HP layoffs and Facebook IPO reflect Silicon Valley's highs and lows

By Chris O'Brien

So rarely do two events occur in such close proximity that perfectly capture the agony and the ecstasy of Silicon Valley.

As the sun rose, hundreds of hoodie-wearing Facebook employees gathered on their new campus to celebrate the social network's first day as a public company. Meanwhile, employees of Palo Alto-based Hewlett-Packard were still digesting reports that their company is potentially planning to lay off between 25,000 and 30,000 people.

Facebook represents the promise of the future. HP, the onetime icon, seems destined to continue its slow, ignoble slide. And Silicon Valley shrugs and marches on.

"We once again see how 'creative destruction' continues to transform the Valley as Facebook goes IPO and Hewlett-Packard restructures," wrote Doug Henton, CEO of Collaborative Economics, in an email Friday. "This is historical but fits a longer-term pattern."

In a place like this, with its relentless fixation on the future, there is no time for sentimentality.

Today, who weeps for the passing of Netscape, SGI or Sun Microsystems? The valley just moves on, or, in the case of Facebook, moves into Sun's old headquarters.

Earlier this year, I was having coffee in Palo Alto with former Sun CEO Jonathan Schwartz to talk about a new health-related startup he had founded. I asked him how it felt to see Facebook occupying the place that had been home to Sun for so long before it was acquired and moved by Oracle.

Schwartz said, very matter-of-factly: "That's just how Silicon Valley works. Companies die and new ones are born."

Clearly, the verdict Friday is that Facebook is the future, while HP doesn't seem to have much of one. And that's why, even though the HP news is likely to affect far more people, a disproportionate share of the public and media's attention was focused on the Facebook news Friday.

The Facebook IPO represented the welcome end of several years of breathless speculation about when the company would go public. Yes, with the stock closing the day almost flat, it was easy to shrug it all off as anticlimactic.

But don't let the first-day performance fool you. Facebook is a juggernaut. Armed with billions of dollars, thanks to investors, it will hire thousands of new employees, acquire dozens of startups, and further extend its reach into every corner of the Web and our lives.

Yes, like any company, it faces challenges. Things could go sideways. Or a new competitor could come from nowhere and derail it. But I wouldn't count on any of those things happening anytime soon. I expect a year from now, Facebook's stock will be trading substantially higher, and many of us will be kicking ourselves for not buying it for that $38 when we had the chance.

Facebook, with its 3,500 employees and $3.7 billion in annual revenue, is now valued at $104.63 billion, more than double HP's anemic $42.43 billion valuation. That is shockingly low for a company with almost 350,000 employees and $127 billion in annual revenue.

And yet, it's hard to argue that it's wrong.

HP long ago turned away from its history of being a place that invented things and instead embraced the modern corporate mentality of trying to build itself up through a strategy of endless acquisitions and layoffs.

Starting with the Compaq merger in 2001, HP has spent more than $60 billion in cash and stock to acquire at least 59 companies. In the process of growing from 88,000 employees to nearly 350,000, the company has announced job cuts over the past decade that could top 120,000 come Wednesday.

This strategy was initiated by Carly Fiorina and embraced by Mark Hurd. For a brief moment his replacement, Leo Apotheker, seemed to promise a respite. He promised to invest! Give raises! Focus on innovation!

Of course, Apotheker was gone in less than a year. Enter Meg Whitman. After growing rusty in the basement, it sounds like she's dragged out the HP layoff machine, gassed it up, and is apparently going to cut loose.

When a company's most successful product is the creation of former employees, it's hard to hold out much hope for its future. Sadly, binging on acquisitions and layoffs has gotten HP nowhere. The announcement expected Wednesday will be the surest sign that HP is lost with no chance of finding its way back.

But most likely, this news will be met with a shrug across the valley, where most people will be too busy figuring out how to start the next Facebook to fret much about a company like HP as it sinks into irrelevance.

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IPhone sales hurt carriers' profits

By David Sarno.

The iPhone has been a huge hit for Apple Inc., helping send the company's stock to all-time highs and producing record-breaking profits.

But for AT&T Inc., Sprint Nextel Corp. and Verizon Communications Inc., it's breaking the bank.

The three wireless carriers all found themselves answering to Wall Street in recent weeks for posting depressed quarterly earnings, and analysts pointed to the heavy cost of offering the iPhone as a culprit.

The iPhone has become the single most popular smartphone in the United States, and that has left the carriers trapped in a kind of Faustian deal: The more iPhones they sell, the more money they lose.

That's because they have to buy the phone from Apple before they can sell it to their customers for hundreds of dollars less. The carriers are betting that they'll make back the difference and more by signing up customers for two-year plans and collecting monthly fees.

But so far, the carriers are finding that the math isn't adding up.

AT&T was the first carrier to offer the iPhone and has been struggling to make it profitable for years. During the last quarter, the iPhone accounted for 82 percent of the smartphones AT&T sold to its customers, meaning the company had to pay the hefty subsidy on each of the 7.6 million iPhones.

All that money paid to Apple tugged down the company's profits. In AT&T's wireless division, operating margins - a common measure of how much a firm makes - dropped to 15.2 percent from 22.9 percent a year earlier.

