Apple confirmed yesterday that it has purchased online music retailer Lala.com, a smaller technology company that has developed an as-yet-unreleased application for streaming songs to the iPhone. Though Apple has not provided any further information, such as how much the deal was worth or what it plans to do with this acquisition, Lala’s streaming application promised to give users the right to stream songs to their iPhones an unlimited number of times for $0.10 per song, significantly less than the price of songs on the iTunes Store; the tracks could be purchased thereafter. Apple was said to be interested in Lala’s technical expertise, including its payment and streaming technologies, rather than its specific application. The company was launched in 2006 as an online CD-trading site but relaunched in October 2008 as a music retailer. (via MSNBC)
UPDATE: According to a source familiar with the matter, Apple may be looking to expand iTunes by offering streaming services in addition to their traditional download model. The source, who asked not to be named, stated that
“Apple recognizes that the model is going to evolve into a streaming one and this could probably propel iTunes to the next level.” (via Reuters)
UPDATE 2: Media Memo reports that according to multiple sources, Apple paid around $80 million for the company. This price represents less than half of what investors had valued Lala at in 2008, but is more than twice the money that has been raised by the company throughout its lifetime.
Apple is considering taking its new internally-developed iPod touch point-of-sale (POS) system to market, according to a new report. Citing unnamed sources, ifoAppleStore reports that Apple has seen a high volume of inquiries about the system since rolling it out in its own retail stores, but has until this point said the system was proprietary and not for sale. The system is comprised of a standard iPod touch that is housed in a custom shell with an integrated barcode scanner and credit card reader, which is linked to software that streamlines the checkout process. The report states that Apple retail executives have asked the retail store business specialists to collect contact information from anyone who inquires about the new POS system, possibly to create a database of potential customers should Apple decide to sell the system commercially.
Apple is manipulating NAND flash memory pricing though “questionable” purchasing strategies, according to a new report. Citing multiple unnamed industry officials, The Korea Times reports that Apple is using the leveraging power provided by the popularity of the iPhone and flash-based iPods to order more chips from semiconductor makers than it actually needs. “Apple should certainly be blamed for deteriorating the supply and demand cycle in the global NAND flash market,” said an unnamed senior industry official. “Apple has asked Korean semiconductor makers to produce a certain amount of chips for its digital products, only to actually purchase a smaller volume eventually. The company doesn’t make immediate purchases, but waits until chip prices to fall to the level the company has internally targeted.” A separate unnamed official called Apple’s purchasing strategies “absurd,” adding, “Samsung and Hynix both provide chips to Apple and have less of an edge in deciding prices and volume. Apple’s strategy could hurt the industry’s health.” An earlier report from September indicated that Apple’s consumption of NAND flash chips, which are used in the iPhone and iPod nano, touch, and shuffle, was causing a severe shortage of the popular components.
Prior to its acquisition by Google, mobile advertising firm AdMob was approached by Apple about a possible purchase, according to a new report. Citing a person familiar with the matter—who declined to be identified due to the private nature of the negotiations—Bloomberg reports that Apple approached AdMob to discuss a possible acquisition “a few weeks” before Google made its $750 million bid. Apple declined to comment on the story, while a spokesperson for AdMob said the company doesn’t comment on “rumor and speculation.” A purchase by Apple would have allowed the company to extend into online advertising, stated Karsten Weide, an analyst with research firm IDC. “If a lot of traffic goes through my devices, why can’t I become the middleman that serves ads against that inventory?” Weide said. “AdMob would have allowed [Apple] to do that quickly.” Weide estimates that together, Google and AdMob will account for between 30 and 40 percent of the mobile advertising market.
Apple has said that it plans to open between 40 and 50 new stores in 2010, with more than half those located outside the United States in countries including Canada, Australia, Italy, Switzerland, Germany, France and China. The Wall Street Journal reports that the company is also planning to focus on building more “significant,” or flagship, stores in major cities, as they are the company’s top retail revenue generators. “Other retailers call them flagship stores. We don’t use that word,” Apple senior vice president of Retail Ron Johnson said when explaining the “significant store” terminology. Highlighting Apple’s new Upper West Side store in NYC, set to open Saturday morning, the report adds that more significant stores are planned for spring or early summer openings in London, Paris, and Shanghai. Johnson also said that new stores will be larger than the majority of existing stores, to accomodate more product displays and larger Genius Bars. “Our stores are too small,” he explained. “Our biggest challenge at the Genius Bar — we cannot build them big enough.”
