Tech Industry

 A leading US electronics retailer has decided to end sales of Microsoft’s Zune player due to insufficient demand.

US video game retailer GameStop has thus applied yet another slap across the face of Microsoft’s attempt to produce an ‘iPod-killer’. Zune has sold two million units since launch, proving itself an unwanted minnow in the sea of Apple competitors.

"’We have decided to exit the Zune category because it just did not have the appeal we had anticipated,’ said a GameStop spokesperson," Priya Ganapati reports for TheStreet.com.

The retailer has hundreds of stores across the US. Apple has sold 85 million iPods in the same time period, outselling Microsoft by a factor of 42.5 to 1.

Thanks to MacDailyNews for the picture.

Apple’s dead serious about exploring next-generation wireless technologies, including WiMax, UWB and GPS solutions. How do we know? Because the company  has been searching for an insanely great wireless and WiMax expert since November 2007. That individual will help the company develop new products that work with these next-generation wireless technologies.

This news shows Apple’s getting even more serious about WiMax and networking. In fact, the company is now looking extremely hard at all available wireless technologies, but (as we’ve been saying for some time now), the company wants to make WiMax for Macs. Why do we know this? Because Apple’s advertising for a senior RF Systems Engineer, a full time role based in Santa Clara valley. 

“The Senior Wireless system Engineer will be responsible for designing/integrating Apple wireless products, and exploring new wireless technologies. He/she will work in a technology group on next generation wireless communications products as well as the integration of wireless technology within Apple products,” the ad states.

The role demands someone to work “proactively with other cross-functional engineering groups such as industrial design, product design, EMC, antenna design, software design and test, and all of the computer system project teams.”

It’s not just WiMax, of course, its most any wireless standard. They must be familiar with RF fundamentals and test equipment, and must have knowledge about, “Bluetooth, 3G, UWB, WiMAX, GPS, Mobile TV and similar wireless technologies.”  

We know that WiMax is due wide-scale deployment worldwide this year, with wireless deployments set for Russia, Malaysia and many other countries. And while phone operators decry the standard, which they see as threatening to their colossal 3G investments, WiMax is increasingly emerging as a viable choice to bring some kind of connectivity to large land masses that lack other forms of network deployment.

Apple’s main pitch here isn’t the standards, but on the development of wireless-enabled products – and the vacancy confirms the company’s interest in all wireless standards. Specificaly, though, Apple thinks a candidate with “experience with wireless module integration into PC system or consumer products is a strong plus.”

This is a big deal job, “Additionally, the engineer must be able to interact closely with offshore engineering development and manufacturing partners. International and domestic travel is likely.”

We’re looking forward to seeing what new breeds of wireless product Apple comes up with next. 

By the way, if this is the perfect job for you, you’ll find more information about it right here…

Here’s the link in full, in case this one stops working, http://jobs.apple.com/index.ajs?BID=1&method=mExternal.showJob&RID=11829&CurrentPage=1

 France Telecom’s Orange brand will retain the exclusive distribution rights for the iPhone in France, a head honcho at the company said today.

"It will remain an exclusive contract in France,"  Chief Financial Officer Gervais Pellissier told the Reuters Global Technology, Media and Telecoms summit in Paris this morning.

This confirms that in all three European markets in which Apple chose exclusive partnerships with operators in order to bring iPhone to those countries will retain exclusivity. O2 in the UK and Deutsche Telekom in Germany have all indicated they’ll keep hold of that exclusive deal, even while Apple chooses to offer the next-generation device through multiple operators in other key countries, including Switzerland, Australia, Egypt, India and Italy. (We have a list of currently confirmed iPhone carrier deals right here). The only significant change known of so far is in Austria, where Deutsche Telekom recently lost exclusivity on news that Orange will also sell the device there.

 Apple’s iPhone has sparked interest and use of web browsing using smartphones, particularly in the US, where such use has climbed 89 per cent.

Smartphone users (and let’s face it, mobile web usage is  most prevalent among iPhone users) are running to social networking and e-commerce sites, spending an average of four hours and thirty-eight minutes online using their phone every month (in the US) and two and a half hours per month in the UK, research claims.

Recall that January survey of more than 10,000 adults, which revealed 84.8 per cent of iPhone users access news and information from their device? That compares to 13.1 per cent of the overall mobile phone market and 58.2 per cent of total smartphone owners…

The modern day digital obsession, Facebook, is the most visited website from a mobile the UK, while in the US, Craigslist, eBay and MySpace trump that social networking service. UK users explore the 3 portal, Sky TV and the BBC.