"The AT&T wireless model is broken," said Kevin Smithen, a wireless analyst at Macquarie Securities. "AT&T is basically subsidizing Apple's revenues and profit growth."

Investors have taken notice: Since June 29, 2007, the day AT&T first offered the iPhone, Apple's stock has shot up more than 300 percent, to $493.69 from $122.04. Meanwhile, AT&T's stock has dropped 28 percent, to $29.82 from $41.40.

Sprint's stock is down more than 16 percent since it began selling the iPhone late last year. It sold 1.8 million iPhones last quarter, spending $630 million to buy them from Apple. That was a large contributor to the company's $1.3 billion quarterly loss - a 40 percent wider loss than the struggling company saw a year earlier, before it offered the iPhone.

Verizon sold 4.2 million iPhones last quarter, accounting for more than half of the smartphones it sold. But despite those strong sales numbers, Verizon's profit failed to meet Wall Street's expectations, and the firm's stock dropped 2 percent after its earnings release.

Wireless carriers began subsidizing the cost of cellphones years ago, in an era of simpler, less expensive "feature" phones. Carriers might have offered a $300 phone to consumers for $100.

But that doesn't work well with the much more expensive iPhone, which companies buy from Apple for about $600, analysts estimate, before reselling it to consumers for $200 - eating the $400 difference.

A particularly sticky issue for carriers is that many iPhone users don't want to wait for their two-year contract to expire to buy the latest model, which has come out once a year.

Generally the carriers have required consumers to pay the full price if they want a new iPhone before their contract runs out. But now, worried that subscribers will flee to competitors if they can't get a good price on the new phone, several carriers are offering "early upgrade" deals to discount the newest iPhone before two years elapse. That means helping the consumer buy a second iPhone in one year - and handing over additional hundreds of dollars to Apple.

"Can Apple continue to roll through industry after industry, soak up all the profits, and leave everything it touches as a smoking wreckage?" asked Craig Moffett, an analyst at Sanford C. Bernstein & Co. "They've done it with music and handsets, and now they're doing it to the carriers."

Representatives from Sprint, AT&T and Verizon declined to comment on their plans for offsetting the iPhone's effect on their bottom line.

But analysts believe the carriers' best shot at wrestling back some power from Apple is getting consumers interested in alternatives. This year, that has meant souped-up campaigns to entice buyers to look at Google Inc.-powered Android phones manufactured by Samsung Electronics, LG, HTC, Motorola and others.

After heavy promotion, devices such as Motorola's Droid Razr and Samsung's Galaxy S 4G have begun to sell well. They also can take advantage of faster, next-generation 4G wireless technology, while Apple's iPhone still works with the slower 3G.

Best of all for carriers, the Android devices can cost half as much, allowing them to pay closer to $200 for each device instead of $400 for the iPhone.

"They're doing everything they can to make the Android phone something you want to choose," said Chris Larsen, an analyst at Piper Jaffray & Co. "It keeps Apple in balance to some degree."

At a Verizon Wireless store in Los Angeles' Koreatown neighborhood, half a dozen wall-mounted displays feature fancy, back-lit red-and-silver graphics pitching the company's new line of next-generation 4G Android smartphones. The display for the iPhone is smaller and plain, its white motif clashing with the store's color scheme.

"It depends what you like," a clerk says when asked for advice on which type of phone to buy.

"Do you like the Androids' faster download times, bigger screens, longer battery life and better cameras? Or do you like Apple?"

Classrooms of the Future: New Digital Textbooks and Other Mobile Technology to Help Prepare Texas Students for College and Beyond

School leaders to participate in conference this week to improve education across the country as the nation moves to digital textbooks and other mobile learning technology

Interactive textbooks for the iPad and other digital instructional materials from Pearson are taking center stage days after the U.S. Department of Education announced a move toward digital textbooks and other mobile learning technology for classrooms of the future. Superintendents and other school leaders from Texas and around the country will gather in Houston this week to share ways to help teachers improve student achievement and better prepare students for college and careers with technology like interactive textbooks and other powerful classroom tools.

A pioneer in digital and mobile learning, Pearson worked with Apple to recreate the textbook and help teachers offer a learning experience for students illuminated with color, video, 3D animation and interactive images. Pearson's iBooks and other digital instructional materials are built on decades of expertise and research in effective teaching and learning.

As the American Association of School Administrators' (AASA) National Conference on Education kicks off in Houston this week, schools are making a major push to transform the classroom experience in Texas and across the country by integrating digital instructional materials proven to work, such as those provided by Pearson.

"Mobile learning will revolutionize school as we know it, with interactive textbooks, videos, 3D animation, and illustrations at students' fingertips, bringing concepts to life," said Raymond Ward, Pearson vice-president for Texas. "When students graduate, they go to college and enter a workforce where technology - and the ability to use it and interact with it - is at the forefront. Digital learning helps students grasp the substance of their lessons while meeting them on the digital frontier where they are already spending their time."

iBooks are the newest addition to Pearson's wide range of mobile learning solutions available for schools today, including the Online Learning Exchange. OLE is a digital program that gives Texas teachers mobile access to multimedia learning materials like videos and podcasts so they can choose and develop lessons best suited for their students' needs. Pearson's Prentice Hall Writing Coach is an interactive writing and grammar program that provides personalized help for every student through a digital "coach" that gives individualized feedback on paragraphs and full essays. Pearson's digital Online Learning Exchange (OLE) and Writing Coach programs are already being used in Texas on computers and mobile tablets.

