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TheAppleBlog, published by and for the day-to-day Apple user, is a prominent source for news, reviews, walkthroughs, and real life application of all Apple products.
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Apple Allows iPhone In-App Purchases for Free Apps

When Apple first allowed in-app purchases for third-party apps on the iPhone platform it was restricted to paid apps only, even if the app was only 99 cents. Today, Apple informed all registered iPhone developers that it was now allowing free apps to contain in-app purchases.

While this does open the door to potential ‘bait and switch’ apps (its free, but then you have to pay to make it useful), the advantages completely outweigh the potential for bait and switch. Developers have been asking since the beginning to make true ‘trial versions’ available that can be upgraded without the consumer losing data. If app developers embrace this it will put a complete end to the argument that Crackulous exists, not for piracy, but to enable users to ‘trial’ software.

What is not clear yet is that if Apple will allow ‘time limited’ demos or not — giving the full features for 30 days or so and then locking it out with an upgrade. Another question is how this change will affect the top “Paid” and “Free” app lists. Time will answer these questions, but I think this is definitely a good move on Apple’s part and continues to strengthen its App Store’s lead in the industry.

The email sent to developers is below:

In App Purchase is being rapidly adopted by developers in their paid apps. Now you can use In App Purchase in your free apps to sell content, subscriptions, and digital services.

You can also simplify your development by creating a single version of your app that uses In App Purchase to unlock additional functionality, eliminating the need to create Lite versions of your app. Using In App Purchase in your app can also help combat some of the problems of software piracy by allowing you to verify In App Purchases.

Visit the App Store Resource Center for more details about how you can add In App Purchases to your free apps.

What was the big news that happened in your sector in Q3? Catch up with GigaOM Pro's, "Quarterly Wrap-ups."

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AT&T Removes All Remaining Doubt: No Tethering This Year

It seems AT&T is on a quest to cause as much damage as possible to the already flaky reputation it has with its iPhone customers. In an oddly confrontational email to 9to5 Mac, a spokesman for the communications company took issue with one of their recent articles that said AT&T would be delivering tethering services to iPhone customers by the end of the year.

The email, as quoted by 9to5 Mac's Seth Weintraub, says:

Just reading again – where did anyone promise tethering by EOY? Where did you see that? We promised MMS by end of summer and ended up being a few days late for that…

In their defence, 9to5 Mac was channeling reports from TechCrunch and CNET which got them to arrive at the "before end of year" conclusion. You can hardly blame them — CNET's headline in November 2008 read "AT&T confirms tethering coming to iPhone in 2009." That's pretty unequivocal as far as assertions go, right? Yet, I don't recall anyone from AT&T sending CNET a snippy email in the interim…

Last week I wrote how AT&T told the Wall Street Journal that it needed 'more time' to work on tethering functionality. I also mentioned how AT&T's CEO Ralph De La Vega said, way back in 2008, that tethering would be available "soon." A year later it’s not unreasonable to wonder just what De La Vega’s definition of “soon” might be.

Add together the history of dropped calls, patchy 3G coverage and recent reports that the company might start throttling data for iPhone users, the snarky email above only adds to the sorry state of affairs at AT&T. However kindly you may choose to interpret that email, there are countless ways it might have been more professionally composed.

For a company still enjoying exclusive distribution and service rights for the iPhone across America, (and the prestige and profits that partnership with Apple entails) its performance in the last two years can only make us hope Apple is considering offering the iPhone to other cell carriers willing (and actually able) to do the job properly.

In any case, while the email doesn't specifically deny tethering will become a reality this year, it certainly makes the proposition sound unlikely. AT&T announced last month it is working to expand its network, and have invested heavily in the hardware upgrades necessary to do so. That’s welcome news to long suffering customers, but those upgrades aren't going to be completed until the end of 2011.

Or, as Mr De La Vega might put it, "soon."

As Q4 begins, online video is now mainstream. Read the, "Connected Consumer Q3 Wrap-up."

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Mac Sales Up, But Netbooks Way Up

The good news is that preliminary estimates from both IDC and Gartner for the third quarter have Mac sales up and Apple ranked fourth in overall PC sales. The potentially bad news is that Apple will probably drop in ranking next quarter due to the increasing popularity of netbooks.

Nonetheless, despite more unemployment and less consumer spending, Apple managed moderate year-over-year growth in both reports. Although neither Gartner nor IDC ranks Apple in worldwide PC sales, the U.S. market accounts for about 40 percent of Macs sold, so the numbers are instructive of the overall health of the platform. Of the two reports, IDC shows more robust growth for Apple during the last quarter.

According to IDC, Apple shipped some 1.64 million Macs in the third quarter, up from 1.467 million for the same period last year, a growth rate of 11.8 percent. That puts Mac share of the overall market at 9.4 percent, verging on double digits not seen since the halcyon days of the early 90s. However, like 1994, before the deluge of cheap PCs with Windows 95, there may be danger for the Mac from cheap PCs with Windows 7.

While HP sales were up only 3.2 percent, and Dell saw its sales drop 13.4 percent, both Toshiba and Acer are up, up, up. On the steroidal strength of netbooks, Toshiba sales jumped 37 percent. With an 8.1 percent share of the market, the company will likely pass Apple in ranking next quarter. As impressive as Toshiba was, Acer was even more so. With sales up nearly 50 percent, Acer has already passed Apple and now holds 11.1 percent of the US market. Gartner tells a similar story.

