Maybe you’ve seen some form of the 230 ads. If you haven’t, we’ve embedded it below. The ad – in its various forms – features a bouncing, smiling, and winking electrical outlet that ends up representing the number “zero” after numbers 2 and 3. All of these appear above the numbers “8-11.”  So what the heck is it all about?

General Motors (GM)

What could be the relationship between an electrical outlet and the number 230? In the U.S., heavy-duty electrical outlets that run heavy appliances such as air conditioners and washing machines produce 230 volts. Also, we have figured out that GM is behind the campaign. Meghan Winger, a staffer at Chicago agency All Terrain, is the creator of the What Is 230 Facebook group. She is also the one who posted a teaser about the campaign to the “What is 230?” YouTube channel. All Terrain describes itself, among other things, as a “social-media expert” on its website and lists Chevrolet at the top of its client roster. So what can GM possibly mean with the number 230, and what’s supposed to happen on August 11?

2011 Chevy Volt

After some thinking, I narrowed the meaning of the viral campaign to two possibilities:

1. Could the 230 campaign be related to the upcoming Chevrolet Volt – the plug-in hybrid electric vehicle that the company has been developing? It will most likely plug into these types of heavy-duty outlets to achieve its charge. For anyone who’s not up to snuff on the latest car news, the Volt is a breakthrough product in that “unlike most current commercially available electric hybrids, the actual propulsion of the Volt is accomplished exclusively by the electric motor. The internal combustion engine is used as a range-extending electrical source, powering the on-board 53 kW generator (which sends power to the electric motor and charges the batteries simultaneously).” With fully charged batteries, the Volt will be able to achieve a range of 40 miles – enough for the daily commute of 75 percent of Americans. After the initial 40 miles, the car’s small 1.4 liter 4-cylinder internal combustion engine kicks in, extending the Volt’s potential range to 640 miles on a single tank of gas. On top of all that, the Volt simply looks cool  – unlike other environmentally-conscious vehicles (read: Prius).
   Since the Volt is scheduled to be available for purchase in the end of 2010, it appears too early to launch a promotional campaign for the vehicle.
2. Late last week, GM announced that Buick (a brand of GM) will release a five-passenger hybrid CUV that will be followed by a plug-in version in 2011. The General expects the soft-roader “to be the first commercially available plug-in hybrid SUV produced by a major automaker.” And it looks like the manufacturer is going full-out on this one: the gas-electric Buick will use LG Chem lithium-ion batteries powering a reworked version of GM’s 2-Mode hybrid drive train. The battery can be recharged in four to five hours. Interestingly enough, the supposed market leader in hybrids – Toyota – doesn’t have a hybrid vehicle in the same class, let alone a plug-in… period. Perhaps this is a sign of the new GM, post-bankruptcy, coming out in full force.
   The Buick brand has also been repositioned in the GM product portfolio: it will now compete in the pure luxury segment with the likes of Lexus, Mercedes-Benz, and Volvo; GM’s other luxury division, Cadillac, will take on the performance luxury segment of BMW, Audi, and Infiniti.  Perhaps the 230 will be an ad campaign to launch this new Buick vehicle?

So which of these two possibilities is the right one? The Volt is too far out for an ad campaign. That makes the Buick plug-in hybrid CUV more likely… until we realize that the vehicle itself hasn’t even been unveiled! Behold another twist in the road! On Monday, it was revealed that GM hosted an event that involved the GM’s CEO, some members of its PR team, around 100 members of the public, and a few social media junkies. Some of the tech-savvy attendees have revealed a few exciting details about GM’s new product plans. Here’s straight from the Twittersphere (via Autoblog):

• GM unveiled a new Cadillac concept dubbed the ATS, a compact BMW 3 Series fighter that will be available in both coupe and sedan forms.
• The Cadillac DTS’ replacement – currently named the XTS – will be built atop the Buick LaCrosse’s underpinnings and will be available with all-wheel drive.
• The CTS Coupe is due to arrive this May, and there’s still talk of a V version (duh). Apparently GM has a working CTS-V SportWagon on premises and it could arrive as early as next year.
• New Chevrolet Malibu unveiled, but it supposedly won’t reach production until 2012.
• All-new midsize Buick model coming within the next 24 months.

Most of these news mean something only to a gear head. What is significant, however, is that details are leaking and GM appears to be firing away on all cylinders. And here’s the final straw: Tomorrow morning at 8:00 AM EST, General Motor’s President and CEO – Fritz Henderson – will be hosting a webcast to update the public and the media on the automaker’s turnaround efforts. During the event, Henderson is expected to make a new product announcement.

Now that’s real, juicy details! So perhaps this “new product announcement” will be related to the Buick CUV or any of the leaked details from Monday’s press conference? Time will only tell – and there are only a few hours remaining before the webcast kicks off. You can be sure TNR will be watching with eagle eyes and reporting on the developments (be sure to follow our Twitter feed for up-to-date news).

For now, we can commend GM and/or All Terrain for putting out the 230 campaign that made us wonder what the heck it’s all about. Even though the campaign might not have become the next true pop-culture phenomenon, great job on the social media marketing front!

