An extensive profile of Apple’s retail stores by the Wall Street Journal has revealed some interesting facts about the decade-old chain. Although Apple’s attention to detail in its stores’ designs is evident, the company also stresses over customer service details, going so far as to instruct its Genius Bar staffers to use “as it turns out” rather than “unfortunately” to sound less negative when they are unable to fix a problem, and to forbid employees from correcting customers when they mispronounce an item name because that might make them feel patronized. The report also references an Apple employee training manual as using the acronym APPLE for its steps of service, which include “Approach customers with a personalized warm welcome,” “Probe politely to understand all the customer’s needs,” “Present a solution for the customer to take home today,” “Listen for and resolve any issues or concerns,” and “End with a fond farewell and an invitation to return.”
The report also goes into detail about the stores’ financial performance, citing investment bank Needham & Co. as saying that Apple’s annual retail sales per square foot have risen to $5,914—including online sales—compared to $3,070 for Tiffany & Co. and $880 for Best Buy. Despite the $880 mark, Best Buy’s profit margin is roughly one percent, according to the report, while Apple’s retail profit margin is said to be 26.9 percent. The comparison between the Apple and Tiffany is perhaps more fitting, as both companies’ stores are similar in size, use high-end fittings and materials in their construction, and sell mostly smaller items that retail for hundreds of dollars, while Best Buy carries a number of larger items—such as appliances and home theater packages—in more warehouse-like stores.
Ron Johnson, Apple’s Senior Vice President of Retail, is set to leave the company in order to take a position as the president, and eventually CEO, of J. C. Penney. The Wall Street Journal reports that Apple is expected to announce Johnson’s departure later today; Johnson will succeed long-time Penney leader Myron Ullman in the CEO position. Apple hired Johnson away from Target in 2000 in order to build out its retail stores, which have grown to over 300 outlets during his 11-year tenure. The report does not indicate whom Apple might have in mind as Johnson’s replacement.
Update: In a J. C. Penney press release announcing the move, Johnson said, “I’ve always dreamed of leading a major retail company as CEO, and I am thrilled to have the opportunity to help J. C. Penney re-imagine what I believe to be the single greatest opportunity in American retailing today, the Department Store. I have tremendous confidence in J. C. Penney’s future and look forward to working with Mike Ullman, the Executive Board and the Company’s 150,000 associates to transform the way America shops.”
The release also notes that Johnson has committed to make a personal investment of $50 million in the company “through the purchase, at fair market value, of 7 1/2-year warrants on 7.257 million shares of J. C. Penney Company stock. The warrants cannot be sold or hedged for the first six years of their term and have a strike price of $29.92, the closing price of the stock on the business day prior to Mr. Johnson’s commitment to purchase the warrants.”
Apple has also responded to the departure, with a spokesperson telling AllThingsD, “Ron is excited about this opportunity and we hope it goes well for him. We’ve got a great retail team in place and are actively recruiting for his replacement.”
Apple has responded to a Samsung request to provide its lawyers with samples of its next-generation iPhone and iPad an “improper attempt to harass” Apple. FOSS Patents reports that Apple, in its response, argues that delivering such samples would result in the exposure of “extremely sensitive trade secrets,” that Apple is not claiming infringement of future products, but of current offerings, and that the request goes far beyond Apple’s own, which requested “expedited discovery” of Samsung products that, at the time of the request, had already been unveiled publicly. The report also notes that Samsung’s law firm, Quinn Emanuel, also represents a variety of Android device makers against Apple and others, and might therefore be able to make use of any confidential information on future Apple products to developer infringement cases that its clients could bring against Apple in a later stage.
Apple first sued Samsung this past April, claiming that products such as the Galaxy S 4G, Epic 4G, Nexus S, and Galaxy Tab copy the look and feel of the iPhone and iPad; Samsung quickly countersued in South Korea, Japan, and Germany, before filing a separate countersuit in the U.S.
