Windows users are refusing to “upgrade” to Vista.

The latest evidence that Vista has fallen flat on its pretty Aero face has arrived in an announcement from Microsoft that it will continue selling Windows XP due to customer demand for the older OS. Microsoft had planned to stop selling XP as of January 31, but now will sell it until the end of June.

Earlier this year some PC manufacturers, most notably Dell, started offering XP as an option on many of its new PCs, also because of customer demand. That so many people would prefer a six-year-old operating system over Microsoft’s latest and greatest speaks volumes about how badly the folks at Redmond botched Vista. It’s a far cry from the overwhelmingly enthusiastic reaction that greeted Windows 95 a dozen years ago.

At this time last year most industry analysts were predicting that the years-delayed release of Vista (which finally went on sale Jan. 30 of this year) would hurt Mac sales. As it turned out, the opposite happened. The first two quarters of 2007 saw Macs selling at a record pace, with year-over year increases of 30 percent.

Over the past week analysts who follow Apple have been predicting another record-breaking quarter for the Mac when the company reports its earnings for the quarter ending this week. Most expect Mac sales to exceed 2 million units, far exceeding last quarter’s record 1.76 million units.

Instead of stimulating demand for PCs as have previous versions of Windows, Vista has inspired consumers to seek alternatives, and many are looking hard at the Mac. Apple’s adoption of Intel chips in 2006, coupled with the wildly successful iPod and the endless hype over the iPhone (keeping the Apple brand at the forefront of consumers’ minds) have created ideal conditions for large-scale switching.

Even some well-known long-time advocates of Windows such as Chris Pirillo have bailed on Vista. Not only has Pirillo reverted to XP on his PC, he’s been toying with Mac OS X for months. Here’s what he had to say on his Web site just today:

Do I recommend Windows Vista? Not a snowball’s chance in………..I’m waiting on Apple to release Mac OS X Leopard. As far as I’m concerned at this point, Microsoft is taking a huge hit. The future of Windows, in my opinion, is inside a Virtual Machine or Bootcamp on a Mac.

With Mac OS X 10.5 Leopard due out next month, the public stature of the Mac stands to benefit tremendously from the inevitable Vista vs. Leopard comparisons. Combine that with the height of Christmas shopping season, and we could easily see Mac sales set yet another record next quarter.

Who said the OS wars were over?

Posted by David Zeiler at 4:04 PM | Permalink | Comments (5)
                    

After the one-two punch of announcements of iPhone availability in the U.K. and Germany last week, every Apple enthusiast fully expected Steve Jobs to make a public announcement at this week’s Apple Expo in Paris of a deal with French cellphone provider Orange. He did not.

It’s crazy. Last Friday Didier Lombard, chief executive of France Télécom (which owns Orange) told a reporter a trade show in Vietnam that Orange had made a deal with Apple, which many media outlets reported. But Apple never said a word.

The Apple Expo was a perfect setting for such an announcement – it’s France’s version of Macworld San Francisco and draws tens of thousands of people. The event runs through tomorrow, but Apple has nothing on the schedule relating to the iPhone. The devices aren’t even on display at Apple’s booth in the exhibit hall.

This curiosity has touched off all sorts of speculation, from Apple holding a grudge over last year’s iPod law requiring iTunes downloads to be “interoperable” with competing devices to questions about the health of Steve Jobs. Some think Jobs is punishing Lombard for speaking out of turn. He has a history of getting very ticked at partners who announce cooperative ventures before Apple is ready (see graphics board maker ATI’s July 2000 gaffe).

The explanation probably is nothing so dramatic – in all likelihood details of the deal are still being worked out – but for Apple to let such an obvious PR opportunity slip by is completely out of character. You’d think that Jobs would have made sure the ink was dry on all three European deals before he hopped on that plane to London.

Then again, perhaps the two parties have reached an agreement but Jobs wanted to wait a few weeks before announcing it in order to gin up more free publicity for the iPhone after the current chatter has died down.

With Apple, you never know.

UPDATE: Mystery solved. The French magazine Challenges has reported that the Apple-Orange deal is hung up on the size of the commission payments that the cellphone operator would pay Apple. The magazine says Apple wants more than one third of each subscription fee. If the two companies can't resolve their differences by next week, Orange may not be selling the iPhone before Christmas.

Posted by David Zeiler at 12:27 PM | Permalink | Comments (4)
                    

Finally, the iTunes Store has a worthy opponent. When the Amazon MP3 store opened its digital doors yesterday, music consumers found a lot to like, including things superior to what iTunes offers. Amazon falls short of iTunes in other ways, so this news does not necessarily mean the iTunes Store rapidly will forfeit its dominant position in the music download market. But it is a wake-up call.

First, let’s look at where Amazon beats iTunes. By far Amazon MP3’s biggest draw is that all the songs it sells are unprotected (free of digital rights management coding) MP3s, which means they will play on any portable digital music player. This could well be the biggest nail yet in DRM’s coffin.

