iLounge

An analyst says the Apple-AT&T alliance is all about content. “They are not going to pull users with speed,” says Michael Voellinger, VP of telecom consultancy Telwares. “They will do it with content and because of the content, it should be very successful.”

An Advertising Age glossary of 2007 media terminology says Microsoft’s Zune brand now means something besides a digital audio player. “ZUNE: Microsoft’s new music player. Also [slang]: a poseur; a wannabe. Usage: ‘Dude, you look like such a Zune in that shirt.’”

Apple and NBC have added the first two seasons of The West Wing to the iTunes Music Store. Episodes are $1.99 each and full seasons are $39.99.

The ringtone used during the iPhone’s introduction last week at Macworld Expo can be downloaded for your current cell phone, thanks to two anonymous Apple fans. Both MP3 and MIDI versions are available.

Original? A knockoff? Or just a non-exclusive design made by a random Chinese factory for sale to multiple vendors? Over the past several years, small iPod accessory makers looking for quick growth have become dependent on web sites such as Global Sources and Alibaba.com, which connect manufacturers of little white speaker systems with Western companies looking to jump on the iPod audio bandwagon. The results have varied from interesting to disappointing: once sold only by Pacific Rim Technologies, the Cube Travel Speakers have now been resold in cosmetically identical form - often times with much inferior sound and build quality - under myriad other small brand names, sometimes producing complaints to Pacific Rim from disappointed buyers of other companies’ versions. Similarly, the number of variants on Sonic Gear’s years-old i-Steroid series of “vacuum tube” speakers, including last year’s iTube from GINI Systems and Recoton’s just-announced blackVault 2.1 (shown), is growing every month, varying only in small details.

This week brought a surprise: two companies with bigger brands - and past reputations for releasing at least aesthetically novel products - joined the “me-too” crowd. At last week’s CES and Macworld Expo trade shows, and for the first time in the United States, two major companies simultaneously announced virtually identical iPod speaker systems: at Macworld Expo, DLO showed iBoom Travel, a small clock radio, at the same time as rival Jensen at CES was announcing JiMS-120, a system with the same general exterior design and features. Can you tell the units from each other using the photos below?

Contexture Design has introduced a new line of iPod cases made from recycled vinyl records. The one-of-a-kind “45” cases are composed of thermoformed vinyl records, felt padding, cork, and have a plexiglass screen protector. The cases—available in albums from artists such as Frank Sinatra, Tom Jones and John Lennon—also feature openings for the Click Wheel, headphone jack and hold switch. The 45 iPod cases are custom built to fit fourth and fifth generation iPods—from 20GB to 80GB. They are priced at $45 each.

Microsoft CEO Steve Ballmer claims that his company’s Zune media player took 20% of the high-end digital audio player market—those devices priced $249 or above—following its debut in November. Ballmer’s estimates compare to those of the NPD Group, which said this month that the Zune accounted for only 2.8% of the total digital audio player market in the five-week period from Nov. 19 to Dec. 23.

“We came into the market, a market in which they are very strong, and we took, I don’t know, but I think most estimates would say we took about 20-25% of the high end of the market,” Ballmer said in a CNBC interview. “We weren’t down at some of the lower price points, but for devices $249 and over we took, you know, let’s say about 20% of the market. So, I feel like we’re in the game, we’re driving our innovation hard and, uh, okay, we’re not the incumbent, he’s the incumbent in this game, but at the end of the day, he’s going to have to keep up an agenda that we’re gonna drive as well.”

Characteristically, Ballmer also laughed at Apple’s iPhone and its premium pricing. “$500 full-subsidized with a plan! I said that is the most expensive phone in the world and it doesn’t appeal to business customers because it doesn’t have a keyboard which makes it not a very good email machine,” Ballmer said. “Now, it may sell very well or not, I, you know. We have our strategy, we’ve got great Windows Mobile devices in the market today. You can get a Motorola Q phone now for $99, it’s a very capable machine, it’ll do music, it’ll do Internet, it’ll do email, it’ll do instant messaging. So, I kinda look at that and I say, well, I like our strategy. I like it a lot.”

