MacRumors

While The Wall Street Journal is outlining Apple's goals for a television set-top box, others continue to believe that Apple is working on a standalone television set of its own integrating much of the same functionality.

One of those observers is Jefferies & Co. analyst Peter Misek, who has been piecing together clues from Apple's supply chain in Asia and noted back in March that components for an Apple television set were "starting to move in small quantities". Misek is out with a new research note today, claiming that the Apple's television is now in "full production" with Apple looking to partner with providers such as AT&T and Verizon on the product while offering a set-top box alternative for entrenched cable providers.

We believe the iTV is in full production. Recent data out of Sharp, Hon Hai, and other specialty chemical and TV component suppliers support this. Also, JDSU noted that they have a new non-gaming customer for its gesture control modules. They indicated this is a new "living room" based customer. We believe Apple will leverage AT&T's and Verizon's content deals for the iTV. Additionally, the WSJ's sources indicate Apple may also consider a set-top box version for the cable operators.

Misek is currently modeling for sales of two million Apple television sets in the fourth quarter of this year with an average selling price of $1250, but he notes that Apple may push back the launch into 2013 as it puts its focus on the iPad mini to counter efforts by Google, Amazon and Microsoft in the tablet market.

We expect either the iPad Mini to launch in CQ4 with the iTV either launching in CQ4 or CQ1.

Microsoft’s Surface tablets, the initial success of Google’s Nexus 7, and Amazon’s upcoming product launches could be affecting Apple’s launch schedule. These represent stiff competition vs. a likely lack of viable competition for the iTV over the next year. [...]

There is also the possibility that Apple chooses to launch both products before year end. The iTV would then be in time for the Christmas selling season, but that would mean Apple having three huge product launches in a short timeframe and leave little for CY13 outside of the typical iPhone and iPad refresh.

Misek also notes that Apple could be looking at a potential problem with display partner Sharp, which has continued to experience financial difficulties amid fears that the company could enter bankruptcy. Apple's assembly partner Foxconn/Hon Hai has already entered into a partnership that saw the company take a 10% stake in Sharp, with Hon Hai reportedly seeking to raise its stake to 20% as it renegotiates the deal in light of Sharp's continued troubles. Misek believes that Apple may find itself having to "spearhead a quiet rescue" of Sharp with the assistance of Hon Hai, given the close relationship among the three companies and Apple's existing investments in Sharp's facilities.

Following last month's report that Apple and Google were heading up separate consortiums bidding to obtain Kodak's portfolio of digital imaging patents, The Wall Street Journal now reports that the two camps may surprisingly be joining the same team. The negotiations are reportedly seeing Apple joining forces with its courtroom foes Samsung and HTC, as well as smartphone platform rival Google, in an effort to obtain the patents for a price well below that sought by Kodak.

The bidding group brings together a raft of strange bedfellows. It includes Apple Inc. and Google Inc., fierce competitors in the global smartphone market. It also includes Intellectual Ventures Management LLC, which buys up patents to seek licensing revenue and increasingly sue other companies for infringement, and RPX Corp., which buys patents to keep them from being used against its members in suits. [...]

People familiar with the matter said the consortium bidding on Kodak's patents also includes Samsung Electronics Co., LG Electronics Inc. and HTC Corp., all companies building smartphones based on Google software.

The report notes that the large consortium of competitors is seeking to purchase Kodak's patent portfolio for "more than $500 million", above opening bids but well below the $2.2-$2.6 billion Kodak has been hoping to win. A win by the consortium could help prevent litigation over the patents by keeping them out of the hands of a single company, but antitrust regulators could raise complaints over the move.

As a result of the volatile negotiations, Kodak has extended bidding several times and has indicated that may end up pulling some or all of its patents from the auction block if pricing is not in line with what it feels it needs to assist with its bankruptcy issues.

After setting a record high close yesterday, Apple's stock today has extended its strong run that has been in place since last month's disappointing earnings numbers, pushing through to set a new all-time intraday high. The stock hit a new high of $644.13 per share just minutes ago, besting the previous all-time high of $644.00 set on April 10.

The move has also pushed Apple's market capitalization above $600 billion for the first time since April 10, also marking a 23% increase in stock price since the bottom of this dip came at $522.18 during trading on May 18.

