Commenting on unannounced products? Pinch me!

In a short, but extraordinarily revealing interview with Greg Joswiak, head of iPod and iPhone product marketing, Joswiak gives Extremetech the lowdown on three burning questions about the future of iPhone: cut and paste, GPS driving directions (aka speech synthesis) and office productivity suites (think iWork Touch). MacPredictions is still heady with excitement that three of this blog’s favourite topics could be discussed so openly by such a senior Apple staffer.

In a nutshell, cut and paste is coming, so are GPS driving directions (and therefore, presumably, speech synthesis services) and Jowsiak sees no obstacles for the development of 3rd party office suites, except perhaps the absence of a “cross-application file structure.” Sadly, Extremetech did not apparently get a chance to ask the obvious follow-up questions - when will you introduce a Finder-style file browser, and will Apple produce an iWork suite for iPhone. Nonetheless, in one blog posting, Extremetech have given us more than we often get in an entire keynote. I think I need to go and find somewhere to lie down now.

(link via MacNN)

More surprises in store for 11th? iWork Touch?

All has been quiet on the predictions front for a while now. The truth is, there just hasn’t been much to say, so Mac Predictions hasn’t said anything. In the meantime, this blog did enjoy getting the BBC’s attention with our last post - despite referring to them (with some accuracy) as the “British broadcast monopoly.”

But as the biggest day of the year for Apple approaches - iPhone 3G day - the time has come to post a new prediction. What surprises (if any) does Apple have in store for us this Friday? Here’s what we know to expect:

• iPhone 3G launch
  
• iPhone 2.0 firmware download
  
• App Store
  
• Free Apple Remote application for iPhone or iPod touch to control iTunes playback

This last item was inadvertently revealed by Apple with the developers pre-release version of iTunes 7.7. It’s a great idea - a free app, downloadable from the App Store, for iPhone and iPod Touch, which will presumably allow the user to browse an iTunes library on a remote Mac or PC, using a combination of Bonjour and WiFi. And in combination with Apple’s AirTunes solution for wireless streaming of music to a hi-fi, it may finally complete Apple’s living room audio solution. In terms of the remote interface on the iPhone itself, MacPredictions envisages that this will appear almost identical to the iPhone’s own iPod application - right down to browsing album art in Cover Flow.

Launching a free, high-value App like this is certainly a great way to incentivize users to trial the new App Store, although to be honest, Mac Predictions thinks it would have been more elegant to integrate this functionality into the iPod app itself - perhaps with the option to browse and pair with additional iTunes libraries via a new “Sources” menu in preferences, similar to Apple TV. In the iPod app, a new “Sources” icon would then appear alongside “Songs,” “Artists,” “Albums,” etc. But hey, who are we to challenge Apple on this point. If it must be a separate app, so be it!

...Anyway, what does Apple’s new, free Remote app tell us? Simply this: Apple has surprises up their sleeve for this Friday, and the Remote app may not be the only one. Our bet is that they’ll have more than just free App’s up their sleeves. It seems unlikely that Apple will take a back seat and allow 3rd parties to have all the fun with iPhone app development. That’s hardly been their strategy with the Mac after all. Sure, they bundle free apps with the Mac, such as Mail, Calendar, Safari, etc. But they have plenty of premium apps as well, such as iLife, iWork, Final Cut Studio, Aperture and Logic. Isn’t it likely that they’ll pursue a similar strategy with iPhone?

Why would they not have announced such a plan last month at WWDC? Perhaps because it wouldn’t be very diplomatic to highlight to their community of developers who are just beginning to embrace the iPhone SDK that they’re going to be competing against Apple itself. This blog still believes that the first paid-for apps to see the light of day from Apple will be the mobile for iWork, which we anticipate will be called iWork Touch, and it could be coming as soon as this Friday.

Mobile Me

With recent changes in 10.5.3 making a rebrand for .Mac all but certain, Mac Prediction turns its attention to what that rebrand might entail.

With the anticipated addition to the .Mac package of iPhone consumer push services, Apple’s 2006 registration of the “Mobile Me” trademark is widely suspected to indicate its new name. Of course, it’s not the first time that Apple has rebranded the service - it renamed it from iTools in 2002. Ironically, iTools would have been a more appropriate name, and had they not changed it back then, they probably wouldn’t need to change it again now. It seems that even Apple weren’t anticipating the phenomenal success of its forthcoming mobile business back in 2002.