Here is the full press release about the Buick CUV:

[Source: General Motors]

Apple has aired two new iPhone ads: “Share” and “Travel.” The two commercials are in the familiar “There’s an app for that” format, featuring iPhone apps for file sharing and navigation. Videos and our take after the break!“Share” presents Mover and Bump – two free apps that can be used to transfer files as well as contacts between iPhones via Wi-Fi or a 3G connection. The 30-second ad also demonstrates two users playing playing Scrabble from different iPhones, which is made possible either by using Wi-Fi or through the Facebook app.

“Travel” starts out with the question: “so how does the iPhone make traveling easier? It then presents Rick Steves’ Historic Paris Walk ($4.99), which guides users through the city and provides bonus information in the form of text, audio, and video. Playing on the Paris theme, the commercial demonstrates the Paris Metro 09 app  ($4.99) – used to help navigate the city’s public transit systems. The ad concludes with the very useful Postman app: it provides the user with the ability to create virtual postcards and send them to anyone s/he desires.

These ads continue to demonstrate the wealth of apps available for the iPhone and iPod ecosystem. Considering recent App Store developments, however, Apple should be careful not to alienate users or developers. I get asked about the “Google Voice app debacle” even when I’m around non-geeks, illustrating that the matter is not only of importance to technology fanatics. That said, I hope that Apple realizes the potential opportunity it has in an App Store for the Mac platform.

Share

Travel

RadioShack is undergoing a major rebranding that will change the company’s forward-facing name to “The Shack.” The name change may hint at a new direction for the company, venturing into the general home electronics space thus far occupied by general technology retailer Best Buy. How will the move impact RadioShack and will it be a success?

Here’s the game plan: RadioShack stores will reflect the new name in displays this week, while store-front signs will be replaced by the end of the year. Only the corporate infranstructure will retain the old RadioShack name, however.

Financials

Financially, RadioShack stands on solid ground. The company posted an after-tax net income of just over $48 million in the second quarter of 2009. That’s a $5 million increase from the previous quarter and is attributed to cost-cutting throughout the company (overall revenue is down over $37 million from 1Q 2009). Compared to the year-ago quarter ended 6/30/2008, the retailer has posted an after-tax increase in net income of 17 percent. That’s a lot better than the giant electronics retailer Best Buy has fared in the down economy, which has posted a sharp 73 percent decrease in after-tax net income in Q2 2009 from the previous quarter. Perhaps the RadioShack executive team is predicting a change in market perception and/or shopping habits and is basing its re-branding decision on this forecast, caring to be proactive going forward with the company’s 4,453 company-operated stores.

Target market

Dating back to its roots, RadioShack is known for its supply of unique electronics and tech gear: adapters, cables, electricity converters – all these items are usually not available at a big-box retailer such as Best Buy or the now-defunct CircuitCity. In that regard, the company caters to the true tech geek. However, many see the name change as a sign of the retailer’s plans to make a greater push into the general electronics space. If that is the case, a move to rebrand the company is one thing, but if the name change will also bring with it a tidal shift to the type of products sold in the store (read: eliminating its unique product lines), The Shack faces the risk of alienating its most loyal customers. In fact, a commenter on this blog post went so far as to say that “The day I can’t walk in [Radio Shack] and buy a diode and some molex power connectors is the day I stop shopping there.” As with any unique product, RadioShack has built a small (yet powerful) cult-like following of hands-on tech fanatics. Therefore, I hope that if The Shack is planning on carrying more mainstream technology in its stores, it does not do so at the expense of the uber hands-on customer.

Hut or Shack?

Taking the word “Radio” out of “RadioShack” may have valid reasons. Radios today may be perceived old, outdated, and simply not hip, especially for generations X, Y, and Z. After the word”Radio” has been cut out, though, we are left with just The Shack. And here is where it may get a little shaky from a psychological interpretation perspective. When we speak about “living in a shack,” we usually refer to an environment that is not in pristine condition. Put simply, the word carries some negative connotations. So it looks like the branding folks at RadioShack were stuck between a rock and a hard place: radio is an outdated word and shack carries many not-so-positive associations. So they decided to put the word “The” in front of “Shack” to make this not just any kind of shack, but the most definitive shack in the world! Not sure about you, but without prior knowledge of RadioShack, I don’t think many would want to buy a 50 inch flat screen at a place that others call “The Shack.”

In June, Pizza Hut pulled a similar rebranding, slicing the name “Pizza” from the name to end up with “The Hut.” The move was held in conjunction with the chain adding pasta to its menu. Media and advertising trade publication MediaWeek characterized the name change as an attempt to transform its stores into hip hangouts. Is “hut” a little more positive than shack? You be the judge! At least there isn’t a “shed” – yet.

Concluding Thoughts

I see the rebranding as a way to make what otherwise is a hardcore geek haven a cool place for teens and tech fans to hang out: more traffic and more time spent in the store are surefire ways increase sales and customer interaction. To attract teens – many of whom are into gaming – The Shack would need to improve its gaming selection, perhaps adding functioning gaming consoles connected TVs. This would fall in line with the general consensus that changing the name to “The Shack” is part of an overall push into the general electronics space. As long as that doesn’t mean a pull away from its unique items such as diodes and molex power connectors, I think the plan has a good chance of success. Add to that the growing foray into wireless sales (T-Mobile will be joining AT&T, Sprint Nextel, and Alltel on The Shack’s shelves) and you’ve got yourself a recipe to keep those profits growing.