Apple's new all-time high comes a day after the company issued its first quarterly stock dividend since 1995, giving shareholders $2.65 per share as one piece of the company's strategy for handling its massive stockpile of cash. Investors had been calling for a dividend for quite some time as Apple's cash hoard approached and then exceeded $100 billion, with the company relenting in a March announcement in which the company outlined its belief that it will have enough cash on hand to meet its needs for the foreseeable future. The company also instituted a $10 billion stock buyback program intended to offset dilution coming from stock grants and employee stock purchases.

Following up on its story from yesterday about a possible forthcoming Apple set-top television box, the The Wall Street Journal had more details to share today.

Apple aims to make it so viewers can watch any show at any time via a cloud-based DVR that would store TV shows online. The service would be designed so viewers could begin streaming a show minutes after it began airing live.

Another significant feature of the Apple set-top device is likely to be its user interface, which could resemble the navigation icons on Apple's iPad. While the design may change, the interface is expected to be easier for people to use than existing cable on-screen menus, widely viewed as clunky.

Apple's device also may create space on the TV screen for social media features, such as sharing TV shows through services like Twitter Inc., the people said. Apple also wants users to be able to access content from the device on other Apple products like iPhones and iPads.

The Journal says Apple has been in talks with cable services like Comcast and Time Warner Cable, as well as companies that control television content. The article notes that existing agreements between cable and content companies may not allow them to sign deals for Apple's device without content owner permission.

CBS CEO Les Moonves said earlier this month that his company would be open to offering its content on a hypothetical Apple television depending "what the terms are" and "what we get paid". Apple is looking to offer past seasons of shows through iTunes on the device which are already available on iTunes, as well as all episodes from current seasons.

The sort of cloud-based DVR that Apple is envisioning could be the motivation behind Apple's plans for a new 500,000 square-foot data center in Oregon, as well as an existing massive center in North Carolina.

Apple's stock price closed at an all-time high of $636.34 today, passing the prior all-time closing high of $636.23 set four months ago on April 9th. The next day, April 10th, the stock hit an intraday high of $644 and the company's market capitalization breached $600 billion before falling back. Apple's stock price is up nearly 60% on the year, outperforming the NASDAQ by more than 3:1 and the Dow Jones Industrial Average by more than 6:1.

Growth in Apple's stock had been slightly weaker for the past month in the run-up to weaker-than-expected earnings for the third quarter, but new reports of a September launch for the next iPhone as well as a smaller, cheaper iPad Mini have been pushing the price higher.

All shareholders of record as of Monday's close also received a cash dividend of $2.65 per-share today, the first dividend payment to Apple shareholders since December 1995.

Back in February, Apple announced plans to build a new data center in Prineville, Oregon, and by late April it was revealed that Apple had agreed to invest $250 million in the project. The company has already begun installing modular data center buildings at the site while it continues to work toward permanent facilities.

The Associated Press now reports that Apple has filed its plans with the city of Prineville, revealing its goal of constructing 500,000 square feet of data center space, on par with Apple's facility in Maiden, North Carolina.

The plan shows two buildings with more than 500,000 square feet of what are described as "data halls," The Bend Bulletin reported Wednesday. The plan doesn't say when Apple might start building.

"They really didn't say how long they are looking at," Prineville senior planner Joshua Smith said.

A company spokeswoman, Kristin Huguet, referred Wednesday to the company's early statements on the development, which forecast "hiring dozens of people and bringing hundreds of construction jobs to the area" but didn't set a construction schedule.

The report notes that Apple is also partnering with Prineville on expanding the city's water supply by tapping a newly-discovered underground stream. Under the deal, Apple will help convert some existing test wells into production wells to meet the company's needs and beyond, with the city reimbursing Apple over time.

Following our report from earlier this week regarding word from Apple retail store sources of cutbacks and layoffs, Dow Jones Newswires now shares word that Apple has acknowledged that it "messed up" in adjusting its staffing formulas, although the company denies mass layoffs at its stores.

In a communication with store leadership teams, senior vice president of retail, John Browett, who took the reins of Apple's retail stores in April, said that the company had been trying a new staffing formula for its retail stores, leading some employees to see their hourly shifts cut and retail locations to be understaffed. This happened for a few weeks before the company decided to revert to its older system, hoping to rectify the problem.