Whilst “Mobile Me” may initially sound a bit of a clumsy name, so did MacBook Air to many when they first heard it, but the initial scathing remarks from some Apple fans have mellowed over time. With a liberal dose of Apple-gloss, people will get used to Mobile Me as well. On the positive side, Mobile Me gives .Mac a much clearer mission statement - it becomes a package of Internet services to keep you in touch with your digital lifestyle, wherever you go. At home on your Mac, at work on your PC, and on-the-move with your iPhone.

Those three contexts - home, work and on-the-move - bring to mind a recent sneaky change that Apple introduced in their 10.5.1 update. Whilst historically (and somewhat counter-intuitively) shared resources in Mac OS X featured a .Mac globe icon, this changed without explanation in the 10.5.1 release to a “paper dolls” icon of three men holding hands. Whilst this subtle change could simply have been an intelligent enhancement to prevent confusion between file services and .Mac services, in retrospect, it was perhaps indicative of the forthcoming Mobile Me rebrand. In time-honored style, we’ve knocked together a mockup to see how that might look.

Mobile Me - the new name for .Mac

Earlier this month, Mac Predictions speculated that a change was coming to .Mac to link it more tightly with Apple's iPhone product - potentially bundling free .Mac membership to all iPhone subscribers, and selling it as a stand-alone service to support a new sim-free iPhone option.

"Blogging Robots" (via 9 to 5 Mac) has found evidence of plans for a name change to the .Mac service. This is entirely consistent with our previous iPhone bundling prediction, since .Mac would be an odd name for a an iPhone-related product.

We suspect that the newly relaunched Mobile Me (or me.com) service will include all the existing .Mac features (excluding iCards, which is surely past it's sell-by date!), plus:

• Push IMAP e-mail
  
• Push contacts & calendars for iPhone
  
• Visual Voicemail for sim-free iPhones
  
• iDisk for iPhone
  

The search is on - for iPhone 2.0

Who knows what the eagle-eyed people at blargkaboom were searching for when they discovered a magnifying glass icon in the top-right corner of a screen shot used in a slide presented by Phil Schiller during last week's Stevenote. The slide in question (entitled "Push Contacts") appears about 9 minutes and 30 seconds into the presentation.

This neat discovery tells us a couple of things. Firstly, it clearly indicates that at the top of the Contact List in iPhone 2.0, there will be a handy search box. About time. Secondly, it indicates that there are new features in the frame for 2.0 that have not been officially announced by Apple, and that there may be more clues in those lovely high definition video streams that Apple has so kindly provided. Some of these new features will probably also make their way into the Beta release that will be distributed to a select group of enterprise customers shortly. Seems like Spring may shape up to have plenty of Apple rumors after all.

SDK Announcement Summary

Available now:

• Beta iPhone SDK
  
• iPhone Developer Program
  
• iPhone Enterprise Beta Program
  

Available in "late June":

• iPhone 2.0 firmware update (free)
  
• iPod Touch 2.0 firmware update (price TBC)
  
• iTunes App Store
  
• Games, including Sega’s Super Monkey Ball and Electronic Art’s Spore
  

Apple has delivered exactly what they promised, albeit a week later than scheduled. The iPhone SDK is available today for free download from Apple.com (albeit their servers are currently struggling to cope with demand). Nonetheless, some iPhone fans will be disappointed that nothing new has been delivered for the end user today.

So let’s take a look at what today’s announcements reveal about the future of iPhone from the end user’s perspective. Firstly, we now know that that 2.0 firmware will be released in late June – whilst that doesn’t preclude any further incremental updates before June, it certainly makes them less likely.

Here’s what we know we can expect from June’s 2.0 update:

• iTunes App Store – enabling users to wirelessly download and install iPhone apps, which will then presumably be backed up on next sync. It will also be possible to purchase apps via iTunes on a Mac or PC
  
• New icon for iTunes WiFi Store - a small detail, but hey!
  
• PowerPoint attachment support – this is revealed in today’s press release
  
• Mass move and delete messages in Mail – also in today’s press release
  
• VPN support – could come in handy for techies and corporates alike
  
• Microsoft Exchange ActiveSync support – only interesting to companies that have Exchange servers
  

Presumably there will be more to the 2.0 update than that – we’re guessing that Apple is holding back some of the cool stuff for another Stevenote closer to the time. Strange though that during the SDK announcement, when Scott Forstall listed the features of the new “Cocoa Touch” application framework, he made no mention of a “File Picker” (i.e. Finder-style file browser) to go along with the “People Picker” and “Image Picker”. Hopefully this is a top-secret feature that’s been deliberately left out of the SDK beta just to tease us. Hopefully.

Analyst predictions: UBS vs RBC Capital Markets [Updated]

MacPredictions loves to keep a close eye on analysts. It's always amusing to see what they're getting up to - especially when they go head-to-head on the Mac Prediction front. In the ring tonight - UBS versus RBC Capital Markets. What's at stake? The release date for the 3G iPhone.

