Apple

http://www.youtube.com/watch?feature=player_embedded&v=5cL60TYY8oQ

Marketplace reporter Rob Schmitz is the second reporter ever to get an inside look at Foxconn, the manufacturing plant where Apple’s products are made. Today, Schmitz posted a video showing our first-ever look at the assembly process of an iPad as it goes down the assembly line at the Foxconn plant in Shanghai, China. It is interesting to look at how machines streamline some of the process. Schmitz also noted a few other interesting points, such as workers switching positions every few days while making $14 a day when first starting.

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The U.S. Department of Justice and Attorney Gen. Eric Holder just announced (via CNN) a settlement with three publishers—Hachette, HarperCollins, and Simon & Schuster— following this morning’s report that it would launch an antitrust suit against Apple, Macmillan, and Penguin, which refused to settle. The settlement is said to give publishers the “freedom to reduce the prices of their e-book titles,” allowing Amazon to return to its previous wholesale model.

The states are seeking $51 million in restitution that will be provided through a credit toward a future book purchase or a check, although the Department of Justice’s charges remain civil. The exact details of the settlements with the three publishers were not discussed, but Apple, Penguin, and Macmillan will continue to fight charges in the lawsuit filed earlier today in New York.

As for exactly why Apple and the two other publishers have decided to take the case to court, at least one publisher is speaking. Macmillan’s Chief Executive Officer John Sargent published an open letter today explaining the company’s stance (via PaidContent). In the letter, Sargent claimed the Department of Justice’s settlement demands “could have allowed Amazon to recover the monopoly position it had built before our switch to the agency model.” He also said it is “hard to settle a lawsuit when you know you have done no wrong” and called the agency model the future of an “open and competitive market.”

Interestingly, AllThingsD pointed us to a line from the Department of Justice’s official complaint that indicates Apple proposed teaming up with Amazon at one point:

In addition to considering competitive entry at that time, though, Apple also contemplated illegally dividing the digital content world with Amazon, allowing each to “own the category” of its choice—audio/video to Apple and e-books to Amazon.

Go past the break for Sargent’s full letter, which is a great rundown of the case from the perspective of the publishers that have decided not to settle:

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[tweet https://twitter.com/#!/bloombergnews/status/190075312703410178]

Bloomberg is reporting that the United States has filed an antitrust lawsuit in a New York district court against Apple and publishers Hachette SA, HarperCollins, Macmillan, Penguin, and Simon & Schuster over alleged eBook price-fixing. The news follows reports from Reuters yesterday that the U.S. Department of Justice was preparing to launch a lawsuit against Apple and five major publishers accused of colluding to fix and increase the price of eBooks.

According to the report, all the parties named in the suit—except Macmillan, Penguin, and Apple— are willing to settle to avoid legal costs. The Department of Justice could announce “unspecified” settlements as early as today.

At the core of the settlement discussions is the agency model introduced with the iPad in 2010. The deal with publishers was described by Steve Jobs to biographer Walter Isaacson:

“We told the publishers, ‘We’ll go to the agency model, where you set the price, and we get our 30%, and yes, the customer pays a little more, but that’s what you want anyway…. They went to Amazon and said, ‘You’re going to sign an agency contract or we’re not going to give you the books.’ “

The model allows publishers to set their own prices as long as Apple gets a 30 percent cut and a guarantee that the same content is not offered lower elsewhere, but the Department of Justice is trying to return to Amazon’s wholesale model by giving retailers like Amazon control over pricing. Bloomberg explained:
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O.K., here is another Instagram story, but now its about the iOS app landing the No. 1 free app spot in the App Store for the first time—despite much media attention on the subject of it selling out to Facebook.

Hipsters everywhere donning their skinny jeans took to Twitter to post one last heavily filtered image, while threatening to delete their Instagram accounts after news broke earlier this week that social network giant Facebook bought the app for a cool $1 billion.