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Apple's foray into TV could leave Samsung hamstrung

By DANNY O'BRIEN.

TV companies may well be led by Apple into a completely different world of TV entirely

IT'S NOT OFTEN you hear an executive saying words so laden with hubris you can practically hear the bell tolling for them in the background.

Chris Moseley, Samsung's UK marketing manager for its audio-visual products, told Gadget site Pocket Lint last week "TVs are ultimately about picture quality. How smart they are a secondary consideration."

He was responding to the persistent rumours that Apple is readying a new television product, aimed at the giants of television like Samsung. This would mean taking the current Apple TV product from a $99 device that Steve Jobs described as a "hobby" to a more serious line of devices, potentially with content deals like iTunes, and an integrated display.

The rumours are strong and growing. In December, the Wall Street Journal published reports that the company was in negotiations with TV media companies, and had mentioned in vague terms a new TV product. Analysts Piper Jaffray claim that Apple has spoken to at least one "major TV component supplier" about a potential display for the device.

The television market has been stable for some time, with little interest in anything beyond displaying what TVs are sent by satellite, cable and terrestrial broadcasters. The top-end hardware fight, as Moseley says, is mostly about picture resolution and quality.

But if that's what manufacturers are concentrating on, then that's exactly the moment for Apple to step into the market.

Screen quality, as an attractor for the majority of customers, is bottoming out, just as processor speed became less and less important for computer purchasers. What annoys you more - that your television picture isn't high resolution enough, or that your digital TV box takes five seconds to change channel? That your colours aren't beautiful enough, or that you can't find what you want to watch now on your intensely confusing digital program guide?

Television is, already, all about the software. And the software, for now, sucks. Some is better than others, but Moseley's point indicates why none of it is good enough. The programming part of your TV is thrown together, and stuck into state-of-the-art hardware.

Or worse, it's not in the television at all, but in a medley of set-top boxes, digital video recorders, mysterious audio and video connections, and endless incomprehensible remote controls.

Could Apple step into this, given their lack of experience building a high-grade television? Of course they could. Indeed, this is pretty much exactly the market they faced when they entered the mobile telephone market.

There were plenty of smartphones before the iPhone, but they were all a little clunky, a little slow, a little frustrating to use.

Apple brought their marketing, their user interface skills, and their devotion to a single, highly refined product. They not only established a beachhead for their product, but they also created a secondary market around it. The iPhone was not just an accessory, but an accessory with its own accessories - be they software apps, or complementary hardware.

The comparison runs even deeper. Before the iPhone launched, Apple experimented with a "hobby" iPhone - the Rockr, a Motorola phone with iTunes software.

The product quietly failed, but it gave the Apple engineers an insight into how the mobile phone market operated.

The current €121 Apple TV is Apple's similar, early, foray. And Samsung cannot seriously believe that Apple can't apply the expertise it has gained from its monitor and retina-display LCD development (and ability to massively invest and dominate supply channels).

Jobs himself, the same WSJ article reported, was dismissive about entering the TV market - the margins are low, he told Apple employees, and consumers don't buy televisions very often. But Jobs frequently dismissed a market just before entering it. And we know that before his death, Jobs mentioned to his biographer Walter Isaacson that he had "cracked" the best interface for operating a TV.

In truth, it might not be Samsung, or its product managers, who really need to worry if Apple turn their gaze toward the television market. The iPod, iPhone, and iPad stories show that the group who has to gamble most on Apple's new markets are the content providers. If they choose not to go with Apple, they risk missing the initial gold rush of a new Apple-spotlit market. If they do make a deal with Apple, they can find their negotiated deal being rather less beneficial than they imagined. The music industry was happy to work with Apple, until they realised the dominant position of the iTunes store meant they were no longer able to set their own prices on singles. The phone carriers fought over iPhone, but have discovered that its bandwidth demands and circumvention of their own media dreams have limited their own room for manoeuvre.

The rumours of Apple talking to cable and TV companies about their new TV should worry Samsung. But perhaps it should also worry those potential partners. At least Samsung knows Apple is entering its market. The TV companies may well be being led by Apple into a completely different world of TV entirely.

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Sony Begins Entertainment Push After Ericsson Buyout

BY KATE KNIBBS.

Sony revamped its mobile strategy to integrate gaming and entertainment features, in the wake of the completed Ericsson buyout of their joint venture.

The Japanese giant plans to merge its newly acquired mobile division into its electronics division, bolstering its product line-up and helping the company better compete in the smartphone market. The deal also fuels Sony's migration from low-end phones and puts a renewed emphasis on cutting-edge smartphones like its Xperia handsets.

The buyout figures into Sony CEO Kazuo Hirai's larger strategy to focus on producing high-end devices with unique capabilities that capitalize on Sony's strengths.

