A few of these will be what Apple (AAPL) refers to as “significant stores,” outlets that are striking in both appearance and location. With its 45-foot tall stone walls, vast glass ceiling and beacon that some say is “brighter than anything on Broadway,” the Upper West Side store certainly qualifies as that–as does Apple’s newly opened store at the Louvre in Paris.

Given their architecture and locales, these “significant stores” come with some equally significant expenses. But evidently, they’re worth it. According to Ron Johnson, Apple’s senior vice president of retail, annual revenue per store is now around $26 million. Altogether, Apple’s stores posted revenue of $1.87 billion in the September quarter, nine percent more than last year and their highest level ever.

[Image Credit: Matt Buchanan/Gizmodo, Flickr]

“The cost of smart phones is considerably higher than feature phones for which the early termination fees were created years ago at $175,” said Verizon spokesman Jim Gerace. He added that the new $350 ETF declines by $10 per month through the life of the contract and customers can avoid it by buying their devices off contract and paying full retail price.

An interesting move for Verizon (VZ), which just last year agreed to pay $21 million to settle a class-action lawsuit filed by California consumers over the very early-termination fees it is now increasing. The plaintiffs in the suit alleged that Verizon’s ETFs were illegal under California law and that they were designed to unfairly lock consumers into long-term contracts and prevent them from switching carriers. When Verizon settled the suit, it denied any wrongdoing, insisting that early-termination fees are simply a means of recovering legitimate costs. And to some extent Verizon does have a point.

Full retail price for the Motorola’s (MOT) new Droid is $559.99. With a two-year contract, Verizon sells the handset for $199.99. Theoretically, that’s a $359.99 subsidy (I have no idea at what price Verizon purchases Droid from Motorola). So if Verizon allowed subscribers to break their contract after a month without paying an early-termination fee, the company would stand to lose money. And subscribers who did so could subsequently sell the device online and potentially make a profit, though a small one.

So it’s certainly understandable that Verizon and other carriers want to protect the subsidies they dole out for these new smart phones. And as noted earlier, Verizon’s new ETF drops by $10 each month a subscriber remains under contract. But at this rate, subscribers are still bound to pay a $110 termination fee in the 23rd month of a two-year contract. The contract is nearly over, the subscriber obligation to Verizon almost fulfilled, yet the company can still slap its customers with nearly a third of the full ETF if they break it at that time.

By month 23 of a two-year contract, does Verizon really stand to lose $110 if subscribers decide to switch carriers? Doesn’t seem likely if subscribers can walk away just a month later without consequence, taking their handsets with them.

Since Verizon is pro-rating the ETF, why isn’t it doing so in such a way that it zeroes out by the end of the contract?

And isn’t the fast pace of innovation in the smart-phone sector such that prices–for both component and device–are dropping so quickly that high ETFs aren’t really justified? Remember, you can get Apple’s (AAPL) iPhone for $99 today. When the iPhone debuted in 2007, it commanded a price of $499/$599, depending on model.

I’ve put those same questions to Verizon and will update here when I hear back. In the meantime, here’s what Consumers Union policy analyst Joel Kelsey has to say on the matter: “When people want to switch wireless services, the biggest cost they face is early termination fees. These fees are designed to lock people into long-term contracts and stop them from getting better deals. Early-termination fees make the marketplace less competitive. Verizon’s move is painful proof that it’s time for lawmakers to crack down on these fees.”

UPDATE: Verizon Wireless spokesperson Nancy Stark offers the following answers to the questions I posed above:

Your first question regarding the balance at month 23 or 24 assumes that, at that point, we have recovered all of our subsidy and up-front costs for every device. That simply is not so.

On your second question, while the pace of innovation plays a role in prices coming down somewhat, it also plays a role in driving up costs as more and more complexity that customers want is added to phones–from premium HTML browsers to high-resolution MP cameras with optical zoom; videoplayers; music players; dual processor chipsets; WiFi; very high display resolution, operating systems such as BlackBerry, Windows Mobile, Palm, Android–ALL with the added value (vs a desktop) of mobility, and ALL in one tiny device that ALSO allows you to talk to anyone from anywhere. phew! (by comparison, I recently paid $200 for a camera and all it can do is take pictures, and it has only middle of the road capabilities.)

But getting back to ETFs specifically. The most important point is that Verizon Wireless customers do not have to have an ETF at all if they do not want to. ETFs allow customers to have it either way: They can have no ETF and pay full retail for their device. OR, they can get a greatly discounted device by having an ETF.