All these claims are included within the latest research from M:Metrics, where senior analyst Mark Donovan notes: "People are becoming increasingly engaged in the mobile medium.” Revealing the rate of mobile browsing to have increased 89 per cent year-on-year and page views have climbed 127 per cent, he notes changing consumption patterns.

“It’s evolving from brief transactions such as checking the weather or flight times, to time-intensive interaction with mobile websites – even without an iPhone,” the analyst said.

All these figures make interesting reading, but the killer punch is at the end, where M:Metrics reveals the data to be derived from “actual user behaviors among those with Windows, Symbian and Palm handsets.”

This begs the question: with users of smartphones from those manufacturers becoming increasingly interested in mobile web browsing, just how much pent-up demand will Apple face when it releases it’s next-generation iPhone next month? And with Blackberry recently beginning TV ad campaigns in the UK, are both firms set to profit from the mobile multimedia explosion? 

 Apple has huge plans to stake space in the digital home,  and could introduce a slew of products to this end in the years ahead – at least, that’s what Forrester Research believes.

As reported by the Wall Street Journal, new research from Forrester explores the kind of products Apple could introduce in the next five years. And while the report’s packed-full of speculation, there’s elements within it that may be worth pondering.

For example, the researchers believe it’s possible Apple could introduce a range of Mac-enabled digital picture frames. These could, for example, connect to .Mac or other online image galleries to display new images uploaded by friends, or could randomly show images selected from a user’s own iPhoto library. These screens could also include speakers and be capable of playing music or video clips, and could be touch sensitive so viewers can flip to different images at will.

Forrester also predicts an Apple clock radio, once again connected to iTunes. A highly-sophisticated Apple remote control is also speculated upon, equipped with a screen this would let users browse their iTunes collections as they wander round their home, playing music through their selection of iTunes-enabled speakers.

Underpinning all such dreams of a digital dwelling, the researchers also imagine Apple may introduce new services for the home, such as an in-home installation service, in which Genius Bar type operatives would visit people’s homes to design and install the appropriate multimedia set-up.

Sure – all these things are speculation; and Apple’s staying silent on such rumour and conjecture, but what else can we imagine? Home automation systems controlled from an iPhone? Electronic wallets? Small but powerful Wi-Fi-enabled speakers that can be placed around the home, offering direct access to a user’s iTunes collection and controlled by an Apple remote or iPhone? Television sets containing an Apple TV?

Mind boggles. Anything’s possible – but that doesn’t always make it probable.

 All MacBooks released in 2009 will carry LED backlight screens, claims Taiwan’s Economic Daily News, via DigiTimes.

The report reveals backlight maker Kenmos Technology last year emerged to be Apple’s leading provider of screens, with the company set to widen its franchise through the company’s computers next uear. Kenmos is expected to ship 1.5 million LEDs this year and already provides the LED screens used in the MacBook Pro and Air computers.

Apple CEO Steve Jobs last year promised to make the switch to LED screens as part of the company’s attempt to become more environmentally responsible, though he declined to say when this switch would take place.

“To eliminate mercury in our displays, we need to transition from fluorescent lamps to light-emitting diodes (LEDs) to illuminate the displays,” he said. “Apple plans to reduce and eventually eliminate the use of mercury by transitioning to LED backlighting for all displays when technically and economically feasible,” he wrote.

We think it possible the LED screens will be deployed in the next generation of MacBook, which is also expected to sport an aluminium chassis, faster Core 2 Duo processors, and 

Recent reports have suggested that the next revision of the consumer-oriented MacBook will undergo a major redesign that converts the portable from plastic to aluminum and should also introduce other technical improvements, such as Intel’s Centrino 2 platform and accompanying faster Core 2 Duo processors. 

 Apple’s Mac sales shot up 50 per cent year-on-year in April, driving a 46 per cent spike in revenue, according to the NPD Group.

NPD also revealed that – far from slowing down – iPod sales also jumped 15 per cent that month. And Lehman Brothers analyst Ben Reitzes reckons new Mac laptops – equipped with MacBook Air-type touch technology – are on the way. (And maybe more).