AppleInsider reports that UBS are predicting that the 3G iPhone will be released this Summer, sporting a new chip solution from Infineon (nice touch with the extra detail there). Whilst MacNN reports that RBC Capital Markets are predicting a delay to the iPhone's launch, due to testing and fine-tuning on partner networks (another nice detail to add credibility). But who is right?

Admittedly, since Apple has not announced the 3G iPhone, it's uncertain what a "delay" may mean in practice. However, if the 3G iPhone does come out this summer, that's one point for UBS, if not, then the honours go to RBC. MacPredictions is keeping a score card - we'll let you know how things develop.

Update:

Look who's just leapt into the ring - it's Citigroup's Richard Gardner, who has apparently just returned from a trip to Taiwan (again with the convincing details) citing sources indicating the launch of a 3G iPhone in Q2 (as reported by Silicon Alley). Since we're already in Apple's 2008 Q2 (their year starts in October), we assume this means calendar quarter Q2 - an even earlier ETA. Who will win this battle of the banks? Mac Predictions can hardly wait. 

“Touch OS X” - Branding Apple’s Handheld OS [Picture]

With the launch of Apple’s iPhone and iPod Touch SDK this week (albeit probably still in Beta), it’s surely time for the company to sort out the branding of its mobile OS. Currently, Apple refers to the system that iPhone and iPod Touch share as “OS X”, (sometimes mistakenly referred to by journalists as “Mac OS X”). And as anyone writing about Apple knows, it’s a real mouthful to keep referring to “iPhone and iPod Touch”. The problem will presumably only get worse as Apple releases even more products running their handheld OS – “iPhone, iPhone Nano, iPod Touch and iTablet” will hardly trip off the tongue. And software developers will need a snappy name to describe what their apps run on – not just a list of devices.

It therefore seems inescapable that Apple will need to review its mobile branding strategy, and our money is on “Touch OS X”. It seems like there’s no better time to make the switch than at this week’s forthcoming SDK Keynote. As usual, the mockups on this page are just for fun, and MacPredictions has no inside sources.

iPhone launch in Ireland indicates continuation of high-margin strategy

MacPredictions has been arguing for some time that Apple's high margin on iPhone is limiting its potential market penetration, and that Apple will learn from experiences in the UK, and price the iPhone more keenly as it launches in other markets.

It appears that we were a bit off on that prediction. Ireland's Independent has already raised concerns about the high pricing of the Irish iPhone, which is even more expensive that the UK version. So it seems that Apple are continuing to favour high margins over high volume - at least for the time being. The company seems unconcerned by the harm that this kind of media attention could do to its brand. 

Given Apple's recent response to the European Commission's intervention on iTunes pricing, we wonder whether the same principle applies to mobile handsets as well. Time will tell.

More clues on emerging themes from Apple

Two bits of news yesterday which seem to reinforce what MacPredictions has been arguing for the past few weeks. Firstly, AppleInsider reports on a talk from Steve Cook, Apple's chief operating officer, at the Goldman Sachs Investment Symposium. According to AppleInsider, Cook referred to Apple's relationship with AT&T saying, "we're not married to any business model. What we're married to is shipping the best phones in the world." Implying that Apple might be open to offering contract-free or "SIM-free" iPhones in the future.

The second clue is MacNN reporting on Apple's new iPod Touch TV ad, which premiered on US prime time TV last night. Whilst this is hardly earth-shattering news, it is indicative of Apple's continuing redirection in focus towards the Touch.

If MacPredictions was working for Apple's marketing team, we'd be pushing for the unification of the iPod Touch and iPhone lines under a single moniker, with a premium sim-free iPhone option, a discounted network-locked iPhone, and an affordable phone-free option (the Touch). Apple could then run ads promoting the entire line, and avoid the confusion of marketing iPod Touch against iPhone. But what to call it... hmmm...

SDK = Strangely Dull Keynote

It’s ironic that whilst Apple normally uses its invitation teasers to build excitement and speculation in the run up to a Stevenote, today’s SDK invitation is designed to do the opposite. First, it makes clear that the focus will be on enterprise software – which means corporate messaging, VPNs and so on. Hardly exciting fodder for most iPhone fans. Second, the roadmap clearly shows an SDK announcement followed by a software update. Indeed, the whole use of the term roadmap seems to be in the special “peace process” sense, meaning don’t get your hopes up that anything will happen anytime soon.

