Kara began Monday with some of the hard facts from the pending AOL-TimeWarner (TWX) split. Stock issued for the post-spinoff AOL places the company’s total implied value at around $3 billion. Also on the list of stuff from 1994 being jettisoned from tech companies is the original instant messenger, ICQ. Kara reported that AOL seeks to shed the brand in an effort to keep the larger ship afloat. Over at Yahoo (YHOO), Kara opened the lid on CEO Carol Bartz’s shifting of top execs. In Silicon Valley’s house of cards, everyone watches out for a shuffle.

Over at Digital Daily, John brought some hard numbers to the stresses being felt by AT&T’s (T) 3G network thanks to a certain fruit-flavored smartphone. It seems that the iPhone is largely responsible for the 2,000 percent increase in data traffic in the San Francisco Bay Area compared with a year ago. (Weekend Update doesn’t claim sole responsibility.) Keeping up with layoff news these days is almost a full-time job. It’s a good thing Paczkowski is on the case. This week, Sony-Ericsson let roughly 2,000 employees go. The firm plans to shutter whole offices in both the United States and abroad. John finished strong with a whole slew of posts about the forthcoming Google (GOOG) Chrome OS, which was released in a developer’s beta this week. Next year, the good kids may be getting their stockings filled with Chrome rather than Apples.

You can never tell what MediaMemo will have up its sleeve in a given week, and this one was no exception. Peter came in early with reports that Wired magazine is another publication betting on a certain tablet. Wired may pave the way for other Condé Nast publication e-editions. From the department of “Hey, it looks like it worked for them,” a couple of music giants will release a Hulu-like service for music videos. No word yet on whether the Internet killed the video star. Peter closed it out this week with the fizzle that will be Oprah’s broadcast career. The talk-show-host-turned-deity will end her broadcast career in 2011, but may not be sorely missed by CBS, according to MediaMemo. Everyone is pretty torn up about Gail leaving though.

Personal Technology went a little off the reservation this week and covered an intriguing specialty gadget with a very specific target audience. The reading aid for the visually impaired is unusual for many reasons, not the least of which is that its branded Intel (INTC) both on the inside and outside. The reader uses a downward-facing camera to read text and translate it directly to speech. Walt was pleased with the device on the whole, though he encountered some bugs and a somewhat steep learning curve that may be a function of the novel nature of the product. Over at Mossberg’s Mailbox, the lead question this week was about data loss. Once the geek shudders stopped, Walt let the reader know that there are many alternatives to Apple’s (AAPL) Time Capsule drives, and the integrated Time Machine option is one useful alternative. At Mossberg Solution, Katie won a fight with a Pixi and brought us the blow-by-blow account. The cheap-and-cheerful version of the Palm (PALM) Pre features a stripped-down price. That savings came at too high a performance cost, said Katie. She praised Palms webOS, but came down on the side of spending a little more to get the Pre.

Stay tuned and check back often. Weekend Update will be back next week as long as we can make it out for the Black Friday sales with all our fingers and toes.

The report, should it prove true, will no doubt be a disappointment to overanxious tabletites awaiting the mysterious device’s arrival, but really, that’s immaterial to Apple (AAPL). In the end, a six-month delay is simply six more months of rumor and speculation with which to build the bonfire of publicity that will erupt when (and if) the tablet/slate arrives.

Moreover, the tablet market is a nascent one; it’s not as if Apple is losing market share to its rivals by delaying entry. It’s best, then, for the company to take it’s time and uncrate the tablet/slate when confident that it has everything right. As Piper Jaffray analyst Gene Munster wrote in a research note to investors Thursday, “the exact timing is irrelevant given Street models do not currently reflect the tablet, expectations for actual units in 2010 are low, and investors focus is more on whether the tablet is real and less on timing.”

Munster, it’s worth noting, envisions Apple’s tablet/slate as a $500-700 device about three times the size of the iPod touch.

“We expect the tablet hardware to be similar to an iPod touch but larger; we expect the key differentiator of the device to be its software,” Munster writes. “While there are several options ranging from a touch screen Mac OS X to an iPhone-like OS, we expect the tablet to be driven by a new version of Apple’s iPhone OS that runs a new category of larger apps alongside all the current apps from the App Store. We believe Apple’s tablet would compete well in the netbook category even though it would not be a netbook.”

According to its 10-K, the company “anticipates utilizing approximately $1.9 billion for capital asset purchases during 2010, including approximately $400 million for Retail facilities and approximately $1.5 billion for corporate facilities, infrastructure, and product tooling and manufacturing process equipment.”