Apple and Cingular will see a nearly 50 percent gross margin on each iPhone sold, giving the companies “a hefty profit, as well as plenty of room for future price cuts,” according to a preliminary Bill of Materials (BoM) estimate by iSuppli.

“iSuppli estimates the 4GB version of the Apple iPhone will carry a $229.85 hardware BoM and manufacturing cost and a $245.83 total expense, yielding a 49.3 percent margin on each unit sold at the $499 retail price,” said Andrew Rassweiler, teardown services manager and senior analyst for iSuppli. “Meanwhile, the 8GB Apple iPhone will sport a $264.85 hardware cost and a $280.83 total expense, amounting to a 46.9 percent margin at the $599 retail price.”

Commonwealth Bank, a large Sydney, Australia-based bank, has created a new method to compare global currencies and purchasing power using the iPod nano. Similar to the Big Mac index launched 20 years ago by The Economist magazine, the CommSec iPod Index looks at pricing of the 2GB iPod nano in U.S. dollars in 26 countries.

“Brazilians pay the most for an iPod, shelling out $327.71, well above second-placed India at $222.27,” reports Reuters. “Canada was the cheapest place to buy a Nano at $144.20, while Australia ranked 19th at $172.36, cheaper than Germany ($192.46), France ($205.80), South Korea ($176.17) and China, where the machine is manufactured. The U.S. was fourth cheapest at $149.”

In its first-quarter 2007 Quarterly Results Conference Call, Apple Inc. executives provided additional insights into the domestic and international sales of iPods, growth of the iTunes Store, and the potential of both Apple TV and the upcoming iPhone. During his introductory remarks, Apple CFO Peter Oppenheimer noted that music products, including iPod, represented 57% of Apple’s total revenue, versus 59% in the preceding year’s quarter. The company maintained its MP3 leadership share in the U.S. market, boasting a 72% marketshare in December, according to NPD data, and extended its lead in every international territory for which it has market data. Very strong sales through the iTunes Store helped the company’s performance: “other music revenue” grew 29% over the same quarter last year, buoyed by doubled sales of iTunes Gift Cards. iTunes now accounts for 85% of the U.S. market for legal digital music downloads, according to Nielsen Soundscan.

Additional notes from the Conference Call, including Apple TV as the “DVD player of the 21st Century” and potential changes to iPhone before release, are now available below.

Along with its quarterly financial results, Apple today announced that it shipped over 21 million iPods during the busy holiday shopping quarter. Specifically, Apple said it shipped 21,066,000 iPods during the quarter, a 28 percent growth in iPods over last year’s results, bringing the total number of shipped iPods to over 90 million. Apple’s net profit for the fiscal first quarter was a record $1.0 billion, or $1.14 cents per share, on $7.1 billion in revenue.

“We are incredibly pleased to report record quarterly revenue of over $7 billion and record earnings of $1 billion,” said Steve Jobs, Apple’s CEO. “We’ve just kicked off what is going to be a very strong new product year for Apple by launching Apple TV and the revolutionary iPhone.”

iFrogz recently announced several new iPod accessory offerings, all of which should be available by the end of January. 

The company is now offering its customizable silicone iPod cases in new multi-packs that provide iPod owners with 30 different case styles in one package. These include one Wrapz, three Bandz and 10 removable Screenz grouped around a particular theme, such as “Urban,” “Girlie” or “Hippie.” iFrogz is also now bundling its Tadpole iPod 5G case for kids with child-size headphones (shown right).

iFrogz also rolled out a rugged silicone case for the 5G iPod called the Bullfrog. It’s available in a wide array of variations. Joining it are Shuffle Bandz (silicone and come in multiple colors with raised contrasting stripes) and Shuffle Strapz (made of leather and comes in three colors) cases for the new iPod shuffle as well as the Rana, an unconstructed leather pouch for the iPod and other personal electronic devices which has snap fasteners to secure devices, an internal pull-tab for removal of devices and a soft interior.