He instructed leadership teams to tell employees, "We messed up," according to two people who were aware of the communication, which also stressed that while shift schedules were affected, no one was laid off. He also wanted employees to know that it was hiring new staff, these people said.

Apple acknowledged the retail staffing changes. "Making these changes was a mistake and the changes are being reversed," said Kristin Huguet, an Apple spokeswoman. "Our employees are our most important asset and the ones who provide the world-class service our customers deserve."

Despite Apple's claims that "no one was laid off", we have indeed heard from several Apple employees who have been laid off in recent weeks, with several of them independently claiming that there have been others, although some have called the moves "isolated" while others have characterized them as "many". ifoAppleStore reported yesterday that the cutbacks were made by Browett in an effort to meet profit goals and encourage the "bloated" store staffs to run "leaner", despite the objections of retail veterans within the company.

We did receive an unconfirmed report yesterday claiming that at least some stores held meetings addressing the issue, with promises that the cut hours would be restored and a phone call from Apple's corporate offices apologizing for the situation. It was unclear, however, exactly which employees were included in those meetings.

This is the second high-profile acknowledgment of a "mistake" on Apple's part in recent weeks, with Apple just last month having backpedaled on removing its products from the EPEAT environmental registry. In that case, Apple senior vice president Bob Mansfield posted an open letter apologizing for the company's error.

Late last month, fingerprint scanner firm AuthenTec announced that it had been acquired by Apple, naturally leading to speculation that Apple is looking to include the company's biometric security technology in its products.

A lengthy report from The Next Web now takes a look at the U.S. Securities and Exchange Commission filing documenting the negotiations that led to the acquisition, highlighting Apple's sense of urgency in obtaining access to AuthenTec's technology, whether through acquisition or licensing. According to the filing, Apple and AuthenTec began discussions in late 2011, with serious talks about a potential licensing deal starting up in late February 2012.

Then the agreement shifted completely.

On May 1, Apple decided it wouldn’t be satisfied with a commercial agreement and notified AuthenTec’s representatives of its proposal to acquire the company instead. Apple offered a price of $7.00 per share, valuing AuthenTec at a 115% premium over the closing price of its common stock as a day previous, pricing that Apple believed “other potential buyers would be unwilling to pay.”

On May 2, Apple started tightening the screws. The company believed its price was “very attractive” as AuthenTec would face challenges trying to develop new technologies for its rivals, which “have dozens of different smartphone platforms, in contrast to Apple’s unique narrow product platform, which allows for unity of design in component parts across significant unit volumes.”

The regulatory filing details how Apple insisted that negotiations proceed quickly due to its "product plans and ongoing engineering efforts", with Apple informing AuthenTec that it would not participate in an auction for the company due to the tight timeline. Negotiations continued under a tight time schedule, but they hit a snag when Apple discovered some unacceptable issues during its due diligence process, and discussions once again turned back to a potential licensing agreement rather than an acquisition.

[F]rom June 1 to July 3 both parties continued to “design and develop the technology for Apple and continued to negotiate to narrow the significant differences between the parties regarding acceptable terms for a commercial agreement.”

If there was a sign that Apple was hell-bent on integrating the technology in its products no matter what, this was it.

Gears shifted once again in mid-July once AuthenTec reported that it had resolved the issues raised by Apple during the due diligence process, and a full acquisition of AuthenTec by Apple was once again back on the table. Negotiations over just a handful of days brought together the final package that saw Apple pay $8.00 per share for AuthenTec and make licensing-related payments totaling $135 million.

The Next Web points to Apple's urgency during the negotiations and willingness to obtain access AuthenTec's technology under whatever scenario it could achieve as reason to believe that Apple is under a very tight timeline to bring the technology to its new iOS device hardware. The technology would be a nice complement to iOS 6, serving as one component to unlock the potential of Apple's new Passbook digital wallet feature.

Throughout its meetings with AuthenTec, Apple was keen to express that work on the new technology must continue unhindered, regardless of whether it entered a commercial agreement (which involved royalties, patent licensing and its exclusive use) or it acquired the company.

Will we see fingerprint technology in the new iPhone (or iPad)? It seems almost certain.