In an interview with the Wall Street Journal, Nintendo president Satoru Iwata has said he doesn’t like attempts to paint Apple and his company as rivals. As the article states, Iwata is an Apple fan himself, carrying an iPhone and using a Mac laptop on a regular basis. He claims the two companies appeal to different consumers, and says that attempts to create a rivalry make him “uncomfortable.” Despite Iwata’s claims, Apple’s senior vice president of Worldwide Product Marketing Phil Schiller made direct comparisons between the iPod touch and Nintendo’s DS, as well as the Sony PSP, during the company’s rock and roll media event in September, stating that while the latter two “seemed so cool” at first, they now “don’t stack up” to the touch or iPhone.
Nintendo recently announced a 52% drop in profit for the first half of its fiscal year, citing lagging sales of its Wii and DS consoles, and also predicted that its annual profit would fall year-over-year for the first time in six years. “If we can’t make clear why customers pay a lot of money to play games on Nintendo hardware and Nintendo software and differentiate ourselves from games on the mobile phone or iPhone, then our future is dark,” Iwata said at a recent company event. Industry analysts also believe Nintendo may be in trouble due to increasing competition from Apple, with research firm DFC Intelligence expecting revenue from iPod touch and iPhone game to rise from $46 million in 2008 to more than $2.8 billion in 2014, while revenue from dedicated gaming devices is expected to shrink 27% over the same time period. Nintendo will launch a new version of its DS handheld, the DSi LL, in Japan on Nov. 21. It will sell for 20,000 yen, or roughly $222.
Apple has launched a new Reserve and Pick Up service ahead of the holiday shopping season that allows customers to reserve products online for pick up in one of Apple’s retail stores. Included in the service are all models of iPod, and most Mac computers; curiously missing from the reservation system is the Apple TV, while the iPhone link simply pops up a message promoting the iPhone Gift Card. All iPods and laptops are also available for gift wrapping. No charge is applied at the time of reservation; instead, customers must pay in the store when picking their items up between December 15 and 24.
A new Apple patent application published this week suggests the company is working on a system of simplified data transfer between devices such as the iPhone, iPod touch, Mac computers, and Apple TV. The application covers a variety of transfer methods, including local Wi-Fi, cellular, and near-field networks, and also mentions the use of online data storage services that could serve as an intermediary between devices. In addition, the system would allow for simple transfer not only of individual files, but also of content with applications, allowing the user to pick up exactly where they left off on the other device. Notably, the illustrations accompanying the patent show two new iPhone/iPod touch applications, one called “Grab & Go” that would presumably be used to quick file transfers, and another called “Revisit,” which would give users access to recent browser history, searches, media, files, and more. As with all Apple patents, this filing does not necessarily represent any future product release from Apple, but offers evidence of the company’s research in this area; continue reading for images from the application.
Fortune magazine has named Apple co-founder and CEO Steve jobs its CEO of the decade. “Superlatives have attached themselves to Jobs since he was a young man. Now that he’s 54, merely listing his achievements is sufficient explanation of why he’s Fortune’s CEO of the Decade (though the superlatives continue),” Adam Lashinsky writes in a two-page overview of Jobs’ business history. “In the past 10 years alone he has radically and lucratively reordered three markets—music, movies, and mobile telephones—and his impact on his original industry, computing, has only grown. Remaking any one business is a career-defining achievement; four is unheard-of.” In the multi-part tribute, Fortune also offers an interactive timeline of key products and releases from the last ten years, a list of the top 10 moments from his career, interviews with eight important figures that have known Jobs throughout his life, and more.
Apple has sent specifications of its upcoming tablet device to various Australian media outlets, according to a new report. The Sydney Morning Herald reports that Apple has been distributing the specs in an effort to gauge the publications’ interest in delivering content for the device. None of the outlets were willing to talk about the device on record, but New York Times executive editor Bill Keller mentioned the device in a recent off-the-record staff meeting, suggesting it too has knowledge of the device. “I’m hoping we can get the newsroom more actively involved in the challenge of delivering our best journalism in the form of Times Reader, iPhone apps, WAP, or the impending Apple slate, or whatever comes after that,” Keller said. Video of the meeting is available online. [via AppleInsider]
Apple announced this week that they will be hosting a series of iPhone Tech Talk World Tour events in select cities around the world from October 29 through to December 15, 2009.
Open to members of the iPhone Developer Program, the event will provide expert advice from Apple technology evangelists to assist developers with tips on how to get the most out of their iPhone applications, with topics ranging from adding In App Purchase features to mastering OpenGL ES.