That’s a wide range of potential applications–wider, in fact, than it has been in years past, as Caris & Company analyst Robert Cihra notes. “Interestingly…this year’s 10K added wording for purchases of ‘product tooling and manufacturing process equipment’ which could imply Apple reversing course to actually build certain products/components in-house,” Cihra said in a note to clients today. “Beyond that are signals of Apple investing in massive new data center capacity (e.g., North Carolina) that could support anything from iTunes/iPhone Apps through new ‘cloud computing.’”

Sounds plausible. After all, there’s a lot a company like Apple could do with an additional $1.9 billion in capital expenditures. Certainly, an iTunes TV subscription service would require some investment. A tablet/slate device might as well. Whether that’s where this money is headed–if it’s headed anywhere at all–remains to be seen. Who knows, perhaps Apple intends to blow it all on CEO Steve Jobs’ dream of the “ultimate computer factory.”

“We’re eagerly awaiting Apple’s Tablet and the answer to the question of whether there really is a very large market for stand-alone eReaders. We think there is…we see people carrying around stand-alone Readers all the time…they’re called books.”

– Mark Mahaney, Citi Investment Research

“We are very impressed by Apple’s ability to post a record profit quarter during difficult macro spending conditions,” Canaccord Adams analyst Peter Misek said in a note to clients this morning. “A host of new product introductions and continued traction with the iPhone give us confidence in the sustainability of Apple’s operating model.”

Suffice it to say, Misek wasn’t the only the analyst lauding Apple’s (AAPL) fourth-quarter performance. Below a selection of commentary from other Apple watchers:

Gene Munster, Piper Jaffray
“September results were strong despite headwinds of iPhone production constraints and a Mac desktop offering in need of a refresh. We expect these headwinds to become tailwinds in the December quarter, which we believe will be positive for AAPL shares in the coming months.”

Mike Abramsky, RBC Capital Markets
“With strong financial performance and product uptake amidst recession, and further catalysts (iPhone in China, Tablet, refreshed iMacs, iPhone share gains/momentum), we foresee further upside for the shares.”

Maynard Um, UBS
“Upside to virtually every metric in the qtr backs our positive view on Apple. We continue expect greater “recurring” iPhone hardware revenue (growing installed base & stickiness of the App Store), which should drive more visibility into iPhone sales (20%+ of our FY10 iPhone shipments), as well as iPhone expansion driven by new partnerships (& end of exclusivities). Longer term, we believe a service to provide seamless access & mobility of digital content across all products may be the draw (halo) that drives additional future Apple product sales.”

Tavis McCourt, Morgan Keegan
“Overall, Q4:09 was a strong quarter for Apple, as the Mac is nearly becoming the de facto computer for the back-to-school season. Additionally, iPhone trends remain remarkably strong, with unit economics holding up at unheard of levels in the wireless industry.”

Yair Rainer, Oppenheimer
“As usual, Apple appears to be leaving plenty of room for upside surprises to both revenue and margins. On the revenue side, Apple should benefit from continued Mac momentum (particularly in Europe), higher recognized iPhone revenue, and some channel fill for both Mac and iPhone. Gross margin upside is likely to come from a higher proportion of recognized, high-margin iPhone revenue.”

No wonder it was a blowout quarter.

After market close Monday, Apple reported a fiscal fourth-quarter profit of $1.67 billion, or $1.82 a share, on revenue of $9.87 billion. That topped the estimates of analysts surveyed by Thomson Reuters, who’d expected the company to earn $1.42 a share on revenue of $9.2 billion.

The company sold 3.05 million Macs during the quarter, a 17 percent increase over last year. It sold 10.2 million iPods, an eight percent decline from the year-ago quarter.

And iPhones? Apple (AAPL) sold 7.4 million of those–seven percent more than during the same period last year. So much for those supply-chain issues that some analysts warned might undermine iPhone sales.

“We are thrilled to have sold more Macs and iPhones than in any previous quarter,” said CEO Jobs. “We’ve got a very strong lineup for the holiday season and some really great new products in the pipeline for 2010.” [Editor's Note: "...really great new products"--is that code for a tablet?]

Apple shares, which closed at $189.86 today, are spiking as I write this. At $203.90, they’re up more than seven percent in extended trading.