Hirai intends to "fully leverage Sony's diverse electronics product portfolio, in conjunction with our rich entertainment assets and growing array of networked services, to engage with our customers around the world in new and exciting ways," a goal the Ericsson deal will help reach by consolidating mobile operations and giving Sony full control over them.

The acquisition arrives at a critical time for Sony, as the company has weathered disappointing sales and a leadership overhaul. The Japanese company is struggling to stay afloat in a competitive market, and the deal confers vital advantages, like cross-licensing and integration opportunities.

Sony is already pursuing aspects of its strategy. This week, Sony granted PlayStation Certification to HTC, allowing the company's devices access to the cross-platform PlayStation Suite. Expanding this gaming suite, which was previously exclusive to Sony's smartphones, to some of the world's largest Android manufacturers is another way the company is getting its software into the hands of more customers and expanding its targeted gaming audience.

At the same time, Sony's decision to license its PlayStation Suite will likely bring the company revenue, which it can use to finance its higher-end smartphones. The company is fine-tuning these higher-end devices, and the licenses are expected to cultivate a market which Sony can capture with its own devices.

The Ericsson deal builds on this strategy since Sony can now employ its cloud technology and bring its gaming and entertainment holdings onto its handsets without working out deals with Ericsson.

Sony paid $1.29 billion for control of the company, which includes comprehensive cross-licensing agreements, and intends to rename the mobile company Sony Mobile Communications. The Ericsson deal was a necessary expense for Sony, as Hirai's plan hinges on substantial strategy shifts, and some of these changes may only be possible with the buyout.

Mobile Technology Enhances Sports Illustrated

By Shannon Willoby.

Sports Illustrated swimsuit viewerThe 2012 swimsuit issue of Sports Illustrated hits newsstands this week, but fans will be happy to know it's been given an upgrade thanks to mobile technology.

Readers can now point their smartphone's camera at one (or all 19) of the models featured in the swimsuit issue to view behind-the-scenes videos of the photo shoots. For it to work, readers must have an Apple or Android smartphone, download the Swimsuit Viewer mobile app, and point their camera at the models' photos.

How do they do it, you ask? Each model's photo has been embedded with invisible digital watermarks to ensure they do not detract from the photos.

Bryan Laurienti, leader of BBB Systems' graphic design team, said he thinks the digital watermarks are a great way to make the Sports Illustrated magazine an interactive experience. Plus, it gives the magazine a modern update that may draw in new readers thanks to the bonus videos.

Tell us your thoughts: Do you think mobile technology - like digital watermarks - will work well in a magazine like Sports Illustrated?

Android widens lead over Apple

By Chris Keall.

Mobile phones running Google Android software extended their market share lead over Apple's iPhone during the fourth quarter of 2011, market research outfit Gartner says.

Apple had a boom quarter on the back of the new iPhone 4S, selling more than 35 million handsets, double that of the year-ago quarter.

Yet Android-based smartphones (made by Samsung, Motorola, Sony, HTC, Huawei, LG and others) also more than doubled sales to maintain their collective majority market share.

The Android camp's fragmentation did mean that Apple registered the highest sales of any single smartphone maker.

And, like a recent IDC survey, Gartner found Apple is now number three in the cellphone market as a whole.

Apple and Android's success was at the expense of BlackBerry maker RIM and Nokia, whose smartphone share halved over the period (although it is in the process of mounting a fightback with its new Microsoft Windows-based handsets that will be released in New Zealand next month).

Microsoft New Zealand country manager Paul Muckleston told NBR that so far Windows Phone smartphones have been a hit with a niche audience. Nokia was still the largest mobile phone maker overall (see second table). The Nokia-Microsoft partnership would help Microsoft's mobile software pushing into the mainstream, and revive Nokia's smartphone fortunes.

With the three-way fight between Apple, Android and Nokia/Microsoft helping to grow the smartphone market overall, the phone companies win either way.

Global smartphone sales to end users reached 115 million units in the third quarter of 2011, up 42% from the third quarter of 2010, Gartner said.

Nokia's Windows Phone-based Lumia series has sold more than 1 million since its November launch in Europe, Nokia Australia-New Zealand MD Chris Carr told NBR - still modest compared to the numbers clocked by Apple and Android, but not bad from a cold start.

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Sony acquisition of Ericsson now complete - what we can expect

By Edgar Cervantes.

This has been one of the smoothest acquisitions we have seen in the life of Android. In less than 4 months since its announcement, Sony has completed the full acquisition of the Ericsson mobile devision. This costed the Japanese manufacturer €1.05 billion, but good ol' Sony is now in full charge of its mobile division.

Even before this transaction was finalized, though, things had already started to change. We have seen the latest Xperia devices being unveiled without the Ericsson branding (like the Sony Xperia Ion and the Xperia S). But we feel like Sony's plans are not fully portrayed by these devices.

Sony can turn the tables around, and make things much better for its future. And we would assume that Sony has a plan - they did not spend €1.05 billion on a hunch. Sony Ericsson hasn't been making the best profits, but we should start seeing some strategy changes soon.

Seamless Connectivity with Sony Products

According to Sony, this is the main reason for said acquisition. The company wants smartphones to be part of the connected home that they have been creating for years. As of now, they have done a great job with their other products: computers, televisions, Blu-ray players, game consoles and other devices have the ability to communicate with one another, taking us closer to the "smart home."