So it seems likely that all we’ll get next week is a demo of forthcoming enterprise technology (e.g. Blackberry/Notes/Exchange/VPN support), and a kit for developers with a promise of 3rd party software sales via iTunes this summer. Ho-hum. Nothing to see here, move along!

Apple Store Watch – iPod Touch is hot, iPhone is not

Here’s a geeky idea for an occasional feature on MacPredictions. This is a rough floor layout of the Apple Store on Regent Street, London UK (as of 23/02/08). You can tell the products that Apple wants to push, since they’re positioned towards the front of the store (indicated in red). You can see the products that customers are interested, based on the relative crowds in each product area (blue circles). There’s always a bias towards Macs, since many people just mill around the store checking their e-mail. Nonetheless, it’s clear right now that Apple’s pushing the Macbook Air, and shoppers seem interested. Apple’s also pushing the iPod Touch in preference to the iPhone, which is now bizarrely tucked at the back of the store. It seems both Apple and shoppers are in agreement that iPod Touch is hotter than iPhone right now. See previous post for a possible solution!

Could Apple resort to a contract-free iPhone?

Recent press reports indicate that Apple has three problems with its iPhone strategy:

• Lower than projected handset sales
• Lower than anticipated income from network revenue-shares
• Slower than expected global rollout

All three problems arise from one root cause – the networks. Sales are presumably lower than expected because the barrier imposed by requiring users to switch networks and sign new, expensive contracts is proving to be tougher to overcome than Apple had hoped. Income from network revenue-shares is lower than anticipated because of the large minority of unlocked handsets. The global rollout is slower than expected because Apple appears unable to extract the same revenue-share terms from other networks that they negotiated with AT&T.

Ironically, the deal that Apple struck with AT&T, which seemed so favourable to Apple at the time, is turning out to be more in the network’s favour. Whilst Apple succeeded in extracting an unprecedented agreement to share the networks’ revenue, this was at the costs of exclusivity to the network. And it’s precisely this exclusivity that is now limiting Apple’s options to promote sales. From AT&T’s perspective, however, the deal presumably still makes sense, because it’s helping to attract new customers to the network.

However, given that the success of iPhone is mission critical to Apple, Mac Predictions anticipates that the company will be willing to pay a hefty price to renegotiate with the networks. The result could be a new contract-free iPhone, sold at a small premium, alongside the locked iPhone.

Steve Jobs' February 2008 SDK Keynote [Part 2]

Time is running out for Apple to organize a February keynote - but since they haven't announced a delay in the SDK, we're assuming invitations will go out on Monday for an event on Thursday or Friday next week. We can but hope! In the meantime - enjoy this fantasy transcript, a continuation from the previous post.

Of course, Apple has got a lot of experience with office productivity software. Our iWork package has been hugely popular on the Mac. So it’s simple, right? We just port iWork to the iPhone… Wrong! Because it turns out that word processing on a mobile device is an entirely different kind of application to word processing on a desktop. And you can’t make a business presentation on a mobile phone screen – even a beautiful high-density widescreen like the one we put in the iPhone.

So what do people want to do with documents, spreadsheets and presentations on their phone? Well the main thing is that they want to view their documents – and you already can do that on an iPhone because we’ve got this great feature built right into our Mail application that let’s you do just that. It’s built on the same rock-solid technology we use for QuickLook in Leopard. And for many users, that’s all they need. Which is great.

But then, what if I want to do more than read the document? Maybe I’ve got ten minutes to spare on my way to a meeting, and so I take the opportunity to read through a document. But I have changes that I want to share with my colleagues, and I want to track those changes. It’s amazing, but as far as we know, there is no mobile software out there right now that let’s you track changes on Word documents. Now we couldn’t believe that, so we spent a lot of time looking, but we really couldn’t find any.

The next thing I might want to do is to make some comments on that document. Again, there isn’t much mobile software out there that allows you to do this, and there’s certainly no mobile software out there that makes it easy. So that’s exactly what we’ve done. We started from scratch to build a whole new kind of application – a mobile word processor that makes it really easy to read through documents, to track changes and to make comments. And I’d like to show it to you now. [Demo]

…so that’s Pages. But what about presentations?

We looked at the mobile presentation software out there, and a lot of it seems to be focused on letting you edit presentations. But we don’t think that’s what people want to do. Working with graphics isn’t easy on a handheld device. We just don’t think that people want to design this stuff on their phones. So what do people want to do with presentations on their phones? Simple – they want to present them. And there’s no slicker way of making a presentation than with Keynote.

