”

Also making the rounds are rumors that Sept. 5 will see The Beatles appearing on iTunes. Seems the title Apple has chosen for the event–”The Beat Goes On”– also happens to be the closing line of the band’s final press release.

Spring is here and Leeds play Chelsea tomorrow and Ringo and John and George and Paul are alive and well and full of hope. The world is still spinning and so are we and so are you. When the spinning stops - that’ll be the time to worry, not before. Until then, the Beatles are alive and well and the beat goes on, the beat goes on.”

Coincidence? Who knows. As Apple 2.0’s Philip Elmer-DeWitt notes, it was Sonny and Cher, not the Beatles, who made “The Beat Goes On” famous. That said, Apple has been hinting at a deal to distribute the Fab Four’s music for some time now. During the 2007 Macworld keynote address CEO Steve Jobs cued up the song “Lovely Rita” from the Beatles’ “Sgt. Pepper’s Lonely Hearts Club Band.” Coincidence, or another of Apple’s marketing master strokes? Again, who knows. At the time Apple dismissed Jobs’s selection of music as a matter of taste. “Anyone can rip their own CD,” said Eddy Cue, Apple’s vice president for iTunes. “Steve’s a huge Beatles fan–huge. He rips and burns.” A plausible explanation, but one that could have just as easily been smoke and mirrors as well. We’ll find out which on Sept. 5.

UPDATE: Word on the street has it that the Beatles will not play a role in next week’s announcement. Guess we’ll have to make do with Sonny and Cher …

Note: John Paczkowski is on vacation and won’t be writing or posting videos until he returns Monday.

To keep you abreast of tech news while he’s away, we’re compiling a daily digest of 10 must-read tech stories. We’re calling it the Tech 10 and it appears below.

1. Retailing behemoth Wal-Mart will sell digital-music downloads on its Web site without copy protection, Reuters reports. The so-called digital-rights management software insisted on by some record labels can stymie where the average user plays the songs.
2. Taking on the juggernaut of iTunes, MTV and RealNetworks are forming an online digital music venture called Rhapsody America. According to The Wall Street Journal, Verizon Wireless has signed on as mobile distributor of the joint content.
3. Adobe Systems’ warhorse Flash Player is getting a makeover named “Moviestar.” The update, says InfoWorld’s Paul Krill, will bring high-definition video technology to downloads, affording clearer and smoother playback of images.
4. Increasingly popular online video site Metacafe got a shot in the arm in the form of $30 million in financing. VentureBeat reports that the latest cash infusion was led by new investors Highland Capital Partners and DAG Ventures.
5. Acknowledging it did bad (though not evil), Google announced last night that it would make credit-card refunds, rather than Google Checkout credits, to those owed after the company terminated its download-to-own/rent service of Google Videos. PC Magazine disclosed that the search giant will also allow users an additional six months to watch the videos they have already downloaded.
6. Fretting over security and productivity concerns, half of all companies in a recent survey are blocking employees’ access to Facebook. The poll of 600 workers by online security firm Sophos also found that two-thirds of all employees believe their colleagues are revealing too much information on the social-networking site, exposing them to cybercriminals bent on data theft and their companies to network hackers.
7. Bebo, the U.K.-centric social-networking site, has announced a partnership with Microsoft on a new instant-messaging service. According to Webware, the Windows Live Messenger hookup is only that–and not a signal of any impending acquisition.
8. Joining the social-networking parade, online business network CollectiveX has launched Groupsites. According to Michael Arrington of TechCrunch, the new product opens up the buttoned-down service to allow users to create social profiles as well.
9. Upping the ante in the competition for giving laptop users more memory, Toshiba announced today that it will release a 320-gigabyte hard drive for its laptops by the end of the year. According to IDG News Service, for users of multimedia laptops–where storing video is paramount–the extra space will come as a welcome feature.



10. In a bow to color choice and the sexes, researchers have found that there’s truth in the the time-honored (if sexist) adage that girls like pink, boys like blue. Reporting on a study from two scientists at Newcastle University, the Independent did not confirm whether the findings were borne out in colors chosen by men and women for iPod skins.

–posted by Associate Editor John Sullivan