Looking ahead to its fiscal first quarter, Apple estimates it will earn between $1.70 and $1.78 a share on revenue in a range of $11.3 billion to $11.6 billion. That’s comically lower than the $1.91 a share on $11.45 billion in sales that analysts are forecasting. But as today’s results clearly demonstrate, Apple subscribes to the underpromise-and-over-deliver school of guidance theory, so there’s likely little cause for concern.

So, to recap: Apple sold more Macs and more iPhones than in any previous quarter in the company’s history. Before the holiday quarter. And in midst of the worst economy we’ve seen in 50 years.

Notes From the Earnings Call:

• Apple COO Tim Cook and CFO Peter Oppenheimer are handling the earnings call. CEO Steve Jobs will not be attending.
• Oppenheimer says this was Apple’s second-highest quarterly revenue ever. Highest-ever operating margin. “We are thrilled with these record-breaking results, particularly given the economic environment around us.” Obviously.
• Macs are showing “fantastic momentum,” says Oppenheimer. Sales have outpaced the market in 19 of the past 20 quarters. Quarterly sales were up 17 percent; portable sales, 35 percent. Interesting: 42 percent growth in Asia.
• Moving on to iPods: Sales were down to 10.2 million from 11 million a year ago. But iPod touch sales doubled. MP3 market share in the U.S. is now more than 70 percent (according to NPD, I think).
• iPhone sales were up seven percent. Apple will begin selling iPhones in China later this month. More than 85,000 apps in App Store. Two billion downloads.
• Apple opened 15 new stores during the quarter. Now has 273. Will soon open first two stores in France, including one at the Louvre.
• Moving on to the Q&A. Asked about those iPhone 3GS supply issues I mentioned earlier, Cook acknowledges that demand did outstrip supply in a number of countries. But the situation improved “markedly” in September. How are things looking for China? Cook: “I would have liked to have had more, honestly, because we were still short in some countries at the end of the quarter.”
• Apple is obviously very excited about the iPhone’s impending debut in China. “There’s a good opportunity, and we’re really excited to get started,” says Cook. “It’s the largest market in the world in terms of total phones.”
• No comment on the broader economy. “We just spend our time projecting our business and leave the economy to the economists.”
• Does Apple worry about iPhone rivals? Android? Not really, says Cook. “We feel very good about suiting up and competing against anyone.” Our competitors are still trying to catch up with the first iPhone, he adds.
• Snow Leopard? Cook says the company’s been “pleasantly surprised” by sales of Apple’s latest OS.
• How does Apple benefit from carrier-exclusivity iPhone deals? Cook says carriers with exclusivity deals are willing to invest more in the platform and that means greater innovation. Visual voicemail is an example of that. That said, he adds, “We’ve found no lack of people wanting to sell iPhones, frankly.”
• International store revenue up more than 20 percent, on average.
• More on iPhone supply issues. Cook insists this is not a component issue, though he notes that silicon can sometimes be hard to get. “We feel good about our position now.”
• And still more on iPhone supply issues: How many iPhones would Apple have sold if it had an adequate supply? Impossible to say, really, Cook says, adding that 3GS units were in short supply virtually everywhere in September.
• Enterprise demand for the iPhone is very strong. It’s either being deployed or already in use at some 50 percent of Fortune 100 companies. Same with Europe and the FT 100. Widely used in higher ed and government as well.
• But perhaps not widely enough. Asked about institutional sales, Cook says Apple isn’t seeing much stimulus funding. The company’s worried about state spending. Says Cook, “We may see more this quarter, but it’s too early to tell.”

Digital Daily never disappoints in the headline department and OMFG, this week was no exception. John pulled some juicy nuggets out of CTIA’s semiannual wireless survey, including the staggering figure of 4.1 billion— the number of text messages Americans exchange each day. Google Voice was among the top stories again, thanks to a group of House members who asked the Federal Communications Commission to investigate the service. Digital Daily rounded out he week with comments from Qualcomm (QCOM) CEO Paul Jacobs and the cacophony that is the net neutrality debate. With a dazzling turn of phrase, Jacobs supported the idea of “traffic shaping”, or giving network managers the keys to their net-neutrality handcuffs.

Three time zones away at MediaMemo, Peter didn’t seem sure whether it was a sadder week for music sales or for music in general. Music sales are still in a slump. What may be worse, however, is that the slump was only slowed by Michael Jackson and The Beatles, neither of whom seems like a pillar for viable growth. Amid music’s slump, there may be a ray of hope in videoland. MediaMemo reported that Network TV-buster YouTube seems to be learning how to play nice with the other kids, offering certain content producers a way to channel some revenue back into their own coffers. The momentary bright spot for media quickly evaporated when it came time to talk about print. Peter followed the story of Condé Nast’s multiple magazine closings. It’s always a sad day when there are fewer beautifully composed pictures of cookies in the world.

