Apple’s Next Revolutionary Product: iTunes

Apple announced the iPad Wednesday, and with it added e-books to the menu of content it’s selling via iTunes.

But I can’t believe that Steve Jobs is going to stop there.

Brian X. Chen and I predicted on Tuesday evening that Apple’s big announcement would go beyond the iPad, and include the announcement of a major, multi-platform content store centered on iTunes.

We were wrong. Wednesday’s announcement was all about the iPad, and nothing else.

But the door is still open for Apple to make a broader content play, and here’s why it makes sense — and why it may be inevitable.

Apple already sells apps, music, video and podcasts through iTunes. Already, iTunes includes fairly robust support for sharing the content you download with other computers on your home network, and of course you can play music, video and podcast on your iPhone or iPod touch as well as your computer. In other words, iTunes is a pretty good media delivery system. In many ways, it’s broken, and it needs to be fixed, but it works.

Apple will shortly begin selling e-books. They’re in the EPUB format, which is fairly rudimentary and doesn’t include much support for formatting or layout, but it’s a start. Also, it’s unclear whether those books will be readable on anything except the iPad. Let’s assume that even if they are iPad-only to start, Apple quickly comes up with some way of reading those books via iTunes on your computer and on your iPhone, because it needs to do that to remain competitive with Amazon’s Kindle.

Apart from those formats — AAC/MP3, Quicktime video, EPUB books and iPhone/iPad apps — iTunes doesn’t offer much support to content producers.

But there’s an end-run around iTunes, for app developers who are frustrated with Apple’s slow and arbitrary-seeming approval process. It’s call web development, and it’s why Apple will soon have to expand the iTunes menu.

Ambitious web developers are discovering that they can create web-centric apps using HTML5 and JavaScript that have surprising speed and interactivity. Check out the Google Voice web app for a clear illustration of this principle. It looks and feels more like a native app than anything I’ve seen recently.

The more developers start going this route, the more money Apple is going to be leaving on the table, because those web apps won’t be sold through iTunes. They’ll be given away or sold through a variety of other payment mechanisms, none of which give a cut to Apple.

Eventually, Apple’s going to offer a way for web app developers to sell subscriptions or one-off access to their web apps via iTunes.

It won’t be mandatory, because there’s no way for Apple to close off the independent web developers completely without messing with the web standards they seem clearly to be supporting. But there will be a powerful incentive for developers, which is that they can take advantage of a built-in micropayment system and the installed base of 125 million iTunes users.

When that happens, it will be a subtle but powerful shift in the economics of the web. App producers will then have the option of creating iPad/iPhone native apps in Objective C, or of producing web apps using HTML5, JavaScript and H.264.

If they go the latter route, they’ll have the option of deploying content on the public web, and collecting money however they can.

Or they will be able to deploy HTML content and web apps via iTunes, letting Apple take care of billing and settlement in return for a 30% cut.

There will be cries that Apple is creating a walled garden, or splitting the web into pieces. And they’ll be right, to a point. But the fact is, there’s no reason that all web content has to be delivered via HTTP from a public, free web server. It could be delivered, page by page and web app by web app, via iTunes.

If I were a web developer or a content producer, I’d be looking at ways of creating rich, immersive experiences using web technologies. Because even if my prediction is wrong and you can’t at some point sell those through iTunes, the iPad is going to make experiences like that compelling enough that you will be able to sell them, through one channel or another.

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Apple’s Next Revolutionary Product: iTunes

Sprint Leapfrogs Verizon With Fast 4G Hot-Spot Device | Gadget Lab |

Sprint Overdrive photo by Dylan Tweney/Wired.comVerizon’s MiFi was one of our favorite products of 2009: It takes a 3G wireless data signal and turns it into a Wi-Fi hot spot.

Now Sprint has one-upped Verizon with the Overdrive, which takes a 4G signal and turns it into a Wi-Fi hot spot.

CES 2010On Sprint’s WiMax-based 4G network, the Overdrive, which is about the size of a drink coaster, will reliably deliver 3 to 4 Mbps of download bandwidth, Sprint executives say, with peak speeds as fast as 10 Mbps. Upload speeds will be slower, but could peak as fast as 4.5 Mbps.

Because the 4G network isn’t available everywhere yet, the Overdrive also works with Sprint’s widely deployed 3G network, which delivers 600 Kbps down and 100 Kbps up, Sprint says.

The router then takes that internet connection and blasts it out as an 802.11b/g signal, with an “extended range” of up to 150 feet. It will support up to five simultaneous device connections.

In demos, the Overdrive router was used to deliver streaming Netflix movies, Skype conversations, and webcam views simultaneously.

Overdrive also contains a GPS receiver (accessible to network applications via a programming interface Sprint provides) and a MicroSD card slot, which can be used to store up to 16 GB of data for local access.

Overdrive will sell for $100 with a 2-year contract at $60 per month for unlimited 4G data downloads, and up to 5 GB of monthly data on the 3G network.

