MacRumors

Pegatron, a contract manufacturer for Apple that makes the iPad mini and the iPhone 4S, among other products, said today that its second quarter consumer electronics revenue will drop 25 to 30 percent from the previous quarter, reports Bloomberg.

The company says there is a decline in revenue from iPad mini production is "more on demand, while price has been stable", but CEO Jason Cheng also noted that "almost every item is moving in a negative direction" for the quarter. "Not just tablets, also e-books and games consoles".

The iPad Mini accounts for more than half of Pegatron’s consumer-electronics revenue, and the iPhone 4S contributes a majority of sales in the communications division, Cheng said.

"This is a bigger drop than we’d expected," said Vincent Chen, who rates the company buy at Yuanta Financial Holding Co. in Taipei. "We’re seeing strong indications from the supply chain that demand for iPad Mini will now fall 20 percent to 30 percent from the first quarter, instead of an earlier 15 percent estimate."

In its quarterly results report in April, Apple issued guidance for expected revenue for the June quarter of $33.5-35.5 billion, a drop in revenue of some 20 percent from the prior quarter.

Reports have indicated that mass production of the display for a Retina iPad mini should begin in June or July, for a planned release well into the third calendar quarter of 2013.

Update: Fortune reports that Pegatron CEO Jason Cheng has clarified the situation, noting that in no way did he indicate weakening iPad mini demand was responsible for the company's projected revenue decrease. The association with iPad mini demand appears to have simply been speculation by Bloomberg based on the device being responsible for a significant portion of Pegatron's consumer electronics division revenue. In an email to Fortune, Cheng wrote:

After the meeting, one reporter from Bloomberg approached me, trying to dig out detail numbers about some specific product. I clearly refused to comment on specific products, nor customers, even though he continued with other questions. I did say those words that he quotes me in the article "more on demand, while price has been stable"…, "almost every item is moving in a negative direction"...; "Not just tablets, also e-books and games consoles". But I did not say anything associated with any specific products.

"No indication, nor hint for specific products or customers" has been our principle and guideline for any public events such as investors conference. There are always speculations after these meetings.

Apple is well known for the simple, no-frills product photos that highlight its lineup of mobile devices and as it turns out, a lot of work goes into capturing those images. The Verge interviewed Peter Belanger, a photographer who has worked with Apple for years, to shed some light on Apple's creative process.

In the interview, Belanger reveals that Apple exercises extreme attention to detail when it comes to product photos, providing him with both sketches and a comprehensive shot list.

The team at Apple always has a really well developed shot list and sketches of what they need. I work with their talented art directors to translate those sketches into photos. We start by getting the position of the product and then move forward on lighting. Because Apple products have such carefully selected materials it is incredibly important to light the product in a way that will showcase the various materials accurately.

As depicted in the photo below, Belanger uses an intricate setup of lights and equipment to accurately highlight the design of each item that he photographs.

I pick an area to start with and think about how that material needs to be described. Once that section is done I move on to the next. This is how my sets get so complicated! I need to have control over each and every surface so when the client asks for a highlight to be elongated, I can do that. It's similar to working on a file in Photoshop: you don't do all your work on one layer. I think of my lights as layers that I can adjust individually to get the desired results.

Belanger goes on to explain that most of his work is done in the camera, but that post production is used for the finishing touches. He captures the majority of his images with the Canon 5D Mark III, using a 24–70mm lens. Belanger's full interview, which details more of his personal creative process and the tools that he uses, can be found at The Verge.

While websites and developers have been seeing low levels of hits from iOS 7 devices for several months, as of last week we noticed a significant surge in such hits in our own logs. The hits come from Apple's block of IP addresses, suggesting that the company may have rolled out a new phase of testing with its Worldwide Developers Conference (WWDC) just a month away.

MacRumors is not the only site seeing significant increases in iOS 7 activity, as TechCrunch reports that mobile publishing company Onswipe has seen a similar spike coming from San Francisco and Cupertino.