So, we launched our Keynote application back in 2003, and the reaction has been huge. You see Keynote does the same thing as other presentation packages out there [show’s icon of PowerPoint on screen]. The difference is that Keynote does it a whole lot better. It really takes advantage of the amazing graphics capabilities in Mac OS X to deliver incredibly slick and impactful presentations. Well, the great news is that the same graphics technologies that Mac OS X ships with are also built right into iPhone. So we can deliver almost all of the amazing visual impact of Keynote from something as small and compact as an iPhone. It’s truly amazing. Of course, you’re not limited to viewing your presentations on the iPhone’s built in screen. You can plug in our Apple Component AV cable, and hook it right up to your TV. And today, we’re introducing a new iPhone compatible VGA cable, so that you can hook up your iPhone to any VGA display – it means you can leave you Mac behind, and still take your Keynote presentations with you on the road. And the great thing is that your iPhone turns into this wonderful remote. You see, we’ve made our VGA cable really thin and flexible, so that it doesn’t get in the way when you’re presenting. On your iPhone screen you have a big back and next button… you have speaker notes… you can even check out the next or previous slides. I don’t know any other presentation remote that lets you do all that.

So Keynote on iPhone really is a great new way to take presentations with you on the road, and you can even use it with PowerPoint presentations – you’ll just have to do without Keynote’s amazing graphics.

Then, of course, there’s Numbers. Now, not everybody loves number crunching – I guess only an accountant can really love a spreadsheet. But of course there are numbers that we all like to keep track of [shows chart tracking iTunes sales on an iPhone screen, to laughs from the audience]. Anyone in business has numbers that they need to have at their fingertips, and iWork Touch does exactly that. It literally puts your numbers at your fingers. You see it turns out that our MultiTouch interface is really great for working with spreadsheets. Scrolling across big spreadsheets is a breeze – and if you double tap on a cell, you can adjust numeric values with this neat slider, without even having to use the keyboard. Plus of course, there are all these great 3D graphs and charts. So that’s Numbers on iPhone.

So we have these three great applications. What do they all have in common? Well they’re all redesigned from the ground up as mobile applications – providing you with the stuff you need to carry on doing your job when you’re on the road. They all take advantage of our amazing MultiTouch user interface. They all work with our hugely popular iWork suite for Mac, and of course, Microsoft Office as well, including Office 2007 & 2008 for Mac.

So as you can see – with our new iWork Touch suite – Pages, Keynote and Numbers, we’ve re-invented mobile business software. And after today, I don’t think anyone will want to settle for anything less. But there are a couple more thing that all these applications need. [Copy & Paste appears in words on screen to another round of applause]. In fact it’s not just for iWork – as we’re getting more 3rd party apps, we’re going to need copy and paste system-wide. But how?

Well we already have this great magnifying glass that helps you to position your insertion point. Well now we’ve made it so that if you hold down one finger as you move the magnifying glass, it let’s you highlight text. They you can simply tap the highlighted text to bring up a context menu that gives you some options – you can choose cut; copy; make note; send as e-mail or send as text. Then when you want to paste, you just use the magnifying glass again to position the insertion point, and then tap the insertion point to paste the text. It’s that simple. Let me show you [Demo].

So that’s how we’ve done copy and paste. And we know a lot of users have been wanting this for a while now. Well it’s so simple to use, we think you’re going to find it was worth the wait.

But there is one more thing that we’re going to need for all these amazing new apps. On the Mac, we call if the “Finder” [Finder icon appears on screen]. It’s what we use to browse documents. And in Leopard, we introduced CoverFlow, so you can browser through these gorgeous large thumbnails of your documents. We’ll we thought – wouldn’t it be great to have that on your iPhone too, so that you can browse through documents using CoverFlow, just like you browse through your music. It’s amazing. This is a real, desktop class file browser, right here on your iPhone. And it couldn’t be simpler to use. Here’s how it works. We’ve got this new icon in iTunes, called “Documents” – it appears under your iPhone icon. You can either drag your documents straight to it, or you can set up a folder on your Mac or Windows PC to sync right onto your iPhone. But that’s not the only way you can send and receive files. You can…

• Sync with a folder on your Mac or PC via iTunes
• Save attachments from e-mail on iPhone
• Send and Receive files via Bluetooth from any compatible device
• .Mac integration, so you can access you iDisk directly from your iPhone via WiFi

Of course, you’ve got plenty of storage – whether you have the 8GB iPhone, or the new 16GB model that we launched last month. This is way more built-in storage than most smart phones come with, so there’s no need to fiddle around with tiny removable media – everything fits neatly into your iPhone.