"Checks are indicating that the attractive look of the Air may make its way into other models in terms of slimmer, metallic designs. We believe these notebooks will be popular for the back-to-school and holiday shopping seasons," the analyst said. Oddly, that’s what we were saying last week…pegging the date as July-ish…(We predicted the iMac intro a month early too, fact fans).

It’s just the latest in a string of industry trend-beating news from Apple Inc. As 9 to 5 Mac reported (before the majority of the Mac web) earlier this week, NPD figures show Apple to be the brand of choice in the high-end laptop market. An astonishing 66 per cent of laptops sold in the US costing $1,000 or more are made by Apple. While Apple’s share falls to just 14 per cent  in the sub-$1,000 bracket, it’s an incredibly significant figure all the same. (And yeah, we know those Windows Fanboys will begin to chunder on about how the only Mac we can buy for under $1,000 is the Mac mini, get over it, those cheap PCs just don’t offer the same degree of utility, usability or features as a Mac, and run a second-rate OS).

Apple’s making market gains through a combination of factors: superior operating system, better-featured and aesthetically-designed Macs, a world-class retail store chain, and the increasingly vapid WIndows market. Apple’s iPod and iPhone have put the corporate brand into consumer minds, meaning that 50 per cent of Macs sold through Apple’s retail stores are going to users new to the platform.

High-tech also counts: I think many experienced industry watchers missed the significance of the MacBook Air when it shipped: but the whole notion of a computer you can put inside an envelope has caught on on the streets, people remember this. Which is why Apple’s recent 10Q noted: “The increases in Mac net sales and unit sales were driven primarily by sales of the new MacBook Air, introduced in January 2008, and higher sales of the iMac and other Mac portable systems.”

Proof of the pudding’s in the eating: Mac unit growth reached 51 per cent and 48 per cent in the second quarter of Q2 and first six months of 2008 respectively – exceeding the industry average.

Apple’s laptop sales climbed 61 per cent, with 2.29 million Macs sold in Q2, 1.433 million of Macs sold were laptops.

Surging Mac sales caused Apple CEO Steve Jobs to reflect last October: “The question is, are we headed for a tipping point, it sometimes feels like that."

IDC claims 23.5 million computers were sold in the first quarter of 2008 in Europe, the Middle East, and Africa, which is equivalent to 19 per cent sales growth over Q1 2007. Apple’s overall Mac sales in Europe climbed 45 per cent in the March quarter.

And the effect? Apple accounted for 7.58 per cent of all US Internet users in March, up near 15 per cent, year-on-year. And Apple is now the leading supplier of laptops within the US education markets.

So while those inexpensive PCs may dominate the market share numbers, when it comes to users looking to make a serious computing investment in order to actually, you know, do stuff, Apple’s growing share and dominance in the $1,000-plus category promises great things…

….and isn’t the Mac mini due an upgrade soon? With near $20 billion in the bank, is there any real reason now Apple can’t ramp-up its competitiveness at the lower end of the market? (Not one they’ve traditionally played in, I agree).

 Apple’s senior vice-president of industrial design Jonathan Ive offered a rare interview with the Independent in the UK to mark Apple’s recent win of two coveted Black Pencils at the world’s leading creative industry awards.

Ive talks a little about his work, saying that for his creative team its not about taking a huge leap to understand Apple’s users, “because we are the users.”

"I’m not driven by making a cultural impact," he says. "That’s just a consequence of taking a remarkably powerful technology and making it relevant.

"My goal is simply to try to make products that really are meaningful to people. Ultimately there is something motivating and inspiring in seeing someone using an Apple product and enjoying an Apple product."

Read the interview in full here.

 The Mac is slowly evolving as a more serious platform for gamers, with the release of key game development software for OS X.

MysticGD today announced its realtime game animation middleware software, Emotion FX, is now officially available for the Mac. And it’s the growing marketshare for Apple computers that has driven the company to make the move, it confirmed this morning.

Emotion FX has been used in the development of a huge range of titles for multiple platforms, including Mythic Entertainment’s Warhammer Online; Tilted Mill’s SimCity Societies; and Sony’s Vanguard – Saga of Heroes.

“The Mac platform is getting more and more marketshare, and as a result the Mac gaming sector is getting stronger,” said John van der Burg, development director at the company.

“We are pleased to support PowerPC and Intel based Macs and are looking forward to working closely together with more Mac developers," he added.

