Tech Industry

 The signs are pretty good for Apple’s iPhone 3G launch in India. As far as we can tell, there’s a whole bunch of excitement among India’s switched-on, well-educated tech savvy gadget geeks…

See – what we’re reading right now from EETimes describes a lot of excitement there right now, as launch day clicks ever closer as the tock ticks to August 22.

Airtel and Vodaphone will be offering the in-demand device – three million of which have already been sold worldwide – in India. "Vodaphone is accepting iPhone 3G orders via SMS messages, but has also said nothing about the cost of the new phone or cancellation policies."

What we read about then is a huge big grey market for iPhone non-3G, which sets punters back around $299…but there appears to be some, erm, anticipation, as to how much the iPhone will cost…

"Here in India, cellphones have become status symbols. Whether you use all the features or merely receive voice calls, it doesn’t really matter," said Chiranjeev Shenoy, an executive at a multinational company, adding, "$600 is too high a price to pay, around $300 is a good price" for a new iPhone.

Oops, one snag, there’s no 3G in India yet, and GPS isn’t truly "there" yet… but we are interested in the long tail to the anticipative iPhone article…"There are few reliable statistics on the number of iPhones in India. Estimates range from 100,000 to 500,000."

Now, if only there were a smaller, perhaps less well-featured model that perhaps more people in the world’s growth markets could afford.

Heavy iTunes Store and software purchasers in the US had better get ready for the value of their dollar to shrink, as state authorities across the country have begun to push for taxes on downloads, like film, software and songs.

It’s all about the money – the US wants it, its citizens may be forced to hand it over – online retail sales in the US are set to reach $130 billion this year. That’s a fat and juicy low-hanging fruit for the taxman to get his hands around. 

This year so far at least nine US states have mulled over the notion of applying taxes against digital downloads, and five have already put them into effect, according to Cnet News.com. Nebraska, Tennessee, Indiana, South Dakota and Utah have all implemented taxes on downloads this year. In California, laws to implement taxes on downloads are continuously discussed – it’s a question of time.

Massachusetts, Wyoming and Washington are also pondering wrapping tax around iTunes buys – even as the industry unwraps those downloads from the cotton wool of DRM.

According to News.com, including Nebraska and Tennessee, there are 17 states, plus the District of Columbia, that tax digital downloads: Alabama, Arizona, Colorado, Hawaii, Idaho, Indiana, Kentucky, Louisiana, Maine, New Jersey, New Mexico, South Dakota, Texas, Utah, and Washington

Opposing these new taxes are consumer and tech industry groups, including NetChoice, who most recently argued that digital downloads are the greenest way to purchase multimedia, urging they be kept tax free.

And in New York, local state legislatures seem unlikely to move to tax downloads yet, terming them to be "intangible property" and therefore not liable to State tax.

But with iTunes now the largest music retailer in the US, accounting for maybe 21 per cent of recorded music sales there, just how long will music be tax free?

 Apple has already sold three million iPhone 3Gs in less than a month since the product shipped – and there’s no sign yet of momentum slowing down, an analyst claims.

Telecoms analyst Michael Cote of the Cote Collaborative made the claims in chat with CNN. A former T-Mobile executive, the media outlet says he has been "extremely accurate with wireless predictions in the past."

Apple – being Apple – refused to comment on Cote’s claims that the computer-cum-iPod-cum-iPhone-cum-pro software and education solutions company is seeing "unprecedented demand".

The three million figure is much higher than Wall Street analysts had anticipated, CNN informs. Many analysts had simply expected quarterly sales of up to four million…not monthly sales of three million…

Three days after the new iPhone’s July 11 debut, Apple announced that it had sold 1 million iPhones. 

Cote believes demand may ultimately fully outstrip supply, particularly as the device ships in new markets. "The demand is so strong it may impact or delay the new countries coming on," he said.

 Apple boss Steve Jobs told the Wall Street Journal that iTunes is making a million bucks on selling iPhone application downloads each day – but just how ‘sticky’ are those apps?

Sure, we’ve played with the ‘Wooo’ button, messed around with iPint and made a few friends with Crazy Mouth, but what’s really happening in the active, profitable iPhone app ecosystem?

Quite a lot, it seems, according to GigaOm, which asked Pinch Media chief, Greg Yardley, for a little information…(in case you haven’t heard of it, Pinch Media provides a range of analytical data for iPhone developers). And there’s some interesting information to help comprehend the state of the iPhone and third-party application union:

– There’s ten downloads of free apps to each purchase of a paid app.