The company will hold launch events August 6-8 in New York City (Times Square) and San Francisco (Justin Herman Plaza) called the The Shack Summer Netogether and has launched a website dedicated to the event. Great name!

Image courtesy of lesjones.com

Apple is by no means a newcomer to the education market. Graduating high school seniors wait for the start of the annual Apple summer sale, at which point they can get a free iPod along with the purchase of a Mac. With the iPod Touch occupying the top rung in the iPod lineup, the device is well worth the wait (of the end of the school year). But Apple does much more than give away free iPods to entice students and the education market at large! Apple has abundant resources that offer both faculty as well as school administrators the means to publish content online. This points business back in the direction of the iTunes Store as well as the company’s hardware products.

TUAW reported earlier this month that the University of Florida College of Pharmacy has made it a requirement that students own an iPhone or an iPod Touch. A college requiring a specific kind of cell phone or music player? Isn’t that a bit much? Isn’t college already expensive enough? The Alligator, an independent school news publication, reported on the story back on July 9th. In the story, the Dean of the College of Pharmacy said, “These are the instruments at the forefront that are developing applications for medical uses by the hundreds. We want our students to become adept at using these mobile devices early on because we see this as the future in pharmacy practice.” Quite a tall order to fill. But this wasn’t the first university-wide application of the popular Apple cell phone or music player. Earlier in the year, the University of Missouri implemented the use of an iPod Touch in order to help students retain information. Brian Brooks, associate dean of the Missouri School of Journalism told the campus newspaper about his decision to make the device a requirement for incoming freshmen: “Lectures are the worst possible learning format,” Brooks said. “There’s been some research done that shows if a student can hear that lecture a second time, they retain three times as much of that lecture.”

Can the requirements for iPod Touch/iPhone on college campuses be considered a trend that’s sweeping the nation? It’s hard to tell. The iPod has been around since 2001 and from the day it was born, Apple has yet to see significant market competition. Apple’s most recent quarterly earnings yielded a 7 percent decrease in iPod sales from the same quarter last year, but a 626 percent unit growth for the iPhone. Here’s what the numbers could tell us:

• The iPod line has reached its maturity stage and is already entering the saturation and declining stages or
• The iPhone has become the all-in-one desired by the masses and
• Looks to be eating into iPod sales

Since the iPhone is – as a rule – a higher-margin product, I can imagine Apple prefers that the last of those statements to be true.

Apple is also tacking names and selling Macs when it comes to unified educational sales. The State of Maine has recently decided on supplying its entire body of students in 7th through 12th grades with MacBooks. The state chose to issue the MacBook because the laptop is “durable, flexible, and goes with students to all points of learning.” Moreover, Apple may have hit another gold mine when it comes to the App Store. The College of Pharmacy at the University of Florida directs students to the free app Epocrates (click opens iTunes), which claims it is the “leader in mobile clinical software with more than 625,000 healthcare professionals relying on [its] references to make quick confident decisions at the point of care.” The University of Missouri’s school of Journalism is featured on the Apple website as a sort of poster child for Universities partnering with Apple: the university gets name recognition by a worldwide tech conglomerate while Apple receives real-life scenarios of how Apple technology helps real people.

Apple’s website boasts that the Mac is “the number one computer in schools and on college campuses.” iTunes U has recently become a gold mine for free educational content. Some of the top universities, both in the United States and abroad, have content in the iTunes Store available for not only their students, but also the public at large! Apple’s education website shows just how much Apple is integrated into the educational system: “Today’s students expect constant access to information—in the classroom and beyond. Which is why more and more faculty are using iTunes U to distribute digital lessons to their students,” reads Apple’s mobile learning page. And it doesn’t end there. From an Apple Reps program to advertising for Mac Labs, Apple has the Education market covered from president to student.

In the past, owning a Mac was trendy. Today, it looks like owning a Mac is simply a necessity in the education market: the computers allow students to learn rather than worry about technical issues. And if they already have a Mac, what better media player to buy than an iPod? What better cell phone to buy than an iPhone? The marketing behind all of Apple’s efforts fit together so perfectly, that it becomes very difficult to nit-pick. The credit is due to the pure genius in Apple’s marketing guru Philip Schiller and Retail Vice President Ron Johnson, not to mention CEO Steve Jobs. Is there any better way to infiltrate college campuses or college dorm rooms than the way Apple has laid for itself? I don’t think so!

This kind of marketing genius is sure to pay dividends: after its best non-holiday quarter ever, Apple projected even higher revenues for Q3 2009 at $8.7-8-9 billion. That’s compared to $8.34 billion in Q2. Increased Mac and iPhone sales are sure to be the leading factors that propel these numbers.

What do you think? Does Apple have the Education market covered well on your campus? Can we expect new growth in this market? Let us know in the comments!

We all love Apple. Well, most of us do. The last few years, especially since the Vista launch, modern media has pushed on us the virtues of owning a Mac. Most of the top names in the tech blogosphere use Macs, and support almost all of Apple’s products. Leo Laporte, Ryan Block, and Peter Rojas are all self-admitted Macs (though they all come clean to using PCs). The “in” thing to do in the industry is to be a Mac. While this may put Apple in a position to become the leader in the PC industry, there are several reasons as to why Apple doesn’t want to and cannot do so.