EMotion FX is a real time, next generation, Character Animation SDK. The SDK is designed to take full advantage of hardware that allows parallel processing and also includes a code path optimized for single processor hardware. The SDK includes full body skeletal and facial animation support, Lipsync, real time motion retargeting, inverse kinematics, PhysX Ragdoll support, and comprehensive exporters for Max and Maya.

The software has been used by game developers worldwide to produce games in all genres and is currently available for PS3, Wii, Xbox360, Mac and PC.

 We’ve been watching Napster’s decline for some time, but now the company is fighting back with the introduction of a new download service that takes the market wars to Apple – because it’s made a move to drop DRM..

Napster has announced that all six million tracks it sells through its music service will from now on be available in DRM-free MP3 format, (256kbps bitrate). This means each 99-cents track will play on any device, including Macs, iPods and the iPhone.

What’s also significant here is that all the major labels have signed up to offer their catalogue through the Napster DRM-free service: EMI, Universal, Warners, and Sony BMG have all agreed to sell tracks free of rights-restriction. Having the majors on board means Napster is declaring that its service offers 50 per cent more DRM-free tracks than any other music service. And it’s an aggressive kick at Apple’s iTunes marketshare, where only EMI has so far agreed to sell music DRM-free.

"Music fans have spoken and it’s clear they need the convenience, ease of use and broad interoperability of the DRM-free MP3 format, and they want to be able to find both major label artists and independent music all in one place. Napster is delighted to deliver all of this and more with the world’s largest MP3 catalog," said Napster’s chairman and CEO Chris Gorog.

UPDATE TO ADD: What’s pretty sad about the company’s anti-iTunes attempt is that Napster has failed in one essential element: its online music store is incompatible with Apple’s Safari web browser….go figure… 

We’ve always known that Apple’s marketshare figures are skewed by enterprise sales of servers, terminals and word processing PCs, and new research from NPD confirms this, revealing that two-thirds of laptops costing $1,000 or more and sold across US retail chains are Macs.

Macs? That’s right. New figures from the research group as reported by eWeek reveal that 66 per cent of laptops sold in US retail stores that cost $1,000 or more are Macs. And while that share slides to just 14 per cent for computers costing under $1,000, the news still confirms Apple’s growing footprint in retail Mac sales.

NPD vice president Stephen Baker told eWeek that Apple’s notebook marketshare is growing at twice the market rate, with Windows notebooks “pretty flat right now”.

It’s not just notebooks. Apple’s retail desktop sales have climbed 45 per cent, against industry patterns for desktop sales (down 20 per cent) and far outweighing Windows’ Vista’s continuing decline – sales of desktop PCs running that OS are down 25 per cent, eWeek reveals.

"iMacs are growing and the Windows desktop ain’t. No matter how you look at it, Apple is outperforming Windows,” Baker said.

"Apple has got better distribution than it’s had in the last 15 years," he adds. "They’re in the right spot right now. There’s the iPod advantage. But the big thing is the stores."

It’s an inflection point for Apple, alright – don’t forget the company recently surpassed Dell to become the biggest laptop vendor in the US education market.

The FCC just released information on Intel’s upcoming 5350 WiFi/WiMAX combo Mini-PCI card.  "What’s that got to do with me?" You might be saying…

Physically, this card will fit into the MacBook Pro’s Mini-PCI card slot, replacing the current Wifi card.  The only caveat is that the WiMAX antenna might not do so well with the Wifi antenna setup that current MacBook Pros possess.  Oh, and there is no Mac driver software (Bootcamp?) for this semi-unofficial product yet.  Oh, and Sprint-Clearwire are late in the nationwide WiMAX rollout…

Intel’s 5350 WiFi/WiMAX combo Mini-PCI card (Above)

Apple’s current 802.11NWifi Card (below)

Other than that…it is a go!

 Apple is moving toward the release of a redesigned MacBook, a new report emanating from the company’s Asian Mac manufacturers claims.

AU Optronics Corp. and Chi Mei Optoelectronics Corp. have been signed-up to produce flat-panel screens for the new MacBook models, confirmed the Commercial Times this morning, citing “sources”.

In line with Apple’s continued marketshare growth for its laptop offerings, Apple has set strong targets for sales of the new device, which MarketWatch claims is set for launch in the third quarter of 2008 (so that’s somewhere between July and September, people). Apple is aiming for three million MacBook sales. The two flat-panel manufacturers are the two largest in Taiwan, the report adds.

Apple has filed a patent describing ways to use an iPhone to pay for groceries, a restaurant meal and sundry other wireless ecommerce applications.