Many tweets and reports even detailed how to keep Instagram photos from Mark Zuckerberg’s acquisitive hands through export services like Instaport.me that essentially leave users free and clear to erase the Instagram app from their smartphones.

The public’s warning now seems empty, of course, as Instagram itself used Twitter this morning to announce its sudden surge in popularity. It looks as though the intense press scrutiny only encouraged the iOS app to soar up the charts. Meanwhile, its new parent company does not even sit in the top 25 free apps in Apple’s App Store.

[tweet https://twitter.com/#!/instagram/statuses/189845445458132992]

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The U.S. Department of Justice will sue Apple as early as tomorrow morning over allegations of fixing eBook prices with five major publishers, according to Reuters. The five publishers, which are also in question, will be looked at later in the week.

The Justice Department is investigating alleged price-fixing by Apple and five major publishers: CBS Corp’s Simon & Schuster Inc, HarperCollins Publishers Inc, Lagardere SCA’s Hachette Book Group, Pearson and Macmillan, a unit of Verlagsgruppe Georg von Holtzbrinck GmbH.

A lawsuit against Apple, one of the parties not in negotiations with the Justice Department for a potential settlement, could come as early as Wednesday but no final decision has been made, the people said.

The news of a lawsuit comes just weeks after the Department of Justice launched a probe into Apple and the five publishers. We will keep you updated with any more news about this case.
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[slideshow]

A user over on The Verge forums did an interesting mock-up of the 4-inch iPhone. The shorter side’s size remains the same, while the longer side is increased (640-by-1152 pixels). Go over to The Verge for a few more screenshots.

What do you think? I especially like that extra row of apps on the home screen and the ability to better play widescreen videos. Current apps would need a re-write to take advantage of the extra pixels or else letterboxing would occur, so it is a bit far-fetched.

It would also allow current docking stations to work; although, the 30-pin connector is rumored to be a goner.

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As the market just begins to open today, Apple’s market cap crossed the $600 billion threshold. Today’s accomplishment comes just a month after the company hit the $500 billion threshold. The market overall is down.

To compare, Microsoft holds the record for the highest market cap ever of $619 billion in 2000 (over $800 billion in today’s dollars). At the time of this writing, Microsoft is sitting at a $250 billion market cap. If some analysts are to be believed, the AAPL train will keep rolling to a $1 trillion market cap in the coming years.

Apple now dwarfs the No. 2 company, Exxon, by a comfortable $200 billion. We are looking forward to April 24 when Apple will talk Q2 2012 numbers.

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Over the past few weeks, security experts have warned Mac users of a new virus making its rounds called the “Flashback” trojan. Flashback is allegedly on over 600,000 Macs, which is roughly 1-percent of the 45 million out there. Flashback exploits a pair of vulnerabilities in older versions of Java. Apple may have patched it, but it is still out there and running on many machines.

How do you know if you are infected? F-Secure has a few Terminal commands to check your machine. For the many who are not adept at keeping their Java updates fresh, terminal commands are going to be even more foreign. Luckily, ArsTechnica points us to a free Flashback checker available on github. The app runs the same checks as you would in Terminal, but automates it for you.

We ran the test ourselves and were clean, but one of our readers found that he had the virus last week. It is definitely worth checking out. If your Mac does have Flashback, F-secure offers a great guide on how to remove it.

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Apple hired a new leader for its tax department, according to an SEC filing this morning. Phillip Bullock, formerly Symantec’s Chief Accounting Officer, chose to leave the company he joined in 2006 to join the winning team in Cupertino.

Phillip A. Bullock, who was appointed as Symantec’s Chief Accounting Officer in September 2009, announced he will be leaving the Company to lead the tax department at Apple, Inc., and not due to any disagreement with the Company on any matters relating to the Company’s operations, policies or practices.

Bullok has years of experience in the industry, serving as Vice President of Tax and Trade Compliance starting in 2006. He took responsibility for Symantec’s corporate risk assurance function in March 2007, and then he became Chief Accounting Officer in 2009. Before Symantec, he worked for a small tax practice.