Apple has long been the underdog of the PC industry. Right before Steve Jobs’ return as iCEO, we can see that this was for a good reason. Apple’s product line-up was a mess and the company was suffering through its worst years ever. Apple started out as a company that was all about the ability to “Think Different.” With Jobs’ return to Apple, this concept was embraced again, and the company started producing computers for the people. The original iMac and iBook are perfect examples: a colored and translucent computer was all about style and appealed to a younger audience. On the other hand, Windows PCs of the day were still considered the computers of choice amongst the tech elite and the business world.

Cut to today

Apple’s lineup of computers is amazing, to say the least. An Apple computer represents the latest and greatest in hardware: processors, graphics cards, RAM, connectivity technology, and enclosure engineering are all top-notch. The Mac lineup caters to both personal and business users and does so with extreme precision. Yet Apple is still the underdog of the personal computer market, having approximately 10% of U.S. market share. And this is exactly where the company needs to and wants to be, give or take a few percentage points.

One of Apple’s greatest strengths is its ability to manufacture both the software and the hardware that combine to make an amazing piece of machinery which outperforms all competition. But this level of performance comes at a price: the company’s second-greatest strength is the margin it enjoys. The last bevy of financial reports have pegged profit margin in the area of 30% or higher. Compared to rival companies such as Dell and HP, that’s an astounding number! It has turned Apple into a company that’s not only debt-free, but one that also enjoys tens of billion of dollars in the bank (and other short-term investments). But why can Apple charge so much more for its computers while other companies try so hard to earn even a 5 percent margin?

How can Apple get away with such a high margin?

1. The single most important reason is that Apple is a top-tier premium brand. Top-tier premium brands, by definition, are limited to the very few that can afford its products. If Apple were to gain a larger market share, it would do so by expanding down-market and diluting itself into something that doesn’t occupy a top-tier premium position. If this were to happen, Apple would not bring home as much money per item.

2. OS X is wonderful software, and the Mac is a great computer because of it. The sheer joy of using the two is thrilling: they just work. But why is that so? How can Apple’s product work in such great harmony while other computers don’t? It’s because of the limited product portfolio that Apple carries, a lineup with very well-known specs. This allows Apple to engineer OS X in a way that works best with the hardware it ships. Contrast that with Microsoft’s Windows, which has to support millions of components and hardware devices, all while not really being sure which combination of processor, motherboard, and graphics card will be used. Yet Apple’s limited hardware carries a price not denominated in dollars: there are some people whose needs are not fulfilled by the limited amount of products that Apple makes available. There are those that would like a netbook, or a smaller headless tower with the expandability of a Mac Pro. Such wants are simply not fulfilled by Apple. If the company were to fill every single void in its computer line-up, there would be a lot more hardware that Mac engineers would have to support.

As successful as it is, Apple still has to fight some uphill battles!

By having such a small market share, Apple is able to make only those products that its loyal customer base demands. In effect, this means that unless Apple finds a strong business case (iPhone, iPod, Apple TV) for certain products, they are simply not on the radar for the company. Many Windows PCs come in form factors and specs that simply do not exist in the Macintosh line-up (Tablet PC, anyone?). Many different manufactures produce thousands of different hardware combinations to make the Windows PC ecosystem as rich and abundant as it is. And while Apple seems like it is totally in control of its fate, the company does have its work cut out for it.

Price

Windows laptops are cheap; ridiculously cheap. A comparably spec’ed machine to the Macintosh line, while not as sexy, can range from $300 to $1000 less expensive. The company does not build OS X to support certain peripherals. Instead, peripheral vendors make supporting software (drivers) for OS X. This awards Apple the right to not have to go out of its way to ensure that every possible combination of peripherals work with its operating system. Microsoft, with its 90 percent market share, tried this once and the net result was Windows Vista, pre Service Pack 1. We all saw how that worked out for them (deservedly or not).

Compatibility is still an issue

On top of that, PCs are the industry standard and run many programs that OS X can’t natively. Many engineering and business applications only run on Windows. Sure there is BootCamp and various virtualization applications. But in my experience, most people prefer to have the same OS at home as they do at work.

Windows 7

Apple has dissed Windows 7 during WWDC 2009 – labeling it as Vista with a different name. That’s a great facade in and of itself. Internally, however, Apple must realize that the new Microsoft OS poses a threat to Mac sales. Many in the industry have cited Windows 7 as the answer to the problems that plagued Vista. Personally, I use Windows 7 on my daily machine and I can attest that this is an OS everyone will want to use. I feel that it combines the ease-of-use in OS X with the software compatibility (games!) that we have come to know and love from Microsoft. If Windows users are satisfied by Windows 7, it doesn’t give people a reason to switch to a Mac.

Still the underdog

Apple’s PR campaign has been an all-out attack on Microsoft. The “Get a Mac” ad series is very direct, calling the Windows world “stuffy,” filled with problems and vulnerabilities, and with people whose top priority is number crunching. Apple is able to do this because it is the underdog in the personal computer space. It is the David that everyone cheers for, versus Microsoft (the Goliath). Could you imagine if Microsoft took the same approach in marketing its products versus those of Apple? The closest and most effective approach the team in Redmond has come up with thus far are the “Laptop Hunters” series, which just calls MacBooks what they are: more expensive.