Sprint Leapfrogs Verizon With Fast 4G Hot-Spot Device | Gadget Lab |

Sprint Leapfrogs Verizon With Fast 4G Hot-Spot Device | Gadget Lab |

Microsoft Touts Home Entertainment at CES Keynote | Gadget Lab |

Steve BallmerLAS VEGAS — Microsoft detailed plans for XBox 360 enhancements, a new gesture-driven interface for the XBox and a tablet-style Windows PC tonight at a keynote presentation kicking off the Consumer Electronics Show here.

It was the second year as CES headliner for Microsoft CEO Steve Ballmer, who took over the keynote spot from his former boss, Bill Gates, last year.

CES 2010
After a power outage briefly plunged the stage into darkness and delayed the start of the keynote by over 20 minutes, Ballmer ambled onstage in his trademark V-neck sweater. He touted the company’s successes with its recent Windows 7 launch, outlined its plans for enhancing home entertainment and tying together the “three screens” through which people experience media today (television, PC and mobile devices). He provided more details on upcoming enhancements to the successful XBox 360 platform and XBox Live online service.

“From the largest screen on the wall to the smallest screens in people’s pockets, we are delivering the entertainment people want,” Ballmer said.

View the Microsoft keynote live, via a video stream provided by the company.
(Requires Microsoft’s Silverlight plugin.)

It’s been a good year for Microsoft. Ballmer reprised the launch of the company’s search engine, Bing, which he said has attracted 11 million users since its launch. There are now more than 39 million Xboxes in use around the world, and XBox game sales have totaled $20 billion since the platform’s launch, Ballmer said.

And, Ballmer said, “the Zune HD device is getting rave reviews.” That is true — Wired’s review of the Zune HD is quite positive — but the device still has a single-digit share of the portable media player market.

But the centerpiece of Microsoft’s business in 2009 was Windows 7. After taking well-deserved criticism for its launch of Windows Vista in 2007, Microsoft bounced back with many much-needed enhancements in Windows 7. For the most part, the critical and consumer response to Windows 7 has been excellent. The operating system is more streamlined, easier to use and prettier to look at than Vista, and it seems to have injected new life into what seemed like a staggering personal-computing dinosaur. Ballmer called Windows 7 the fastest-selling computer operating system in history, and touted figures showing that it drove a 50 percent increase in PC sales the week it was launched, and a 50 percent year-over-year increase in overall sales of Windows PCs.

The Mac, it seems, has not killed off Windows.

But with rumors of an upcoming Apple tablet looming large in many observers’ minds this week, Microsoft — along with many other computer industry companies — can’t afford to ignore the persistent irritation that is Apple.

Accordingly, one of the gadgets shown by Microsoft tonight was a tablet-like device, produced by HP and running Windows 7. Not the “Courier” tablet that Microsoft previewed in 2009, this is more akin to old-school Tablet PCs, albeit with no keyboard and running the now-multitouch-enhanced Windows 7.

HP said the device would be available later this year, but provided no details on pricing, availability or specifications.

Another not-so-subtle message from Ballmer’s keynote: Apple’s iPhone hasn’t killed off Windows Mobile, either. Microsoft partners shipped 80 different Windows Mobile-based phones last year, Ballmer said, and indicated that more would be coming in 2010. As an example, he showed off the HTC HD-2, a new WinMo-powered phone that will be available on T-Mobile. The HD-2 will feature a 4.3-inch LCD screen and will be about as thick as two poker chips.

Microsoft pushed the message that it’s an entertainment company, too, on two fronts. One was the announcement of Media Room 2.0, software for viewing multimedia content (videos, audio and photos) on your computer. The new version lets you view content on any screen in your home, from a phone to a PC to a TV, Ballmer said.

And the second entertainment front is the XBox 360. Microsoft entertainment and devices division president Robbie Bach took the stage to show off the company’s achievements here. Fresh from the wildly successful pre-holiday launch of Modern Warfare 2 (one of the highest-grossing videogames in history, according to Microsoft), the company promised more games exclusive to the XBox platform to come in 2010, including Tom Clancy Splinter Cell, Crackdown 2, Mass Effect 2, Fable 3 and Alan Wake.

An update to the Halo series, Halo Reach, will enter beta testing later this year. In an unusual twist, anyone who bought the previous title, Halo ODST, will be invited to take part in the Halo Reach beta test, which Microsoft anticipates will include as many as 2 million testers.

Microsoft also showed off a new XBox Live feature called GameRoom, featuring more than 1,000 old arcade games from the likes of Atari and Intellivision, like Tempest and Pac-Man. Users will be able to create “virtual game rooms” that their XBox Live avatars (and those of their friends) can walk around in. Virtual quarters, one assumes, will be available without limit.

Finally, Bach showed off the company’s gestural interface for XBox 360, Project Natal, which first appeared at E3 last year. Natal will be available in time for the holiday season in 2010, Bach promised, as a camera plus software that will work on all existing XBox 360 systems. Developers are currently working on Natal-enhanced games and applications that will be available when the system launches.

Microsoft Touts Home Entertainment at CES Keynote | Gadget Lab |

Microsoft Touts Home Entertainment at CES Keynote | Gadget Lab |