This looks to be Apple’s third major hire this year after it hired John Browett from Dixons Retail to head its retail department. Apple also hired Robin Burrowes from Xbox to head App Store marketing in February.

Apple is known for finding the best in the industry, so we suspect it is no different here. Just in time to submit those taxes.

It appears AT&T has been hit hard by complaints from Apple iPhone users who used up their two-year subsidy and want to go elsewhere, such as T-Mobile in the United States or just roaming internationally without paying AT&T’s high international costs.

Our report from last week about Tim Cook’s office doing special requests to open iPhones may have set off a storm. We received upwards of a hundred reports that, through Cook’s office, 9to5Mac readers were able to unlock their iPhones, but perhaps Cook is now tired of his office handling these requests.

AT&T will now unlock your iPhone—if you are in good account standing and are done with your obligated term of commitment (including having paid an early termination fee.)

Here is AT&T’s statement:

“Beginning Sunday, April 8, we will offer qualifying customers the ability to unlock their AT&T iPhones. The only requirements are that a customer’s account must be in good standing, their device cannot be associated with a current and active term commitment on an AT&T customer account, and they need to have fulfilled their contract term, upgraded under one of our upgrade policies or paid an early termination fee.”

Here is another fun fact:  If you have paid the no-commitment price, AT&T will unlock your phone too.

Chalk one up for the good guys.

[tweet https://twitter.com/stroughtonsmith/status/189077291270283264]

Update (Sunday): How was unlocking? Talk about it in the forums!

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Last year, a Chinese teenager sold his kidney in southern China to buy an iPad and iPhone. Now his renal deficiency is deteriorating, and five people have been charged with intentional injury related to the operation.

The teenager is known in reports by only his surname Wang. According to Reuters (via Xinhua News Agency), prosecutors in Changzhou city, Hunan province claim Wang is suffering from renal deficiency, which also means he is facing a potentially life-threatening decrease in kidney function.

“I wanted to buy an iPad 2 but could not afford it,” said the boy […]. “A broker contacted me on the Internet and said he could help me sell one kidney for 20,000 yuan.”

On April 28th, the boy went to Chenzhou City in neighboring Hunan Province for the kidney removal surgery arranged by the broker. He was paid 22,000 yuan (an extra 2,000–) or $3,400 after his right kidney was taken out at Chenzhou’s famous No. 198 Hospital.

One of the five defendants earned 220,000 yuan (or $35,000 USD) to arrange the transplant, and then he paid Wang 22,000 yuan for the kidney and split the remainder with the surgeon, three other defendants, and various medical staff. The Xinhua report did not detail who received and paid for the kidney.

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Probably not.

The “hacks” require the attacker to have physical access to your device (whether it be Android or iOS). That could be a speaker dock, a charging station, or a friend’s computer, but it still requires you to plug the iPhone into something compromised or give up physical access to it.

The issue, as Gareth Wright first discovered, is that Facebook stores saved account information in a plaintext file that can be transferred to another phone and used to log into your Facebook account without signing in. Other services, like Dropbox, were also shown to have the same vulnerability (but that is disputed).

This is why, when you restore a phone from a backup, you already have access to your Facebook app without having to sign-in again. Facebook attempted to dispel the concern by claiming that a phone would need to be compromised for this to work. That is untrue.

However, as we know, once someone with the right software has your iPhone, your information is pretty much his or hers to use.

[tweet https://twitter.com/chronic/status/188363051139989504]

The bigger issue here is the software that people use to access your data. It is free—and the process is very simple. I expect Facebook and Apple will probably make it more difficult in forthcoming updates.

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From 9to5Toys.com:

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For a few more hours, Walmart is offering the $50 iTunes gift card for $40. That’s 20 percent off and the lowest price yet. The card comes immediately through email, and it counts toward free shipping on other items. It can be purchased for use in the US iTunes Store on iBooks, Mac and iOS Apps, Music, Videos, Movies and more.