When it comes to malware, being small is an advantage!

A small market share also works to Apple’s benefit when it comes to malware. As a hacker/virus writer, why go after such a small installed user base when Windows machines are so much more abundant? Macs aren’t virus-free because they are inherently more secure. They’re free of malware because hackers don’t care enough right now. There is not enough money to be made by hacking Macs. And if hackers were to target the Mac, Apple would be forced to respond much faster in patching its software – something the company is known to not take very seriously.

The long and short of it is that first, Apple would have difficulty breaking out of the number two spot in the operating system world. And second, being number two is not necessarily a bad thing: considering the baggage that being number one brings, being at the top would put the company in a place it does not want to be. If OS X were the dominant force in the computer world, Apple would have to deal with the same interoperability issues that Microsoft faces today with Windows. In the race for the computer dollar, Apple is a distant second: and that’s where it should stay for the benefit of its customers and for its own good. That is, if it wants to hold on to its extremely high user satisfaction ratings. But will it be able to stay second? And if so, for how long?

As many have noticed, AT&T isn’t exactly providing iPhone users with a quality of service they could brag about. During WWDC, the groans in the audience came in loud and clear: MMS and tethering were announced as available features on the device, but weren’t supported by AT&T at the time of release of OS 3.0. In the San Francisco Bay area, making a call on the iPhone could turn into a constant game of “how fast can you hit the redial button?” Many have hoped that the end of the exclusivity contract with AT&T would put pressure on the company to not suck and become more competitive. Yet as much as we would all like to see AT&T lose the exclusive rights to the device in 2010 (when the contract is up for renegotiation), I don’t think the iPhone will be available on any other US carrier. Let’s explore.

To start off, let’s take a look at Apple’s options when it comes to carriers:

Sprint
Why will Sprint never carry the iPhone?  That’s easy: not only does Sprint’s wireless network use CDMA (a completely different set of wireless technology than what AT&T uses), but the company’s future network plans include rolling out WiMax. It would not be wise for Apple to design a completely different phone for just one carrier. It would complicate logistics, support, and manufacturing.  Apple would rather make one phone that can be sold (and used) worldwide, than to manufacture different models that cater to different wireless networks.  Apple can also achieve a greater degree of economies of scale by manufacturing, distributing, and providing support for one worldwide model based on the GSM wireless standard. Yet even if Apple were to make a phone compatible with Sprint’s CDMA network, the wireless company has being on shaky ground lately: it has weathered two consecutive years of a negative operating income, is losing subscribers by the boatload, and has sold its physical towers to Ericsson, which essentially makes the third largest carrier in the U.S. an MVNO.  All in all, a collaboration with Sprint would yield more risk than possible return for Apple. T-Mobile
T-Mobile is the smallest national carrier in the US.  It is also the only other GSM carrier in the country.  Unlike an iPhone for Sprint, making the device available on the T-Mobile network would seem easy enough: just put in a T-Mobile SIM card and off you go, right?  Not so fast: T-Mobile operates its 3G data network on the 1700MHz spectrum. No other carrier in the world does this, AT&T included. I have seen rumors on the interwebs about the iPhone wireless chip having the ability to operate on this band, but there is nothing official from Apple confirming this. Even though Apple could make the iPhone available to T-Mobile customers as the device exists right now, users will not be able to take advantage of the 3G network, which would essentially defeat the 3G in the name. I don’t believe that Apple would allow their “twice as fast” phone to operate at 2G speeds.

Verizon
Of the big four US carriers, Verizon Wireless (VZW) has the most subscribers. Like Sprint, the company operates on the CDMA network, but is expected to make the switch to LTE for its new 4G network.  On the surface, many are excited about the possibilities.  I think there is more here than meets the eye.

Apple approached VZW about carrying the iPhone before it shopped it to AT&T. Verizon and Apple had a falling-out due to control and revenue sharing: Apple wanted full control of the phone and the content that could be placed on it; Verizon wanted the same. While exact details of talks aren’t known, it’s obvious the two companies didn’t come to an agreement. But one thing is for sure: if Steve Jobs was offended during negotiations, you can guarantee there will be no iPhone on Verizon in the near future. Remember when ATI leaked certain details about the Mac Pro ahead of Apple announcing it? Now take a look at how many ATI video cards are available in the Mac lineup today (hint: only one in the entire Mac family). Even if egos were to subside long enough for the device to come to big red, I don’t think the network infrastructure would support it.

From a technological perspective, Verizon plans to upgrade to the LTE standard as part of the company’s migration to 4G wireless technologies. LTE (Long Term Evolution) has been given the 4G moniker and has been adopted by almost all carriers globally as the successor to current 3G networks (CDMA and GSM/UMTS). Eventually, most carriers worldwide are expected to use LTE, making the aforementioned network incompatibily with Verizon (or even Sprint) a non-starter. Verizon plans to begin the launch its LTE network this year and that’s where we begin to run into problems.  Namely, the actual rollout. A network launch is a huge undertaking and takes time to be completed on a national scale. Every cellular network roll-out works essentially the same way: the new network is launched in big metro areas in the first two years.  And only after three to four year after the initial roll out is the new network truly nationwide and ready to be used by all subscribers. That’s the best-case scenario: today, there are parts of the United States where GSM is a relative newcomer. This means that in the near future, our potential Verizonized iPhone would have to fall back on the CDMA network. As with the Sprint scenario, I don’t know that Apple would be willing produce a device with a completely different chip on board, all just for one carrier (citing my earlier concerns regarding logistics, support, and manufacturing as they all relate to economies of scale).