So as we promised at the end of last year, today we’re launching our SDK. Although we’re admittedly pushing it a little for “February” – fortunately this year is a leap year! [Laughs from audience]. But it’s actually a whole lot more than just an SDK that we’re introducing today:

• iPhone Games
• Buy Software from iTunes Store
• Finder for iPhone with CoverFlow
• Bluetooth File Exchange
• Copy and Paste
• New iPhone VGA Cable support

We already had the world’s most advanced mobile wireless platform – now we’re taking the next leap – we’re calling it “iPhone 2.0 Software Update”. It’s available today. It’s free of charge to our iPhone customers, and it’s also free to all our iPod Touch customers who have purchased the January Software Update. [More applause]. Plus, once you've installed the update, you can buy iWork Touch from the iTunes store for $79.

Well, that’s all we have for you today – we’ve been working really hard on this over the past twelve months. The entire team have been putting in a monumental effort to make this update something truly special, and I think you’ll agree, they’ve done a fantastic job. Thank you.

apple

Steve Jobs' February 2008 SDK Keynote

The following is just creative writing for fun - it is entirely speculation based upon publicly available information.

So we have this fantastic new SDK for our touch platform. It means we can build more great apps. But what apps should we build? After all, the iPhone and iPod Touch already do so much.

Well the first question we asked was “do people really want to buy more apps?” It seems like most smart phone users decide to just stick with the software their phone comes with. And that’s no surprise when you see what’s involved in buying and installing software on most smart phones. I don’t want to name any names, but you know what I mean. It’s not a great experience today.

But then in January, we released a software update for our iPod Touch customers, and it turns out that the response has been huge. We were absolutely staggered by the numbers on this – in the first week after it was released, over XX% of iPod Touch owners had bought the upgrade. That’s an amazing number.

So what does this tell us? It tells us that people will buy software for their mobile devices, as long as we get three things right:

• Make it easy – buying mobile software right now is just too hard
• Make it good – let’s be honest, the downloadable mobile software on the market today just isn’t great
• Make it affordable – people don’t want to pay desktop prices for mobile software

So if people want to buy mobile software, what kind of software do they want to buy? Well let’s take a look at what kinds of software you get on a desktop Mac or PC:

• Multimedia already have the iPod built in
• Calendars already have a great calendar
• Communication already have world’s best mobile phone and desktop class e-mail
• Creative Professionals people don’t want to design or make music on their mobile
• Utilities don’t need utilities, iPhone works beautifully just as it is
• Education phones are not really for the classroom
• Games
• Business Productivity

That just leaves two areas – games and business. Well we’ve been selling games on our classic iPods for years now, and it turns out they’re really popular. But not with hard-core gamers. You know, we don’t have people playing World of Warcraft on their iPods. No. These games are different – they’re for mere mortals, and they’re fun. And one of our biggest games on the 5th generation iPod is from a company called PopCap, and it’s called Zuma. Well we gave PopCap an advanced copy of our SDK, and they’ve been busily working on developing some great games of our MultiTouch devices, including Zuma. These games are not simple ports – PopCap have really got into the whole touch interface thing, and it turns out that Zuma is even better with a MultiTouch display. And at this point, I’m delighted to introduce PopCap’s CEO, David Roberts who’s here to tell us all about it…

…Thanks David, that really was something special. So that’s games, and we think you’re really going to have a lot of fun with them. But what about Business? Do business users want to use an iPhone? Isn’t it really for fun stuff like music? Well in fact, ever since we launched the iPhone, AT&T, O2, T-Mobile and Orange have been inundated by requests for special business plans. Turns out most business users were no more impressed with the competitors’ offerings that we were. That’s why in January both AT&T in the US, and O2 in the UK announced new business plans. Because business users also want the full internet experience and desktop class e-mail on their mobile. But what else do business users want? Well what they really want is this… [shows graphic of spreadsheet, document and presentation icons moving onto an iPhone display, to a round of applause] That’s why today I’m delighted to announce a brand new Apple product, and the first piece of iPhone software that we’re going to make available on the iTunes store. iWork Touch. Because we felt this was a piece of software that was so important to the iPhone, that we wanted to do it ourselves, to make sure that we get it right.

Of course, Apple has got a lot of experience with office productivity software. Our iWork package has been hugely popular on the Mac. So it’s simple, right? We just port iWork to the iPhone… Wrong! Because Word processing on a mobile device is an entirely different kind of application to word processing on a desktop…

To be continued – Part Two this weekend.

Apple to get the SDK ball rolling with “iWork Touch”? [Updated]

Here’s what we know:

• iPhone SDK launches some time this month (this is official)
• Installing 3rd party apps will require digital signatures (Engadget)
• Firmware is likely to be an incremental update to 1.1.4, so expect evolution, not revolution (Macrumors)
• 3rd Party Software will be distributed via iTunes (Macrumors)
• The recently released update 1.1.3 provides a means for 3rd party applications to appear alongside the default apps on the start screen
• Apple has recently extended its trademark registration to cover games (Trademork)

On this basis, we make the following four predictions (just guesswork - no insider info!)