Rabid demand for the iPhone has emptied not just the company’s physical retail outlets, but its online store as well. “We continue to see extremely high levels of demand for the iPhone which means it comes in and out of stock very quickly and will be why the Web site hasn’t had any since Monday,” an O2 spokesperson told the Telegraph.

News of the shortage comes just days after O2 rivals Orange and Vodafone both announced plans to carry the iPhone later this year, bringing an end to O2’s exclusivity deal with Apple (AAPL). If Apple is unable to meet consumer demand with just a single U.K. carrier, how will it cope with three?

A reasonable question, but one for which Apple presumably has an answer. Said Forrester (FORR) analyst Mark Mulligan, “I don’t think [Apple] would expand if it couldn’t meet consumer demand, as that would lead to extreme consumer dissatisfaction–which compared to its peers, Apple is usually good at avoiding.”

You see, Palm (PALM) defines units sold as products sold to on-the-street customers or to resellers like Best Buy (BBY) and Amazon.com (AMZN). Which means that Palm can report a unit sold while it’s still sitting at inventory at various retail outlets. In other words, a Pre sold is not necessarily a Pre activated. As Eller notes, that’s problematic.

“We have been perplexed by a disconnect between PALM’s device units sold and our estimates of store level sell through,” Eller writes. “According to PALM’s reported sell through, inventory increased by 13k units and since the ‘vast majority’ of both the device units shipped and the device units sold were units of the Pre, there couldn’t be an inventory problem. The gap between the two is only 13k.”

Continuing, Eller adds a cautionary note: “However, since the company recognizes revenue on sell in to the channel and the company defines device units sold as units that have been shipped from Sprint (their primary customer) to either customers or second tier distributors, PALM could offer investors a high number of units shipped but still have a glut of inventory in the channel. We believe that channel inventory is currently about 11 weeks, which we believe will pressure reorder rates and make it more difficult to sell high ASP products going forward.”

An 11-week glut of inventory in the channel? If that’s the case, it’s certainly cause for concern, more so because many investors are evidently unaware that this is even a possibility. “[Palm’s definition of sold] does not appear to be understood by investors,” Eller notes. “We polled several of the investors who attended the Boston road show lunch and each was under the impression that sell through translated into customer activations. How can this be?”

Good question. Palm and Sprint (S) investors both might want to pay a bit more attention to Sprint’s 10-k in the future.

I’ve asked Palm for comment and will update this post when it responds.

UPDATE: This just in from Palm:

“The sell-through data we post reflects carriers’ sales to their customers. For example, Sprint customers include consumers who buy in a Sprint store, and Sprint retail partners such as Best Buy and RadioShack. We rely on our wireless carriers to provide us with sell-through data, and we note this fact in our 10Q.”

[Image credit: Flickr/Spintar]

That’s what ngmoco co-founder and Electronic Arts (ERTS) alum Neil Young said of Apple’s iconic handset at the Game Developers Conference in San Francisco earlier this year, and it’s worth reflecting on a bit in light of a new report from Bernstein Research analyst Toni Sacconaghi that claims the iPhone OS will soon create pricing and customer migration pressure for traditional gaming platforms.

Noting that some 665-760 million games may have been downloaded from the Apple (AAPL) App Store during the last 12 months, Sacconaghi estimates that the installed base for the iPhone and iPod touch platform could amount to about one third of the total handheld gaming installed base by 2012.

“We believe that gaming embodies the power of Apple’s App store: it has dramatically lowered the entry barriers for both developers and gamers alike, resulting in an unparalleled number of available games at affordable prices, which is creating lock-in and enhanced interest in Apple’s high-margin iPhone (and iPod Touch) platforms,” Sacconaghi writes.

Continuing, the analyst adds: “By most measures, gaming has been the killer App Store category, accounting for an estimated 40% of all downloads. Most importantly, we believe that gaming is providing yet another incremental, differentiated reason for consumers to purchase iPhones and iPod Touches, and creates powerful lock-in to the App Store platform and Apple products on a go forward basis.”

The upshot of all this is bad news for traditional gaming console developers–particularly those who have dismissed it as a novelty. “Most gaming developers today view the iPhone and other smart phones as an incremental opportunity, which targets the casual gamer but not the dedicating gaming enthusiast,” Sacconaghi explains. “Over time, however, we believe that the combination of evolutionary improvements in iPhone/iPod gaming functionality, the convenience of the App Store download model, the App’s Store leading title selection and lower price points could cause some migration among gaming enthusiasts to the Apple platform and/or pressure traditional gaming incumbents’ hardware and software pricing.”