Let’s imagine that these two technological barriers were to somehow disappear.  We would still be left with Verizon playing nice with Apple and making up what was lost during iPhone negotiations. If there were a company that would have nearly as big an ego as Apple, it would be Verizon. The evidence is in its phone line, in which all phones strive to have the have the exact horrific UI. I know this doesn’t apply to its smart phones, but it is evidence of the tight grip Verizon likes to have on its products. Interestingly enough, Apple is the same way: control is uber-important for it.  A recent post at Engadget shows something that Apple would never agree to: a completely new app store, just for Verizon phones. An Apple-Verizon partnership would be like throwing two carnivorous animals into a cage with one piece of meat.
Aftermath
So as much as the tech community loves to hate AT&T, it seems that we are just going to have to get used to it. Apple even threw a jab the carrier’s way during WWDC, when it mentioned that MMS and tethering are available “if your carrier supports it.” One has to wonder how much Apple knows (and cares) about the frustration of the average iPhone user with AT&T.  I’m sure that satisfaction would be much higher if the carrier could deliver a better network infrastructure. And with recent murmors that the FCC is investigating manufacturer-carrier exclusivity contracts, one has to wonder if such business deals will be able to stand up to legal tests. The only hope of the iPhone being available on other carriers (besides AT&T) is Apple being willing to invest in a CDMA version of the device (wireless radios, manufacturing, parts acquisition, distribution, and support).  From what we know about Apple, having two versions goes against its corporate policy of having a device that just works, and works everywhere. I sincerely hope I am wrong, but I do not believe that there is enough evidence to show that the iPhone is going anywhere other than AT&T any time soon.

Sometime late last evening, Microsoft launched its latest addition to its Bing decision engine.  Dubbed Bing Tweets, the new destination is a mash up of real-time Twitter search with Bing web results (something Microsoft apparently calls Bing Insights).  Interestingly, the site is a second series of partnerships between Microsoft and Federated Media – the first being ExecTweets.  And while there is a plethora of real-time search engines cropping up (seemingly left and right nowadays), Bing Tweets may be that one place that takes real-time search mainstream.

Bing Tweets is described as combining “Twitter trends with Bing search results, enabling you to see deeper, real-time information about the hottest topics on Twitter. You can also search for anything in the BingTweets search box (at the top right of every page) and see Bing search results alongside the most recent related tweets.”

Design

The design is very attractive, user friendly, and fairly straightforward.  It takes a few seconds and a few clicks to get used to the layout, which consists of five main content areas and one search box.

In the upper right corner, above the four main content areas, Bing Tweets displays a search box.  This is no ordinary search box, since using it will deliver a combination of Tweets along with search results from Bing (the decision engine we’ve all come to love).  Here is a brief description of the five content areas:

Trending topics on Twitter: this is where I anticipate most users will interact with Bing Tweets.  This section currently consists of four main categories: Popular Now, People, Places, and Products.  Clicking one of these categories reveals the appropriate subset of trending topics on Twitter.  A really cool feature here is the ability of trending topics to grow and shrink.  If, for example, the trending topic for the Palm Pre became more popular, the size of the font would grow.  The reverse effect (shrinking) is also true if the trending topic loses its popularity.  Over time, I see the headings being expanded into other categories: politics and sports spring to mind.

The Tweets content area (column) is immediately below the trending topics on Twitter content area.  It displays a self-updating stream of tweets about the trending topic selected in the above content area.  When a user clicks a tweet in this stream, the updates pause for a few seconds and resume again.  Interestingly enough, the tweets displayed here aren’t exactly real-time: in my tests, Bing Tweets first began displaying tweets from a few days ago and upon running out of new tweets to display, the stream stopped moving (I searched for an unpopular topic).  One interesting tidbit is that this stream doesn’t seem to take hash tags into account when displaying tweets.  When I searched for TechNest Report and included #TechNestReport in my tweet, the stream didn’t display my update with the hash tag at all.

Search Results: this is the area of the site that needs the least amount of explaining, since it’s a direct Bing search result, down to the T.  It’s actually an iFrame of the Bing search results page and allows one to scroll left and right outside the intended viewing area.  Perhaps this is why Lizette thought the site was rushed to market: the Bing team could have integrated a real Bing results page and not just an iFrame.

Share this result: this content area is directly to the right of the trending topics on Twitter content area and above the search results content area.  It’s prefilled with the following text by default: “Check out BingTweets about your search query,” (emphasis – mine) followed by a bit.ly URL and a #bing hashtag.  The user has the option to Tweet this or ShareThis.  Tweeting this takes the user directly to his web-based Twitter account and prefills the compose Tweet box.  ShareThis is actually a ShareThis button (the company) which allows the user to email, text, or post the web page to a myriad of social networks.  By using the ShareThis button as opposed to a custom-built social sharing solution, the service may give off the vibe of being rushed to market, although I think only the hardcore tech geeks will notice this.  The ShareThis button is quite common throughout the web, so it actually might decrease the learning curve for mainstream users – increasing the chances that the user has seen and used the button on a different site.  For example, our blog also uses the ShareThis button.