– The pace of downloads is slowing (we do think offering better visibility for new apps as they appear might help boost this – it’s a little opaque at present)

– Under 20% of an application’s unique users return to an application each day.

– People use the apps for just under 5 minutes at a time

– Most use apps only once per day

– Average number of uses per day is around 1.2

More on this right here.

Meanwhile, Apple seems to have gone crazy for banning applications – seems all you need is some small vocal minority to begin making its usual babble, or perhaps some vested interest firm to start banging on on legal, and the Apple team will remove your app at the drop of a hat (which is a shame when some complain it takes so long to get their software uploaded in the first place).

Other notable recent casualties include:

– PhoneSaber – apparently removed because the people with the copyright on Star Wars demanded it.

– Slasher – apparently removed because it featured violence (far better tune into CNN for that).

– Netshare – seemingly removed because AT&T doesn’t want Mac users going online via their phone – even though MOST OTHER 3G PHONES ARE CAPABLE OF BEING USED AS A MODEM TO GET A MAC ONLINE!!

– I Am Rich – removed because thousands of people noted how expensive it is, and because a couple of incredibly stupid people didn’t understand the significance of the price tag and Buy button. Duh!

Any more out there? Comments…etc., etc.

Mac purchases in the education sector remain a major Apple growth story on an international basis, with more Macs showing up in classrooms.

The company is continuing a fight-back which began in 1999, when Dell surpassed Apple in the US education market for the first time. 

Apple finally pressed pass the competing PC firm on the basis of laptop sales in the first quarter of this year, as then confirmed by COO Tim Cook.

Apple remains number two to Dell in the US education market overall, because of Dell’s strength in desktop PCs – Dell had 38.4% of the overall market to Apple’s 22.8% in Q1.

But Apple’s gains seem set to continue. A spring survey of college students planning to buy notebook PCs this year, 43% said they were looking to get Apple laptops. It was far and away the No. 1 brand, with almost twice the response rate of No. 2 vendor Dell, which got 22%.

Apple has been consistently outpacing the overall PC market – Mac unit sales rose 41% year-over-year compared with the industry rate of 15.3% in the three months ended June.

News remains strong in Europe, where Gartner stats for the second calendar quarter of 2008 claim Apple to be the number one PC manufacturer in the education segment across Europe, a position held for eight successive quarters. In fact, Apple sold 19.2 per cent of all CPU’s sold in the sector – including servers.

Apple continues to broaden its grip on European education computer sales, Gartner confirmed today. According to the … 2008, Apple remains the number one PC manufacturer in the education segment across Europe, a position its held for eight successive 

Now, it seems, Apple is preparing to shake things up even more, with analysts across the board echoing Needham’s analyst, Charles Wolf, who recently suggested Apple will introduce Macs at much lower prices than before, in order to secure further marketshare and answer calls for cheaper machines as the recession begins to take hold.

According to Silicon Alley Insider, Credit Suisse analyst Bill Shope has been doing some research on Apple.  His conclusions seem pretty reasonable…with some caveats.  Here are his findings and our thoughts below:

• New iPods: "More likely." Apple refreshes its iPod line in the fall, and there’s no reason it won’t this year. To compete better with the cheaper iPhone, Apple could offer higher-capacity iPods at lower prices, one possible explanation for its warning about low gross margins.
• Refreshed MacBooks: "More likely." No major shape/size changes, but faster laptops at lower prices.
• Apple Tablet: "More likely." Shope wouldn’t be shocked if Apple released a tablet soon to take advantage of its exclusive, multi-touch technology on a product with a bigger screen.
• iPhone nano: "Less likely." It makes sense that Apple would extend the iPhone family the way it’s done with its computers, iPods, etc. And a cheaper, slimmed-down iPhone could reach a broader audience than today’s. Just not so soon after it launched the iPhone 3G, which has strong demand.
• Super-cheap laptop: "Less likely." Eventually, Apple will need to come out with a laptop under $800 to tap into new markets. But Shope’s conversations with Apple "suggest that the company may not be ready for such a drastic change in product strategy in the near-term."
• Super-cheap desktop: "Less likely." An all-in-one, not the Mac mini, which would expose Apple to the "sweet spot of the desktop market fairly quickly." Just not convinced Apple is ready to play in the "discount PC market" yet.
• Mac TV: "Even less likely," a "long shot." Apple could skip the set-top box by building its Apple TV software into a flat-panel TV. While Shope (and we) would probably be buyers, he thinks "this seems a bit outside of Apple’s normal sphere of business for now."