Apple is expected to introduce the next-generation iPhone on September 12, and while part leaks seen so far have yet to reveal evidence of the incorporation of a fingerprint sensor, a number of observers have argued that the capabilities could be relatively easily incorporated into the device's home button.

The Wall Street Journal is reporting that Apple has a set-top box in the works that would allow viewing of live cable television as well as other content.

Apple Inc. is in talks with some of the biggest U.S. cable operators about letting consumers use an Apple device as a set-top box for live television and other content, according to people familiar with the matter.

The talks represent Apple's most ambitious crack at infiltrating the living room after years of trying.

Apple doesn't appear to have reached a deal with any cable operators. One obstacle may be the reluctance of operators to let Apple establish a foothold in the television business.

The WSJ suggests Apple's set-top box will be an aftermarket item that could cost "hundreds of dollars" rather than $10-$15 per month for the standard one provided by cable companies. Companies such as Tivo already provide similar boxes to independently replace your cable box by utilizing CableCARD technology.

By following this path, Apple would avoid having to license content directly from providers and instead piggy-back on existing cable television distribution. The report also notes that this technology could eventually find its way into a standalone Apple television set.

Apple is said to have considered a set top box as long as 2 years ago, but Steve Jobs had previously dismissed the market due to the lack of national-providers. Meanwhile, cable companies are reportedly reluctant to give up some control and revenue by allowing Apple into their set top boxes.

Photos of what has been claimed to be a nano-SIM tray for the next-generation iPhone have surfaced several times this month, and repair firm SmartPhone Medic now posts a video comparison (via Cydia Blog) of several next-generation iPhone parts including the nano-SIM tray and external buttons compared to the corresponding parts from the iPhone 4S.

The comparison of SIM trays demonstrates how the micro-SIM used in the iPhone 4S/4 does not fit in the smaller tray that is reportedly being used in the next-generation iPhone. Like the nano-SIM tray, other parts shown in the video including the sleep/wake button, volume buttons, and mute switch are notably of a "gunmetal grey" color distinct from the silver color seen on the iPhone 4S. The video also shows the home button that was the first next-generation iPhone part to leak back in late April.

Apple is expected to introduce the next-generation iPhone with a media event on September 12, with the major new features of the device being a taller 4-inch display and a redesign resulting in a taller but thinner form factor.

Update: The video has been removed.

Update 2: The video is now available once again.

Nowhereelse.fr shares [Google translation] a new photo of what it believes may be a flex cable component for the "iPad mini", housing Apple's smaller dock connector, the headphone jack, and the home button connector. The layout of the component is similar to that of a part said to be for the next-generation iPhone that surfaced back in May.

The report notes that Kyle Wiens of iFixit has offered his thoughts on the photo, with Wiens reporting that it is indeed consistent with being an Apple component but that he is unable to confirm its authenticity. The part does bear a close resemblance to the part claimed to be for the next-generation iPhone, and it also carries a part number in the style of Apple's other iOS device flex cable components.

The most troublesome aspect of the part is the location of the headphone jack directly next to the dock connector. While evidence has accumulated suggesting that Apple will be moving the headphone jack to this location on the next-generation iPhone, case leaks, design drawings, and physical mockups have so far all suggested that the headphone jack will be located on the top edge of the iPad mini, as found on the full-size iPad.

Apple's next-generation iPhone is of course expected to support LTE connectivity in at least some markets, but given differences in LTE frequency bands around the world it is interesting to note that The Korea Times reports (via The Next Web) on comments from sources at current iPhone partners SK Telecom and KT claiming that they are currently in negotiations with Apple over LTE service for the forthcoming device.

"KT is in negotiation with Apple to persuade the latter to support KT’s 1.8-gigahertz frequency in Korea for the upcoming iPhone," said one senior KT executive, asking not to be identified. KT spokeswoman Kim Yoon-jeong declined to confirm.

The company, which joined the race for LTE-enabled smartphones later rivals SK and LG, is trying to persuade Apple to have its new iPhone support LTE connectivity, according to KT officials.

SK Telecom is also pushing for the same. Officials from the nation's biggest mobile carrier are currently in Apple headquarters in California to persuade Apple to support SK's LTE frequency for its local customers.

