Power of Thought

Nokia wants some of Apple’s rhythm. On July 1 the Finnish mobile-phone maker said that Warner Music Group has agreed to participate in Nokia’s fledgling music service, making Warner the third of the major record labels to join in the effort. The move is one more step in Nokia’s effort to compete against Apple for the people who want to carry around music libraries in their pockets.

Nokia’s service, which will officially launch in the second half of this year, is called Comes With Music. It will be built into certain Nokia handsets and will allow customers to download unlimited amounts of music from participating labels. The downloaded music can be kept on a PC or mobile-phone forever. In theory, a consumer could download every single song from the labels’ catalogs; they’d simply need a very big hard drive on which to store the files. Nokia and its partners have not disclosed pricing for the service, but they believe it has plenty of potential. “We believe this will be a significant contributor of revenue over a long-term basis for Nokia,” says Liz Schimel, global head of music for Nokia.

(Almost) All Aboard
The record labels seem to be buying that argument. Universal Music Group in December signed up with Nokia, and Sony BMG Music Entertainment partnered with the service in April. A spokesperson for EMI Group, the sole major label yet to join, says the company is talking with Nokia, although no deal has been reached. Nokia says it is in talks with independent labels as well.

For the music industry, the Nokia venture represents a departure from the old ways of doing business. Susan Kevorkian, program director of consumer markets at research firm IDC, says there is “broader experimentation” as CD sales decline and music revenues slide overall. For record companies, it may make sense to look for new ways to sell the work of their artists. Ringtones, for example, have become a multibillion-dollar business in only a few years. “We have a long-term sustainable business for Nokia, the music industry, and the artists,” says Schimel.

It’s hard to evaluate the service before pricing and other specifics are known. Nokia remained tight-lipped about the details of Comes With Music as it unveiled the Warner Music partnership. But Apple has said that it makes little money on music sales through its iTunes store, instead generating profits from sales of iPods and other hardware. Will the music business for Nokia and its partners also be of marginal financial benefit? Schimel says such comparisons are off-base. “We feel it is apples and oranges,” she says. “We are offering a structure that will attract new customers and new revenues.”

Will It Pay?
Some analysts are skeptical that Comes With Music will help Nokia attract new customers for its mobile phones. James McQuivey, a principle analyst at Forrester Research says, “There won’t be the same rush to buy Nokia phones” as there is for iPhones. Apple is expected to sell 10 million iPhones by yearend. McQuivey guesses that at most Nokia could sell between 2 million and 4 million handsets in the year following Comes With Music’s launch. The amount of revenue the company earns from downloads will depend on how much Nokia intends to charge consumers. But it is sure to be insignificant at a company that made $10.6 billion last year on sales of $75 billion.

IDC’s Kevorkian sees this as part of a bigger move by Nokia and the music industry. “It is a slim revenue margin, but it makes sense as part of a volume play for Nokia, who is in the midst of transition,” she says. Kevorkian sees Comes With Music as fitting into Nokia’s Ovi service, a broad effort to sell services to mobile-phone users.

Still, McQuivey thinks Nokia and its partners may find few takers for the new music service. He argues that music enthusiasts won’t be satisfied with a phone that’s merely adequate for listening to tunes, while other people won’t be willing to pay money for such music services. He says it’s a lot like digital cameras. Some people use their phone as a digital camera, but people taking lots of photos will generally purchase a separate, higher-quality digital camera. “It’s a mismatch in market opportunity,” says McQuivey.

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Most of today’s web sites and web applications are built using the JavaScript scripting language. Some may say that a trend towards the fine-tuning of JavaScript interpreters in modern browsers was just a matter of time since any such optimization translates into performance gains. Mozilla recently launched the browser speed race with Firefox 3, which delivers more speed than any other previous Firefox version. Apple answered with Safari 4, claiming the browser’s JavaScript engine has been accelerated by 53%. Welcome to the browser speed race.

Safari 4 has just been seeded to the developers at Apple’s developer conference. The manufacturer claims that the software has a 53% faster JavaScript engine than the preceding and current version 3.1 (based on the SunSpider JavaScript Performance test conducted on iMac with an Intel Core 2 Duo processor at 2.8 GHz, with 2 GB of RAM and running under Mac OS X Snow Leopard.) Although Firefox 3 RC3 was the first to deliver significant JavaScript performance improvement, Apple apparently is exceeding those gains with Safari 4.

Apple uses a new and improved JavaScript interpreter code-named SquirrelFish, which is provided on an open-source basis from the WebKit project, the same organization that makes the open-source engine used by Safari to render web pages. According to the WebKit project, the SquirrelFish engine is 1.6 times faster than the JavaScript engine in Safari 3.1.

SquirrelFish does its magic by turning JavaScript script into so-called bytecodes, an optimized code much more suitable for run-time execution than natural language-based JavaScript commands, which are longer and more complicated to interpret – and therefore are slower.

