MacRumors

Engadget publishes a memo written by Nokia CEO Stephen Elop and posted to the company's employees about the fragile state of their business. The memo is surprisingly candid about the challenges Nokia faces with increased competition from the Apple iPhone and Google's Android. He compares Nokia's current situation to a man standing on a burning platform where the only choice is to shift from expected behavior and "jump".

Of the iPhone's entry into the market, he wrote:

In 2008, Apple's market share in the $300+ price range was 25 percent; by 2010 it escalated to 61 percent. They are enjoying a tremendous growth trajectory with a 78 percent earnings growth year over year in Q4 2010. Apple demonstrated that if designed well, consumers would buy a high-priced phone with a great experience and developers would build applications. They changed the game, and today, Apple owns the high-end range.

Elop acknowledges that even though the original iPhone launched in 2007, Nokia does not yet have a product that is close to that experience. While they have been working to innovate, they fell behind and missed big trends.

The battle of devices has now become a war of ecosystems, where ecosystems include not only the hardware and software of the device, but developers, applications, ecommerce, advertising, search, social applications, location-based services, unified communications and many other things. Our competitors aren't taking our market share with devices; they are taking our market share with an entire ecosystem. This means we're going to have to decide how we either build, catalyse or join an ecosystem.

Nokia plans on launching a new strategy on February 11th. Many are speculating that they may join an existing platform such as Windows 7 rather than continuing on their own.

The whole memo is a very interesting read on the disruptive nature of the iPhone on one of the major mobile phone manufacturers.

The Wall Street Journal claims that the next version of the iPad is now in production. They cite "people familiar with the matter".

The new device will be thinner, lighter and will come with a faster processor, more memory and a more powerful graphics processor, said the people familiar with the matter. It will have a front-facing camera for the first time for features like video-conferencing, but the resolution of the new iPad's display will be similar to the first iPad, they said.

The new iPad will be available through both Verizon and AT&T but not Sprint or T-Mobile, according to the newspaper.

With the GSM version of the iPhone having received considerable attention for issues with loss of cellular signal when held in a "death grip" position, observers have been interested to see whether a similar issue affects the Verizon iPhone with its modified antenna design.

iLounge reports that not only has it been able to demonstrate loss of cellular signal strength with the same "death grip", but it has also been able to hamper Wi-Fi reception by subjecting the device to a grip dubbed the "death hug".

As seen in this Verizon iPhone 4 antenna attenuation video, the CDMA iPhone 4 can still lose substantial cellular signal strength when held in the prior "death grip" position, as well as Wi-Fi signal when held in a different position, in each case noticeably slowing or completely stalling the reception of data.

The problem with Wi-Fi reception appears when the device is held snugly in landscape orientation with two hands. Prior to the Verizon iPhone 4's launch, sources told iLounge to be on the lookout for the issue, which was being referred to as the 'death hug."

It's not clear if such a "death hug" is of any practical concern.

Apple CEO Steve Jobs famously referred to the antenna problems with the original iPhone 4 as a "non issue", telling a customer to simply "avoid holding it in that way".

All phones do suffer from some attenuation when gripped tightly in certain ways, a phenomenon caused by the human body's natural ability to absorb signals in the range used for cellular and wireless networks. Critics of the iPhone 4, however, argued that the effect was seen by some simply by bridging the iPhone 4's antenna with your hand. The video makes no effort to see if this antenna bridging remains a factor on the Verizon iPhone 4.

Reports of tightening supplies for Apple's MacBook Pro models continue today, with one reader letting us know that he was just informed by Apple that a replacement for his faulty machine will likely not be available for 4-6 weeks, and possibly as long as 8 weeks.

The long lead time was reportedly cited for a replacement on a custom-configured MacBook Pro carrying the top-of-the-line 2.8 GHz Core i7 processor, and models with both traditional hard drives and solid state drives have been said to be subject to the same shipping timeframes.

Considering the long wait times, Apple offered the customer the option of waiting for replacement model to come available, a full refund, or a replacement with a standard configuration that would be more readily available.

Despite some hints that a MacBook Pro refresh may occur in the near future, questions have been raised about whether a design error with the chips expected to be used in the updated models would delay a potential launch. But just yesterday Intel announced that it will begin shipping the dual-core Sandy Bridge chips that would presumably appear in the MacBook Pro on February 20th, meaning that Apple could release updated machines relatively soon after.

Late last month, we noted that Toshiba had introduced new 1.8-inch hard drives topping out at 220 GB and carrying the same form factor used in the existing iPod classic. With Apple's iPod classic currently coming in at 160 GB, the capacity bump would be a substantial one if Apple elected to adopt the new drives.