The event is being held in San Jose, Seattle, New York, Toronto, Paris, London, Hamburg, Beijing and Tokyo, and is free to all members of the iPhone Developer Program, although space is limited and several cities have already filled up.
In addition to announcing a new lineup of iMac, MacBook, and Mac mini computers today, Apple has quietly introduced the new Apple Remote ($19), a stylish new update to its prior white plastic version. Silver with a black set of buttons in a wheel-like shape, plus separate Menu and Play buttons, the new Apple Remote resembles a fifth-generation iPod nano minus the screen, and elongated for comfortable use in the hand. It interacts with Apple’s Universal Dock to control an iPod or iPhone’s playback on a television, as well as the Apple TV, and any Mac computer with an Infrared port. One other notable change is to the battery compartment, which has been moved to the rear of the Remote, with a twisting closure instead of the pop-out mechanism used in the older version. Apple’s online store currently shows the new Apple Remote as available within 2 to 4 weeks.
During a conference call with analysts following the release of its fourth quarter financial results, Apple CFO Peter Oppenheimer and COO Tim Cook made several statements regarding the company’s iPod, iPhone, and Apple TV businesses. In his opening statement, Oppenheimer said the company sold “almost” 10.2 million iPods, with 50% of iPod customers purchasing their first iPod, even in countries where the device enjoys a wide market share lead. iPod touch sales were up 100% year-over-year in the fourth quarter, he said, in part driven by the success of the App Store, which saw more than half a billion downloads in the September quarter alone. The iPod family continues to gain market share in nearly every region.
Regarding the iPhone, COO Tim Cook said the company was “very surprised” by the response to the iPhone 3GS. For much of the quarter, most countries were very low on 3GS with demand outstripping supply; the situation was remedied by the end of September in most regions. Cook added that the company expected a higher mix of iPhone 3G sales, and “quickly changed our orders and components etcetera that are different between the models. I think it shows there is an intense appetite for Apple’s latest technology and we were very pleased with the result.”
Cook also revealed that the iPhone will launch on China Unicom on October 30th, with 1000 points of sale, and service plans ranging from $18-$85/month, adding that Apple is “really excited to get started” in the market. Overall, the iPhone 3GS was available in 64 countries by the end of the quarter, and Apple plans to add several more over the next three months, including China, and hopefully Korea. When asked whether a move to multiple carriers in one country had an effect on the price Apple charges its carrier partners for each handset, Cook said, “Generally in markets where we’re already selling, I wouldn’t expect to see a wholesale price difference, however, the end-user price is really set by the carriers themselves, so you may see a street price difference.” The average selling price for the iPhone during the quarter was just over $600.
Regarding Apple’s enterprise efforts, and the popularity of the iPhone in the corporate environment, Cook said, “employee demand for iPhone in the corporate environment is very strong… iPhone is either being deployed or piloted in well over 50% of fortune 100, in europe - about 50% of the financial times 100. Another very key market for us is that over 350 higher ed institutions have approved iPhone for faculty staff and students.” Cook also said the company continues to be very happy with government sales.
Reporting its fourth-quarter financial results today, Apple said it sold 10.2 million iPods during the quarter—an eight percent decline from the year-ago quarter, and equal to Q3 2009. It also sold 7.4 million iPhones, a seven percent increase from the 6.89 million sold in the year-ago quarter and a 40% increase from the 5.2 million units it sold in Q3. The company posted revenue of $9.87 billion and net quarterly profit of $1.67 billion, or $1.82 per diluted share, compared with revenue of $7.9 billion and net quarterly profit of $1.14 billion, or $1.26 per diluted share in Q4 2008.
Sales of “Other Music Related Products + Services” were up 22% over the year-ago quarter and 6% from the third quarter of 2009, to $1.018 billion total. That category includes iTunes Store sales, iPod services, and revenues from Apple and third-party iPod accessories. Revenue from iPhone and Related Products & Services, which includes iPhone handset sales, carrier agreements, and Apple-branded and third-party iPhone accessories, was $2.3 billion, up 36% from Q3 2009 and 185% over the year-ago quarter.
“We are thrilled to have sold more Macs and iPhones than in any previous quarter,” said Steve Jobs, Apple’s CEO. “We’ve got a very strong lineup for the holiday season and some really great new products in the pipeline for 2010.”
“We are delighted with our September quarter and fiscal 2009 results,” said Peter Oppenheimer, Apple’s CFO. “For the full year, we grew revenue by 12 percent and net income by 18 percent in extraordinarily challenging times. Looking ahead to the first fiscal quarter of 2010, we expect revenue in the range of about $11.3 billion to $11.6 billion and we expect diluted earnings per share in the range of about $1.70 to $1.78.”