Our Take:

• New iPods:  Yes, of course, a lock for September.  Nanos in colorful arrays we know.  More interestingly, maybe we’ll see some more iPhone features in the Touch.  Bluetooth, GPS, speaker, and camera are all contenders.  Maybe even a long range wireless capability – 3G, WiMAX?  What can you do with the shuffle?…Making it the size of a Bluetooth headset is the only way to make it smaller – a combo would be cool but unlikely  – Also look for a big announcement next month with 24 Hour Fitness and Nike (with a backend designed with RG/A) to include bringing "exercise-gaming" to the iPod.
  
• Refreshed MacBooks: 99% certain.  More than just a processor and specs update like Shope postulates, however.  Glass trackpads and total laptop redesign.  Cut from one piece of Aluminum.  Thinner.  Late September.  Bet.
• Tablet: Disagree, won’t happen until 2009 unless you count enhanced iPod Touches.  We would like to see something like the Nokia N810 specs but hopes are low.
• iPhone Nano: No, no, no – never.  Is $200 really too much to spend on an iPhone?   In some places it is already free with an expensive plan.  Is the iPhone too big?  Not really.  If anything, Apple will go more upscale in the coming year and the current devices will be the low end. 
• Super cheap laptop?  This is Apple.  No.  But somewhat smaller and less expensive are realistic longer term possibilities.
• Super cheap desktop?  As much as we’d like to see one, nope.  Psystar-like specs, mass produced in a nice enclosure for $400 would be nice, however significant specs updates to the Mini without price movement would cover this market and are much more likely.
• AppleTV? Actually, unlike Shope, we think a game change is very likely.  If Apple could cut deals with HD screen manufacturers across the board (like it did with movies studios) and at the same time beef up the hardware to do 1080p, Apple could turn its hobby into a serious business.  We know Apple wants into this field so badly that it is willing to subsidize the cost.  Components are costing less and less and at some point it will cost about as much 20 movies or a few seasons of a TV series.  The opportunity to entirely subsidize the cost of the device will arrive at some point soon.    The biggest obstacle?  The state of US broadband.  Bottom line, look for movement – there are many opportunities ahead.   —-Also, adding a gaming component to the AppleTV would be cool but a long way off – a deal with Nintendo to bundle the AppleTV with the Wii might be cool.

We would also like to see some more work on Apple’s Pro Hardware.  Most of this equipment hasn’t beeen significantly upgraded since PowerPC days.  What do you think?

 Remember when we told you about new laws being secretly put into effect on a global basis which means officials can confiscate your iPod, iPhone, mobile phone, computer or anything else? How they could keep it and search it without charge, oversight or consequence? We got told it would never happen at the time. But it has. 
http://current.com/e/89181822/en_UK

 Universal Music appears to have another string in its series of plans to create alternatives to iTunes, now planning a free, ads-funded streaming music service called Total Music.

Total Music was Universal Music Group’s move to work with other major labels in order to offer bundled music subscriptions with MP3 players, with payment for access included in the cost of the device.

The plan fell foul of the US Department of Justice, and was quietly put into mothballs (it seems) in order to stave off an anti-trust investigation.

Now, TechCrunch reports the idea has been re-jigged as the ads-funded music streaming service described – and in order to prevent more regulatory investigation, the service will be made available as a warehouse-type service, meaning website owners will be able to sign-up to implement it on their own websites.

TechCrunch has identified four employees of a company called TotalMusic, including Ted Ferguson, former VP of digital product strategy at Universal Music Group. 

A recent job ad for the service states: "TotalMusic, LLC is a new digital music platform offering the integration of music discovery, streaming and downloads into a wide variety of online and mobile environments. We have solid financial backing and a staff with decades of combined experience in online music."

Whether the service will gain any traction is debatable, as MySpace, Nokia and Sky/Universal all have similar services planned, and Last.fm has the ground fairly well-covered already.

TechCrunch also notes: "Since there are only four major music labels, anything that smacks of price-fixing or collusion will be torn down by the Justice Department. The labels need to be very careful about this."

Other recent Universal Music moves include the introduction of its high-quality, DRM-free, UK-only LostTunes service and its move to partner with Sky in offering new subscription services.