Limit two per customer (You can get around the 2 per customer limit if you have multiple credit cards). International readers are telling us that their foreign credit cards are rejected (though US based Paypals are working).

Update: This ended over the weekend  – subscribe to 9to5toys for the latest deals on tech.

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Earlier this week, Apple released a Java security update, 2012-001, to patch the Flashback vulnerability that a security company claims affected 600,000 Macs.

Late this evening, we are getting reports from readers that a new version of the Java update is becoming available via Software Update.

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The latest update, Java for OS X 2012-002, supersedes the -001 update Apple released earlier this week, and indeed the KB article linked from the -002 update is still the -001 version (below).

Update: Apple sent a note out to its Java Community, below, with the ‘why’ (small issue they are the same but for a few symlinks and version numbers.)

Thanks Jessie!
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At the 2012 Consumer Electronics Show in January, LaCie announced a new product for Thunderbolt users. The eSATA Hub Thunderbolt™ Series is a $199 Thunderbolt pass-through that allows you to connect 2 eSATA drives to your Mac via the speedy Thunderbolt port.  By Daisy chaining six of the devices, you could add 12 eSATA drives to your Mac setup.

Today, those devices are now available.

eSATA speeds are up to 3Gb/s or equivalent to SATA II, so you will not be making full use of the Thunderbolt bus speed. However, you will still be much faster than either USB2 (480Mbps) or Firewire 800 (800Mbps). Apple’s Thunderbolt cables are sold separately at $50 a pop.

eSATA docking stations start at around $30, so if you have some eSATA or SATA drives laying around and want to get them on Thunderbolt, this might be a good—though slightly expensive–solution.

Seagate makes a $99 Thunderbolt to SATA drive adapter, but it is having trouble keeping stock (and it lacks a Thunderbolt pass-through) and reviewers note erratic results.

The full specs and press release follows:

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Yesterday, as part of a wider interview with Larry Page, Bloomberg quoted Google’s CEO as saying:

I think the Android differences were actually for show. I had a relationship with Steve. I wouldn’t say I spent a lot of time with him over the years, but I saw him periodically. Curiously enough, actually, he requested that meeting. He sent me an e-mail and said: “Hey, you want to get together and chat?” I said, “Sure, I’ll come over.” And we had a very nice talk. We always did when we had a discussion generally….I think that [Anger at Android] served their interests. For a lot of companies, it’s useful for them to feel like they have an obvious competitor and to rally around that. I personally believe that it’s better to shoot higher. You don’t want to be looking at your competitors. You want to be looking at what’s possible and how to make the world better.

However, Page likely was not present for the behind-the-scenes remarks from the former Apple CEO. Jobs probably put on a more distinguished game face, especially in the last meeting the two had when Jobs was very ill. In addition, Jobs’ anger was more than likely focused on former Apple board member and then previous Google CEO Eric Schmidt.

Biographer Walter Isaacson was present behind-the-scenes with Jobs, and last night he disputed Page’s assertion that Jobs’ anger was “for show”:

Isaacson continued: “It’s almost copied verbatim by Android. And then they licence it around promiscuously. And then Android starts surpassing Apple in market share, and this totally infuriated him. It wasn’t a matter of money. He said: ‘You can’t pay me off, I’m here to destroy you’.”

As for what will happen now that Jobs isn’t around to go ‘thermonuclear’ on Google, Isaacson thinks that Apple CEO Tim Cook will handle things differently. “Tim Cook will settle that lawsuit”, Isaacson added.

In the book, Isaacson quoted Jobs as saying:
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ArsTechnica quotes a Russian antivirus company called “Dr. Web” that claims hundreds of thousands of Macs are infected with the Flashback Trojan detailed earlier this week. The attack takes advantage of an old Java vulnerability that Apple just patched this week.