Nokia has announced that it has signed a patent license agreement with Apple. Under the agreement, Apple will make a one-time payment to Nokia, as well as on-going royalty payments. In addition, the agreement will result in the settlement of all patent litigation between the companies, including the withdrawal of both companies’ respective complaints with the U.S. International Trade Commission. “We are very pleased to have Apple join the growing number of Nokia licensees,” said Stephen Elop, president and chief executive officer of Nokia. “This settlement demonstrates Nokia’s industry leading patent portfolio and enables us to focus on further licensing opportunities in the mobile communications market.”
As previously reported, Apple has started selling unlocked GSM iPhone 4 units through its stores in the U.S. and online. Apple is pricing the handsets at $649 for 16GB units and $749 for 32GB models; black iPhone 4s are given a shipping estimate of 1-3 business days, while white units are listed at 3-5 business days. In its description for the handset, Apple says, “If you don’t want a multiyear service contract or if you prefer to use a local carrier when traveling abroad, the unlocked iPhone 4 is the best choice. It arrives without a micro-SIM card, so you’ll need an active micro-SIM card from any supported GSM carrier worldwide.”
Bluewater Productions has announced that its Steve Jobs: Co-Founder of Apple comic book biography will be released this August. The 32-page publication will be penciled by Chris Schmidt with cover art by DC artist Joe Phillips, and will chronicle Jobs’ now-legendary career. “Admire him or hate him, Jobs’ vision and business acumen revolutionized the world,” said writer CW Cooke. “Between he and Microsoft founder Bill Gates, you would be hard pressed to find someone with greater influence over how we communicate, interact and do business over the last 30 years.” Steve Jobs: Co-Founder of Apple will be available in comic shops, bookstores, and from online retailers such as Amazon and Barnes & Noble, and will sell for $4.
A company named iCloud Communications has filed suit against Apple, alleging infringement over the name of the company’s new iCloud service. The Next Web reports that iCloud Communications is claiming Apple’s heavy promotion of the new service is damaging to its business, which it contends are closely related to the services that Apple’s iCloud will offer. As noted by Mac Rumors, iCloud Communications does not appear to hold any registered trademarks associated with the iCloud name. The suit is seeking an injunction barring Apple from using the iCloud name, destruction of all marketing materials and other items referencing to the service, and monetary damages.
Apple has filed a motion to intervene in the patent infringement lawsuit filed by Lodsys against seven third-party iOS developers. FOSS Patents reports that if the court grants Apple’s motion to participate as an intervenor—something the publication feels is “fairly likely”—Apple will have already submitted its answer to Lodsys’ complaint, as well as a counterclaim. The report also notes that while no one has yet confirmed that Apple has agreed to cover those developers’ costs and potential risks, it is unlikely the situation could work in any other manner. In its motion, Apple states that the defendants “are individuals or small entities with far fewer resources than Apple and [...] lack the technical information, ability, and incentive to adequately protect Apple’s rights under its license agreement.”
Apple’s proposed defense against Lodsys is related to the assertion that the alleged infringements are covered by an existing Apple license. Lodsys’ claims are related to the developers’ apps’ use of In-App Purchases and “upgrade” buttons. Interestingly, an unrelated company—ForeSee Results of Michigan—filed a declaratory judgement suit against Lodsys’ four patents earlier this week, seeking to have them invalidated.
In a new twist on an old problem with stolen Apple devices, a thief successfully convinced the Apple Store to swap a stolen iPad 2 for a new device with a different serial number, after which Apple refused to help the victim of the crime. iLounge reader Dan Chang says that he purchased a black 64GB iPad 2 with Wi-Fi + 3G from the Apple Store Tysons Corner in May, and the device was stolen less than a week later. Chang filed a police report and was told that the iPad’s serial number would show up as a stolen item if sold to a pawn shop. On June 6, Chang used Apple’s Service and Repair tool to check the serial number of the stolen iPad, and received the following message: “We’re sorry, but this is a serial number for a product that has been replaced… If your information is correct, you may need to contact us.”
Chang followed the instructions and contacted Apple Customer Service, providing the company with his serial number. Apple confirmed that the iPad 2 had been replaced at another local Apple Store based on a battery-related complaint, and told Chang to visit the Store in person to discuss the matter. During his visit, the manager told Chang that she was not responsible for his stolen iPad, and told him to call Apple Customer Service, which he had already done.