How do you decide? The last content area of the service is located at the bottom of the page.   It asks visitors: “How do you use the Internet to find the answers you need to make faster, more informed decisions?”  The question is followed by an invitation to Share Your Ideas, which – when clicked – takes users to a page with a form that asks to fill out the name, email, title, and idea.  The submit button is preceded by a check box that reads “I have read and agree with the Terms & Conditions of contributing to the White Paper.”  This content area collects the submissions and then divides them into Featured Authors and Recent Ideas.  It’s unclear exactly what the process is that would take a submission from an idea to a featured author spot, but I’m guessing that’s the part that Federated Media takes care of.  Current featured authors include Anita Campbell, Harry McCracken, and Xeni Jardin, among others.

Overall, Microsoft got it right with the user interface.  It’s very easy to use for such a powerful real-time search engine.  My only suggestion for the site would be to unify suggested terms.  If I search for TechNestReport (one word) using the top-most search box in Bing Tweets, the Bing search results content area would present its suggestion: TechNest Report (with a space between Nest and Report).  It would be nice to see the suggestions unified across the entire service.  The site is built using Java components and thus uses absolutely no Flash to display its dynamic effects (read: auto-updating Twitter search).  As such, it is extremely mobile friendly: my Flash-less iPhone displayed the web page without a hitch.

Goals: mainstream or whalestream?

So what’s the target market here?  Currently, real-time search is a popular topic among web geeks and has not yet received the proper attention from mainstream media that it deserves.  Nevertheless, Microsoft has its own battles to fight on the search front.  It currently has two major goals with Bing: increase consumer awareness (brand awareness) which – eventually – should translate to taking search share away from other players.  Bing is doing its own thing on that front and initial reports are showing signs of success.  Bing Tweets might be Microsoft’s second phase of assault on Google, delivering real-time search before the incumbent is – after all – what any underdog would be proud of: beating Google feature-by-feature.  At the present time, Bing Tweets does not display any ads whatsoever, so it seems that the purpose is to drive usage of the service and build awareness of Bing as an innovator and as a viable alternative to the oh-so-popular Google.  That is, until Google releases its own a real-time search product.

ZAGG, the maker of many gadgets and gadget accessories – most notably known for its amazingly awesome invisibleSHIELD gadget protection film – is demonstrating its savvy marketing genius.  The maker of the see-through scratch-proof gadget protection film is holding a special 30% off promotion, and is doing it in a way that speaks directly to the hearts and minds of iPhone and Palm Pre fans.  ZAGG is pitting the sales of the iPhone SHIELD to the sales of the Palm Pre SHIELD, and is calling the event “Clash of the Gadgets.”  This is a perfect outing for fanboys and fangirls to vote on their favorite device of the two smartphones.  The kicker?  To cast a vote, you have to buy an invisibleSHIELD.

Scratch-Proof, patented film? Check
Lifetime warranty? Check
Military grade quality? Check
Improved Grip?  Check
Invisible protection? Check
No added bulk? Check

This is a perfect way to engage the community of iPhone and Palm Pre owners, since it

• encourages sales
• encourages the fans of one of the devices to get the word out and tell their friends to make a purchase
• keeps your beloved device from harms’ way

What more could you ask for?

PS: As of 9:40pm EST on Sunday, June 21st, the sales of the SHIELD for the iPhone are at 56%, with the Pre trailing at 44%.  It seems that the updates in numbers must be entered manually by ZAGG, because the counter is not self-updating, but rather an image that must be manually replaced by a webmaster.

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In Q1 2009, RIM increased its share of the consumer smartphone market by 15% over the prior quarter.  In other words, RIM now has a market share of nearly 50 percent when it comes to consumer smartphones.  According to NPD group, a “buy-one-get-one” promotion by U.S. CDMA carrier Verizon Wireless helped push the Canadian company’s BlackBerry Curve past the iPhone 3G in the first three months of the year.  This comes as bad news for Apple and Palm, since both companies lost 10% each.  NPD reported that the BlackBerry Curve was the top-selling smartphone during the quarter, followed by the iPhone 3G, the BlackBerry Storm, the BlackBerry Pearl, and the T-Mobile G1.  “Verizon Wireless’s aggressive marketing of the BlackBerry Storm and its buy-one-get-one BlackBerry promotion to its large customer base contributed  to RIM capturing three of the top five positions,” NPD analyst Ross Rubin said.

On the surface, it looks like the folks over at Waterloo (RIM HQ) should be celebrating.  But what if they don’t have anything to celebrate with?  By cutting margins in half – that’s what happens with a buy-one-get-one promotion – RIM is well on its way to becoming the Dell of the smarphone market.  Sure, the company’s products took three of the top five smartphone spots in the quarter.  But the iPhone was #2 – and it got there without using any “aggressive” promotions or buy-one get-one offers.  In other words, the iPhone spoke for itself (no pun intended), while the Curve needed all the help it could get to entice consumers to buy it.