1. iWork Touch
To get the ball rolling with selling applications on the iTunes Store, Mac Predictions anticipates that Apple will launch a mobile version of it’s iWork productivity app, enabling users to view and (to a limited extent) edit documents, spreadsheets and presentations (in iWork or Office format) on their phones. This will be paid-for software, and Apple may add extra features for tight integration with the desktop version of iWork.

2. “Documents” File browser
Since many 3rd party apps will require user access to part of the file system to work with documents, a file browser for iPhone is a likely addition as part of the 1.1.4 update. Whilst Mac Predictions has previously guessed that this app would be called “Finder,” with a Mac-style blue face icon, we’re now suspecting that it will make more sense to call it “Documents” since it’s functionality will be much more limited than the Mac’s Finder app.

3. Document syncing
This would probably involve adding a “Documents” menu to iTunes - users would probably have two options - to drag documents directly into the iTunes window, or to select a folder on your Mac or PC for syncing. iTunes would warn if any file extensions are not supported by installed applications

4. Copy & paste
This feature would be required for many 3rd party apps, and so will probably have to make its debut with the SDK

Update:

It appears that the MacRumors story referenced in this article may be a fake. This makes it less certain that the next update will be 1.1.4 - maybe 2.0 after all?

Psst, don't tell anyone, but here's the 16GB model

Apple is not a company well known for understatement. Hence every new Mac has to be hailed as "the most powerful Mac we've ever produced", and every year's iPod line up is described as "our best ever iPod line" - statements so inane that they surely go without saying. Imagine if Apple announced that this year's iPods are not quite as good as last year's.

Funny then, that the new 16GB iPhone was launched today with such a distinct lack of fanfare. One might almost describe its launch as furtive.

Could it be that the backlash from last year's iPhone price drop has got the company so spooked that they're fearful of prompting more ire with something so bold as a press release for the new 16GB model?

Whatever the reason, the new model should certainly help to inject a bit of sizzle into iPhone's sales. It's just a shame that Apple doesn't dare to shout about it!

Hate to say “I told you so”... alright...

In December last year, Mac Predictions reported on lower than expected demand for iPhone in the UK - speculating that this was due to a combination of high upfront handset costs combined with expensive tariffs (in the UK, “plans” are called “tariffs”).

Given the negative reaction from US consumers when Apple substantially dropped the handset price there, it seemed unlikely that they would do something similar in the UK. Nonetheless, Mac Predictions speculated that Apple would have to do something to stimulate sales.

Sure enough, this week, O2, Apple’s UK mobile network partner, announced substantial drops in the prices of their tariffs, plus greater flexibility, with the addition of “bolt on” options. Whilst the iPhone still has it’s own “exclusive” tariffs, they are at least now more comparable with 02’s standard 18 month contracts.

This is a neat strategy, making the iPhone more affordable without provoking the ire of early adopters by dropping the handset price. Instead, early adopters are rewarded with access to the new, cheaper, more flexible tariff options. Mac Predictions suspects that this price drop has been largely funded out of Apple’s commission on 02 revenue, since this is the only obvious reason why iPhone tariffs were more expensive than standard 02 tariffs in the first place.

Apple will be hoping that the newly competitive tariffs will revive UK iPhone sales. The risk is that it’s too little, too late, and that they have now missed their window to gain early sales momentum during the launch campaign and press coverage. This experience in the UK market will likely discourage Apple from pursuing such high-price strategies at launch in other markets, and will likely strengthen the mobile networks’ negotiating position going forward.

Are Apple shifting focus from iPhone to iPod Touch?

A few weeks ago, Mac Predictions speculated that iPhone wasn’t doing so well in the UK. That was based upon anecdotal observations at the time. Since then, more tangible evidence has emerged that iPhone sales are not meeting expectations. Admittedly, falling short of target by 10k isn’t the end of the world, but the discrepancy between Apple’s figures for units sold and AT&T’s numbers seems to indicate mounting channel inventory - another bad sign.

It feels counterintuitive that a such a popular device is not selling as well as expected. How can this be? The answer probably lies in Apple’s pricing model - by preventing the networks from subsidizing the handset, whilst taking a share of the networks' billing revenue, Apple is effectively double-dipping. The result is both a high up-front cost for the handset itself, and an expensive ongoing cost for the contract. Apple have chosen higher margins over higher unit sales - an unusual strategy for a company trying to launch an entirely new platform.