This is something we can see the smartphone being integrated into - better communications with other Sony products and services. Many Sony TVs can now be turned on automatically when a Playstation 3 or Blu-ray player is in use, and the console can be controlled via a keyboard and mouse.

It would be great if a portable device could be added into the equation. Imagine if there was an option that allowed you to do the same with your smartphone. Simply select the DLNA (or any form of wireless communication) option when walking into the living roon, and boom - the TV turns on and starts playing the movie.

Maybe being able to access your Playstation 3 while on the go will also be featured in the future, much like the PSP devices have been able to do for a long time. The possibilities are endless, but such features are what we should start seeing in Sony smartphones. The connected home is the future, after all.

Better Gaming

Sony is one of the most successful competitors in the video game industry. Its consoles have created a great consumer loyalty since the release of the Playstation 1. It continues to hang with the best of them with consoles like the Playstation 3 and the PS Vita.

There have been recent rumors of Sony moving to Vita OS in the future[1], but this is not expected to happen for a long time. And we hope it never happens, because it has great potential to be successful in the Android world.

Gaming is something very important in the mobile ecosystem, and Sony can apply some of its talent to coming smartphones. We have already seen a gaming device being released, the Sony Ericsson Xperia Play (image to the right). This phone is great, and the controller pad definitely makes for a better experience. The games and specs left much to be desired, though.

With Sony in charge, we should be seeing many improvements in the Xperia gaming strategy. Better gaming smartphones and tablets, an improved Playstation Certified experience and console quality games could really turn things around in the Android ecosystem.

Will we see super phones with access to games with PS Vita quality and resolution? We will have to wait and see. It is highly likely Sony will make some strong moves within mobile gaming, though.

Design and Performance

Sony Ericsson devices have not been the best, but they improved greatly last year. Sony Mobile Communications could take great advantage of the company's resources and talent. As already mentioned, Sony is no small kid on the playground. Many of its products are highly desired by the population, and their name has a great reputation for solid manufacturing.

Sony Ericsson's design already fits in with Sony's style, and we probably won't see that changing too much. We may see Xperia devices with much better specs, though. If the new smartphones are going to be powerful gaming devices, the specs will have to be much more impressive.

Quad-core processors and gadgets with 2 GB of RAM are just around the corner. We might, or might not be seeing Sony taking a leap in this movement. Sony might have some hiccups with the transition, but we could expect them to stay on top of the game from then on.

Conclusion

Sony has great potential and talent. We have seen it in their other products, and hope to see better smartphones being added to its line - but this is only the beginning. There is much more that could be done. The Japanese manufacturer could make use of its talent to add great cameras, better sound, better displays and all of the above mentioned improvements.

But Android enthusiasts care about even more - for some, a super phone is immediately discarded after learning that it has a locked bootloader (Sony Ericsson has been great about open bootloaders). It is also a big "no no" if a manufacturer is known for not keeping its devices updated in a timely fashion.

There are many things that Sony could do to make its customers very happy - some being relatively simple to accomplish. So let's see how Big Sony plays things out. We hope that it goes well. Competition is a great factor for the mobile evolution, and we hate to see manufacturers fail.

But let us know what you think. Do you think Sony will do well with the acquisition? If so, what do you see coming in the near future?

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Customers pre-ordering latest iPad will have to wait

By James B. Kelleher.

(Reuters) - People pre-ordering Apple Inc's new iPad to avoid the release-day crowds at the company's retail stores will have to wait longer to get their hands on the devices.

The latest version of the company's tablet, which was unveiled this week, is set to hit shelves next Friday.

But tablets pre-ordered online will not ship to buyers until the following Monday, March 19, according to the company's website.

Earlier in the week, Apple had promised the newest tablet would arrive at customers' homes on the launch date.

Trudy Miller, an Apple spokeswoman, said the change was made because customer response to the new iPad had been "off the charts," quickly exhausting the supply set aside for pre-order and delivery by March 16.

Apple's new product releases are some of the hottest events on the tech calendar, scrutinized by investors, the media and industry insiders alike.

To the company's devoted fans, who vie to be the first to own the latest device, a three-day delay would be an eternity and could add to the crowds at the company's retail stores.

In January, enraged Chinese shoppers pelted Apple's flagship Beijing store with eggs and shoving matches broke out with police after customers were told the store would not begin sales of the iPhone 4S as scheduled.

The new iPad sports a crisper display and an array of technology advances and tweaks.

Apple said it will continue to sell the iPad 2 but dropped its price by $100. The older tablet now starts at $399 while the new third-generation wi-fi only iPad starts at $499.

The high-end model of Apple's latest iPad starts at $629 and will be capable of operating on a high-speed 4G "LTE," or Long-Term Evolution, network. At speeds roughly 10 times faster than current 3G technology, that may help banish the sometimes shaky video quality of older devices.

New iPad 3 Is Incompatible With International 4G LTE Networks

Despite 4G technology being one of the most-touted features of the new iPad 3, SlashGear have noted that the iPad 3 will be incompatible with the LTE networks being rolled out in countries outside the United States.