The iTunes Store does sell songs from EMI in an unprotected format, but they cost $1.29. Which brings us to Amazon’s next advantage: variable pricing, with many songs priced at 89 cents. Not only is that 40 cents lower than iTunes’ DRM-free offerings, it’s 10 cents less than iTunes’ regular price. And Amazon’s songs are in a higher-quality 256 kbps bitrate. DRM-encoded songs on iTunes use the lower 128 bitrate, although the DRM-free songs are 256 kbps.

Amazon also gets points for being Mac-friendly (although it requires Mac OS X 10.4 Tiger). Most music download services other than iTunes force customers to use Windows. Amazon offers a helper application that resides on your Mac and activates when you click to download music from the Amazon MP3 site. (See screenshot below).

Although I still prefer iTunes’ site design, finding and downloading music on Amazon MP3 is straightforward and easy. If you already have an Amazon account and are logged in, the download automatically is charged to the credit card registered to your account. The songs download to an “Amazon MP3” folder that the helper app creates inside your user’s Music folder, but automatically get copied into your iTunes library as well, album cover art and all. (Although I’m not sure I want two copies of every song on my hard drive.)

I’ve been reading a lot of articles in the past day that cite the above advantages and essentially declare the iTunes Store dead meat. Why wouldn’t everyone drop the iTunes Store and buy their music exclusively from Amazon from now on?

The biggest reason right now is that Amazon has a much smaller selection than iTunes – 2.3 million songs versus iTunes’ 6 million-plus. Only two of the Big Four music companies are signed up with Amazon right now, EMI and Universal. That leaves out all the artists on the Sony and Warner labels. You can’t buy a song from Amazon if they don’t offer it, no matter how many other advantages the service has.

Another reason Amazon won’t obliterate iTunes any time soon is that the service for now is available only in the United States.

It stands to reason that the Amazon service will continue to improve, and that Sony and Warner will hop on board when they see the juicy sales figures for EMI and Universal. But one would expect Apple to recognize the need to respond to bona fide competition. Customers – even Mac users – will flock to whoever offers the best service with the best prices.

That means Steve Jobs will need to reconsider his position on variable pricing. He will at some point have to upgrade the bitrate of all of iTunes’ offerings to 256 kbps. And the DRM will have to go, too.

Apple’s problem is that the record companies want the competition to succeed to break iTunes dominance – a 75 percent market share. So they may not be willing to give Apple the same terms as they have Amazon or other competitors. Jobs will need to call upon all of is formidable negotiating skills to keep iTunes in the game.

Most of what Apple needs to do should not be that big of a deal. Remember, Apple only put the DRM on its music in the first place because the record companies refused to allow Apple to sell any music without it. And iTunes already offers the DRM songs in higher bitrates.

But this much is clear: if Apple ignores the challenge posed by Amazon MP3, the iTunes Store will suffer. It figures to lose some market share to Amazon anyway, but how much is up to Apple.

All that said, music consumers will win no matter how the battle between Apple and Amazon plays out. We’ll keep getting higher quality downloads for less money and with no DRM restrictions. Hallelujah.

Posted by David Zeiler at 3:32 PM | Permalink | Comments (10)
                    

You mess with your iPhone, you void your warranty.

That’s the blunt message Apple sent to the iPhone hacking community in a statement it issued yesterday. Many had wondered when or if Apple would retaliate against the widespread unlocking schemes and other iPhone hacks that have emerged over the past two months on the Internet.

Here’s what Apple had to say:

Apple has discovered that many of the unauthorized iPhone unlocking programs available on the Internet cause irreparable damage to the iPhone's software, which will likely result in the modified iPhone becoming permanently inoperable when a future Apple-supplied iPhone software update is installed. Apple plans to release the next iPhone software update, containing many new features including the iTunes Wi-Fi Music Store (www.itunes.com), later this week. Apple strongly discourages users from installing unauthorized unlocking programs on their iPhones. Users who make unauthorized modifications to the software on their iPhone violate their iPhone software license agreement and void their warranty. The permanent inability to use an iPhone due to installing unlocking software is not covered under the iPhone's warranty.

While I think Apple is stretching it by describing software damage as “irreparable” – it’s rare that you can’t simply reinstall software on an otherwise undamaged piece of hardware – I believe the company when it says the upcoming software update is incompatible with many of the hacks. And Apple in no way wants to be in the business of ensuring that every screwball hack will work on the iPhone as it continues to update and enhance both the hardware and the software. (I’d like to point out here that I’m not equating third-party software designed to run on the iPhone with hacks that modify the built-in software, hardware or firmware. I believe Apple should re-think opening the iPhone up to third party apps.)

Some folks on Apple’s iPhone support forum questioned Apple’s motives, wondering if AT&T was pressuring Apple to crack down on the unlocking software. Every time someone unlocks an iPhone, AT&T loses a customer as well as the revenue from that customer. Nevertheless, I don’t think Apple needed a push from AT&T. It has plenty of its own reasons for playing hardball with the hackers.