It is unclear, however, exactly what SK Telecom and KT are attempting to achieve in their efforts to "persuade" Apple to support their LTE frequencies on the next-generation iPhone, given that the hardware capabilities of the device have long been finalized. If the hardware does support the Korean carriers' frequencies and the negotiations are simply over contractual terms, it would suggest that there could be significant expansion of international LTE compatibility for the iPhone compared to the third-generation iPad.

The third-generation iPad supports LTE only over the 700 MHz and 2100 MHz frequency bands, with only a handful of carriers including AT&T and Verizon in the United States and Bell, Rogers, and Telus in Canada being supported for the device. With SK Telecom using the 800 MHz band as its primary LTE spectrum and 1800 MHz as a secondary band, and KT operating solely on 1800 MHz, the next-generation iPhone hardware would need to have new LTE frequency support for service on those carriers to even be possible. Notably, the 800 MHz and 1800 MHz bands are also the spectrum being used for LTE in Europe, Australia, and other markets, and thus hardware compatibility with those frequencies could significantly expand the number of countries and carriers on which the next iPhone could support LTE connectivity.

A trio of reports out today is beginning to pin down some more rumored details for Apple's smaller "iPad mini", suggesting that the device will carry a narrower profile than previously thought and perhaps match the iPod touch's 7.2 mm thickness.

The first report comes from 9to5 Mac, which claims that the iPad mini will "look like a big iPod touch", with narrower bezels along the sides of the device paired with more traditional, thicker bezels at the top and bottom.

This iPod touch-like design makes a lot of sense for a number of reasons. For one, when compared to the Nexus 7 (and Kindle Fire, Galaxy Tab 7, RIM Playbook, etc.), this would give the iPad mini a similar, “purse-able,” and “big pocket-able” form factor but with a larger 4:3 display. The lack of a bezel on the sides will make it easier to hold too.

The report goes on to speculate that the iPad mini will offer at least a front-facing camera and perhaps LTE connectivity on some models, and a lack of significant part leaks suggests that the device may not be ready to begin shipping for several more months.

The second report comes from iMore, which backs up the earlier report and offers its own thoughts on the iPad mini's design, as well as a rendering of the rumored device.

Based on several sources, I believe that design to be an accurate representation of what the iPad mini will look like. In addition, it's my understanding that it will be the exact same thinness as the iPod touch, which is substantially thinner than the 9.7-inch iPad. The quick mockup [below] shows what I believe are accurate proportions for the iPad mini compared to the 9.7-inch iPad and the current generation iPod touch 4.

Finally, Daring Fireball's John Gruber shares his thoughts on the device, including his belief that some of the leaked rear shell photos may indeed be genuine given the similarities seen among several independent leaks. Gruber goes on to argue in support of the narrower side bezels, noting that with the device falling in between the full-size iPad and the iPod touch its design is likely to similarly fall somewhere between the two existing devices.

The iPad 3 — the whole device, not just the display — measures 241.2 × 185.7 mm. Divide and that comes out to roughly 1.3, which is very close to the aspect ratio of the iPad display (1.333…). [...]

That’s not true for the iPhone and iPod Touch. The iPhone 4S is 115.2 × 58.6 mm; divide and you get roughly 1.97 — far different proportions than the 1.5 (3:2) aspect ratio of the display. Again, just look at it.

Should not the iPad Mini fall somewhere in between?

Gruber goes on to perform some calculations estimating the size of the iPad mini at roughly 200 x 135 mm, only slightly larger than Google's Nexus 7 despite having a screen 0.85 inches larger diagonally, a feat made possible by the narrow side bezels on the iPad mini.

But with a thickness in line with the iPod touch, the iPad mini would be one-third thinner than the Nexus 7 and thus encompass roughly one-third less volume and one-third less weight. Comparing this to the Nexus 7's weight of 340 grams, Gruber suggests that the iPad mini could weigh just 265 grams, marking a major weight savings over the full-size iPad while still retaining a reasonable display size.

Details on Apple's release plans for the iPad mini remain up in the air, but iMore appears to be standing by its earlier claim that the device will be introduced at Apple's iPhone media event reportedly set for September 12. Unlike the next-generation iPhone, it will likely be a fair amount of time before the iPad mini actually launches, with the company likely to begin ramping production to achieve availability just in time for the holiday shopping season.