While the iPad 3 supports data transfer rates of up to 73 Mbps on LTE, these speeds will only ever be seen by American and Canadian customers with international users to be relegated to 3G speeds.

The new iPad WiFi + 4G put up for pre-order in Europe yesterday supports the same 700MHz and 2100MHz LTE bands as the AT&T version in the US; however, actual LTE roll-out in Europe is expected to use the 800MHz, 1800MHz and 2600MHz bands.

That means, even if commercial LTE networks become more commonplace in Europe ¨C which has for the most part remained using the faster variants of 3G technology, such as DC-HSDPA, which the new iPad also supports ¨C the Apple tablet is unlikely to be compatible with them.

The Wi-Fi + 4G iPad 3 that is being released in the ten international launch countries is the same as that being sold in the U.S. on the AT&T network, despite international networks not running on the same frequency bands as AT&T.

Apple have admitted the issue and thus far only offered up the concession that if international users visit the U.S. they will be able to access the AT&T LTE network on their iPad.

iPads sold internationally will be able to connect to AT&Ts LTE network when in the US with the appropriate SIM and plan.

It is unclear at this stage whether Apple will release a different version of the iPad 3 in the future with LTE frequency bands optimized for local networks.

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Apple runs out of new iPads for Friday delivery

By Gregg Keizer.

Computerworld - Apple has sold out of initial supplies of the new iPad in every country where it will launch the tablet on Friday, and is now telling buyers that orders will not ship for up to three weeks.

In the U.S. and Canada, all iPad pre-orders placed through Apple's online store will now ship on March 19, three days after the on-sale date. Customers who placed an order very early in the pre-sale process were told they will receive the tablet on Friday, March 16.

Some consumers, including Computerworld staffers who ordered the new iPad last Wednesday, have received emails confirming that their tablets have been shipped.

Australian orders will ship on March 22, while those ordered in other first-wave markets -- France, Japan, Germany, Switzerland and the U.K. -- currently show a shipping delay of two to three weeks.

Hong Kong's online store simply says that the new iPad is currently unavailable.

U.S. carriers AT&T and Verizon, both which will also sell the iPad, are only taking customers' email addresses for later notification when the tablet is available.

The tight supplies and resulting delays were not surprising.

Last year, the Apple iPad 2 sold out on its first day of availability in the U.S., where shipping delays changed several times on opening day, first from two to three business days, then five to seven days, and finally settled on two to three weeks.

Four days later those delays had grown to four to five weeks, a timespan that one analyst called "intense."

Apple acknowledged it could not keep up with demand for the iPad 2.

In an April 2011 conference call with Wall Street analysts, Tim Cook, at the time its chief operations officer, called demand "staggering" and admitted orders were bogged down in the "mother of all backlogs."

Not until the mid-point of 2011's third quarter did Apple claim iPad 2 supplies had matched demand.

More recently, analysts predicted that Apple would face a repeat of the problem, in large part because suppliers of the new model's higher-resolution screen have had difficulty getting high yields from their lines.

Last week, Richard Shim, a senior analyst with DisplaySearch, said manufacturing the iPad's 2,048-by-1,536 pixel screen was a "challenge" for Sharp, Samsung and LG Display.

The shortages have again created opportunities for resellers who claim they will have the tablet next week.

On eBay, for example, prices for a 16GB Wi-Fi third-generation iPad run as high as $1,200, a 140% markup over that model's list price of $499, while 64GB 4G tablets are priced as high as $2,799, or 238% above the $829 list price.

Apple will begin selling the new iPad in its retail stores, as well as other outlets such as Best Buy and Radio Shack, on Friday, March 16.

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Instagram's Highly Anticipated Android App Is Coming Soon

By Christina Bonnington.

AUSTIN, Texas - The Instagram party is about to go from a few cocktails with friends into a raging kegger. An Android version of the super-popular photo-sharing app will be released "very soon," according to the company's founder.

In a fireside chat Sunday at South by Southwest Interactive, Kevin Systrom showed a glimpse of the upcoming version of the app, which is currently being tested in a private beta. Smartphone photogs who use Google's mobile platform rejoiced.

"I'm glad to see Instagram coming to Android," said SXSW attendee Patrick Asher, who recently picked up a new Samsung Galaxy Note smartphone. "I'm going to download it. I'm looking forward to taking more photos on this than my old iPhone."

The arrival of the new app will end months of frustration for photographers who carry Android devices and can't participate in Instagram's white-hot world of social photography. Instagram earned the honor of being Apple's iPhone app of the year for 2011 and has quickly amassed a tight-knit community of smartphone photographers who enhance their square-shaped images with an array of retro-style filters.

"It'll be really cool to try out the filters with my photographs," said J.J. Martinez, an organizer of SXSW Interactive. "I take photographs with my smartphone a lot, at least every day, but I think I would take more pictures with Instagram."

Others are also eager to check out the photo-sharing app on Google's increasingly prevalent mobile platform.

"It'll be interesting to see how they bring it to the Android platform so the experience is intuitive and natural," said Darren Himebrook, a producer at a Miami-based advertising agency. When asked if he felt left out that Instagram has been iOS-only, Himebrook said, "Oh totally!" a sentiment echoed by several other Android users we spoke with after the announcement.