Apple has an almost psychotic need to control every aspect of its products. While it can’t prevent people from making unauthorized changes, it doesn’t have to support them. It never has and never will. This policy applies to everything the company makes. For example, among the many things my MacBook warranty does not cover is “a product or part that has been modified to significantly alter functionality or capability without the written permission of Apple.”

I understand that people want functionality that Apple has not provided. That’s why the hacks have proven so popular. History tells us that eventually Apple will implement some of the hacks into future versions of the iPhone. But in the meantime Apple needed to do something dramatic to show it wasn’t tacitly condoning the hacks by inaction.

As the hacks have spread and become easier to implement, Apple must have worried more and more people would feel it was OK to do it. Recognizing that the iPhone was turning into a DRM-like situation, in which hackers would invariably break whatever locks Apple could devise, the company saw the need to adopt a different strategy. By making a public pronouncement on the evils of hacking the iPhone, Apple is seeking to shield itself of all consequences while frightening most iPhone owners from ever trying it in the first place.

Apple also wanted to fire a preemptive strike against a PR disaster in which an iPhone software update – such as the one due out this week – would “brick” thousands of hacked iPhones. Having just soothed the fury over the unexpectedly rapid $200 price drop, Apple would prefer not to have its retail stores filled with crowds of even angrier iPhone owners waving (or hurling) their useless devices at the heads of hapless Mac Geniuses.

Now Apple can say, “You were warned.” People who end up with a dead iPhone as a result of running the update on a hacked unit will have themselves to blame. Apple’s statement has preemptively drained much of the venom from the inevitable complaints that will arise from bricked iPhones.

Some may object to the severity of Apple’s policy, but the company has little choice. Hacks are risky. That’s why they’re called “hacks.” Apple simply refuses to share that risk with anyone who chooses to hack his iPhone. Makes sense to me.

What do you think?

Posted by David Zeiler at 1:07 PM | Permalink | Comments (3)
                    

System maintenance under Mac OS X is much simpler than it ever was under Mac OS 9. In the bad old days, even commercial utilities didn’t always restore your ailing Mac to health. Don’t even get me started on extension conflicts.

OS X eradicated most of the previous system’s headaches just by virtue of its completely new, UNIX-based architecture. But even OS X can get sluggish over time, or have the occasional oddly behaving program. That’s why it’s still a good idea for Mac users to run certain basic maintenance routines from time to time.

Without going into the technical details, suffice it to say that these maintenance routines “clear out the cobwebs” and return your Mac to its usual efficient state. While Apple provides ways to perform many of these tasks, it never bothered to consolidate them in one handy utility. But plenty of others have.

Generally speaking, what third-party Mac OS X maintenance utilities do is take what are essentially UNIX text commands and put them in a visually more accessible form with clickable buttons and drop-down menus. I have tried several such utilities, including Socks and Cocktail. All have their merits, but one, OnyX, stands above the others for one simple reason: it’s free. (Both Socks and Cocktail are $15 shareware, but free is free.)

Like others of its ilk, OnyX provides a handy way to repair disk permissions, run Unix system maintenance scripts, run prebinding and optimization operations, and delete log and cache files. If you don’t understand a word of what you just read, that’s OK. You only need to know that running these routines periodically helps keep your Mac in optimum condition.

Another thing to like about utilities like OnyX is that they open access to features and options hidden in Mac OS X. (Why Apple doesn’t provide access to these features in the SystemPreferences is a mystery.) In OnyX, clicking on the Parameters icon brings up a whole collection of system options in seven categories, including Finder, Dashboard and Exposé, Dock and Safari.

Some examples of what you can change:

• In the General category, you can elect to have double scroll arrows at both the top and bottom of all your Finder windows.

• A menu (also in the General category) to choose the format of files saved when you use OS X’s built in screen capture function. The default is a PNG file, which can be converted to other formats via the Preview software Apple supplies with all Macs, but what if you want all your screen grabs in JPEG format? OnyX not only lets you change the default to one of 10 image formats, it lets you change the default name.

• In the Dock section you get a third option, “Suck,” for the Minimize window effect. You can also anchor the Dock to the top of the screen, though I can’t imagine why you’d want to.

• With OnyX, you can disable Dashboard (Apple provides no option for turning it off). If you change your mind, you can always use OnyX (or one of the other third party utilities, for that matter) to re-enable it. But it’s nice to have the ability to choose.

While utilities like OnyX draw the most interest from geeks who relish tweaking and optimizing their Macs, I think many less technically inclined users could derive some benefits. If nothing else, you can use it to make sure all of OS X’s UNIX maintenance routines have run (yes, I know Tiger OS X 10.4 is supposed to do this automatically, but I still prefer to run the routines manually sometimes. It can’t hurt.)

And you very well could find a system preference that you were dying to change but could never figure out how.