Rounding out the week, Walt released his anticipated review of Windows 7, and proclaimed it good enough to help you get rid of that lingering Vista hangover. With installation times averaging about 45 minutes and lots of neat new features, Windows 7 may just be good enough to make you feel like having a party. Mossberg’s Mailbox was peppered with several Windows 7 RSVPs. Walt issued his usual sage advice about switching to Windows 7, as well as a quickie about personal finance software. The Mossberg Solution covered a set of new point-and-shoot cameras, each with a striking party piece. Katie reviewed the Samsung Dualview TL225, which features a second screen on the front of the camera for convenient self portraits, and the Nikon Coolpix S1000pj, which features an actual projector right inside the camera. Both cameras earned praise for ingenuity, with the caveat that those new features come with an extra price tag.

Check back early and often. There’s always room for AllThingsD.

“Foxconn Electronics (Hon Hai Precision Industry) will be the manufacturing partner for an upcoming tablet PC device from Apple, according to market sources,” the publication claims. “The sources indicated they believe the tablet PC features will focus more on e-book functionality rather than music, and that based on Apple’s marketing strategy, long battery life, quick Internet connectivity and an easy-to-use user interface will be key features of the device.”

PREVIOUSLY:

• Rumored Apple Netbook Actually an E-book?
• Coming Soon From Apple: Big Touch?
• iTablet: Apple’s Killer App for Higher Ed

Kara was half James Bond, half Indiana Jones in the cities and jungles of BoomTown this week. She jet-setted, jet-lagged and still managed to report on a genuine cougar fight.

BoomTown waved goodbye to merry old England and racked up some more frequent flier miles early in the week heading back to the techie embrace of Silicon Valley. Before her tray table was locked, though, Kara made a quick stop at music darling-of-the-moment Spotify. Daniel Ek, founder and CEO, hopes to bring its pay-per-month music service to millions of American mobile devices, to add to its hefty presence in the U.K. and Europe.

As D-Force One touched down at AllThingsD headquarters, one of the valley’s original major players shook things up with a $100 million branding move. Yahoo (YHOO), possibly now spelled Y!hoo, changed its brand in support of an overall shakeup of its services. Kara hearkened back to the D conference and wondered if rebranding the company Y!#@&$oo might have been more appropriate, considering CEO Carol Bartz’s preference for “salty” language.

And not to be left out of a worthy chuckle, BoomTown brought readers the inside scoop on the cougar that came to town. Yes, a cougar–or mountain lion, if you’re from California–was seem roaming the hills above Microsoft’s Redmond, Wash., campus this week. The company circulated a fairly priceless memo that included tips on how to successfully fight a cougar. Any such advice against snow leopards, however, was omitted.

As Kara was jet lagging, John was running full-tilt over at Digital Daily. On Monday, the Federal Trade Commission released a new proposal to institutionalize Net neutrality. The proposal would ban Internet service providers and data deliverers from prohibiting or throttling content to promote their own services. John pointed out that it wasn’t too surprising that AT&T (T)–and Republicans–weren’t too happy with the move.

While politicians exercised their series of tubes, Microsoft (MSFT) was busy shadow-tablet boxing. John filed a report about the first Microsoft device designed exclusively to compete with a product Apple (AAPL) doesn’t make. The “Courier,” as the two-page “tablet-book” is called, features some decidedly un-Apple-like interfaces, unless of course you look a little farther back to the days of the Newton.

To finish out the week, Digital Daily took the AllThingsD time machine back to 2003, when Apple was rolling out its revolutionary MMS service. Sometime Friday, iPhone users were suddenly able to share pictures with friends over the air. Unless they already use Flickr, Facebook, or about a zillion other apps that basically do the same thing.

MediaMemo explored its inner, or maybe outer, geek this week, beginning with the Gizmodo annual gallery show. The charity event featured musical Tesla coils, Star Trek props and a “Microsoft Surface”-like computer with a mud-based (not joking) user interface.

Peter continued the browsing theme, reporting that Yahoo and Google were both back in the market for acquisitions. Google (GOOG) CEO Eric Schmidt said he had his checkbook open again, now that “the worst is behind us.”

