EoW March 2010

Transat lant ic Cable

the iPhone. Whether it does or not, he concluded, “The iPad will no doubt add more strain to an already encumbered network. And, for Apple, tethering the iPad to the fortunes of AT&T seems like a risky bid.”

Telecom

AT&T is exclusive carrier for the Apple iPad as well as the iPhone. But is its triumph over Verizon a Pyrrhic victory? An open question is whether the most newsworthy event in the US on 27 th January was President Barack Obama’s rst State of the Union address or the introduction by Apple Inc chief Steve Jobs of the company’s iPad. The slate-like tablet computer that falls somewhere between a laptop and a smartphone had prompted a frenzy of anticipation, notably an o er by the online gossip site Gawker of a bounty up to $100,000 for a report from anyone scoring veri able face time with the iPad before its unveiling. Apple’s threat of legal action to arrest the assault on its trade secrets did nothing to quell a clamorous public. Now that the existence of the iPad has been con rmed (it is a half-inch thick, weighs 1.5lb, and has a 9.7" glass touch screen: “gorgeous,” according to Mr Jobs), another question presents itself. What happens when the device is launched this spring? AT&T, exclusive network for the iPad, is already struggling to handle data requests from users of the phenomenally popular Apple iPhone in high-density metro areas across America. The carrier has itself acknowledged that its New York network is “performing at levels below [AT&T] standards.” Whether or not the already strained AT&T network is up to supporting the iPad was considered by, among others, sta writer Matthew Shaer of the Christian Science Monitor . AT&T blames the overload on data-guzzling iPhone users, and Mr Shear does not dispute that analysis. On average, he wrote in the paper’s Horizons blog, “The feature-heavy phone gulps down ten times the network capacity” of other smartphones. (“Can AT&T handle the Apple iPad?”, 28 th January) Possibly sensing that its victory over Verizon for an exclusive on the iPad could worsen its situation, AT&T in December said that it would take steps to rein in rampant data usage on the iPhone. “Incentives” o ered to bandwidth hogs might include pay-per-use plans that meter monthly activity, or a pricing structure with graduated limits on how much data each phone may download. The trouble is, iPhones come with an unlimited data plan, and at least some of the more than 42 million iPhone owners around the world have taken the trouble to read the ne print in their contracts. It has been called to the attention of AT&T that availing oneself of too much of something that is unlimited is impossible. Three models of the iPad ($499 to $699) will connect to the ❈ Internet by means of local Wi-Fi connections. Three later versions including 3G wireless access will cost an additional $130 and require a data plan from AT&T. Currently, Apple is o ering two monthly options for the original iPad: unlimited ($29.99); and limited to 250 megabytes ($14.99). This set Mr Shear to wondering whether the iPad’s 250MB monthly cap will mark the beginning of tiered pricing for

Smartphone rivals Apple and Nokia trade accusations of patent infringement In other news of Apple Inc (Cupertino, California), the company on 15 th January led a new patent infringement complaint with the US International Trade Commission (ITC) against the Finnish mobile devices giant Nokia. Setting the tone of the intensifying quarrel between two of the world’s biggest names in smartphones, Bruce Sewell, Apple’s general counsel and senior vice president, said in a release, “Other companies must compete with us by inventing their own technologies, not just by stealing ours.” Nokia, the world’s largest maker of mobile phones, in December had lodged its own complaint with the ITC against Apple. The allegations here claim that Apple’s iPhone, iPod and MacBook products, among others, had made use of Nokia patents. Apple, for its part, is alleging that Nokia replicated particular features of Apple’s iPhone and violated 13 of its patents. “It is almost inevitable for debates to surface, given that the smartphone market is the industry’s most competitive and fastest-growing area,” wrote Caroline Dobson of the Epoch Times . She cited Bloomberg News data as showing a third-quarter 2009 drop to 39.3% in Nokia’s share of the market, from 42.3% a year earlier – to the presumed advantage of Apple and the Canadian rm Research In Motion. (“Nokia and Apple Locked in a Heated Patent Dispute,” 21 st January)

The economy

Good news raises consumer morale, but impact on the economy awaits an upturn in the labour market

Experienced bettors know that the most valuable piece of information they could obtain about a horse is ever outside their grasp: how the animal feels on the day of the race. Fortunately for those wagering on the economic expansion of the United States, the people whose spending accounts for some 70% of the US economy are able to disclose how they feel; and in January they did so. They are feeling better. According to the Reuters/University of Michigan Index of Consumer Expectations, con dence among American consumers improved in January to the highest level in two years as the economic expansion prompted companies to slow the rate of job cuts. That is a far cry from job creation, but enough to boost consumer sentiment almost two points above the reading for December – a remarkable increase in only a month’s time. Stocks rose on publication of the well-regarded report – an o cial component of the Index of Leading Economic Indicators

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EuroWire – January 2006 Euro ire – March 201