Apple could announce the availability of the Beatles on the iTunes Store in a commercial to air during next month’s Super Bowl. According to a report by the Toronto Sun, Apple is planning a special announcement in a Super Bowl ad on February 4th. The newspaper reports that music from the Beatles could be available through iTunes as soon as next month, with Apple being given an “exclusive three-month, restricted deal” allowing iTunes to offer remastered Beatles songs online. A report by a Beatles fan website yesterday said that at least one Beatles album will be available on Valentine’s Day next month.

Tech.co.uk claims that Apple will open up its FairPlay copy-protection technology to licensed iPod accessory makers. Apple is “expected to make two announcements this week—the first will be to allow streaming of protected AAC content via USB; the second will be to licence its Fairplay DRM to the company’s Made For iPod licensees,” the Tech.co.uk article says. “This will have the effect of enabling you to play songs bought from the iTunes Store through third party devices like hi-fis using digital connections. It may also mean that devices like iPod docks will be able to display more information—artwork and other track info, for example—which is stored alongside the protected audio.”

According to a report, music from the Beatles may be on the iTunes Store as soon as Valentine’s Day next month. Beatles fan website Abbeyrd claims that a deal between Apple and Apple Corps. has been struck, and that their latest album, “Love,” will be made available through iTunes.

Online DVD rental service Netflix has officially announced its online movie service, which allows subscribers to stream and watch about 1,000 movies and TV shows on their PC at no additional charge. The Windows-only service will roll out in small numbers to Netflix members each week through June.

Perooz is a new online service that lets users download mobile magazines for iPods, PSPs, and other devices. “Now you can enjoy your favorite magazines on the go with our exclusive content partners including Maxim, Stuff, Blender, Car & Driver, Road & Track, and more.”

Strong holiday sales will boost Apple’s fiscal first quarter numbers, which are due tomorrow after the markets close. Analysts, on average, expect earnings of 78 cents per share on sales of $6.42 billion, according to a Thomson Financial poll.

LG Electronics is considering whether it will file a lawsuit against Apple, claiming that the iPhone design is a clone of the unreleased LG KE850 “Prada” mobile phone. The LG phone shares some similarities with the iPhone, including a rounded, black design, touch-sensitive controls and a full-screen interface. “At first glance, we recognized the iPhone shares many form factors with the Prada phone. We are flattered that other makers follow our design policy,” LG spokesman Lee Hyoung-kun said. “We can’t say at the moment whether or not we will file a lawsuit against Apple regarding this. It’s too early to make remarks on the issues.”

Despite soaring iPod sales, analysts believe that the popularity of lower-cost nanos and shuffles will result in Apple’s first year-over-year decline in iPod revenue. Bernstein Research analyst Toni Sacconaghi estimates that Apple sold 17.5 million iPods during the holiday quarter, a 25 percent increase compared with last year, but likely at lower prices. “We believe the first ever y/y decline in iPod revenues may be unexpected for some investors,” the analyst wrote in a research note Friday. Sacconaghi estimates that the average sales price declined 22 percent, to $161 from $207, in the quarter compared with a year ago. Apple’s $79 shuffle accounted for 21 percent of all U.S. iPod sales in November, according to the NPD Group. The nano made up 51 percent of iPod sales during the month.

“Apple CEO Steve Jobs” appeared on NBC’s Saturday Night Live over the weekend, showing off the new iPhone. Over 2 billion songs and 150 kabillion contacts, in your pocket.

Apple will announce its fiscal first quarter financial results on Wednesday, January 17th, at 5:00 p.m. ET. Along with its earnings, Apple will reveal how many iPods it sold during the busy holiday quarter.

Apple’s legal team is cracking down on websites and online forums that link to newly created software that turns the Windows Mobile operating system into an iPhone lookalike.

