Apple to Provide Refunds for Notebook Power Adapters?

In another class action suit settlement, Apple has reportedly agreed to give refunds of $25-$79 to as many as 2.3 million PowerBook and iBook owners who purchased faulty power adapters that were prone to spark.

Customers who bought certain replacement adapters for PowerBook and iBook computers are eligible for the settlement, according to documents filed in federal court in San Jose. U.S. District Court Judge James Ware granted preliminary approval of the agreement March 24.

The settlement has not yet been finalized with an approval hearing scheduled for September 8th.

One customer had posted a Youtube video demonstrating a sparking power supply, though it was from a MacBook, so it does not appear that it would necessarily qualify for this settlement. Full details on the settlement won’t be available until it is finalized.

Jeff Han’s Multitouch Screen Hits Mainstream

Longtime MacRumors readers will remember the excitement surrounding Jeff Han’s early multitouch videos which predated the launch of the Apple iPhone. Han and his team had explored new user interface designs surrounding the use of a large multi-touch screen. The concepts of zooming in and out of photos and manipulating objects directly on the screen gave many readers their first look at multi-touch technology.

Han went on to found Perceptive Pixel to market large versions of their touch screens for “film studios and other operations where people can use them as high-tech blackboards to brainstorm on projects”.

Those following the U.S. primary elections over the past few months may have noticed that CNN had become one of the Perceptive Pixel’s first customers. Their “Magic Wall” has been used to show off the large amounts of data coming in from the primaries:

“It’s a stupendous way to explain a lot of complicated data,” says David Bohrman, chief producer of CNN’s political coverage. “Fundamentally, our job is to explain things to people, and we need to do it visually. This lets us do it naturally, without a keyboard or mouse getting in the way.”

Han believes its use will expand to other many other areas in the near future:

“News wasn’t the first market we thought of, but it’s an interesting application,” Han says by phone from New York. “Once the election calms down, you can see how this might work for other kinds of news, like financial, weather or sports.”

The screen made its debut on CNN in January of this year. Videos from CNN: Photo resizing, Election results, Annotation, Zooming.

Apple, of course, implemented their own version of multi-touch in the iPhone and iPod Touch, and there’s been evidence that more advanced multitouch gestures will make their way into Mac OS X.

Warner Brothers to Offer Online Rentals Alongside DVD Releases

A NYTimes blog reports that Jeff Bewkes, Time Warner’s chief executive, revealed that Warner Brothers will now release “on demand” videos (including iTunes rentals) on the same day as the DVD release. Historically, on-demand releases have tended to lag behind DVD releases by 30-45 days to avoid sales cannibalization.

When Steve Jobs announced the iTunes Rental store at Macworld this year, he acknowledged that the rentals would appear about 30 days after the DVD release. We later noticed, however, that some iTunes movie rentals had started appearing much earlier than the expected 30-day delay. As it turns out, Warner Brothers was experimenting with this approach for the last few months, and found that DVD rentals only fell by 3-5 percent while DVD sales actually increased when on-demand videos were offered earlier.

Mr. Bewkes boasted to investors that the shift from DVDs to digital distribution, on the “day and date” of DVD release, will be better for Warner Brothers because it will eliminate some of the costs of manufacturing and distributing discs.

This shift, of course, is good for customers who are given more flexibility in purchasing video content.

AT&T Providing Free Wi-Fi Access to iPhone Users [Updated]

A couple of readers have reported that AT&T hotspots are now offering free Wi-Fi access to iPhone users. Barnes and Noble, Starbucks and presumably AT&T’s 71,000 other Wi-fi hotspot locations are now offering iPhone users a custom portal to access free Wi-Fi. A special iPhone formatted page asks for your mobile phone number. Once entered, you can access the Wi-Fi access for free.

MacRumors has been able to confirm this finding at a local Barnes and Noble. Blurry photo provided:

AT&T recently partnered with Starbucks (displacing T-Mobile) to provide Wi-Fi access to Starbucks’ 7000 stores nationwide. This partnership allowed existing AT&T broadband customers free access and AT&T promised that it would “soon extend the benefits of Wi-Fi at Starbucks to its wireless customers”, but no official announcement has yet been made.

A list of AT&T’s 71,000 hotspots can be found on AT&T’s site, including Starbucks, Barnes & Noble, Airports, and McDonald’s locations.

Update: MacRumors reader ntrigue confirms that AT&T’s system is based on the iPhone’s User Agent, which can easily be faked on laptops. He successfully accessed the free iPhone Wifi through his laptop (and a valid iPhone phone number):

Apple Calls for WWDC Developers, Launches iPhone SDK Beta 4

Apple changed their home page today with a photo of an iPhone and MacBook Air with the title “Calling all developers”, reminding visitors that early registration for the World Wide Developer’s Conference ends on April 25th, 2008.