The patent discusses over the air downloads of podcasts and a number of specific location-based solutions, such as shopping, groceries or recipe discovery.

“For example, if the merchant is a restaurant, the merchant may provide a menu to the personal media device and the user may place an order on his or her media device by selecting items on the menu,” the patent states.

Additional ideas include purchasing cinema/movie theatre tickets, or information about objects or creatures on display at a museum, art gallery or zoo. The patent even describes ways to locate others – specifically children – should both the guardian and child be carrying “a media device”.

While the filing of such a patent doesn’t mean Apple is definitely about to introduce such services, we recall some whispers the company may be moving to transform iTunes (with its sophisticated micro-payment infrastructure, tied to a credit card) into some kind of virtual wallet.

We also recall that Procter & Gamble, The Clorox Co., Del Monte Corp. Kimberly-Clark, and General Mills Inc., plan a four month test later this year to see if shoppers would be prepared to begin using mobiles to hand over virtual discount coupons for their shopping. 

O2 boss Matthew Key says the 3G iPhone will be unveiled “in the coming weeks”.

Key made the comment when speaking to press and analysts after the announcement of the network’s first-quarter results this morning. He’s the Chairman and Chief Exec of O2 owner, Telefónica Europe, and he said his company would be making an announcement with Apple in the “coming weeks”.

Key declined to say exactly when the announcement would take place, saying, “that’s more of a question for Apple,” while promising a joint announcement. He also confirmed the network to hold a multi-year exclusive agreement with Apple for selling the iPhone in the UK and Ireland.

While O2 declined comment on how many iPhones have been sold so far, the network did add 206,000 new contract customers in the first three months of this year, according to its own financial report, which states: “This was driven by iPhone and strong “traditional handset” connections and excludes connections to O2 UK’s mobile broadband offer, launched in April.”

The company also outperformed the UK market again in the qurter, posting revenue growth of 12.6% for the quarter and  adding 206,000 net contract customers, 2.5 times the figure for the first quarter last year. “Despite a slowdown on the high street, we are currently seeing no evidence of significant change in our customers spend or usage, but continue to monitor behaviour,” O2 added.

Key also commented on the revenue-sharing deal it has with Apple. It has been suggested the deal makes more sense for Apple than for the telco. Declining to enumerate the exact terms of the deal (which some industry insiders say isn’t as good as the deal reached between Apple and Vodafone), Key said: "Clearly I don’t know the economic deals they have done, and I would reiterate we are very happy with deals we have done, which clearly they don’t know the details of either."

iPhone is out of stock across Apple. There’s also limited availability in the UK where only the 16GB model is intermittently available from O2 – and this isn’t an inventory problem, but deliberate execution.

I’m not saying I know this for sure, but it makes sense that with a new model iPhone on the way, Apple is clearing its supply chain to make way for the device. But its a deeper strategy. I suspect (personal opinion, speculation, alert) Apple management have deliberately decided to make the device more or less unavailable in the weeks preceeding the release of the new model.

This makes sense for two reasons: 

First, Apple is stimulating demand for the new device when it ships by making it hard to get hold of the current edition. That move should help ensure “stellar sales” of iPhone v.2 3G within the first few weeks.

Second, Apple’s September 5 2007 decision to slash $200 off the cost of the first generation device saw the company hit with a storm of criticism as angry customers complained they felt ripped-off. These complaints reached such intensity Apple CEO Steve Jobs approved a $100 rebate to iPhone customers to keep the peace.

In an open letter on the matter, he said: “There is always change and improvement, and there is always someone who bought a product before a particular cut-off date and misses the new price or the new operating system or the new whatever. This is life in the technology lane. If you always wait for the next price cut or to buy the new improved model, you’ll never buy any technology product because there is always something better and less expensive on the horizon.”

Well, we don’t know about the expense (though AT&T reportedly plans to offer the next-gen iPhone at a $200 subsidised discount); but we do know the keenly-anticipated ‘phone’s going to be “something better”.

Apple doesn’t want to upset hundreds of customers when it launches the new device, nor does it want to swap out/replace thousands of iPhones purchased in the week or two before the launch.

As such, I think the current lack of availability is deliberately designed to minimize complaints and maximize demand.