Those pesky business customers, they just won’t get on board with the Vista program, it sounds like.  According to HP, the vast majority of the computers it sells (and tallies) are actually running XP even though they report every sale as a Vista sale.

"From the 30th of June, we have no longer been able to ship a PC with a XP license," said Jane Bradburn, Market Development Manager, Commercial Notebooks for HP Australia.

"However, what we have been able to do with Microsoft is ship PCs with a Vista Business licence but with XP pre-loaded. That is still the majority of business computers we are selling today."

Every sale of Vista is, in all actuality, a sale of XP.

Rob Kingston, Group Manager of Commercial Product Marketing for HP said, "Looking into the crystal ball, I don’t think businesses will see much value in upgrading to Vista until late next year, and even so, Microsoft will probably have come out with something else by then."

HP’s revelation casts doubt over Microsoft’s claims about how many copies of Vista have been sold, as HP has made clear that although a sale may be counted as ‘Vista’, it may actually be XP.

Ouch.  So what percentage of Microsoft’s tallies of Vista were actually just Vista licenses with XP actually running on the machine?  Half?  More?

It looks like Microsoft is going to try to curtail this process in 2009, according to the article, but many PC vendors are already trying to circumvent this.  Like every EEE clone for instance.

 The latest ChangeWave Consumer Smartphone survey suggests Research In Motion and Apple’s will wipe the floor with other manufacturers, as the two horse race between the two firms for dominance of the smartphone sector pushes other makers out of the game.

Director of research, Paul Carton, notes that prior to the release of the iPhone 3G, his surveys had suggested the device would have a huge impact on the market. It did. Apple sold one million units in the first weekend, and demand remains high today.

"RIM isn’t taking the Apple 3G challenge lying down," Carton notes. "The Canadian manufacturer has multiple plans in motion to counter Apple’s momentum among consumers, including an already announced new product release (the Bold) and two likely additional product releases (the Thunder and Kickstart)."

Just after the announcement of the iPhone 3G and just before the product shipped, ChangeWave surveyed 3,567 consumers on their reaction to the new RIM counteroffensive. And while consumers don’t appear as enthusiastic about the company’s forthcoming devices, they do seem keen enough to place a challenge to the Apple attack.

A total of 4% of respondents report they’re Very Likely to buy the new RIM/BlackBerry Bold when it becomes available. Another 13% are Somewhat Likely.

Slightly less positive but nonetheless significant, 2% of respondents say they’re Very Likely to buy a RIM/BlackBerry Thunder when available. A total of 13% are Somewhat Likely.

Another 2% say they’re Very Likely to buy a RIM/BlackBerry Kickstart when it becomes available, and 11% are Somewhat Likely.

“These results show consumers hungry for all varieties of BlackBerry,” said Tobin Smith, founder of ChangeWave Research and editor of ChangeWave Investing, who added, “it appears like when it comes to the BlackBerry, the adage ‘if you build it, they will come,’ certainly holds true.”

The strength of these early survey results on the demand for RIM’s new products points to a potentially powerful counteroffensive to Apple’s 3G iPhone, according to Smith. “The real losers in this smart phone battle will most likely be the second-tier players, who could find themselves increasingly pushed to the sidelines as the two Goliaths battle for market dominance.”

ChangeWave also looked at the impact of the new RIM releases on the rest of the smartphone industry – current RIM customers are two-to-three times more likely to buy new models than customers of other manufacturers. Competing firms most at risk from the two horse Apple/RIM battle include Palm, Motorola and Samsung, Changewave said.

Apple customers, on the other hand, appear least likely to buy any of the new RIM phones," they added.

"The Apple iPhone has captured the hearts and minds of its user base, and so has the RIM BlackBerry," the researchers said. "Fortunately for both, the global consumer and enterprise smart phone markets are big enough to support both Apple and RIM – it’s the other cell phone manufacturers that look like the real losers."

RIM should be concerned, however.  As you can see in this graph, they’ve netted a 1% loss in marketshare for the 1st 1/2 of 2008…and that is before the 3G iPhone ws released.

 PwnageTool 2.0.2 will be available "within hours" the iPhone Dev Team explained today.

The tool will be made available through the PwnageTool software updater that is built-in and checked when you start PwnageTool.

The developers note that PwnageTool 2.0.2 does not yet include a new version of the installer.app, which is currently being developed.