Posted by David Zeiler at 5:47 AM | Permalink | Comments (1)
                    

Shortly after the new iPod Touches hit the streets complaints about a glitch with the screens began popping up on the Web. Those afflicted with the bad iPod Touches report that they play video very darkly, with black shades so exaggerated they resemble an old film negative.

A post on a Web site called Apple-Touch.com actually included videos comparing a flawed iPod Touch playing the same scene side-by-side with an iPhone, which also sports a 3.5-inch screen. The difference in quality and the issue with dark areas in the iPod Touch’s video is obvious.

Some unhappy customers asserted that the flaw resulted from Apple using a poorer quality LCD screen in the iPod Touch relative to the one used in the iPhone. Some exchanged their bad unit for another bad unit. In forums, some customers countered that their new iPod Touches looked perfectly fine.

With accusations flying in every direction, I decided to stop by the Apple Store in Towson Town Center yesterday to have a look at the iPod Touch for myself. The store had four on display. I looked at some video on each one and could detect no hint of the problems I saw depicted on several Web sites. In fact, I thought the video on the iPod Touch looked pretty darn good.

I then moved over to the iPhone table and repeated the exercise (for the record, I played videos stored on the devices, such as the Ratatouille trailer, not YouTube videos). Frankly I could not discern a quality difference between the iPhone and iPod Touch, although I could not study them side by side since all the devices were tethered to their respective display tables.

One of the store employees said the staff there knew of the problem (although they learned of it by reading about it on the Internet; the Mother Ship hadn’t supplied any info yet) but had not seen any defective units, either in the store or brought in by a customer. In fact, he said they checked their entire iPod Touch inventory just to make sure.

My guess is that a bad batch of early-run iPod Touches slipped past the quality checks into Apple’s retail channels. If Apple was leaning on its suppliers to make deadline for the product launch, it’s not hard to imagine them shortchanging quality assurance procedures to satisfy Apple’s demands. I don’t think the iPod Touch screen is innately inferior to the iPhone’s. It is possible, but until there’s hard proof otherwise I’ll give Apple the benefit of the doubt.

Which brings us to perhaps most critical issue raised by all this: What’s Apple doing about it? Walt Mossberg, in an uncharacteristically muted review of the iPod Touch in yesterday’s Wall Street Journal, indicated that Apple was taking action:

Also, some early iPod Touch units have had defective screens, where images appeared too dark. Apple says this problem affected a small number of units and is being remedied. My two test units displayed beautiful images.

However, there has been no official word from Apple akin to the iPhone price drop apology and subsequent coupon. My hope is that Apple moves sooner rather than later to replace the defective iPod Touches. One of the company’s many strengths is its consistently high level of customer satisfaction. Apple can’t afford to appear callous when serious problems surface in any of its products.

I’m reminded of the problems that plagued the first MacBooks when they debuted last summer, primarily the “mooing” of the cooling fan and a yellowish discoloration on the wrist rest area that appeared within weeks of use. Apple issued a firmware update to fix the mooing and eventually agreed to replace the MacBooks that exhibited the discoloration.

I bought an early MacBook myself and fortunately experienced no problems with it. Perhaps my ears, ruined by years of listening to loud rock music, simply couldn’t detect the mooing. But the lesson here is that most defects reported in Apple products only involve a small number of units, percentage-wise. Unfortunately, many of those who end up with bad units also have their own Web sites. Within a day or so the entire Mac Web is talking about it, tainting the product’s – and Apple’s -- reputation.

Apple needs to act quickly to prevent the iPod Touch from getting stuck with a bum rap that will cut into its sales. Steve Jobs proved he’s capable of a rapid response to a widespread customer meltdown during the iPhone price cut affair. He needs to make a habit of it.

Posted by David Zeiler at 12:26 PM | Permalink | Comments (18)
                    

Yesterday in London Apple CEO Steve Jobs launched his iPhone invasion of the European mobile market with the announcement that the much-hyped device will go on sale in the United Kingdom starting Nov. 9. Deals announcing iPhone availability in France and Germany are expected within weeks, if not days.

The terms of the deal with UK carrier O2 sound familiar: it’s an exclusive deal for an undisclosed period; Apple gets an undisclosed share of O2’s monthly subscriber fees (estimates range from 10 to 40 percent); customers must agree to an 18-month service contract; and customers will pay the full price of the iPhone with no subsidy from O2.

Maybe it’s that stiff upper lip, but the British appeared generally unimpressed at becoming the first country other than the United States to enjoy iPhone availability.

The quibbles start with the price. The iPhone will cost £269 in the U.K., which at current exchange rates equal about $536. Jobs blamed the $136 difference on Britain’s value-added tax (which accounts for about half the difference) and the higher cost of doing business in the UK.

British mobile customers sounded much like their U.S. counterparts in voicing their displeasure with the 8-gigabyte iPhone’s slower 2.5G network technology, O2’s relatively high monthly fees (ranging from £35 to £55 per month, or $70 to $110 in Yankee money) and the required 18-month contract. For good measure some added their disappointment over the lack of a new model, such as one with 16 GBs of storage. Apparently few Brits were paying attention in June when U.S. critics leveled almost identical criticism at the iPhone.