Variations of the Flashback trojan have reportedly infected more than half a million Macs around the globe, according to Russian antivirus company Dr. Web. The company made an announcement on Wednesday—first in Russian and later in English—about the growing Mac botnet, first claiming 550,000 infected Macs. Later in the day, however, Dr. Web malware analyst Sorokin Ivan posted to Twitter that the count had gone up to 600,000, with 274 bots even checking in from Cupertino, CA, where Apple’s headquarters are located.

Dr. Web said over half of the infected computers were in the United States (including 274 in Cupertino), and 20 percent were in Canada. The malware self-installs after you visit a compromised or malicious webpage. Obviously, it would be a good idea to update any Macs in your control.

If you think one of your machines may be infected, F-Secure has instructions on how to use the Terminal to find out. If these numbers are true, chances are some 9to5Mac readers are infected. Update: A reader comments that he was infected (599,999 more to go):

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The Sparrow team just announced version 1.1 for “Sparrow for iPhone” on its official blog, while also revealing Push API is coming to the iOS app’s next version:

Thanks to your amazing support, we feel confident that Apple might revise its position on the Push API. We’ll submit a first version of Sparrow 1.2 including it. This might delay Sparrow 1.2 validation but we’re already working with some partners to include Push in future versions of Sparrow without needing Apple clearance.

Push is coming. With or without Apple.

The team also said version 1.2 will include localization in nine languages, landscape mode when composing, and swipe up and down gestures to move between messages.

A screenshot gallery and version 1.1 updates are below. 

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Apple subsidiary FileMaker has announced a new version of their flagship software product, FileMaker 12, with new database creation tools and themes. The Mac version of FileMaker 12 gain improved 64 bit support as well as wide area network support, enhance support for large databases, and add fast file and multimedia-content streaming. Database and project creation are now easier and faster with new and more intuitive themes on the Mac. The most important addition to the product is its more streamlined interface for creating interfaces that run on iPads, iPhones, and iPod touches. Additionally, a new iOS device application is available for free. The app takes many features from the desktop product but is mostly used to run Mac-created databases. The Mac and iOS apps work in tandem.

http://www.youtube.com/watch?feature=player_embedded&v=LQl1FdbEyME

The full press release is after the break.

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Piper Jaffray’s Gene Munster has surveyed kids for a many years on their electronics usage. This spring, he polled 5,600 students, and half the group was male, while the other half was female. A surprising 34 percent of high school respondents said they owned an iPhone and 40 percent said they planned to get one in the next six months:

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This is surprising, because comScore released its own Mobile phone breakdown today that claimed only 13.5-percent of ages 13 and up owned Apple phones:

Included in that 13.5-percent are supposedly those 34 percent of high school kids, meaning the adult population would have to be even lower than 13.5-percent, which also means high school kids are three times as likely to own an iPhone as their parents if the numbers are right.
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Fortune relays Piper Jaffray/Gene Munster’s bullish prediction that Apple could reach a $1Trillion valuation in a few years by taking some its competitors’ value while also benefiting from increased tech investment and sales. The first point he illustrates (above) is that during the period where AAPL gained $400B in valuation (2008 to present), some of its key competitors lost the same amount in market cap. The second point is rationalized thusly:

We believe dollars invested in US technology companies will increase ~5% y/y on average for the next three years (CY12-CY14). By comparison, dollars invested in US tech companies were up 9% y/y in 2011. Therefore, the tech sector will add ~$390 billion in market cap through 2014. We assume Apple could capture half of this market cap (from 85% in the 4 years prior).Therefore, the tech sector will add ~$390 billion in market cap through 2014. We assume Apple could capture half of this market cap (from 85% in the 4 years prior).

Here’s a video from CNBC where Munster explains his world view: Apple and Samsung rule the mobile roost and companies like Nokia and RIM disappears into the ether.

[vodpod id=Video.16316843&w=425&h=350&fv=]

Munster’s figures follow another report from yesterday by Topeka’s Brian White who first made the $1000 AAPL call…
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