Meanwhile, Apple also quietly released the 4th beta of the iPhone SDK. Beta 4 adds at least one much requested feature: OpenGL ES support within the iPhone simulator. Previously, developers had to install directly to their iPhone to run OpenGL applications.

“The fourth beta version of the iPhone SDK includes Xcode IDE, iPhone simulator with Open GL ES support, Interface Builder, Instruments, frameworks and samples, compilers, and Shark analysis tool.”

Developers are continuing to work on iPhone/Touch apps and games to ready for the June launch of the iTunes App Store.

Apple’s Plans for P.A. Semi? Not Interested in the Chips?

Earlier today, the news came out that Apple was acquiring chip designer P.A. Semi for $278 million. In February 2007, P.A. Semi debuted a 64-bit dual core processor which claimed to be “300% more efficient than any comparable chips” running at 2GHz and consuming 5-13 watts of power.

While the news generated speculation that Apple might use P.A. Semi’s low power PowerPC chips in future iPhones or iPods, Beyond3D points out that these chips require far more power than can be expected for use in the iPhone or iPod.

Instead, EETimes provides some additional insight into Apple’s motivations on the acquisition. According to comments made directly to P.A. Semi’s customers, Apple is “not interested in the startup’s products or road map, but is buying the company for its intellectual property and engineering talent.” In fact, P.A. Semi also told customers that they would be unable to guarantee a supply of its chips in the future.

As it turns out, this may cause some resistance to the acquisition, as P.A. Semi’s chips are reportedly used in a number of ongoing Department of Defense projects.

Apple 2Q 2008 Results, Conference Call Highlights: $1.05 Billion in Profit

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Apple posted revenue of $7.51 billion and net quarterly profit of $1.05 billion, or $1.16 per diluted share, both Apple records for the second fiscal quarter. This compares to $5.26 billion revenue and $770 million profit, or $.87 per diluted share from the year ago quarter. Gross margin was 32.9 percent, down from 35.1 percent in the year-ago quarter. International sales accounted for 44 percent of the quarter’s revenue.

Sales notes from the quarter:
- 2,289,000 Macs shipped (51% unit growth, 54% revenue growth)
- 10,644,000 iPods shipped (1% unit growth, 8% revenue growth)
- 1,703,000 iPhones sold

“We’re delighted to report 43 percent revenue growth and the strongest March quarter revenue and earnings in Apple’s history,” said Steve Jobs, Apple’s CEO. “With over $17 billion in revenue for the first half of our fiscal year, we have strong momentum to launch some terrific new products in the coming quarters.”

“We’re thrilled to have generated $4 billion in cash flow from operations in the first half of fiscal 2008, yielding an ending cash balance of $19.4 billion,” said Peter Oppenheimer, Apple’s CFO. “Looking ahead to the third quarter of fiscal 2008, we expect revenue of about $7.2 billion and earnings per diluted share of about $1.00.”

While Apple beat expectations for the second quarter, Apple’s guidance for the third quarter falls below the street’s expectations for profit of $1.09 a share on $7.23 billion in sales.

The corresponding quarterly conference call will begin shortly at 5pm EDT. Continue reading for highlights of the call and the Q/A session.

Conference Call Notes:

- Pleased to report highest March quarter revenues and profit in history.
- Very strong Mac demand.
- Revenue growth accelerated to 43%, up from 21% last year.
- Retail sales up 74%…number of visitors in retail stores up 57%.
- Mac sales up 3.5 times the rate of PC industry as a whole.
- 3-4 weeks of Mac channel inventory at quarter’s end.
- Very pleased with customer response to iPod touch.
- iPod shuffle sales were down until price drop, then accelerated.
- 73% share of MP3 player market.
- iTunes Store with 85% of legal music download in US. Movie rental service well-received.
- 200,000 developers have downloaded iPhone SDK. One-third of Fortune 500 companies have contacted Apple about the program.
- Retail stores: 208 stores. Looking forward to opening first stores in Australia, China, and Switzerland.
- $19.4 billion in cash. Generated $4 billion in cash over the last two quarters.
- Q3 Outlook: Targeting $7.2 billion revenue, gross margins of 33%, earning of $1.00 per share.

Q&A:

Q: Gross margin good, but why down a bit? Confident about 33% prediction for next quarter?
A: Gross margin better than had been predicted. DRAM and NAND pricing hit historic lows. LCD and other components pricing stable. Decline was partly due to Leopard entering second quarter: decreased sales of high margin product. Also partly due to iPod shuffle price cut.

Q: iPhone availability tightening. Can you grow this going forward? Any shortages?
A: We will hit 10 million for the year. We expected more of a quarter-over-quarter decline than we got, leading to some shortages. “Significant” number of unlocked phones contributing to demand.

Q: How is the education market?
A: Up 35% institutional and individual…highest growth rate in education in eight years. This quarter is a big K-12 quarter. Surpassed Dell in educational portables sales last year. Always worried about tight educational budgets, but no issues seen yet.