Over the past week, Onswipe found a significant bump in the number of visits from iOS 7 iPhones and iPads, specifically located in both Cupertino and San Francisco. SF had the most iOS 7 visits, with 18.75 percent, and Cupertino accounted for 17.9 percent of the total. May 2 saw the highest iOS 7 traffic to date, representing 23 percent, or nearly a quarter, of all unique iOS visitors to Onswipe-enabled sites. Most were visiting from iPhones (75 percent), but iPads also represented a full quarter of visits.

Apple is expected to show off iOS 7, as well as OS X 10.9, at next month's WWDC, but a public release of iOS 7 is not expected until later in the year alongside new iPhone hardware.

We have not seen a similar spike in OS X 10.9 traffic coming from Apple in recent weeks, although that traffic has been slowly growing for a number of months now.

As part of its first quarter earnings release today, T-Mobile USA revealed that its iPhone 5 sales stand at approximately 500,000 units less than a month after the device debuted on the carrier. The carrier also launched the iPhone 4 and 4S in limited markets where the devices are compatible with its networks, but T-Mobile did not specify how many units of those models it has sold.

"Our first quarter operating metrics and financial results are showing positive impact from the changes we began making in the fourth quarter. Branded customer net additions turned positive for the first time since the first quarter of 2009 and our postpaid business has demonstrated significant improvement," said John Legere, President & CEO of T-Mobile. "We ended the quarter with strong operational momentum, which is continuing into the second quarter, driven by the successful launch of our Un-carrier "Simple Choice" service plan and the introduction of the iPhone into our device line-up. Things only get more exciting from here, having brought T-Mobile USA and MetroPCS together to create the wireless industry's value leader and premier challenger."

T-Mobile also announced that success with its Bring Your Own Device campaign continued during the first quarter, adding 100,000 iPhones per month from customers switching to the carrier even before it officially began offering the iPhone.

Comparing T-Mobile to other U.S. iPhone carrier launches, Sprint sold 1.8 million iPhones in its first quarter of availability in late 2011, although that debut took place within the context of the brand-new iPhone 4S launch. Earlier that year, Verizon activated 2.2 million iPhones in its first two months of availability.

According to a new report from Japanese newspaper Nikkan Kogyo Shimbun [Google Translation] (via AppleInsider) Sharp, one of Apple's primary display partners, will begin manufacturing LCD panels for the iPhone 5S beginning in June at its Kameyama Plant No. 1 in Japan.

The site notes that Apple also sent orders to both Japan Display and LG Display, with mass production already under way, which confirms a report last month from The Wall Street Journal that suggested iPhone 5S production would begin in the second quarter.

Earlier this year it was believed that production of the iPhone 5S would ramp up in March to facilitate a summer release, but Apple has faced production challenges as detailed by reliable KGI Securities analyst Ming-Chi Kuo in April.

According to Kuo, the work on the fingerprint sensor that is rumored to be included with the iPhone 5S has caused delays, resulting in a later-than-expected launch date.

While Kuo did not offer a specific fall release date for the iPhone 5S, he did outline three different scenarios involving a launch between September and November. Apple CEO Tim Cook also hinted at an autumn release for the iPhone 5S during Apple's second quarter financial results call, stating that the company has a number of surprises coming during the fall and beyond.

Apple's iPhone 5S is rumored to have the same design as the current iPhone 5 with a number of improvements including the aforementioned fingerprint sensor and a better camera.

A German court has ruled that eight provisions in Apple's privacy policy are inapplicable because they run afoul of German consumer protection laws, reports Bloomberg.

The lawsuit, between Apple and consumer protection group Verbraucherzentrale Bundesverband (VZBV), related to Apple's request of its users for 'global consent' to use customers' data.

The German court appears to have struck down blanket policies that allow Apple to share personal information with other companies or use it for advertising, regardless of what the ultimate purpose is. Instead, to comply with German law, Apple will need to be more explicit about exactly what information is being shared, and what it will be used for.