Such an unenthusiastic reaction would not appear to bode well for iPhone sales in the U.K. While the device sold 1 million units in 74 days on sale in America, it faces several obstacles in Britain and the rest of Europe that it didn’t face in this country.

For example, The New York Times pointed out that many UK mobile users – about 20 percent -- are already using the faster 3G networks and may balk at downgrading to 2.5G just to use the iPhone. European resistance to the high prices and contract restrictions is likely to be stronger since cellular operators there typically offer more flexible terms than those in the U.S. And Apple’s powerful brand does not carry quite as much weight in Europe. The iPod, for example, has only 20 percent of the portable music player market in European nations other than Britain, where it has 40 percent. That’s considerably lower than the approximately 70 percent share the iPod enjoys in the U.S.

Finally, many potential U.K. iPhone customers have expressed concern about buying too soon in the aftermath of the $200 price reduction in the U.S., not to mention persistent rumors that a 3G version is in development.

One thing Apple has in its favor is that twice as many Brits buy expensive “smart phones” as do their American counterparts, which means they’re willing to spend their pounds on a fancy mobile phone. And the iPhone has an unmatched “cool factor,” which for many overcomes all shortcomings.

The iPhone’s goal, as we frequently are reminded, is just 1 percent of the global market next year. Apple plans a steady rollout of the iPhone throughout Europe and then into Asia from now through 2008. I’m sure Asia will present issues distinct from those in either Europe or the U.S. Apple has taken on perhaps its greatest challenge in seeking to become a global player in the cell phone market. It can succeed, but only by remaining nimble.

The signs so far indicate Jobs realizes competing successfully in the cell phone market will require Apple to adopt new tactics — tactics which have the potential to annoy customers as happened in the recent price reduction fiasco. Responding to questions at the London news conference yesterday, he all but admitted that frequent new models and price cuts will be the norm for the iPhone.

“In technology there’s never any guarantees,” Jobs told the gathered news media. “There’s always new models of things, there’s always price reductions on old models. If you wait to buy something, always looking over the horizon, you’ll never buy anything.”

UPDATE: This morning Apple announced that T-Mobile will be the iPhone carrier in Germany with availability starting Nov. 9, same as in the U.K. I should have said "hours," not days! Apple is wasting no time here.

Posted by David Zeiler at 6:09 AM | Permalink | Comments (0)
                    

SpiralFrog.com, an ad-supported Web site that allows registered users to download music and videos for free, officially opened for business this morning. The ads pay for the music; SpiralFrog cuts the record companies in for a piece of the action. “We believe it will be a very powerful alternative to the pirate sites,” SpiralFrog chairman and co-founder Joe Mohen told the Associated Press.

Sorry Joe, but I disagree. This would-be iTunes Store killer will die a slow and lonely death. It’s bound and gagged by so many restrictions -- no doubt added at the request of paranoid music company executives – that no one will want to use it, free or not. (Side note: most of SpiralFrog’s content at launch is from Vivendi’s Universal Music Group, which recently tussled with Apple over pricing at the iTunes Store. Hmmm.)

In order to get permission from the record companies to offer free downloads, SpiralFrog had to agree to use Digital Rights Management, and they chose Microsoft’s Windows Media format (WMA). As Apple loyalists well know, WMA files with DRM can’t be played on Macs – or on iPods. They could afford to ignore Mac users, but iPod users comprise over 70 percent of the portable music player market. Geez, SpiralFrog’s songs won't even play on Microsoft’s pathetic Zune.

Beyond the DRM issues, SpiralFrog has chained up its content in other ways. Users not only must register to download any digital content, but also need to re-register every month or the files lock up and won’t play.

Think you can work around these problems by burning the songs to a CD? Think again. CD burning of SpiralFrog content is not allowed, either.

Very few music consumers are likely to kiss this frog. Odds are SpiralFrog will be tucked away in a jar of formaldehyde by this time next year.

Posted by David Zeiler at 2:40 PM | Permalink | Comments (18)
                    

Rather than tell you about one or two pieces of inexpensive software, this week I’m going to tell you about a way to save tons of money on very expensive software – but only if you are the parent of a school-age child (or a student yourself).

Most large software companies offer their products at a steep discount to students and schools in the hope of nurturing future customers that, once gainfully employed, will pay full price to own and use software with which they’ve grown comfortable.

As I have not been a student for, er, a very long time, I have ignored these discounts, assuming I was not eligible. And though I am not eligible, I do have a daughter who just entered the second grade. You would think second graders would only be eligible for discounts on children’s educational programs, but it turns out that even kindergarteners qualify for prodigious discounts on professional-grade software.