And this is clearly what Apple (AAPL) is aiming for. Consider these recent remarks from Phil Schiller, the company’s senior vice president of worldwide product marketing: “People are starting to see what a great gaming device this is. When you think about the companies that came before us…when you played those other systems, they seemed so cool, but now when you look at them, they don’t stack up against the iPod touch….No Multi-Touch user experience, Games are expensive, No App Store, No iPod, Expensive Games ($25-$40) and uncomfortable retail buying experience. [There are] 607 games for PSP and 3,680 games for Nintendo DS. [But there are ] 21,178 Game and Entertainment Titles at App Store.”

“The sole driver of the increase in Apple’s price target is a higher valuation of the iPhone,” Wolf wrote. “Courtesy of network effects, the explosive growth of the iTunes App Store…should translate into a higher growth trajectory of iPhone sales going forward….By exploiting a commanding lead in the all-important smartphone applications market, the iPhone is in a position to chalk up share gains in this fast-growing market that could surprise everyone….In many respects, Apple and Amazon are in similar positions. Amazon holds a relatively small but growing share of the e-commerce market, which itself is small, but growing an order of magnitude faster than the physical retail market.”

Wolf admits that his latest forecast is “judgmental” in that it’s based on the premise that software, namely iPhone applications, will drive hardware, namely iPhone sales. But he explains that the premise does have a proven track record in markets characterized by increasing returns and network effects.

“We have upped the number of iPhones that will be sold in 2018, the final year in our model, from 67 million to 107 million,” Wolf added. “Our forecast has the phone capturing 20 percent share of the smartphone market in that year, up from 12.5 percent recently. We should note that the iPhone’s share of the worldwide market is already around 12.5 percent. So our forecast is by no means an aggressive one.”

No doubt about it, it’s a good time to be an Apple investor.

Why? A few reasons. First, there’s the government’s “cash for clunkers” program, which will likely stimulate new car sales and new Sirius subscriptions thanks to the satellite radio trials often packaged with new cars.

Then there are rumors of new iPod-related hardware that may or may not debut at the company’s holiday gift-guide event next week. Scheduled for Wednesday, that gathering promises “a new line-up of accessories…for the home, office, vehicle and beyond.” This has led some folks to speculate that we’ll soon see a Sirius dock for the iPod/iPhone.

From XMFan, which claims to have insider details on the device.

The XM SkyDock is a docking station for your iPod Touch or iPhone that turns it into a SATELLITE XM Radio receiver! Included is an XM antenna, power cord (also featuring the new transmitter technology), and docking station that turns your iPod/iPhone into an actual XM Satellite Radio receiver using the SiriusXM app.

XMFan says the dock is expected to retail for under $100 and speculates that it could drive a lot of new subscriptions. I suppose we’ll find out next week–if the device is actually announced.

[Image Credit: XMfan]

“In 2004, as you may recall, we launched a slim version of PlayStation 2, a defining moment for that console, helping us to really expand the user base of PlayStation 2 further,” Sony Computer Entertainment Chief Executive Kazuo Hirai said at the Gamescom videogame trade show in Cologne, Germany. “Today is that day for PlayStation 3.”

And so, starting Sept. 1, the PS3 will be available for $299. That’s still well above Microsoft’s (MSFT) Xbox 360, which retails for less than $200 and Nintendo’s Wii, which sells for $250, but it’s a hell of a lot better than $399. And analysts say it will almost certainly spur demand for the console. “People were expecting this to happen. [Sony] had to do something,” MKM Partners analyst Eric Handler told MarketWatch. “This will bring some new customers to the fold.”

Indeed. But how long can Sony sustain such market share gains, when Microsoft and Nintendo are almost certainly mulling price cuts for their platforms as well?

Canada’s Bell Mobility, which became the device’s exclusive Canadian carrier back in May, this morning announced a ship date and price for the Pre. It is scheduled to go on sale Aug. 27 at a price of $599.95 without a contract and $199.95 with a three-year contract.

“We’re very excited to bring the revolutionary Palm Pre and the Palm webOS mobile platform to Canadians exclusively on Bell’s national wireless network–the largest high-speed 3G network in Canada,” Wade Oosterman, president of Bell Mobility and chief brand officer for Bell, said in a gushing statement.

“Considering the highly successful US introduction of the Palm Pre by Sprint in June and fast-growing Palm Pre buzz among Canadian mobile users,” Oosterman added, “Bell and our retail partners are preparing for high demand for this breakthrough phone.”