Android phones provide a fundamentally different user experience than iPhones. For example, Android smartphones have either three or four permanent navigation buttons at the bottom of the screen, whereas the iPhone has a single home button, with all other navigation performed within various apps.

In his talk, Systrom said the Instagram team has been "working hard on making this one of the best Android apps you'll ever see." He also said the iOS version has been downloaded more than 27 million times so far.

Rumors that Instagram for Android existed in some form and would be landing soon have persisted for months. Instagram's founder played pretty coy about the subject until now.

"In some ways, it's better than our iOS app. It's crazy," said Systrom.

Luckily, Android users like Himebrook, Martinez and Asher won't have much longer to wait before sussing this out for themselves. Until then, check the gallery above for a selection of the many Instagram photos Wired staffers have taken in Austin during SXSW 2012.

Instagram Coming Soon To Android, Co-Founder Shows It Off Briefly

By Ray Willington.

Instagram. Just the mention of the world brings up vivid images of slightly tweaked photographs, uploaded via iOS devices to all corners of the web. But there's a problem: it's only on iOS. Android, BlackBerry, Windows Phone, etc. -- none of those platforms have Instagram. Why? Hard to say why the company hasn't branched out yet, but they know that Android is growing too large as a platform to ignore. At the annual South by Southwest conference in Austin, Texas, the company announced that they had reached 27 million registered users. And of those, a ton of people are actively using it. Co-founder Kevin Systrom was quoted as saying that they're seeing "Facebook-level" engagement.

But more importantly, that the Android app is coming. He even showed it off. There was no full demo, but he had it on a prototype, and he said that in some ways, it's even better than the iOS app. There's no definite date, but it's coming soon -- soon enough for the co-founder to tease it at SXSW.

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Instagram Reaches 27 Million Registered Users

By Kim-Mai Cutler.

Instagram, the photo-sharing app that has taken a definitive lead on iOS, said it has surpassed 27 million registered users today at the SXSW Interactive conference in Austin, Texas.

Co-founder Kevin Systrom didn't disclose daily active users during his fireside chat with TechCrunch editor Alexia Tsotsis. But he did say of all the users who have been active in the last week, 67 percent of them used the app yesterday.

"It's Facebook-level engagement that we're seeing," Systrom said.

He didn't really offer any clarity on rumors that the company is raising $40 million at a $500 million valuation.

"Good companies are always fundraising," he said. "Whether you're meeting people or considering firms, you're always fundraising. But it doesn't mean we're active. We're trying to create a long-term, viable company that doesn't come and go with fads. It should be something that lasts and creates meaningful value."

Systrom also had one more thing up his sleeve - he showed off the company's upcoming Android app. He waved it around very briefly on-stage, but he didn't give a full demo. (That's for later, and the company tells us they aren't totally ready for a walkthrough yet.)

"In some ways, it's better than our iOS app. It's crazy," he said.

Co-founder Mike Krieger added that folks over at Android have been pretty impressed with the way the app leverages the platform. It's taken awhile to come to Android simply because the company was focused on scaling on iOS, Systrom said.

"I don't think it took us so long. We just had priorities. Had we tried to be both on Android and iPhone at the same time, it would've been tough to innovate in the way that we have," he said.

He was also coy about what Instagram's business model will ultimately end up being. The app currently doesn't have any advertising and it doesn't have any in-app purchases. Path, in contrast, sells some filters. (But it also has far fewer users with the latest publicly shared figure being 2 million registered users.)

"We have a visual platform and advertisers like visual mediums. They like TV and magazines, but attention is moving online and they want to switch," he said. "I do believe that Instagram has put a stake in the ground and we're growing more quickly than anyone. Is there something in there we could do to make it a multi-billion dollar business? I think we can figure out something along the way."

Launched in the fall of 2010, Instagram grew out of some unsuccessful experiments in location sharing. While the company would have been too late to a crowded space that included Foursquare and ultimately Facebook Places, Systrom and Krieger saw that their beta users were sharing tons of photos.

"I was not super pumped up about location-based services. But I saw that what Kevin was doing was more about sharing the story of a place," Krieger said.

Systrom added, "Burbn never really failed. We just never really let it fly."

They quickly turned around a native iOS app that seemed to marry elements of paid camera app Hipstamatic with social features. It was perfect timing since the iPhone 4 was just arriving on the market and the device finally had a camera that produced photos of comparable quality to what point-and-shoot cameras could do. Apple also had an installed base of iOS devices that was finally large enough to produce the network effects that Instagram needed to take off.

"Mobile has created a totally different dynamic for discovering apps," Systrom said. "You're sitting in a bar and your friend is taking some pictures and then you ask what app they're using."

The app was soon a home run that quickly secured a top ranking among photography apps and then a consistently high ranking on the free app charts. On the first day, 25,000 registered users showed up. The challenge soon became about scaling the back-end and infrastructure.

"From then until now, it's been a hockey stick," Systrom said. "We've been very lucky with scaling. The difference is that we're served out of the cloud and we can call up instances with the demand. We also have a fantastic team that focuses on scale."