Even if Yahoo and Google are in a buying mood, one particular VC firm isn’t feeling so flush. New York’s Union Square Ventures opted out of the latest round of Twitter fund-raising. Peter hazarded a guess that the now-famous $1 billion valuation may have had something to do with it.

Across town at the Mossberg Solution, Katie gave readers a complete rundown on the Microsoft Zune HD. The iPod-hunting media player is now in its fourth generation. The player got high marks in the style and widgets categories, but still needs a solution to the confusing “points system” purchase interface. The problem with Zune isn’t the player, it seems, but the stuff Zune isn’t connected to.

It’s going to be another week of electro-awesomeness here at AllThingsD. Until then, always remember that you should never turn your back on a cougar. The safest way to escape is to buy it a pomegranate martini and squeeze out the window of the men’s bathroom.

“A significant number of buyers–21 percent (3,100 respondents)–would be interested in purchasing a Mac tablet priced at $500-700,” RBC analyst Mike Abramsky wrote in a message to clients this morning. He noted as well that this is far above the nine percent who professed to be interested in the original iPhone in an April 2007 survey. The promising early interest illustrates the market opportunity for a Mac-based tablet, Abramsky said.

Assuming, of course, Apple (AAPL) plans to bring one to market.

For one thing, the Microsoft (MSFT) device is a booklet, not a tablet; in other words, it’s designed to fold. For another, it supports input via multitouch and, in an ironic nod to Apple’s Newton, stylus.

From Gizmodo, which somehow managed to uncover a bevy of information about the device:

“The Courier user experience presented here is almost the exact opposite of what everyone expects the Apple tablet to be, a kung fu eagle claw to Apple’s tiger style. It’s complex: Two screens, a mashup of a pen-dominated interface with several types of multitouch finger gestures, and multiple graphically complex themes, modes and applications. (Our favorite UI bit? The hinge doubles as a ‘pocket’ to hold items you want move from one page to another.) Microsoft’s tablet heritage is digital ink-oriented, and this interface, while unlike anything we’ve seen before, clearly draws from that, its work with the Surface touch computer and even the Zune HD.”

The latest, from China Economic News, claims the device is being prepped for a February debut at a price somewhere between $799 and $999. Supply chain sources tell the publication the tablet will be built around a 9.6-inch Wintek capacitive touch panel and a mystery processor engineered by P.A. Semi, the boutique semiconductor design company Apple acquired in 2008. DynaPack International Technology will supply batteries, which are said to be “long lasting.”

Finally, the Apple (AAPL) device is said to support the high-speed downlink packet access 3G protocol. Interesting, since this likely means the tablet is destined for AT&T’s (T) network, not Verizon’s (VZ), as had been previously rumored, and lends credence to predictions that Apple will extend AT&T’s iPhone exclusivity deal rather than allow it to lapse.

Digital Daily came bearing sad news on Monday: The Apple (AAPL) event scheduled for Sept. 9 will not have anything to do with a tablet computer. Just music. And from an organization vulnerable to Palm (PALM) poachers. Presumably, all managers present will be exercising caution and using peripheral vision. Netflix (NFLX) was the recent recipient of good news, as John reported this week: Analysts’ research shows that the DVD-by-mail business has a lot of life left in it. Now, if Google (GOOG) will just stay out of that business. The search giant, in any case, might be a bit preoccupied by the Open Book Alliance and that group’s opposition to its Google Book Search Settlement, the $125 million deal that will allow Google to digitize and monetize some 18 million books. Probably won’t be preoccupied for long, though.

MediaMemo returned this week with an explanation for why the relatively mediocre iPhone camera has become the favorite camera on Flickr: It’s already in your pocket, and no one wants to carry another gadget around. Which is likely to become a more common refrain as high-end handsets grab more marketshare than ever and the quality of secondary functions improves. Another common refrain: The one where media companies start charging for content, and people start paying. News Corp. (NWS) (which owns this Web site) is working on assembling the critical mass of publishers it believes is necessary for making this possible.

Over in Personal Technology, Walt Mossberg reviews a robotic investment adviser called Cake Premium and points out some of the reasons you may or may not want to follow its suggestions for what to do with your 401(k). From Mossberg’s Mailbox, Walt answers questions about Windows OS upgrades on the Mac, and some follow-up questions about DriveSharp. In The Mossberg Solution, Katie Boehret tests out Rosetta Stone’s (RST) Totale, a web-based language-learning system that might be the next best thing for immersing yourself in another culture.