I happened to be on an Internet hunt for a discounted version of Adobe’s Creative Suite 3, which includes such programs as PhotoShop, Illustrator and the page design program InDesign, all of which we use in the production of the Baltimore Sun. But if you want to dabble with such programs at home, you’re looking at a wallet-draining price tag: the standard design package lists for $1,200. If you’re upgrading from just one component (in my case, PhotoShop), it’s still $900.

That’s when I stumbled on the Web site for the Academic Superstore. They specialize in selling software at educational discounts, and they aren’t alone. Typing “academic software discount” into Google brings up dozens of similar sites. Browsing the Academic Superstore I quickly found CS3 standard selling for $389.95 and the premium version – which lists for $1,800 – for an astounding $589.95!

At that point, something else caught my attention: a chart that listed students from kindergarten through college as eligible for the discount. Still disbelieving my good fortune, I clicked on the Students/Parents eligibility page for more information. Here’s the key paragraph:

If you're a Student or Parent of a Student currently attending classes from Kindergarten through College, you can buy most products at a special academic discounts! The Student is the eligible customer and orders may be billed, shipped, and charged in the Parent's name. Yes, parents can buy a copy of Adobe Creative Suite or Microsoft Office for a Kindergarten Student at 30% to 50% savings over Retail prices!

There are several options for verifying the status of your student, all fairly easy. Older students with ID cards can submit those for verification of eligibility. I simply asked the principal of my daughter’s school for a Letter of Enrollment (a letter on school letterhead which says your child attends that school). The school e-mailed me the document a few days later. I forwarded the letter to the Academic Superstore and they validated my daughter’s eligibility within hours. My software was shipped shortly thereafter.

Not all the software is available at a huge discount, but it’s worth poking around any of the sites if you’re looking for something in particular. In addition to CS3, the Academic Superstore had high-end video software (Avid Xpress for $295 from $1,400) business software (FileMaker Pro for $178.95 from $300) and other categories ranging from CAD and Modeling to Research Tools. And of course you can find the expected stuff like the Microsoft Office Student and Teacher edition for $159.95).

Thanks, Mandy!

Posted by David Zeiler at 4:22 AM | Permalink | Comments (1)
                    

Today Apple posted the terms for qualifying and obtaining the $100 Apple Store credit promised to early buyers of the iPhone miffed over the unexpectedly quick $200 price drop. For the most part, it’s just what you’d expect: instructions on how to confirm your eligibility and get the $100 credited to your Apple Store account.

Not everyone is eligible for the credit. For example, anyone who bought after Aug. 22 falls in the 14-day window covered by product price reductions and thus qualifies for a full $200 rebate. Also excluded are iPhones provided to Apple employees, logical since every one of Apple’s nearly18,000 employees received their iPhone free.

The curious part comes in the last paragraph of the “terms and conditions” section. In addition to such expected rules as forbidding redemption of the credit for cash, you can’t redeem the credit at any iTunes Store. Nor can you use it to purchase iTunes Store gift certificates. Nor can you use it to give iTunes Store content as gifts. Just to cover all their bases, Apple also forbids using the credit to purchase Apple Gift Cards, which you might think of using at the iTunes Store.

Let’s see. Why would Apple prevent aggrieved iPhone owners from spending their $100 credit on music from the iTunes Store? Since the iPhone is part iPod, you’d assume that many iPhone owners would want to use at least some of their credit on music or video purchases.

The only answer that makes sense is that Apple’s margins on digital content purchased from the iTunes Store are miniscule compared to almost everything else it sells. True, the company is trying to buy back customer goodwill, but each $100 credit claimed by a customer is $100 in lost profits. Allowing customers to use the credit at the iTunes Store would result in a near-total loss of that $100. Forcing them to use it on other products in the Apple Store, which carry an average profit margin of more than 30 percent, will allow Apple to retain much more of each $100 claimed and used by a disgruntled iPhone early adopter.

While this may be smart business, it’s lousy public relations. Steve Jobs apologizes and promises to “do right” by his customers and then pulls a cheesy, transparent maneuver like this? That’s not the Apple that has won the hearts and minds of millions of loyal customers.

Apple has almost $14 billion in cash and $0 in debt. It could have afforded to give its early iPhone customers a true credit they could have spent on any Apple product. I wouldn’t be surprised if this touches off another wave of discontent among iPhone owners. We’ll see what happens in the forums over the next few days, but it would be a shame if Apple has bungled what should have been a commendable gesture to some of its best customers.

UPDATE: A story appeared onBloomberg News this evening that contradicts the document on Apple's Web site. Apple spokeswoman Natalie Kerris told Bloomberg the information on the site is wrong and that the iPhone credit will indeed be applicable to iTunes Store purchases. That's one heckuva typo. As of 1:30 a.m. EDT Saturday, the original document remains unchanged on Apple's Web site. What's going on in Cupertino, anyway?

Posted by David Zeiler at 6:38 PM | Permalink | Comments (0)
                    

In his Media Biz blog, Paul LaMonica of CNNMoney.com today cites the announcement of a Led Zeppelin reunion show in London in November as cause to speculate on the addition of the Zep catalog to iTunes.