With that information floating around, observers have been keeping their eyes on stock levels for the iPod classic, hoping to see some indication of a change in availability. AppleBitch has found just that information, seeing shipping estimates from Apple and other vendors slipping in recent days, primarily for the silver model.

The Apple Store shows that the silver iPod Classic now ships in 1-3 days, down from 24 hours last week. In addition, Best Buy has updated their website to say that the device is backordered for 1-2 weeks (last week it was shipped in 1 day) and Target also has it backordered for 2-4 weeks. Currently the shortage only seems to be affecting the silver colored model, the dark colored version appears relatively unaffected.

Questions remain, of course, about what this information might mean. Apple's product availability does tend to ebb and flow as the company manages its finely-tuned inventory channels, although such delays are sometimes indicative of upcoming changes to Apple's product lines.

And even if the tightening supplies do indicate a forthcoming change, it is unknown whether that change might be refreshed models carrying the new larger-capacity drives or if Apple may simply finally be discontinuing the iPod classic. The iPod classic has not been updated in nearly 18 months, and Apple CEO Jobs notably reported at the company's September 2010 iPod-focused event that Apple was introducing an "all-new" iPod lineup. That statement came even as the iPod classic remained untouched, suggesting that Apple might simply be relegating the iPod classic to the back burner and potentially phasing it out.

A pair of reports from The New York Observer and ifoAppleStore indicate that Apple is looking to open a new retail store, its fifth in Manhattan, at the landmark Grand Central Terminal. The store would reportedly be located inside the busy transportation and tourist hub and would sit less than a mile from the company's flagship Fifth Avenue store.

Apple has begun a super-secret quest for a store in historic Grand Central Terminal, potentially creating a hive of buzzing techies in the glamorous Beaux Arts landmark.

Reliable sources tell The Observer that the maker of ubiquitous iGadgets - from computers to cell phones - hopes to open a store in the transportation and retail hub, though it has yet to begin the long approval process necessary for opening in a city landmark.

ifoAppleStore notes that Apple is keen to open the store not only for its location in the historic and highly-trafficked building, but also to relieve pressure on the busy Fifth Avenue store that, despite its relatively small size, outsells the company's other three Manhattan stores combined.

Today, the terminal hosts 700,000 visitors a day, most hurrying to trains and the city's busiest subway stop. But another 250,000 visitors a day pass through the expansive Vanderbilt Hall, the station's original waiting room that is now rented out for special events.

The 134,000 square-feet of retail space includes 68 shops and 35 restaurants, some on the main concourse level surrounding Vanderbilt Hall, and others on the balcony level just below. Current major tenants include Banana Republic, Kenneth Cole and a Michael Jordan Steakhouse in about 6,000 square-feet of space each, and many other tenants in less than 1,000 square-feet. The historic Oyster Bar restaurant in on the lower level, along with a fresh food market.

Negotiations appear to still be in the early stages and will likely take quite some time to complete, but the location could provide an interesting opportunity for Apple to fit its brand into one of the most iconic transportation hubs in the world.

Market research firm IHS iSuppli yesterday released data on U.S. online movie downloads and streams for 2010, revealing that Apple continues to dominate the market with a 64.5% share of total spending. That share is down, however, from 74.4% in 2009 in the face of growth of other services such as Microsoft's Zune Video.

"The iTunes online store showed remarkable competitive resilience last year in the U.S. EST/iVOD movie business, staving off a growing field of tough challengers while keeping pace with an dramatic expansion for the overall market," said Arash Amel, research director, digital media, for IHS. "Apple faced serious competition from Microsoft's Zune Video and Sony Corp.'s PlayStation Store, as well as from Amazon and - most significantly - Wal-Mart. However, iTunes managed to grow because of the introductions of the iPad and the second-generation Apple TV, which have spurred the company's movie rental offerings and have invigorated the iTunes multi-screen ecosystem. We expect that in the United States, Apple's strong performance in iVOD will allow it to continue to bypass the video on demand services offered by many major cable operators."

iSuppli reports that the overall market grew 60% in 2010, with Microsoft riding the popularity of its Kinect controller for the Xbox 360 to late-year gains with its Zune Video offerings and Wal-Mart making significant gains with its Vudu service.

The report appears to limit data to services offering individual purchases and rentals of downloadable and on-demand streaming content, omitting subscription-based services such as Netflix that offer unlimited streaming for a flat fee.

Intel is planning on shipping the Dual-Core Sandy Bridge chips for laptops starting on February 20th, 2011.