The PwnageTool 2.0.2 version will jailbreak the latest iPhone 3G and iPod touch software, offering those who did not update to iPhone 2.0.1 firmware new features and stability, which those who did update will now be able to access jailbroken applications.

The developers do warn, "If you care about the possibility of a GSM/3G unlock in the future (there is no unlock as yet), do not update your 3G device unless you do it via PwnageTool 2.0.2 – If you have updated you’ll still be able to Jailbreak using PwnageTool 2.0.2 but it may reduce the chance of you being able to unlock the phone to be able to use a SIM card from all carriers in the future.

"To clarify, PwnageTool 2.0.2 will still provide the jailbreak for 3G users. Meanwhile, we’re still actively pursuing the GSM/3G unlock – stay tuned."

The developers also pointed us to this CNet review of their software.

http://www.cnet.com/av/video/flv/newPlayers/universal.swf

Apple appears to be patenting all manner of implementations of its multi-touch technologies, with a recent patent revealing plans to create virtual DJ software for potential deployment on MacBooks, rumoured Multi-Touch tablet Macs and – potentially – the iPhone and iPod touch.

The Apple patent – which is available in its entirety here – describes ways to manipulate objects on a touch screen, including numerous user interface applications, detailed with accompanying diagrams.

For DJ’s the patent describes the following implementation, which basically explains a virtual pair of twin turntables which appear on the screen, touch-sensitive, these would let DJs mix and shift various kinds of digital media.

"Like a pair of physical turntables, stylus 844 and stylus 855 can be graphical icon indications of a playback queue, the position of which can be varied by touching the queue on a touch sensitive display screen and dragging the icon to the desired position on the graphical record."

"[0148]During song reproduction, the records 834 and 835 can be manipulated similar to a physical record. For instance, rapid back and forth movement of a record can cause the sound effect of a record "scratching," as disc jockeys often do on physical turn tables," the patent explains,

Like all Apple patents, the existence of this one doesn’t mean the product will ever actually appear – in a sense, patenting these technologies may actually hamper their appearnace, as third party developers will require Apple’s permission to use such patented technologies.

 Analysts at Piper Jaffray have set tongues wagging, predicting new Macs and iPods will make their first appearance at an Apple special event in September.

True, the analysts aren’t claiming to have any definitive proof of the so-called Apple happening, but, as Piper Jaffray analyst Gene Munster points out – the company has held a special event that month every year for the last three years. So  it’s educated guesswork. 

Munster thinks Apple will unveil redesigned MacBooks, and possibly re-enter the $999 price point occupied by the original iBook models. He also expects a redesigned MacBook Pro. 

The analyst also expects increased capacities for the iPods shuffle and nano, but the same prices. He doesn’t anticipate new form factors for these products, but does suggest the iPod touch could see a redesign and be introduced at a lower $199 price.

Additional highlights from this analyst’s Apple predictions include:

– Touchscreen Mac is unlikely right now. A "MacBook Touch" may emerge in 2010.

– Smaller version Macbook Air for 2009.

– Wider deployment of multi-touch, and Apple will eventually swap the trackpad on its laptops to backlit colour screens.

 The Daily Mail’s report claiming Apple plans to launch an iPhone nano before the end of the year may have some truth – but the timing is awry, Lehman Brothers analyst Ben Reitzes warned last night.

The UK newspaper had claimed Apple plans to introduce a small version of the iPhone, quickly dubbed the ‘iPhone nano’. This gadget was reportedly to ship in time for Christmas and to be made available on a pay-as-you-go basis.

The analyst counters, “While we believe Apple is working on a lower-end iPhone form factor, we do not think one will come until Spring 2009."

This suggests Apple is working to deliver such a device, but isn’t planning one just yet, after all, the company has enough to do shipping the existing iPhone 3G to 50 more countries before the end of the year, the analyst writes.

Not only that, but it appears Apple hasn’t yet decided what "form factor" the device will take.

However, rumours of a smaller, less well-featured iPhone have persisted for a year at this point, leading many to believe it’s not a question of if, but when. Like Nokia, Apple will at some point have to diversify its range in order to widen its addressable market.

Equally, the Daily Mail’s sources may have confused the iPhone nano whispers with Apple’s secretive plan to upgrade its iPod range – specifically, the Mail report could be construed as suggesting plans to introduce multi-touch to the nano, though the utility of such a proposition remains to be seen.