For Apple, Gartner estimates 1.572 million Macs sold in the third quarter, up from 1.471 million for the same period last year, a 6.8 percent increase. Apple’s share of the U.S. market is now at 8.8 percent, barely up from 8.6 percent last year. While both Dell and HP declined slightly, once again Toshiba and Acer are the big winners in market share because of netbooks, Toshiba up 45.8 percent, and Acer up 61.4 percent — that’s like iPhone growth.

The question then becomes: is the lack of a MacBook mini hurting Apple? In terms of market share, definitely, but as Mikako Kitagwa of Gartner points out, “preliminary research shows consumer mobile PC ASPs declined more than 20 percent compared to a year ago.” Netbooks are clearly hurting HP and Dell, both in terms of market share and profit. In contrast, Apple is slowly making gains in market share and continues to profit handily from its portable lineup, which starts at $999. Apple’s move to counter Toshiba and Acer will likely be the long-rumored tablet device, anxiously anticipated for the first quarter of next year.

As for the quarter just ending, Apple will announce its official numbers on Monday. As always, TheAppleBlog will have the numbers and pretty graphs, as well obfuscating quotes from Apple executives about future products.

What was the big news that happened in your sector in Q3? Catch up with GigaOM Pro's, "Quarterly Wrap-ups."

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Michael Jackson's Posthumous Album Is Coming to iTunes

A storm sprang up this week around reports that, due to disagreements between Apple and Sony BMG, the upcoming Michael Jackson album “This Is It” — a tie-in to the movie of the same name and bound to be a sales success — would not be available on iTunes, the world's biggest digital music provider.

When Michael Jackson tragically died in late June, sales of his music on iTunes sky-rocketed. A day after he died, eight of the 10 top-selling albums were from Michael Jackson. Eight of the 10 top-selling music videos, too. Five of the 10 top-selling singles were also from Jackson. It was a trend that would continue for weeks. With interest in (and thirst for) Michael Jackson music and video at an all-time high, online music vendors have a vested interest in the new album.

So it came as something of a surprise when, two days ago, news broke that iTunes was to be denied the chance to sell the upcoming album. Paul Reskinoff reported that, according to confidential information leaked to Digital Music News, Sony BMG and the Jackson Estate were insisting downloads could only occur within the constraints of a bundled, full album. So, if a customer wanted just one song from "This Is It," they'd be forced to buy and download the entire album to get it. Apple's policy, on the other hand, is well established in these matters; it insists on making individual tracks available for purchase and download. Hence the current standoff.

In his MediaMemo column on All Things Digital, Peter Kafka writes:

…the story is a familiar one, because it's a longstanding dispute between Apple (AAPL) and the music business. The industry, for both financial and artistic reasons, has tried to keep music bundled together, while Apple insists on selling it a la carte.

Apple usually wins these disputes: Even the stubborn iconoclasts in Radiohead eventually bowed to Steve Jobs's will and turned their precious albums into individual songs.

Lois Najarian, Sony's Senior Vice President of Publicity yesterday told Wired.com:

I'm happy to report that… Michael Jackson's This Is It album will indeed be for sale on iTunes Oct. 27. I don't have much more information to impart other than that right now, but suffice [it] to say fans will be able to purchase it there.

It was always unlikely Apple would have been blocked from selling the new album — the contract Apple has with Sony BMG to distribute its catalogue of music would see to that. So the question now is not if the album will be sold on iTunes, but how? Najarian doesn't say, adding only that Apple and Sony BMG are "working on that now."

Will Sony acquiesce to Apple's rules, or, controversially, could we see Apple agree to the album-bundling method? It's not impossible, given how well this release is expected to sell; Apple might be prepared to make an exception to its own (usually immutable) rules in favor of meeting the guaranteed demand of its iTunes customers. Plus, I'm sure the sales revenue it generates will not be unwelcome, either.

Whether temporarily or otherwise, if Apple does indeed make an exception and bow to Sony's wishes, it's a decision sure to cause frustration and anger amongst iTunes customers. And you can bet your bottom dollar we'll be hearing from some pretty miffed artists unhappy they weren't afforded the same special treatment as the late, great, King of Pop.

As Q4 begins, online video is now mainstream. Read the, "Connected Consumer Q3 Wrap-up."

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Apple Hints at Mac Counterattack on Windows 7

With the release of Windows 7 next week, senior Apple VP Phil Schiller is boldly asserting that it “presents a very good opportunity for us.”

That opportunity will possibly come in a series of ads contrasting Windows with OS X, at least according to Peter Burrows of BusinessWeek. The expected campaign is expected to take Windows 7 on directly, and will likely “poke fun” at the upgrade process, from backing up data and reformatting drives to reinstalling software.

“Any user that reads all those steps is probably going to freak out. If you have to go through all that, why not just buy a Mac?” says Schiller.

The idea is that, rather than upgrade, people will be buying new computers, but the problem with Macs — especially in difficult economic times — is price. To that end, rumors continue to swirl regarding price reductions. Just last week, Google AdSense placements temporarily appeared in several European countries hinting at new iMacs, Mac minis and MacBooks. While only the Mac minis listed lower prices, it’s certain that new MacBooks and iMacs will have speed and storage increases, and the rumor of Blu-ray for the iMac persists.

In the interview, Schiller deflected inquires about new Macs and lower prices, remaining dismissive towards Windows and predicting a poor upgrade rate for Windows 7 compared to Snow Leopard. In the end, Windows is “still Windows.”

In Q3, NewNet focus turns to business models and search. Read the, "NewNet Q3 Wrap-up."

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