You might say to me, “Alex, numbers are numbers; there are no if’s, and’s, or but’s about it.”  Well, there are in this case.  While RIM did sell more devices, the more important question is – at what cost?  By discounting giving away  the Curve, RIM has basically admitted that it can’t compete with Apple’s iPhone on the basis of value, user experience, or customer delight.  Thus, it resorted to price-cutting measures.  It’s kind of like deciding on that Porsche Cayman you’ve always wanted, but seeing a Toyota Yaris next to it for free, when purchased with another Yaris.  So you buy the Toyota because your sixteen year-old daughter needs her first car, and you just couldn’t pass on the buy-one get-one offer.  By allowing Verizon to give one Curve away as another one is bought commoditizes the BlackBerry brand, plain and simple.  This is something Apple didn’t have to do.A parallel of this can be seen in the PC market, where a Dell, HP, Acer, Asus, Gateway, Toshiba, and (name your PC brand here) can be purchased for hundreds of dollars less than an Apple Mac.  By choosing not to compete in the botton of the market, Apple has consistently won user satisfaction surveys and delighted its customers.  Year after year.  Can any of the aforementioned PC manufacturers say the same?  RIM is following the business model of the PC manufacturers, and it doesn’t have to.  It’s not relying on a third party to get its software, the way the PC makers are relying on Microsoft for Windows.  RIM makes the entire widget – the way Apple does.  So this is purely a choice on RIM’s part to position itself as the bottom-feeder of the smartphone market.  In the long run, I don’t think this is a sound strategy.  RIM might win some number wars, but at what (whose) expense?

Some more interesting tid-bits from the NPD report: smartphones now make up 23 percent of cell phone sales, up from 17 percent in the year-ago quarter (Q1 2008).  According to NPD’s Rubin, “Even in this challenging economy, consumers are migrating toward Web-capable handsets and their supporting data plans to access more information and entertainment on the go.”  Translation: people want information and entertainment on their mobile devices.  Guess what’s the best device that delivers?  iPhone.

On a closing note, I’ve been a long-standing supporter of the idea that Apple make the iPhone available on all the carriers once the exclusivity contract with AT&T runs out (hopefully during the summer of next year).  I truly belive that Apple will do just that: during the launch of the iPhone – the first few years of it – Apple wanted to understand the cell phone game and be conservative, attacking first and foremost with product.  It wanted to understand the various business models as well as perfect the technical and engineering techniques that go into making a cellular device.  Remember, the iPhone is Apple’s first cellular product.  Ever.  Apple also wanted to streamline the experience for the user: want an iPhone?  There is only one carrier where it’s available: AT&T.  Once the launch has come and gone and Apple has learned about the “ins and outs” of the cellular game, the company can really start to focus on making the device available to as large of a market as possible, and this means making it available on all carriers, not just in the U.S., but worldwide.  Once this happens, even the buy-one get-one promotion from RIM won’t stand a chance.  What do you think?

It seems not long ago Blu-ray won the HD disc battle and became the one and only high-def physical format for consuming movies.  But even as that happened, the “tech bubble crowd” (if you tweet about the fail-whale, you’re in it) wondered whether it really mattered: how would a physical medium hold up in light of digital downloads and instant streaming?  It looks like concerns about the viability of a physical medium are highly overblown by the tech bubble crowd.  Physical media is still preferred, according to NPD Group research.

As F.Y.E., Virgin Megastores, and other brick-and-mortar chains are shutting down, more people are buying DVDs than streaming and downloading content.  In fact, when asked about their home entertainment purchases over the past three months, 48% of respondents said they bought a DVD or Blu-ray Disc – according to the NPD survey.  If that doesn’t elicit a scratching-of-the-head response, get this: only 2% of respondents said they downloaded a movie or TV episode, and 2% said they digitally rented a movie or TV show.  These numbers and the fact that physical media is becoming more difficult to find (as evidenced by the closure of many brick-and-mortar stores), actually make sense: the retail space for physical media is consolidating, especially in the current economy.  But what about streaming content?

Sadly, it looks like sites such as Hulu.com and ABC.com, about which I expressed some dissatisfaction yesterday, didn’t make the cut into the NPD study.  And that’s a shame: the beauty of web-based distribution is not in downloading, but in streaming.  Downloading – if renting or buying – is the wrong way to do it.  All downloads I know of (iTunes, anyone) are encumbered by some form of DRM and actually need to work some “expiration magic” if the rented content is set to expire upon a particular time period or amount of playing.  Streaming, on the other hand, is the correct format for digital delivery of online video content: it’s quick (get in by going to hulu.com, get out by closing the browser window) and convenient (it isn’t locked to your iTunes collection on your desktop PC).  It can be streamed to a netbook, to a laptop, to a desktop, or to a set-top box (of course, if Boxee brought hulu back).  And looking into the future (if I may), streaming content will be widely available on mobile devices like the iPhone and the Palm Pre – when the former gets Adobe Flash support, that is.

Physical formats like Blu-ray are simply no longer necessary: having a physical disk is no longer a convenience, but a hassle.  You either have it with you or you don’t.  And if you don’t, your SOL.  Plus these things are subject to scratches, breaks, and other forms of damage.  Oh, and did I mention they need a $250+ investment in the form of a big, bulky, and power-hungry Blu-ray player?  And while Netfilx expects that “DVD mail shipments overall should grow over the next five to 10 years,” they are also in the streaming game with the Netflix Rolu player.  I wonder why that is (hint: because they know that the days of physical media are numbered).  As for me, I’ll stick to streaming.  I recommend you do as well.