The first Sandy Bridge processors to ship were quad-core chips, mainly for high-end laptops. The dual-core chips will likely go into end-user and ultraportable laptops, many of which were shown at last month's Consumer Electronics Show. Fujitsu said it plans to use dual-core Core i7 chips in its high-end ultraportable laptops.

The Dual-Core chips are likely upgrades for the existing MacBook Pro line which is due for updates. The Sandy-Bridge CPUs were described as the next generation replacement CPU with significantly improved integrated graphics performance and better performance/power ratios.

The remaining question is how the "design flaw" found in some of the early Sandy Bridge controllers will ultimately affect the production and availability of these new chips. The issue didn't directly affect the CPUs, but affected SATA-II connectors found on the chipsets. Like other computer manufacturers, Apple uses Intel's chipsets to interconnect their CPUs to the rest of the computer. Intel has announced that they would begin shipping fixed chipsets by mid-February.

Repair firm iFixyouri has started taking apart the Verizon iPhone and 9 to 5 Mac notes that the device carries a Qualcomm "Gobi" MDM6600 wireless chip inside it, technically offering "world-mode" compatibility with both CDMA and GSM networks. iFixit is also performing one of its usual high-quality teardowns of the Verizon iPhone and has seen the same chip.

The MDM6600 supports HSPA+ data rates of up to 14.4 Mbps, as well as CDMA2000 1xEV-DO Rev. A/Rev. B. Apple of course has not included a SIM-card slot in the Verizon iPhone, and thus the device can not actually be used on GSM networks.

The use of the dual-mode chip in the Verizon iPhone does, however, increase the likelihood that Apple will use a similar solution in the fifth-generation iPhone and could thus offer a single model supporting both GSM and CDMA networks.

Update: iFixit's Kyle Wiens speculates that keeping separate CDMA and GSM devices for the time being may have made it easier for Apple when it comes to antenna design given the number of frequencies involved across the standards. The Motorola Droid Pro currently uses the same Qualcomm chip to offer both CDMA and GSM compatibility.

iFixit also notes that the vibrator on the Verizon iPhone has been redesigned and moved, yielding a "quieter, softer feel" with a less-jarring noise when the device is lying on a table.

Late last month, we reported that we had received word of tightening MacBook Pro supplies, suggesting that an update to Apple's popular notebook line might be coming in the near future.

Information has continued to flow in regarding tightening supplies, with Japanese blog Mac Otakara reporting today that supplies in Japan are now pushing out to 2-3 week shipping estimates. The site also reports that the following Sandy Bridge configurations are likely for update MacBook Pros:

Core i7-2620M(2.70GHz)
Core i5-2540M(2.60GHz)
Core i5-2520M(2.50GHz)
Core i5-2410M(2.30GHz)
Core i3-2310M(2.10GHz)

Also getting attention today is a Best Buy inventory screen pointing to a March 11th in-stock date for what may be a revised version of the entry-level 13-inch MacBook Pro. We received word of the same database entry about ten days ago, but have little faith in its accuracy, as the company did the exact same thing in early 2010, guessing at a March 14th date for new models. The update didn't actually occur until a month after the proposed date.

The other wildcard in the MacBook Pro update situation is Intel's "design error" that has forced the company to fix its manufacturing process for one of the chips in the chipset being used the Sandy Bridge processors presumably destined for the next-generation MacBook Pros and iMacs. A delay in availability of Sandy Bridge chipsets could easily push back MacBook Pro updates from Apple's original target date and result in an extended period of tight supplies of the current models.

Research firm IDC has released the results of its survey of worldwide smartphone sales for the fourth quarter of 2010, finding Apple holding onto the same second-place ranking it earned last quarter as the top manufacturers see their shares decline slightly as small vendors ride the Android wave to greater sales.

According to the results, Apple's 16.1% share of the smartphone market in the fourth quarter trailed only Nokia's 28.0% share and came in solidly ahead of Research in Motion and its 14.5% share. Apple's share dipped slightly from the 17.4% share it held in the previous quarter, and came in on par with the same 16.1% share the company held in the fourth quarter of 2009.

Apple's iPhone gained more ground in the worldwide smartphone market, with shipment volume growth coming from Asia/Pacific and Japan. In addition, Apple made further inroads into the enterprise market, with more companies adding Apple to their approved smartphone list and increased development of corporate-centered applications. Rumors of an iPhone 5 have begun to heat up the blogosphere, with many expecting a new design and perhaps a mobile wallet.

Consequently, Apple's 86.2% year-over-year growth essentially mirrored the smartphone industry's overall growth rate of 87.2%, with major players Nokia and Research in Motion checking in at only 36% growth while Android-focused manufacturers such as Samsung (438.9%) and HTC (258.3%) saw tremendous growth in market share, but not enough to overtake the three leaders. Total smartphone sales topped 100 million in the quarter for the first time in history.