Again following instructions, Chang was told that the iPad had been “recycled” and was no longer traceable; further, the representative said that Apple was not responsible for the stolen item, and that he should contact the police to try and catch the thief. In the end, Chang ended up without his $870 iPad 2, which he says he will not be replacing with another iPad or any other Apple product. He says he wishes that the thief had taken the stolen iPad to a pawn shop, where at least it could have been reclaimed thanks to the serial number tracking system, instead of to an Apple Store, where it was accepted with no questions asked and with no recourse available to the victim. The absence of a simple online Apple tool enabling users to report the loss or theft of their devices is at least partially to blame for this problem.
In another change to its App Store Review Guidelines, Apple has removed several widely criticized restrictions it put in place with the launch of In-App Subscriptions, according to a Mac Rumors report. Perhaps most importantly, the new terms no longer demand that any content or subscriptions sold outside an app must also be available via In-App Purchase for the same or lower price. The prior text of section 11.13 read: “Apps can read or play approved content (magazines, newspapers, books, audio, music, video) that is sold outside of the app, for which Apple will not receive any portion of the revenues, provided that the same content is also offered in the app using IAP at the same price or less than it is offered outside the app. This applies to both purchased content and subscriptions.” The decision to attempt to control pricing outside third-party apps drew the ire of many companies, some of which threatened to leave the App Store altogether should they have gone into effect on June 30 as expected.
Section 11.13 has since been replaced by section 11.14, which reads: “Apps can read or play approved content (specifically magazines, newspapers, books, audio, music, and video) that is subscribed to or purchased outside of the app, as long as there is no button or external link in the app to purchase the approved content. Apple will not receive any portion of the revenues for approved content that is subscribed to or purchased outside of the app.” This is a significant change in policy, and should help encourage more publishers and media companies to release offerings for iOS.
Apple has revised its App Store Review Guidelines to prevent the approval of any new DUI checkpoint apps. According to Autoblog, Section 22.8 of the new Guidelines states, “Apps which contain DUI checkpoints that are not published by law enforcement agencies, or encourage and enable drunk driving, will be rejected.” The update follows growing interest from the U.S. government in such apps, including a letter sent to Apple asking the company to remove any apps that inform users of DUI checkpoints. As noted in the report, while the developers of such apps might be able to remove DUI-specific functionality, most apps that identify law enforcement areas and speed traps are crowd-sourced, and it may therefore be quite difficult to stop users from submitting checkpoints themselves without the developers’ knowledge.
During the Cupertino City Council Meeting yesterday, Apple CEO Steve Jobs gave a presentation outlining the company’s plans for a new headquarters. The headquarters, which Jobs referred to as a “spaceship,” would be placed on the former Hewlett-Packard campus purchased by the company last year, and would be completely circular, with a courtyard in the center. According to Jobs, there wouldn’t be a single piece of flat glass used in the building; it would instead be built from curved architectural glass, of the same kind the company used to build the cylindrical glass entrance to its Shanghai retail store. The building would feature underground parking, a cafe capable of feeding 3,000 people per sitting, and would house 12,000 employees. Jobs referred to the structure as having the potential to be the “best office building in the world.”
Apart from the main building, the surrounding land would be heavily rebalanced in favor of green areas and away from asphalt; Jobs said the site is currently 20% landscape, and Apple’s plan would make it 80% landscape, moving from 3,700 on-site trees to roughly 6,000, the latter including some apricot orchards. Other buildings included in the plan are a separate, second parking structure, an energy center which would use primarily natural gas and other power sources, and rely on the grid for backup, an auditorium, a fitness center, and separate testing buildings. Between the company’s existing campus and the new headquarters, Apple could keep 15,000 employees in Cupertino. Jobs said that the company would like to submit plans for the site as quickly as possible, break ground in 2012, and move in to the new headquarters by 2015. A video of Jobs’ presentation is available on YouTube and is embedded below. [via ifoAppleStore]
Apple has released iTunes 10.3.1, the latest version of its digital media management software. The purpose of the update, which arrived without version-specific release notes, is unknown; the prior version, 10.3, was announced during the company’s keynote address on Monday but was not made available for download until early yesterday morning. iTunes 10.3.1 is available now via Apple’s Software Update utility.