A Berlin court struck down eight of 15 provisions in Apple’s general data-use terms because they deviate too much from German laws, a consumer group said in a statement on its website today. The court said Apple can’t ask for “global consent” to use customer data or use information on the locations of customers.

Apple had previously agreed to void the other seven provisions that the VZBV had flagged as problematic. Instead, the company will need to let customers know "in detail what data is used for what purpose", instead of a single "global consent".

The full report is available in German from VZBV's website, or via Google Translate. It should be noted that this ruling only applies to Germany, not to the entire European Union.

The New York Times reports on Foxconn's efforts to diversify its business, recognizing that while Apple is and will remain an important customer currently responsible for about 40% of Foxconn's revenue, it needs to tap into other markets in order to improve its own stability.

One major push for Foxconn has been the television market, where it has invested with Sharp in an LCD panel factory in Japan and begun releasing its own televisions in partnerships with RadioShack and Vizio.

Analysts say Foxconn’s strategy satisfies two seemingly contradictory goals. The company does not want to compete with clients directly, because it has TV assembly orders from Sony, Sharp and Toshiba. [...] But it needs to absorb excess LCD panels produced by the Sakai factory to take advantage of the lower manufacturing cost per unit. Therefore, Foxconn negotiates with partners to sell the television at or below its production cost.

Despite the push into televisions, including the partnership with Vizio, which is the top-selling brand in the United States for television over 60 inches, Foxconn is said to need additional large partners with Apple viewed as the primary target.

Analysts say Mr. Gou’s efforts to buy an LCD factory and vertically integrate his television manufacturing represent anticipation that orders for an Apple television product will come his way.

“Their gamble now is if Apple will put out a TV, and they should know better than anyone else in the world,” said [Thompson] Wu, the Credit Suisse analyst. “They’re making a bet that it’ll work.”

Almost exactly one year ago, Foxconn chairman Terry Gou was initially reported to have confirmed that the company was making preparations for an Apple television set, but the company quickly clarified the situation to deny that any specific acknowledgement had been made.

Foxconn noted that Gou had refused to discuss or speculate on any specific product and merely stated generally that Foxconn is "always prepared to meet the manufacturing needs of customers should they determine that they wish to work with Foxconn in the production of any of their products".

Following a somewhat confusing report earlier this week in which NPD DisplaySearch analysts first indicated that a Retina iPad mini would not appear until the first quarter of 2014 before quickly issuing a correction stating that a third quarter refresh would bring the Retina display to the line, the firm has now told CNET that production on those Retina display panels should begin in June or July.

The timing would not be a tremendous surprise given that the firm just said that the device should begin shipping in the July-September quarter, although other sources have indicated that it may not appear until somewhat later in the year. DisplaySearch's Richard Shim also claims that current iPad mini display supplier LG Display will maintain a prominent role in production of the new Retina displays, and that Samsung will remain out of the display supply picture.

"We should see the start of mass production of the panels in June or July," said Richard Shim, an analyst at NPD DisplaySearch.

LG Display will be one of the major manufacturers of the display, he said, adding that Samsung is not a supplier for the Mini.

"Samsung is currently not in the iPad Mini and they won't be in the next generation. LGD is becoming a much bigger supplier than before," he said.

LG is reportedly the main supplier for display panels in the current iPad mini, with AU Optronics also responsible for a significant portion of the supply.

Also unsurprising is Shim's claim that the Retina iPad mini will adopt the same 2048 x 1536 resolution seen on the full-size iPad's Retina display, albeit at a higher pixel density to fit the iPad mini's smaller physical size. Maintaining consistent resolution across the iPad lineup allows developers to target a single screen size with their apps, simplifying their work.

On last month's earnings conference call, Apple CEO Tim Cook appeared to specifically temper new product expectations for the next several months, mentioning that Apple had a number of great products coming "in the fall and across all of 2014."