Yes, the Beatles aren’t the only holdouts. The iTunes Store is completely bereft of Led Zeppelin music. But LaMonica must have been tuned out in late July when the band announced that Mothership, a new compilation album scheduled for release in November, will be available from iTunes. According to reports, Mothership consists of tracks selected by the band members and includes such classics as “Stairway to Heaven,” “Whole Lotta Love,” and “Dazed and Confused.”

The willingness to test the waters with Mothership nurtures hope that Robert Plant, Jimmy Page and John Paul Jones are considering putting the entire Led Zeppelin catalog on iTunes. It sounds like a prime opportunity for another one of those publicity-generating Apple Events, doesn’t it, Mr. Jobs?

Posted by David Zeiler at 1:11 PM | Permalink | Comments (2)
                    

What if Apple had its own wireless network?

A Business Week article on Monday, citing two unnamed sources, said Apple is considering a bid on the chunk of 700 Mhz wireless spectrum that the Federal Communications Commission plans to auction Jan. 16. (It’s the part of the spectrum that television channels currently use to broadcast their over-the-air signals.) Many have called this spectrum “beachfront property,” as anyone who owns it will be able to set up a powerful wireless broadband network. Possession of a piece of this spectrum would free Apple from requiring a partner such as AT&T to provide the network services for the iPhone. That must appeal to Apple -- we all know how much Steve Jobs relishes controlling “the whole widget.”

But as tempting as the idea sounds – imagine the elegant integration of Apple wireless products with an Apple-operated network – analysts have dumped an ocean of cold water on it. Articles from other publications such as Forbes pointed out yesterday that while Apple has the motive and the money (nearly $14 billion in cash), building and operating a wireless network does not suit the company’s core strengths: designing cool consumer hardware and software.

A list of the potential hurdles:
1. Operating a network generates low profit margins, and almost everything Apple does generates high profit margins or, as with the iTunes Store, encourages the purchase of high-margin products.
2. Apple has no experience in creating and running a national wireless network, but would be competing against several large telecommunications companies that do.
3. Nitty gritty details like billing, activation and consistent signal quality would sop up a lot of resources Apple can’t afford to spare.
4. Whoever wins the spectrum – the television broadcasters are scheduled to surrender it to the government in 2009 – will be required to maintain an “open” network that will allow competitors’ devices to access it. Apple would be loath to support devices not of its own creation.

Still, Apple’s commitment to the iPhone means it has a vested interest in the Jan. 16 auction and its eventual winner. One would expect Apple to be mulling some form of participation. If the major telecommunications players such as Verizon and Sprint gobble up this newly available spectrum, Apple’s unappealing options among network service providers will not improve.

But consider if one or more of Apple’s techno-allies wins a significant block of the spectrum. I’m thinking specifically of Google and Intel, both of which have publicly stated interest in bidding. The Business Week article envisions a possible bidding war between Apple and Google, but Steve Jobs’ close friendship with Google CEO Eric Schmidt – the guy serves on Apple’s board of directors, for Pete’s sake – conjures a distinctly different scenario.

Schmidt has said Google will put up the minimum $4.6 billion to bid for the spectrum, and the company led the campaign to persuade the FCC to require the winner to make the network open. But Google would face many of the same hurdles as Apple in trying to create and run a wireless network from scratch, primarily a lack of experience. In fact, Google may be at even more of a disadvantage; its expertise lies almost entirely in Internet-based software and services.

Intel, at least, has plenty of hardware experience, although the development of microchips and motherboards doesn’t have much in common with operating a wireless network.

However, a partnership forged of all three companies would make for a formidable opponent. Since all three have an interest in the spectrum but little expertise in running a wireless broadband network, the trio might consider jointly backing a fourth player that does have the necessary expertise, namely Clearwire.

Could Apple, Google and Intel team up with Clearwire to create an alliance aimed at breaking the stranglehold the big telecoms have on wireless communications? The connections are all there. As I said, Schmidt serves on Apple’s board. Intel President and CEO Paul Otellini has served on Google’s board since 2004. (Intel also can call on the wisdom of Reed Hundt, a member of its board who happened to have served as chairman of the FCC for four years.) And since Apple switched to Intel chips, those two companies have grown accustomed to working closely together. Want more? Intel Capital, Intel’s venture capital arm, invested $600 million in Clearwire last year. Intel’s relationship with Clearwire stretches back to 2004.

I know it’s all far-fetched, but it would be glorious, wouldn’t it?

Posted by David Zeiler at 6:20 AM | Permalink | Comments (2)
                    

People visiting the iTunes Store customer feedback page have reported seeing references to a “RentalMovie:” category, according to an item today on Forbes.com. This could well mean we’ll see rental movies at the iTunes Store very soon. Usually slip-ups like this foreshadow a formal announcement from Apple within days.