A newly published Apple patent suggests the company is developing a feature for its MobileMe subscription service that would sync playback state across devices. The feature would allow users to begin watching or listening to a file on one device, such as a computer, and then switch to a separate device, like an iPhone, with their current position within the media file synced automatically. Curiously, the patent covers both locally and remotely stored media, and mentions a system of automatic content retrieval based on anticipated future content access. As with all Apple patents, this filing does not necessarily represent any future product release from Apple, but offers evidence of the company’s research in this area. [via Engadget]
Former Genentech CEO and current Apple board member Dr. Arthur Levinson has resigned as a member of Google’s Board of Directors, effective immediately. In a statement, Google CEO Eric Schmidt said, “Art has been a key part of Google’s success these past five years, offering unvarnished advice and vital counsel on every big issue and opportunity Google has faced. Though he leaves as a member of our Board, Art will always have a special place at Google.” Levinson’s position on the Board of Directors at both Apple and Google was a point of concern in the Federal Trade Commission’s investigation into the close ties between Apple’s and Google’s board; Levinson’s departure follows that of Schimdt from Apple’s board, severing one more tie between the two companies.
In a letter written to Apple CEO Steve Jobs, U.S. Chamber of Commerce CEO Tom Donohue has responded to Apple’s decision to resign its membership over the Chamber’s stance on climate change regulation. Specifically, the Chamber is opposed to the Environmental Protection Agency’s decision to regulate greenhouse gas emissions. “It is unfortunate that your company didn’t take the time to understand the Chamber’s position on climate and forfeited the opportunity to advance a 21st century approach to climate change,” Donohue wrote. “While we do support legislation to address climate change, we oppose legislation such as the Waxman-Markey bill that numerous studies show will cause Americans to lose their jobs and shift greenhouse gas emissions overseas, negating potential climate benefits.” He also said that the Chamber is focused on innovation and technology as tools to combat climate change, adding, “it is a shame that Apple will not be part of our efforts.”
Apple has resigned its membership in the U.S. Chamber of Commerce “effective immediately” over the organization’s opposition to the Environmental Protection Agency’s decision to regulate greenhouse gas emissions. According to the Wall Street Journal, the Chamber of Commerce claims it is not opposed to climate change regulations, just those that have been proposed in Congress and/or discussed by the EPA. Apple is the fifth company to make a withdrawal from the Chamber over the issue, but was by far the most harsh in its execution; three other companies simply said they would not renew their membership at the end of the year, while Nike quit the Chamber’s board of directors. From Apple’s letter to Chamber of Commerce CEO Tom Donohue:
“We strongly object to the Chamber’s recent comments opposing the EPA’s effort to limit greenhouse gases…Apple supports regulating greenhouse gas emissions, and it is frustrating to find the Chamber at odds with us in this effort. We would prefer the Chamber take a more progressive stance on this critical issue and play a constructive role in addressing the climate crisis. However, because the Chamber’s position differs so sharply with Apple’s, we have decided to resign our membership effective immediately.”
A lawsuit between Apple and Eight Mile Style LLC and Martin Affiliated LLC, music publisher and copyright manager for rap artist Eminem, has been settled after just five days of trials, the Associated Press reports. The suit, filed in July 2007 in U.S. District Court in Detroit, claimed Apple violated copyrights by allowing unauthorized sales of Eminem’s music. Although Aftermath Records has rights to the recordings, Eight Mile Style claimed that those rights did not allow the label to make a deal with Apple without its approval. A settlement was reached Thursday night, according to an Eight Mile Style attorney; no further details have been disclosed.
Apple has quietly purchased mapping service Placebase and its accompanying Pushpin API, hinting that the company may be planning to use the assets should it need to replace Google Maps in several of its applications, such as the Maps application on the iPhone and iPod touch. Citing a Twitter update from the founder of openplaces.org, which used the Pushpin API in its software, along with an updated LinkedIn profile for Placebase CEO Jaron Waldman, who is now listed as part of the “Geo Team” at Apple, Computerworld reports that Apple purchased the company in July, and suggests that the company may be looking to replace Google Maps in its products in an effort to further reduce dependency on Google. Although Google Maps offers advanced features like Street View, Placebase offered a wide variety of customizations and features that integrated both public and private data sets, and the Pushpin API, which offered an easy way to layer data onto the maps. Despite the article’s strong suggestions, it is possible Apple purchased the company for reasons unrelated to its relationship with Google, such as bringing in more talent for development of more advanced map- and location-based services.