Q: 10 million iPhone sales goal…is a move to 3G technology affecting this forecast?
A: We don’t comment on unreleased products, but we are of course always looking to roll out to more locations.

Q: Forecast for new retail store openings? Will half of them be international as projected?
A: Had 208 total stores at end of quarter, 27 of those outside U.S. Increased forecast to 45 new stores for the year. Won’t be quite half international stores, but it will be significant.

Q: Effect of Leopard sales on gross margin?
A: Leopard revenues $170 million in January quarter, $40 million in March quarter. Also iLife and iWork entering third quarter of sales and thus seeing decreasing sales. Also, low-margin iTunes Store revenue was a more significant percentage of total revenue for the March quarter.

Q: You’ve built up a lot of cash. Any plans for it?
A: No comment on that at this time.

Q: Can you talk about iPhone pricing with European carriers?
A: Our European carriers are free to price the iPhone as they wish. No further comment on that.

Q: Plans for maintaining a 2.5G iPhone alongside future 3G models?
A: We don’t comment on unreleased products.

Q: Availability of products during March quarter?
A: MacBook Air experienced constrained supplies initially, but reached supply/demand balance by the end of the quarter. iPhone demand outstripped projections and thus supply.

Q: Any comment on acquisition of P.A. Semi?
A: We occasionally buy smaller technology companies, and we don’t make a practice of commenting on our plans for them.

Q: Can you reconcile comments about iPhone demand outstripping supply with price cuts seen in Europe? Was there a balance issue?
A: Shortages were most significant in Apple retail stores, which are more susceptible to people buying multiple units, possibly for export. Once units are designated for a carrier, they can’t be easily shifted elsewhere. Overall, we expected a sharper quarter-to-quarter decline than we saw. No comment on Europe specifically.

Q: Comments on number of unlocked iPhones? Why the reticence in quantifying that?
A: We aren’t really comfortable with putting out a number on that due to uncertainty. We have gone out of our way to classify it as “significant” though.

Q: Why did the average selling price for portables decline?
A: The decline was small and reflected slight shifts in product mix.

Q: Any more to say about MacBook Air? Number of Windows users buying MacBook Airs?
A: No data on Windows users. Popular among a wide variety of consumers. Very little cannibalization of other models.

-End of conference call

Apple Trying to Improve Online Shopping Atmosphere?

MacNN detailed a new patent application from Apple that explores methods of “enhancing online shopping atmosphere”. Specifically, Apple notes that while online shopping can be far more convenient than traditional retail stores, the experience can feel “sterile and isolating”.

To address that point, they propose showing users where other customers are in the store, even allowing customers to interact with others while shopping.

This would allow you to see what products people are looking at, and by clicking on one of the other visitor icons, customers could even ask questions to users about why they’d left one product or gone to another product. This visual representation can be used to help with live real-time changes in interest:

For example, if an author has been invited to participate in a live chat hosted by the Acme store, an icon of the book may appear in [a region] alerting customers (in all departments) that a special event is occurring.

Users could, of course, opt-out in certain privacy settings, but these techniques could be applied to both Apple’s Online Store as well as their iTunes Store.

Apple Modifies Software Update for Windows

CNet reports that Apple has responded to the criticism of pushing Safari to all Windows users via Software Update.

The practice received some criticism since the “update” appeared for individuals who had never installed a previous version of Safari. Apple has reportedly revamped their Software Update to clearly distinguish “New Software” from “Updates”:


Safari now occupies a place in the “New Software” box, but continues to be offered to all Windows iTunes users. Even still, Mozilla’s Asa Dotzler believes Apple should not leave the software checked by default.

Clearing Inventory for ‘radically different’ 3G iPhone?

Times Online claims the reason for the UK and German iPhone discounts are to clear room for the 3G iPhone. European mobile operators reportedly overestimated demand for the current iPhone and are said to be working to clear excess inventory ahead of the 3G iPhone release.

This claim appears to be somewhat speculative, but Times Online also claims to have heard that Apple has placed orders for the 3G iPhone:

Times Online understands that Apple has placed an order with its Asian suppliers to produce 200,000 of the new 3G iPhones by the end of May, rising to 2 million – 500,000 per week – in June.

Times Online goes on to say that the new version of the iPhone will have a “radically different” appearance.

Among the possibilities are flip version, which would enable the screen to be larger, and a sliding model with a regular qwerty keyboard – as opposed to a touchscreen one.

The reliability of Times Online’s sources are unknown, but such a departure from the existing iPhone’s design seems very unlikely. Jobs specifically criticized the inclusion of an built-in keyboards amongst existing smartphones when the iPhone was first introduced. Apple is also in the midst of launching a Software Development Kit (SDK) intended for their multi-touch OS X. Radically changing the form factor would splinter the audience for iPhone applications.