In looking at full-year results for 2010, Research in Motion edged out Apple by a margin of 16.1% to 15.7%, although the gap was much smaller than the 5.4 percentage point difference seen in 2009.

While it appears that at least one lucky customer was able to obtain his Verizon iPhone over the weekend, the initial wave of pre-orders for existing Verizon customers is now making its way to their doorsteps in significant quantities.

BGR has already received its order and has put together a small gallery of photos showing the device, packaging, and included materials from Verizon.

Obviously the Verizon iPhone is extremely similar to the GSM iPhone used on AT&T and other carriers around the world, and some of the minor differences between the two versions have been covered in the early reviews, but we'll be keeping our eyes out for any significant observations about the new CDMA-based iPhone as more users begin to get their hands on it.

The Verizon iPhone marked the fastest debut in the carrier's history, despite launching in the middle of the night and being limited to existing Verizon customers. The carrier sold through its initial allotment of iPhones within 17 hours and stopped taking pre-orders at that point. Customers still looking to obtain a Verizon iPhone will need to wait until this Thursday, although Apple has announced that it will begin taking orders and reservations on Wednesday.

With the success of the iTunes App Store and the launch of the Mac App Store, it seems clear that the long term future of software sales is going to be digital distribution. Based on what we've heard from our sources, however, Apple is planning on making the move to all digital sooner than expected at their retail stores. Apple is working towards eliminating boxed software and presumably focusing sales through the Mac App Store.

Apple's recent plans to start offering Personal Setup for Mac seems to be in line with that goal.

When you purchase a Mac at an Apple Retail store an employee will help you setup your e-mail accounts, walk you through the Mac App Store, setup an iTunes account for you, and show you the basic pointers of owning a Mac. Some stores will even have dedicated Mac setup stations.

New Mac customers will be walked through how to use their Mac and also how to obtain new software through the Mac App store.

Boxed software also takes up retail space that could be used for higher profit items such as iPad or iPhone accessories. It's not clear how Apple will deal with prominent titles such as Microsoft Office and Adobe Photoshop which aren't yet available through the Mac App Store.

While the Mac App Store has been launched for Mac OS X 10.6 Snow Leopard, it is also one of the key new components in Mac OS X Lion due out this summer. We expect to hear more about Lion during this year's Worldwide Developer's Conference.

Originally spotted by AppleBitch.com, the possible dates for WWDC this year appear to fall between June 5th and 9th. The Moscone events page shows a "Corporate Meeting" in Moscone West occupying those dates. In the past, such listings have predicted Apple's WWDC event, but not with complete accuracy. Last year, Apple's actual WWDC dates did not fall on the predicted dates.

What is interesting is that the dates do correspond with tentative leaked dates from a San Francisco Convention and Visitors Bureau PDF. Those dates included:

Tentative WWDC Dates:
2011: June 5th - June 10th
2012: June 10th - June 15th
2013: June 9th - June 14th
2014: June 1st - June 6th
2015: June 7th - June 12th

With the rise of iOS and Apple's withdrawal from Macworld Expo, WWDC has become a major event for Apple each year. This year, Apple is expected to feature Mac OS X Lion prominently.

It seems the first Verizon iPhone has been delivered to its customer. The video shows an individual picking up his iPhone 4 from a UPS center on Saturday. Meanwhile, many of our readers who have ordered expect their deliveries on Monday, February 7th.

Those with preorders are organizing in the shipping discussion thread and in our iPhone forums.

New customers looking to purchase a Verizon iPhone 4 will have to wait until February 9th for online orders and February 10th for in-store purchasing.

Mac Otakara claims that Apple is planning to conduct a short media event at the end of February to launch the next generation iPad. The site offers few other details, though seems to think the actual availability of the iPad 2 will be in March.

We're not sure about the accuracy of the information, but the timing seems reasonable. Apple is widely known to be prepping the next generation iPad. There have been reports of iPad 2 prototypes being spotted and there was also an unconfirmed tip that a television commercial for the iPad 2 had already been shot in LA last week.

AT&T released their first iPhone ad directly targeting the Verizon iPhone. It's appropriately titled "Answer" and shows a husband having forgotten to make dinner reservations for their anniversary. The man does a search for "fine dining" while on the phone with his wife. The commercial concludes with:

Only AT&T's network lets your iPhone talk and surf at the same time

Simultaneous voice and data is one of the differentiators between AT&T's GSM and Verizon's CDMA networks. On Verizon, 3G data service is not usable while you are on a voice call, though, of course, local Wi-Fi networking would still work.