Apple has released iBooks 1.3, the latest version of its e-Reader software for iOS. According to Apple’s release notes, iBooks 1.3 adds support for a new read-aloud feature for younger children that’s included in select children’s books from the iBookstore. The feature uses a real narrator to read the book to you and/or your child, and in some books, will highlight the words as its reading them aloud. Other features include automatic audio or video playback in enhanced books, improved responsiveness when opening very long books, and a fix for an issue where some books may display the same page twice. iBooks 1.3 is available now as a free download from the App Store.
In an e-mail just sent to MobileMe members, Apple confirmed what many users have expected since rumors of a follow-up service began to spread: MobileMe as it’s currently known will cease to exist after June 30, 2012. As a goodwill gesture to current users, the company will automatically extend MobileMe subscriptions through June 30, 2012 “at no additional charge,” after which “MobileMe will no longer be available.” Attempts to purchase additional MobileMe service are being rejected and refunded by the company as of today.
Apple urges users to sign up for the just-announced iCloud in order to keep their MobileMe e-mail addresses, mail, contacts, calendars, and bookmarks, and re-confirms that iCloud will be free for iOS 5 and OS X Lion users. While the company does not specifically address what will happen to MobileMe’s iDisk, Gallery, and iWeb services, it states that “more details and instructions on how to make the move” will be shared when iCloud opens for business this fall.
Apple has posted the complete video from today’s WWDC Keynote Address. At nearly two hours long, the video shows Apple CEO Steve Jobs and other company executives discussing Mac OS X Lion, iOS 5, and iCloud. Apple has also posted a brief five-minute video highlighting the new features of iOS 5, including Notification Center, Reminders, Safari, and iMessage. Both videos are available for viewing now on Apple’s website.
We’ve posted a huge collection of news stories regarding all of Apple’s iOS 5 and iCloud announcements today, and wanted to give you all an opportunity to discuss everything in one central location in advance of our editorial on the topic.
Did Apple impress you with the collection of features added to iOS 5? Are you excited or glad to hear about the free services coming in iCloud? Was anything really important missing today? Sound off in the comments section below.
As part of its new iCloud service suite, Apple today unveiled iTunes in the Cloud, a service which allows users to download previously purchased iTunes music to all devices at no additional cost. For music that wasn’t purchased from iTunes, users can gain the same benefits by signing up for a service called iTunes Match. iTunes Match scans a user’s existing music library and replaces existing tracks with 256 kbps AAC DRM-free files if they can be matched to the over 18 million songs on the iTunes Store and will upload any tracks that it can’t match to Apple’s servers. Apple indicated during its keynote address that there will not be any limit to the number of tracks that can be used with the service. iTunes Match will be available this fall for a $24.99 annual fee.
Update: Apple has updated its website to indicate that iTunes Match will be limited 25,000 songs, but that any purchases made from the iTunes Store don’t count against the limit.
Apple today introduced its new iCloud service suite. As a replacement for the company’s previous MobileMe service, iCloud is completely free, and works to store content in the cloud and automatically and wirelessly push it to all a user’s devices. Features of iCloud include rewritten push Contacts, Calendar, and Mail services, automatic synchronization of purchases and downloads from the App Store, iBookstore, and iTunes Store, a Backup features that automatically and securely backs up iOS devices on a daily basis over Wi-Fi, a Photo Stream service that automatically uploads photos taken or imported on any iOS device and pushes them to all a user’s devices—including Apple TV. iCloud also includes 5GB of free storage for mail, documents, and backup, which also serves to seamlessly store all a user’s documents that are created using iCloud Storage APIs, and automatically push them to all that user’s devices. iCloud will be available this fall concurrent with iOS 5 and will be free for all users.
We’ve just posted the full chronological transcript of our play-by-play from the WWDC 2011 Keynote. If you haven’t seen the separate news stories yet, today’s big announcements pertained to the fall 2011 releases of iOS 5 and Apple’s new free wireless synchronization service iCloud, as well as the July 2011 release of Mac OS Lion. Click on the title of this article for the full transcript, and visit our Flickr photostream for live photos from the event.