 This is Part 1 of Aurora, a concept video created by Adaptive Path in partnership with Mozilla Labs that attempts to create a plausible vision of how technology, the browser, and the Web might evolve in the future by depicting that experience in a variety of real-world contexts.

[vimeo http://www.vimeo.com/1450211 w=400&h=225]
Aurora (Part 1) from Adaptive Path on Vimeo.

The release of Aurora is part of the launch of Mozilla Labs’ browser concept series, an ongoing initiative to encourage designers and developers to contribute their own visions of the future of the browser and the Web. Over the next couple of weeks, we’ll be releasing more video segments, as well as background material showing just what went into imagining the future of the Web and translating that into a video.

Apple’s adventures in music retail continue to bear fruit, with the company now consolidating its position as the leading US music retailer – and not just on a per-month basis, but for the first half of the year, new figures reveal.

While Apple’s competitors continue to try to chip away at the iTunes market lead, NPD MusicWatch reports iTunes to have been the leading US music retailer all the way through from January to June of this year, pushing former leader, Wal-Mart, into second place. Amazon’s making a dent, too, with its new MP3 retail service propelling the company into fourth from fifth place in the music retailers top five.

"We expect Apple will consolidate its lead in the retail music market, as CD sales continue to slow,” said Russ Crupnick, entertainment industry analyst for The NPD Group. “Amazon’s CD buyers tend to be older, so they haven’t abandoned the CD format to the extent seen in the average music buyer. Plus Amazon’s successful introduction of its digital download store will help the company improve its position in the future.”

The research also reveals online CD sales to have seen less erosion than sales at high street shops.

Fresh research from the Yankee Group reports a growing corporate marketshare for Apple, with the analysts observing the Mac to be "gaining significant momentum among corporate users."

The research, published yesterday and penned by analyst, Laura DiDio, states: "Don’t look now but Apple Mac hardware and the accompanying OS X 10.x operating system software are gaining significant momentum among corporate users."

The report cites a new Yankee Group web-based survey of 750 global IT administrators and C-level executives. This survey found nearly four out of five businesses -approximately 80 per cent – have Macs and OS X installed in their networks. 

"Although the Apple Mac hardware and OS X operating systems still represent a small niche, adoption and acceptance of Mac hardware and operating system software are growing at a steady and sustained pace not seen since the late 1980s," DiDio observes.

As explained, survey responses indicate that use of Apple products in a corporate environment is much more pervasive and complex than previously thought. Nearly one-quarter, or close to 25 per cent, of the survey respondents have a significant number – greater than 30 or 50 – of Apple Macs and Mac OS X present in their corporate networks, the analyst said.

Cool technologies such as Safari, iChat, FileVault, Time Machine and new bundled applications within Mac OS X 10.5 are also boosting enterprise adoption, the analyst said.

Demand for the iPhone 3G is exceeding Apple’s expectations by a significant margin, and the company has now forced its manufacturing partner, Foxconn, to produce the device at the highest-possible rate.

Citing yet another of those shadowy "sources" that seem to wander about online, TechCrunch alleges Foxconn to have ramped-up its production to 800,000 units per week. The report notes this to be "above current full capacity", and warns there may be some quality control issues ahead.

Apple sold just 6 million of its first generation iPhones, but right now Foxconn is producing the mobiles at a rate of 40 million per year – and Apple was originally expected to ship just 25 million of these devices.

The iPhone is available in 23 countries today, with plans to triple availability this year.

"We’ve heard that Foxconn was initially told to expect sales of up to 40 million units in the first year, but that those numbers are being revised upwards sharply," TechCrunch reports.

Strategy Analytics recently pointed out that Apple’s global handset shipments fell sharply between Q1 and Q2 this year, from 1.7 million units in the first quarter of 2008 to 0.7 million in the second quarter.That was as purchasing slowed down in advance of the release of the iPhone 3G. That gave Apple a worldwide marketshare stood of just 0.2% in that quarter. 

Strategy Analytics expects Apple’s handset market share to rebound to 1.1 per cent in the third quarter – however, should TechCrunch sources be correct and Apple achieves sales of 40 million in a year, this equates to ten million in a quarter, and gives Apple a much higher slice of global handset shipments. And a commanding slice of the smartphone market….

 Microsoft is running scared at Apple’s resurgence, and now warns shareholders that the Steve Jobs-led company could be a threat to Redmond’s business.