More typically, companies launching new platforms will initially sell the product at a loss, in order to gain market penetration. Then, as the component costs come down over time, their margins increase, and, providing that the platform is a success, they ultimately are rewarded with higher volume and higher margins in the longer term. By pursuing a high margin at the beginning of the platform’s life cycle, Apple may be compromising the iPhone’s potential to achieve critical mass.

As any economist will tell you, where supply is unlimited and demand is elastic, a business should set price to marginal cost in order to maximize sales. In other words if lower prices will result in more sales, and Apple has plenty of iPhones to sell, they should price each iPhone at the cost to them of making the next one. As it stands, supply does not appear to be limited (since channel inventory seems to be on the increase) and elasticity must surely be there (after all, iPhone is the most hyped handset in history). This leaves Mac Predictions suspecting that Apple is missing a trick in not going for all-out market domination of their new platform. By allowing their rate of sales to be artificially slow, they’re giving their competitors precious time to copy the iPhone’s innovations and catch up.

There is, of course, one problem with all this. Apple appears to have misjudged the market, believing that they could start off at a high price only to drop it later if it proved to be deterring sales. Sounds good in theory, but this didn’t take into account the PR damage that could be inflicted by vocal early adopters who felt betrayed. After the negative response to Apple’s previous price drop, their room for maneuver is limited. In the light of this, it’s unfortunate that Apple chose to price the UK iPhone at a 10% premium over the newly dropped US price. (The difference is even greater when you factor in the UK’s sales tax).

Apple seems pretty sanguine about the situation - willing, perhaps, to ride-out the lower than expected sales in the short term, in anticipation of the opportunity to drop prices and introduce a 16GB model when the iPhone reaches it’s one year anniversary this summer. After a year, early adopters’ moans will be easier to ignore. In the meantime, press coverage arising from the launch of 3rd party apps in February should add a bit of short-term sales sizzle.

Where iPhone sales did not meet expectations, iPod Touch sales appear to have exceeded them. So what started out as something of a baby brother to iPhone has now become the “first Mainstream WiFi Mobile Platform”. Or so Peter Oppenheimer, Apple’s CFO, dubbed it in a recent Quarterly Earnings Call. What’s all the more remarkable, is that Oppenheimer argued that iPod Touch is more than “just a music and video player”. This is a very significant shift, since in the past, Steve Jobs has stressed that whatever new features they add to iPod, it’s really all about the music. Also indicative of a shift in direction for iPod Touch, is the introduction of the new “January Software Upgrade”, which adds key applications previously only available to iPhone users, such as Mail and Maps. Since early adopter moaning and contractual commitments to the networks are limiting Apple’s room for maneuver in aggressive iPhone pricing, could they now be focusing on iPod Touch instead as their vehicle for early market domination? If so, we can expect to see iPod Touch increasingly positioned as a competitor to iPhone - maybe even with its own iChat application. Time will tell.

MacRumors posts photos of iPhone 1.1.3 software update from GearLive

Photos recently linked to by MacRumors show what GearLive claim to be the features of a forthcoming iPhone software update. It's possible that these images are just fakes, but there's something about them that seems convincing. Whilst the update is far less substantial than I had predicted, it does include a couple of previously anticipated features:

1. Customise home screen
   
2. Send SMS to multiple recipients

...plus three features that few had anticipated:

1. "Locate Me" feature in maps - presumably using GSM triangulation rather than GPS
   
2. Add Safari Bookmarks to Home Screen
   
3. Multiple Home Screens (similar concept to Spaces in Mac OS 10.5)

It's these last two features which are most surprising. Mixing bookmarks with applications on the home screen feels a little awkward. Plus, bookmarks seems the only reason for introducing multiple Home Screens - otherwise all the icons would fit onto a single screen anyway. This is perhaps Apple's approach to make room for 3rd party applications, but I guess I'd be surprised if Apple allows 3rd party apps to sit along site their own apps with equal priority in the user interface.

So the question is - are these images fakes? In Apple's 2007 Q2 analyst conference call, COO Peter Oppenheimer said: “we plan to build on this incredible foundation by continuing to develop new software features as well as entirely new applications, and incorporate them into the iPhone. And since iPhone customers will likely be our best advocates for the product, we want to get them many of these new additional features and applications at no additional charge as they become available.” Given this stated intent, it would be a little disappointing if this is really all that Apple plans to add, a full six months after the product's US launch, and a third of the way into initial purchasers' 18 month contracts. This leads me to suspect that the images may be fakes. If they are fakes, however, they are very good ones indeed. Time will tell...

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