Why JavaScript performance matters
Most today’s web applications and web 2.0 sites rely on the JavaScript scripting language originally created by current Mozilla CTO Brendan Eich while he was employed by Netscape. JavaScript acts as glue that connects a user interface rendered in a web browser with a database and programming logic running in a web server. The browser’s JavaScript engine is solely responsible for interpreting and executing JavaScript commands embedded in HTML code. As a result, a browser’s JavaScript engine performance is directly related to the performance and responsiveness of a web application, contributing to an improved user experience.

The fact that many applications grow in size and become more bloated with each release means that a browser that can run web applications faster and make user interfaces more responsive on any computer is actually a big deal. You don’t have to have any specific market forecasting talent to predict that this trend may be impacting browser market shares: Speed can directly translate into more usability for most of us. Clearly, JavaScript handling is on its way to become a powerful weapon in the browser market.

SpiderMonkey, SquirrelFish, Tamarin and more
Mozilla was the first to introduce significant speed gains with Firefox 3 beta 5 (the final version is expected to ship by mid-June). Firefox has its Gecko engine to render web pages, which is generally considered to be slightly slower than Safari’s WebKit – which is largely responsible for the “fastest browser in the world” status Safari enjoys. Firefox’ JavaScript implementation is based on Mozilla’s own and decade old SpiderMonkey technology, which many considered to be the fastest JavaScript interpreter until SquirrelFish came out.

Although in beta, Firefox 3 scored with many reviewers who are praising the browser’s performance improvements, with WSJ’s Walt Mossberg declaring the browser a “winner.” But now that the SquirrelFish/Safari combination appears to be offsetting the speed gains in Firefox 3 and may set a new benchmark, we can expect more direct competition between Mozilla and Apple. Mozilla has plans to expand SpiderMonkey with Adobe’s JavaScript engine called Tamarin, included in Flash 9, which has a so-called “tracing” feature designed to enable faster code execution. However, the SunSpider JavaScript benchmark claims that SquirrelFish is at least 1.9 times faster than Tamarin.

Mozilla plans to wedge Tamarin into Firefox and match the API’s of both technologies “There are areas in which SpiderMonkey is faster than Tamarin and areas where it’s not. We’re looking to build hybrids that are best-of-breed for both worlds and we’re going to pull those into the Firefox release when ready,” Mozilla co-founder Mike Shaver recently said.

Can IE8 compete?
The big variable in this game is Microsoft’s Internet Explorer 8, currently in beta 1 phase. IE8 is expected to deliver speed gains in JavaScript performance as well. However, Microsoft is facing a tough task. The fact that the software giant is often criticized for delivering bloated and inefficient software certainly doesn’t help. In our tests, the first beta of IE8 shows no noticeable speed gains in running web applications.

Quite the opposite is the case, actually. Websites and web applications run noticeably slower than in IE7. The whole browsing experience generally appears to be less responsive. Of course, IE8 is in an early development stage and you can bet Microsoft is going to tweak its performance. The only problem is that the software giant will have to work to raise the stakes in the browser race. If IE8 under-delivers, the market could respond with further market share erosion for IE. It is evident now that JavaScript engine performance has become a key metric in the newest race for the title of fastest browser.

The battle ahead is nicely summed by Mozilla co-founder Mike Shaver who said the following: “They [Apple] have dropped SquirrelFish in now and got a big speed up there. We’ve got more coming on our side. You’ll see this leapfrog pattern over and over. We’re not going to let anybody slack on that and the other browser vendors need to keep up, too.”

According to Net Applications, Firefox 3 captured almost one fifth (18.41%) of the browser market in May, followed by Safari 3.1 which hit 6.25%. Microsoft’s Internet Explorer continues on its pace of a slow but steady decline, ending up at 73.75% in May. Microsoft has scheduled second beta of IE8 for an August release, with a generally expected final release in the fourth quarter of this year.

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Apple has started offering movies for sale or rent to UK users of iTunes.

More than 700 titles will be on offer from the launch date, 100 of which will be available in high-definition.

Many of the titles on sale for downloading via iTunes will be going on sale on the same day they are released on DVD, said Apple.

New releases cost £10.99 to buy and £3.49 to rent. Movies from the iTunes library cost £6.99 to buy and £2.49 to rent. HD versions cost £1 more.

Those renting films have up to 30 days to watch what they have downloaded and once they have started watching it have 48 hours to finish viewing.

Once downloaded films can be watched on an iPod, iPhone or through Apple TV.

Apple said films from Fox, Disney, Paramount, Warner, MGM, Sony International and Lionsgate would be available via iTunes.

Early titles available for download include I Am Legend, National Treasure 2, Hitman and Into The Wild.

ITunes in the US started offering movies for sale or rent in early 2008.

In the online movie watching market Apple faces competition from rivals such as Amazon, Netflix, Blockbuster and even Microsoft via its Xbox 360 gaming console.

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It’s no secret that Apple Inc. has been on a hardware tear. In the last year alone, there has been a flurry of developments: The company branched into the mobile phone arena with the iPhone. It reinvented the mp3 player with the introduction of the iPod Touch. It worked its way into living rooms with an updated Apple TV.

But Apple is now exploring another hardware technology that has the potential to realign a multibillion dollar industry.

Apple has once again got an itch for gaming.