Initial reports of iPhone going out of stock emerged early this month. This suggests Apple’s preparing a launch window for June. Given the WWDC keynote’s admitted focus on development for OS X and iPhone,  smart speculation now favours the idea that Apple will introduce the 3G iPhone in late June, along with the iPhone Software 2.0 release in late June. That’s assuming it doesn’t announce the new model in early June, for shipment later that month. 

Apple today confirmed Steve Jobs will lead the WWDC keynote on June 9 in San Francisco.

Jobs will lead a team of Apple execs in the keynote speech, which is still widely expected to be the launch point for the next-generation iPhone.

The company is promising 150 in-depth sessions and labs on Mac and iPhone development, fully exploring the capabilities of the iPhone SDK and the App Store.

Developers can look forward to sessions exploring all the iPhone features, with the company admitting “geographical location technology” to be one of the session segments.

The Multi-Touch interface, Core OS, Service and Media and Cocoa Touch technologies will also be explored at the event.

Mac developer sessions will explore every level of the system, including interface design and implementation, application frameworks, security, localization and networking.

 That Apple’s preparing a global iPhone roll-out and moving away from its present exclusive network strategy looks even clearer this morning, with news of new network deals and the disappearance of preceding iPhone models from the US and UK Apple Store.

Mobile network Singtel this morning made its own iPhone announcement, saying: “SingTel, Bharti Airtel, Globe and Optus today announced that they have signed an agreement with Apple to bring the iPhone to Singapore, India, the Philippines and Australia later this year.”

This news follows Vodafone’s announcement last week that it will introduce iPhone in India and Australia, along with eight other countries.

Singtel kept it brief, promising, “more information will be released at a later date.”

While by no means conclusive evidence of GPS capabilities in the iPhone camera software, the latest builds of the SDK are littered with GPS references.  Whether these are just templates (you can see other camera manufactures included as well) or needed by the 3G iPhone camera software is unknown. 

GPS camera software is used to put location (landmark) metadata into the photo files.  Applications like Flickr, and Google earth use this data to arrange photographs (and videos) spatially based on this information.  For instance, if you snapped a picture in Paris, you could later organize you pictures – perhaps in iPhoto? – by Country/city.  Cool!

We’ll leave the speculation to you.  More screengrabs below.    One month to go…

 Apple’s looking pretty serious at extending its reach in the world’s expanding markets, planning a retail store in Beijing, China and continuing to expand its relationships in India, putting its force behind the launch of an array of 60 ‘iStores’ with Reliance Retail in India.

Reliance Retail today told India’s Economic Times that it plans to launch 60 Apple Premium Reseller stores across the country by 2011.

The company this week launched its fourth iStore in Jaipur. CEO Ajay Baijal said the shop is going to stock the entire range of Apple products for both the professional and consumer segments.

Indian consumers can also look forward to the launch of “up to” 150 ‘Reliance Digital’ mega-stores, offering consumer electronics products, across India in the next two years.

Consumer electronics? Oh yes; As we reported in April, Vodafone will introduce iPhone in India later this year (we suspect September, after current key markets have been served up with the device, and in line with previous reports emanating from the sub-continent). Vodafone confirmed it plans to launch iPhone (v.2.0?) in India this year in a widely reported announcement that emerged this week.

Making a mark on the sub-continent makes pretty good business sense at this stage. India’s gross domestic product (GDP) is expected to achieve around 7.6% growth between 2008/09 and 2012/13. IT sales and services are expected to boom in the country, which has a population of 1,147,995,898. Shamefully, when considering the quantity of cheap consumer goods produced in the country, per capita income works out at $2,700 per capita.

(Oh, and it’s regional…if you think back to last week, when US Ambassador to Pakistan Anne W Patterson introduced another Apple partnership, this time in Lahore, Pakistan. According to a press release, the Ambassador said: “The partnership between Apple and Raffles Systems, representing our two countries, will promote growth and prosperity in Pakistan”. 

 Apple and Google are testing a way to link YouTube with the iTunes Store, offering links to video available for sale on iTunes beside selected YouTube clips.

Apple has been experimenting with strategies to link iTunes up with social networking websites, and offers a referral scheme to those who want to link their sites up with the service.

Early reports suggest the new system’s in testing right now, as the iTunes links are appearing beside only a handful of YouTube clips (such as one from Kanye West), and the move is only visible to US users at this time.

That Google seeks to make revenue from YouTube is well-known, the company admitted as much during its financial results announcement last week. It’s possible the company hopes to generate a little cash by sending sales across to iTunes, under an affiliates agreement.