Just months after that, the company picked up a $7 million Series A round led by Benchmark Capital, with participation from Baseline Ventures, Square CEO Jack Dorsey, Chris Sacca and Quora co-founder Adam D'Angelo. Benchmark partner and Facebook alum Matt Cohler joined the board.

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5 Most Telling Takeaways From Tim Cook's Goldman Sachs Keynote

By Christina Bonnington, VIA:wired.com.

Tuesday afternoon, Apple CEO Tim Cook presented the keynote speech at the Goldman Sachs Technology and Internet Conference. Cook's presentation ranged from discussion of Apple's supply chain strategy in China to how the iPad is cannibalizing computer sales.

We listened in on the nearly hour-long keynote livestreaming from Apple's website, and rounded up the five juiciest, most interesting reveals of Apple's roadmap and culture.

Here's what we found - with insight on why it matters.

On Factory Working Conditions
"Apple takes working conditions very, very seriously, and we have for a very long time¡­ Our commitment is simple: Every worker has the right to a fair and safe work environment, free of discrimination, where they can earn competitive wages and they can voice their concerns freely. Apple suppliers must live up to this to do business with Apple. If we find a supplier that intentionally hires underage labor, it's a firing offense."

Cook also detailed how Apple is constantly monitoring its factories. He said Apple has eliminated child labor in the final assembly portion of its supply chain.

It's important to note that Cook opened his keynote with a discussion of working conditions at the manufacturing plants of overseas suppliers. Sure, accusations of inhumane conditions in Foxconn factories are currently making news, and Cook certainly had to respond to the bad press. But the content and tenor of Cook's comments suggest a new humility on Apple's part - that the company knows it needs to do the right thing. We can call this a third gesture of "corporate kindness" in the new Tim Cook Era.

On Quality
"Price is rarely the most important thing. A cheap product might sell some units. Somebody gets it home and they feel great when they pay the money, but then they get it home and use it, and the joy is gone. The joy is gone every day that they use it until they aren't using it anymore. You don't keep remembering ¡®I got a good deal!' because you hate it!"

Let's read between the lines: Cook was responding to a question about tablets, and the above response is obviously a dig at the Amazon Kindle Fire. Clearly, Cook doesn't think the Fire, or any other budget tablet - or any other tablet, for that matter - is a threat to the iPad.

His response doesn't simply suggest he's a man with a competitive streak. It suggests he doesn't have any respect for the Fire and its Android brethren. It's a position that recalls the bluster of Steve Jobs, and proves Cook is just as much the fighter.

On Competition
"The real catalyst to the tablet market will be innovation and pushing the next frontier. Honestly, we'll compete with everybody. I love competition. As long as people invent their own stuff, I love competition."

The unspoken message: If you don't invent your own stuff, Apple's legal team will make sure to set things right. But this statement also makes us wonder which companies, if any, Apple considers to be competition. Google perhaps? In today's keynote, Cook could only muster calling Android "that other OS."

On Mac Cannibalization
"iPad has cannibalized some Mac sales. The way that we view cannibalization is that we prefer to do it to ourselves than let someone else do it. We don't want to hold back one of our teams from doing the greatest thing, even if it takes some sales from another product area. Our high-order bid is, ¡®We want to please customers and we want them buying Apple stuff.'"

While this was just a basic reiteration of Apple's position since the advent of iOS, it's also telling for what it reminds us about Microsoft - namely, that in the ongoing synergistic fusion of Windows 8, Windows on Arm and Windows Phone, Microsoft will be attempting to prop up the Windows legacy by any means necessary.

Indeed, when you think of Apple as a dynamic, forward-thinking company, when do you ever think of Mac OS? It's just not part of the daily conversation or news cycle. But Microsoft has a deeply entrenched, vested interest in making sure Windows never goes away, even if it means, well, window-dressing the Windows desktop with a mobile U.I. We don't blame Microsoft for trying, and it certainly doesn't have Apple's "luxury" of owning such a small part of the desktop and enterprise market share.

On Steve's Legacy
"Steve grilled in all of us over many years that the company should revolve around great product, and that we should stay extremely focused on just a few things rather than try to do so many that we do nothing well. We should only go into markets where we can make a significant contribution to society, not just sell a lot of products. And so, these things, along with keeping excellence as an expectation of everything at Apple, these are the things that I focus on because I think those are the things that make Apple this magical place. We're always focused on the future. We don't sit and think about how great things were yesterday. I love that trait. I think it's the thing that drive us all forward."

This is Tim Cook's assurance to the investment community that a little Steve Jobs avatar is perched upon his shoulder. The avatar isn't issuing orders, mind you. It's just rubbing Cook's delts, and reminding him about core company values.

And this is a helpful avatar to have. We've seen all too many tech companies lose their mojo following the departure of founding fathers. Just look at the mess that's become of Hewlett-Packard. Tim Cook emphasized that he's striving to maintain the same culture and vision that Steve Jobs fostered while he was in charge. And because Apple does have a clearly defined focus, it should be able to continue to deliver solid, inventive products in the years to come.

And, of course, having another iPad waiting on deck - a product launch that wasn't acknowledged in even the most tangential, knowingly cheeky way - doesn't hurt Mr. Cook's chances for success either.

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