The latest institution to realize this–Bank of America (BAC) which, according to The Wall Street Journal, plans to close up to 10 percent of its 6,100 branches across the country over the next three-to-five years. It’s not yet known when the closures will begin or exactly how many locations will be closed. BofA says only that “Our vision is the network will be managed downward over time.”

About time too. With fewer and fewer consumers banking at their local branches and remote deposit capture an easy matter via ATM, it seems foolhardy to maintain them.

“They are not economically viable,” Rochdale Securities analyst Dick Bove wrote in a recent note to clients. “The branches are likely to be closed for three reasons: a) branch economics are changing; b) the need for positioning has been reduced; and c) the fear of regulation suggests closing branches now makes sense.

“When America was building new houses in the millions,” Bove continues, “it was creating new neighborhoods. Banks competed with each other to get branches into the new communities in the choicest locations. Branches were often built in supposed choice locations just to keep the competitors out. This strategy has now been abandoned. Many of the new communities have been abandoned. These branches need to be abandoned.”

According to new stats from NPD Group, Apple now claims 91 percent of the U.S. retail market for personal computers costing more than $1,000. Nine out of 10 dollars spent on such machines in June went to Cupertino.

Now, granted, Cupertino only sells three Macs priced below $1,000 (the 13-inch MacBook and both versions of the Mac Mini), and Apple’s (AAPL) rivals’ offerings typically price out in the $690 -to-$703 range. Still, that 91 percent metric is impressive.

As Joe Wilcox over at Betanews puts it, “A (higher pricing) doesn’t necessarily lead to B (greater sales). All major Windows OEMs sell PCs in the premium category, too. Apple’s charging more isn’t necessarily recipe for people paying more for Macs, or their capturing big revenue share.”

That said, as NPD analyst Stephen Baker points out, Windows product average selling prices have been falling pretty rapidly over time, especially at retail, so it was inevitable that Apple’s share of the high-end market would rise, since the company hasn’t really altered its pricing philosophy.

In a research note issued Monday, Jesup and Lamont analyst Kevin Dede says as much, arguing that the company’s shares are overvalued, particularly in light of Pre returns.

“We stood just as the Street now stands, completely enamored with Palm’s highly innovative new device; however, our checks now lead us to believe that while initial sales could almost be categorized as ‘gangbusters’ and perhaps above initial assumptions, we think there are engineering complications that are driving a higher level of returned devices than otherwise expected.

“From a hardware perspective,” Dede continues, “the Pre includes the features expected in a cutting-edge smartphone, including a large touch screen, one of the most powerful processors designed for a handset, and a slide-out keyboard; we understand that a great many returns are on account of an unsatisfactory experience with the keyboard operation and dead pixels in the screen. Fixing these issues shouldn’t pose a problem, but we think the timing risk and severity should be reflected in the shares.”

Dede notes that his impromptu survey of local retail outlets–Sprint (S), Best Buy (BBY) and Radio Shack–revealed that about one in three devices is being returned. He cites, as well, a survey on Pre Central that suggests roughly 40 percent of initial Pre sales are exchanged.

Now, to be fair, this is anecdotal evidence at best. The Pre Central survey, which at present has only 615 respondents, is hardly statistically relevant. That said, Pre Central is a top Pre fan site, and Palm’s own forum has quite a few complaints, as does SprintUsers. So clearly, something’s going on here.

Reached for comment on the issue, Palm had this to say: “We think the Palm Pre is the best product we’ve ever shipped. While we haven’t seen anything out of the ordinary we will continue to closely monitor both Palm and Sprint customer service channels.”

Despite concerns about the Pre’s build quality and Dede’s contention that the company’s stock is overvalued, the analyst sees good things ahead for Palm. “In light of the overwhelming evidence supporting continued growth of converged devices, we believe Palm addresses the most enchanting segment of the mobile device market and should experience at least market growth over the longer term.

“Shorter term is obviously more interesting, and we believe Palm’s technology positions it to gain share at the expense of those companies offering less attractive, less functional devices,” Dede adds, concluding, “The competitive technology race boils down to ease of use across an increasingly complex technical environment.”

UPDATE: Concerned that its survey has been taken out of context, Pre Central is running another poll on Pre build quality, this one on its blog, rather than its forums. And while it’s no more statistically relevant than the original, it’s worth noting. Because with more than twice the number of respondents, it shows just 18 percent of initial Pre sales being exchanged.