Proof positive of the new fear in at Microsoft CEO Steve Ballmer’s HQ is contained within the company’s recently-filed Form 10-K. This time around, Microsoft has introduced a new risk factor that has never been there before – and while the company fails to name the company that threatens it, you can draw your own conclusions.

“A competing vertically-integrated model, in which a single firm controls both the software and hardware elements of a product, has been successful with certain consumer products such as personal computers, mobile phones and digital music players," Microsoft’s threat assessment states, adding, "We also offer vertically-integrated hardware and software products; however, efforts to compete with the vertically integrated model may increase our cost of sales and reduce operating margins.”

We’re pretty sure we know who that company is. Ballmer said last month, "In the competition between PCs and Macs, we outsell Apple 30-to-1. But there is no doubt that Apple is thriving. Why? Because they are good at providing an experience that is narrow but complete, while our commitment to choice often comes with some compromises to the end-to-end experience."

He has a plan, saying, "Today, we’re changing the way we work with hardware vendors to ensure that we can provide complete experiences with absolutely no compromises."

This means we can see the near future become pretty personal, as the world’s largest software company tries to ignore the damp interest in Vista and Apple’s ever-growing market share.

 Apple continues to feel the pinch in digital music, with competitors closing in on all sides – and this week has seen multiple examples of the heat slowly turning up on the iPod manufacturer.

The stakes are high: Apple holds 70 per cent of the US MP3 player market with its iPod range. We believe Cupertino plans to upgrade its digital music players within weeks.

One band that may not appear at the new iPod launch this time around may be U2. The only band to have had an official iPod model made in its honour has now dropped the DRM from its music catalogue – but only through Real’s Rhapsody service – a snub to iTunes.

One high-profile competitor already appears in two minds at taking on Apple in this market, Dell, which this week moved to diminish reports claiming it plans the release of its own MP3 player to compete with the iPod.

A Dell spokesmen would only admit that while an MP3 player was under consideration, no decision has been made: "We have not announced that we are going to be selling an MP3 player," the spokesman said. 

Universal’s announcement of its LostTunes service this week is also clearly a move into Apple. The website itself declares the songs it sells to be "double the quality of iTunes". In case you missed it, LostTunes is a Universal Music-owned service offering rare music in MP3 format, free of DRM at 320kbps (better quality than iTunes).

Universal is looking to offer its catalogue DRM-free to services such as Amazon MP3 in the US, and is likely to extend this to other services in Europe. Universal now clearly accepts that provision of DRM-free, high-quality music downloads is a winning proposition for online sales.

But for all the DRM-free deals emerging from Universal, the company remains cool on Apple.

This has prompted Jupiter Research analyst, Mark Mulligan, to say: "“The major record labels cannot continue to treat DRM-free as a tactical experiment and must recognize it as the strategic necessity it really is.”

Later revelation that NBC Universal has reached a deal with Microsoft to stream coverage from the Beijing Olympics adds further fuel to the corporation’s anti-Apple zeal.

Also this last few days it emerged that T-Mobile will challenge iTunes with its own video-on-demand service for full length video, including film, available in the UK.

Finally, Apple, Real Networks and Amazon are all competing to provide the infrastructure for the soon to launch and presumably set to be lucrative MySpace Music store, a report claims.

 The iPhone developer iFund has taken out another investment, this time in start-up game publisher, ngmoco.

The fund is run by venture capital firm Kleiner Perkins Caufield & Byers and has taken an undisclosed investment in the games company. Ngmoco will use the cash to develop new titles for the iPhone, and is already advertising for developers, producers and other games development staff.

CEO Neil Young is a former Electronic Arts executive. While at that company, he oversaw development of several titles, including  Lord of the Rings, The Sims 2, and the about-to-be-released Spore. He left EA in June, and wants to both develop its own games and finance and produce games from other developers. 

Kleiner Perkins partner Bing Gordon, a former chief creative officer for game publisher Electronic Arts will join the ngmoco board.

As we also reported here, iPhone application development is proving surprisingly lucrative for some developers, with one developer informing 9 to 5 Mac that their application has been generating near $2,000 per day in sales.

In related news, iPhone music game Tap Tap Revenge is on course to pass the million download mark this weekend, the second iPhone application to reach that benchmark, the first one was Facebook.

What this means is that approximately one-in-five iPhone owners have now downloaded the application, which has also seen 2.5 million songs downloaded to play in the game, mostly from independent and unsigned artists. Publisher Tapulous is in talks with labels about releasing a premium edition of the currently free game, featuring songs from established artists.