This isn’t necessarily a new frontier. Fans of the Cupertino-based company may recall how a Steve Jobs-less Apple entered the console gaming fray in 1996 with the troubled Pippin. At best, the Pippin ended up being a costly lesson. At worst, it served as a stinging footnote to the company’s strained relationship with gamers.

Fast forward to the present — the company has enjoyed a string of hardware and software hits and has disrupted the music and mobile phone industries soon after entering them. Today’s Apple certainly has the means to release another console, but let’s face it — a rehashed Pippin would be a huge gamble, considering the established relationships and competition represented by Sony’s PlayStation3, Microsoft’s Xbox 360, and the Nintendo Wii.

This doesn’t mean that Apple has abandoned ways to break into the gaming market with its desktop hardware. A beefed-up iMac offers an interesting possibility. Adding horsepower to the iMac line isn’t exactly new for Cupertino, but with an overclocked Intel CPU and an nVIDIA 8800M GTS under the hood, the new iMac could easily pass for a leading gaming rig — at least, if there were more developers creating games designed to run on it and OS X.

It seems much more likely that Jobs and Co. may be following a different path to gaming success — domination of the mobile gaming market.

A trademark extension filed last February with the U.S. Patent and Trademark Office is one of the strategy’s biggest tells. The filing extends Apple’s trademark in regards to:

“Toys, games and playthings, namely, hand-held units for playing electronic games; hand-held units for playing video games; stand alone video game machines; electronic games other than those adapted for use with television receivers only; LCD game machines; electronic educational game machines; toys, namely battery-powered computer games.”

Skeptics could easily dismiss this as Apple casting a wide net for future expansion, but a swift call to action seems more likely. Not only are executives well aware of the strong interest in gaming among Mac users (and vendors), but also new conditions exist for gaming to be pushed to the forefront in the Apple hardware and software ecosystem. The faltering company behind the Pippin now dominates several hardware segments, which makes a huge difference in launching a new (and potentially related) product. The problems that the Pippin faced – such as the development and marketing costs associated with an unproven device – would be negated by a gaming platform tied into Apple’s market-dominating and innovative mobile devices.

And here’s the really sneaky part – the iPod Touch and the iPhone are already fully capable of playing games. Apple highlighted this home-court advantage with the recent release of the SDK for the iPhone/iPod Touch. By doing so, Apple let a community of eager third-party developers tackle designing games like “Spore” as well as casual games for its devices that utilize innovative features such as the multitouch screen and motion-sensing accelerometer. Along with all of the development tools necessary for building applications, developers will have the ability to upload and sell their creations through the iPhone App store (naturally, Apple will take a cut).

Consumers are already ga-ga over Apple’s mobile devices to begin with, so whether they should be re-imagined as gaming gadgets is more of a marketing issue. But with the developer community in a tizzy to create the next great Apple-friendly game, it’s only a matter of time before Cupertino announces that it’s ready to connect the dots. Don’t be too surprised if it ends up being Steve’s “one more thing” at next year’s Macworld.

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Apple fans queued through the night in Germany and Britain to be among the first in Europe to buy an iPhone, the must-have gadget that is set to shake up the mobile industry.

Over 10,000 iPhones were sold by Friday afternoon in Germany, a T-Mobile spokeswoman said, after it went on sale at midnight in a Deutsche Telekom shop in Cologne.

“It was love at first sight,” said one 50-year-old man.

T-Mobile representatives handed out blankets and umbrellas as well as hot tea, coffee and pretzels for those waiting outside, before sales staff cheered loudly as the first customers entered the store.

In Britain, fans had to wait until 1800 GMT before the music-playing, Web-browsing phone went on sale at stores from Apple, mobile phone retailer Carphone Warehouse <CPW.L and mobile operator O2.

The queue outside central London’s main Apple store stretched around the corner and long lines also formed in the city’s financial area.

First in the queue, clutching a mug of steaming tea, was student Graham Gilbert, who arrived at 0830 GMT on Thursday and endured a wet and cold night on the street.

Deutsche Telekom, Telefonica’s O2 and Carphone have pinned high hopes on the iPhone after more than a million sold in the United States in a few months.

“It’s probably the most important phone this year in terms of the impact it will have on the mobile phone market but it’s going to be a long way from being a best seller,” CCS analyst Ben Wood told Reuters.

“But one of the things that Apple do very well is they spend a lot of time thinking about the consumer experience and we’re going to see their competitors taking more of that approach.”

Most analysts expect the device to be popular with a niche audience, in part due to its price tag, and those queuing on Friday in Germany and Britain were mostly young men.

Most European handsets are subsidised in return for long-term contracts but the iPhone costs 399 euros ($585) in Germany and customers must agree a two-year contract with T-Mobile for monthly fees between 49 and 89 euros.

In Britain the iPhone costs 269 pounds ($56 on top of an 18-month contract costing a minimum of 35 pounds per month.

“It’s a magnificent product and it’s very well marketed by Apple,” said Greenwich Consulting’s Fred Huet. “The real question will be how many they sell once the novelty wears off.”

The phone will go on sale in France at the end of the month.

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