As far back as June FT.com had reported that Apple was in talks with several major Hollywood studios about offering 30-day movie rentals for $2.99. The iTunes Store currently sells movies for $14.99.

The rental movies presumably could be viewed on a computer, video-enabled iPod (now that we have more to choose from) or iPhone and naturally would include DRM to prevent illegal copying. If you want to own a movie, you’ll still have to pay the full price.

This could be yet another way for Apple to leverage an existing asset – the iTunes Store – to generate a little extra profit. It also sounds like something that should be integrated into Apple TV, one of the few Apple products that could use a little more love from the Mother Ship.

Posted by David Zeiler at 3:54 PM | Permalink | Comments (0)
                    

Apple truly is a company apart. Who else could create such a tempest over something so mundane as a price cut on a single product?

After the initial shock of last week’s $200 iPhone price reduction wore off, the media fed on the reaction of angry early adopters. The next day Steve Jobs uncharacteristically apologized to said customers and offered them an olive branch in the form of a $100 coupon good for any Apple Store purchase.

Wall Street saw all this as a sign that Apple had stumbled badly in its cell phone strategy and punished the stock for the rest of the week. By Friday, AAPL had slipped from $144.16 to $131.77, a drop of 8.59 percent. But give Apple credit for knowing how to play investors. After it announced the sale of the millionth iPhone yesterday, the stock recovered $4.95, more than half of last week’s loss.

Over the weekend pundits, both on Wall Street and in the Mac community, alternately argued that last week’s erratic developments either portrayed Apple in a panic or the company had artfully planned out the entire sequence of events weeks ahead of time.

I surmise Apple had intended an iPhone price cut before Christmas, but saw slowing sales numbers and decided that taking action sooner would spur more holiday sales – just as Jobs said. I don’t think Jobs considered the customer reaction at all; the price cut was purely a business decision. Reading Jobs’ apology letter, I believe he was genuinely surprised by the ferocity of the reaction. A large number of iPhone customers, many of who were among Apple’s most loyal customers, genuinely felt the company had betrayed them. The sentiments expressed in those e-mails, punctuated by the heavy media coverage, got to the normally impenetrable Jobs.

Faced with the necessity of immediate action, the company could not have devised a better response than the $100 Apple Store coupon. It should placate a majority of the angry customers, most of whom can find plenty of things they’d want in an Apple Store. It costs Apple some money, but all of it will be spent with Apple anyway. And the media thoroughly covered the whole affair, helping rescue Apple’s reputation as a company that cares about its customers.

Fundamentally, the iPhone price cut was a shrewd business move. I don’t think Apple is sacrificing as much on its profit margins as Wall Street at first feared; Jobs hinted last week that economies of scale and falling component prices had helped bring down the cost of manufacturing the iPhone. And imagine what the $200 price drop will do for sales volume. Apple has positioned the iPhone to succeed – if you don’t think so, just wait until Jobs announces the device’s holiday sales numbers at Macworld San Francisco in January.

Posted by David Zeiler at 3:49 AM | Permalink | Comments (5)
                    

As an old tech geezer who remembers when cool graphics meant there was more than one color on the screen, I tend to prefer old-fashioned games to the complex and time-consuming fare that gets most of the attention these days. Last week I came across something called Fairy Treasure (Red Marble Games, $19.95, Universal Binary), a fresh interpretation of the classic computer game Breakout. It’s actually a Windows game converted to the Mac by Red Marble Games and released just last week.

In Breakout-type games players use a paddle at the bottom of the screen to deflect an ever-moving ball up into a field of bricks, the object being to destroy all the bricks without losing your ball. The original form of this game is actually built into some iPods (well, it came with my 30 GB video iPod).

The object of Fairy Treasure is the same, but features rich graphics and sound along with the fantasy theme. Instead of simply advancing to increasingly difficult levels as you do in most Breakout-style games, in Fairy Treasure the completion of each level carries you further on your journey through the Kingdom of Trollandia. After each level you are shown your progress on a map of the kingdom. Your goal is to complete all 120 levels to recapture the fairy treasure from an evil troll.

Yes, I said 120 levels – but the game remembers where you left off so you don’t have to do it all in one sitting. Better yet, while losing all your balls resets your score to 0 it doesn’t restart your “quest.” Your next game picks up at the level where you left off unless you choose to restart from scratch. The game also offers three difficulty levels, a useful feature that keeps the game easy for beginners and challenging for experienced players.

Typical of a Breakout-type game, hitting certain bricks causes various bonuses and power-ups to fall which you need to capture with your paddle. But Fairy Treasure adds some nice theme-related touches, such as flitting fairies that help break up the bricks when your ball releases them from the jars in which they’re imprisoned. This is a commercial-quality shareware game.

A free trial is available from Red Marble that’s good for 60 minutes of playing time. Or, if you’d rather check it out with downloading anything, you can play a “light” version (it requires Flash 7.0) for free online.

Posted by David Zeiler at 5:36 AM | Permalink | Comments (0)