Concerned that his “working man hands” won’t work too well with the iPhone’s virtual keyboard, Jason Santa Maria has mocked up a photo of how the keyboard might look in landscape orientation.

RCA has introduced two new “Made for iPod” audio products—the RCA RP5500i Dual Wake Clock Radio and RCA RS2130i Bookshelf system.

The RP5500i Dual Wake Clock Radio ($80; May) features a slide-out drawer with universal iPod dock, USB connectivity, and AM/FM radio. The unit also offers an automatic time set feature, two separate alarm settings, RCA’s Graduwake and SmartSnooze features, adjustable brightness control, and built-in battery backup.

The RS2130i Bookshelf Audio System ($170; May) features an external iPod dock, a 160-watt digital amplifier, and a five-disc CD changer that reads CDs and CD-R/RW discs with MP3 and WMA files. The system also offers RCA’s “Rip&Go” feature, which records music directly to an MP3 player via a built-in USB port.

In addition to its iGroove SXT, Klipsch has also introduced the iPod-specific RoomGroove speaker system. Part of the new KlipschCast family, the RoomGroove is a transceiver system—it can receive CD-quality wireless audio from the Klipsch CS-700 DVD Entertainment System as well as transmit audio to other RoomGrooves.

The RoomGroove utilizes dual 2.5-inch high-output woofers in a ported enclosure, premium crossover networks and dual MicroTractrix Horn-loaded tweeters. It features a hidden dock that accepts and charges all dockable iPods. The RoomGroove also has an auxiliary input and comes with wall mounting hardware and an IR remote control. The system will ship in April for $349.

Delivered by Apple CEO Steve Jobs, this year’s keynote address from Macworld Expo is now available as a free downloadable podcast from the iTunes Store. Despite the fact that it clocks in at a feature film-length 1 hour and 45 minutes, Jobs’ keynote is unquestionably the most engaging public speech iLounge’s editors have ever seen, introducing the company’s new iPhone with a level of oratorical mastery that deserves academic study. The download is 1.21GB, and well worth the transfer time.

According to trademark law experts, Cisco may not be the owner of the iPhone name as it claims in the lawsuit filed this week against Apple. The iPhone trademark, owned by Cisco since 2000, was apparently abandoned in late 2005/early 2006 because the company was not actively selling a product under the iPhone name.

Cisco filed a Declaration of Use with the US Patent and Trademark office days before the trademark’s expiration in May 2006, following a six month grace period, but only provided a photo of one of its previously existing products—the Linksys CIT200 Cordless Internet Telephony Kit—with an “iPhone” sticker affixed over the product’s name.

“If Cisco didn’t launch a product using the iPhone name, their trademark registration would be canceled and they would have no bargaining chips with Apple,” says attorney Jay Behmke. “So in order to keep the trademark active, they had to file the Declaration of Use, and start selling a product under that trademark.”

“It is possible that the Declaration of Use is defective, as there was no continuous use, and the sample that Cisco submitted was for a product not released until 7 months later,” Behmke says. “The fact that the Declaration of Use was submitted only days before the deadline expires gives me the impression that they were scrambling to get a product to market, and had to file the Declaration before the product was ready.”

Celebrating the close of its Illuminator case design contest at Macworld Expo today, Mophie unexpectedly announced that three separate product concepts had won, with each item turned into physical prototype form and planned for release by the company in the near future. One of the winners, Schlep ($30), is a flip-open design that will be produced in two versions - one for iPhone (June), one for iPod 5G (April), adding credit card sleeves and a zippered storage pocket, and suitable for mounting on a bag strap. Bevy ($15, March) is a shuffle-fitting keychain holder-slash-bottle opener, with integrated iPod headphone cable management around its edge. Montage (price and date TBD) is a multi-function digital photo frame with a user-positionable iPod dock. Additional pictures of all three designs can be seen at the company’s Illuminator contest mini-site.