MacRumors

Businessweek provides a very interesting look behind Apple's supply chain and how they have managed to fine tune their operations into a competitive advantage.

According to more than a dozen interviews with former employees, executives at suppliers, and management experts familiar with the company’s operations, Apple has built a closed ecosystem where it exerts control over nearly every piece of the supply chain, from design to retail store.

Apple's well known to be a master at operations with much of that credit going to now CEO Tim Cook. Businessweek's profile gives many examples of how Apple has managed to stay ahead of the competition, with much of it being the ability to predict needs and also secure the necessary pieces by exercising their enormous $81 billion cash hoard.

Even as far back as the launch of the Bondi blue iMac in the late 90s, Apple's Steve Jobs paid $50 million to buy up all available holiday air freight space at a time when most of its competitors were shipping by sea. This reportedly handicapped rivals such as Compaq who later wanted to book air transport.

Similarly for both the iPhone 4 and iPad 2 launch, Apple bought up so many suppliers and machines needed for assembly, they squeezed out the competition who needed the same resources.

The tactic ensures availability and low prices for Apple—and sometimes limits the options for everyone else. Before the release of the iPhone 4 in June 2010, rivals such as HTC couldn’t buy as many screens as they needed because manufacturers were busy filling Apple orders, according to a former manager at HTC.

Apple's level of efficiency and control extends into launch day where factories work for weeks building hundreds of thousands of devices. Electronic monitors are placed in part boxes to discourage leaks and completed products shipped in non-descript boxes to avoid detection. Even in their retail stores, they can monitor demand by the hour and make supply chain adjustments as necessary.

During an earnings call today, CBS CEO Les Moonves is reported to have revealed that CBS had turned down an Apple TV service that would rely on advertising revenue.

As reported by GigaOM:

When asked about CBS’s appetite for striking deals with new streaming providers that might not have the money to pay cash upfront to license its content, Moonves said that CBS had decided against joining an Apple TV service because it was based on an ad split.

Apple has been long rumored to be working on some sort of TV subscription service over the past few years. A Wall Street Journal article from December, 2009 described one possible iteration of the service:

The proposed service by the maker of iPhones and iPod music players could, in at least some scenarios, offer access to some TV shows from a selection of major U.S. television networks for a monthly fee, according to people familiar with the discussions.

Such a service, of course, has never launched. But it's not clear if that particular plan was canceled or is awaiting the arrival of a full Apple television.

Rumors of a full blown Apple TV set were recently revived after Steve Jobs' biography quoted Jobs as saying he had "finally cracked" the problems standing in the way of an Apple television set.

As we'd previously reported, Apple appears to be preparing to unveil the new 5th Avenue Retail Store for Friday.

MacRumors reader Will submitted this photo which shows construction workers starting to remove part of the white covering from the store's new glass panes.

Apple's $6.6 million renovation started back in June and involved replacing the cube's 90 glass panels (Photo of old design) with a much simpler 15 glass panel design (Artist rendition).

Will reports that today they've torn away much of the white covering along the bottom of the store. This area remains hidden from the street level view due to the surrounding construction barriers. Workers have been power-washing the ground, presumably in preparation for the grand unveiling.

We'll post more photos as we get them, readers can submit photos to us via email.

As noted on Apple's 5th Avenue Retail page, the store will be closed from 10pm to 10am:

We'll be closed starting at 10:00 p.m. on Thursday, November 3 and will reopen at 10:00 a.m. on Friday, November 4.

While Apple's new Siri personal assistant for the iPhone 4S experiencing a few hiccups in availability just after the device's launch last month, a new widespread outage appears to be the most significant one since those first few days. The Siri problems have been ongoing for at least three hours, with only intermittent service available over that time. In general, users have been faced with error messages in which Siri reports being unable to connect to the network.

Apple has labeled Siri as a beta service and is no doubt continuing to refine the technology and infrastructure behind the feature. Apple has rapidly rolled out the iPhone 4S to nearly 30 countries already with another 15 set to come online next week, although Siri currently offers support only in English (US, UK, and Australia), French, and German.

Earlier this week, BGR noted a growing number of complaints in Apple's support forums regarding problems with echoes on the iPhone 4S when used with a headset, with calls typically degrading over the duration of the conversation. One thread on the issue has reached 14 pages of posts with a number of users reporting the same issue on a variety of different phone models and carriers.

When using the Apple hands free headset with the phone during a call, I get an echo problem. It does not occur immediately. It can very from 30 seconds into a call and as far up to 9 mins in before it begins the annoying echo. If I unplug the headset it goes away but will return when I plug the headset back in. I have tried 3 brand new iphone 4s headsets with the same problems. So far I have tried rebooting, and also restored phone back to factory original settings as a new phone and still no resolution. I have been told by the other person on the line a screech sound is made then the echo begins.

Users seem to be having some success in fixing the issue by briefly toggling the speakerphone option on and off when the echo begins.

A potentially related issue of static on iPhone 4S calls is also being documented in its own lengthy thread, with the issue affecting both incoming and outgoing calls and some users reporting the issue occurring on multiple handsets as they've exchanged devices at Apple retail stores in attempts to address the problem.

Finally, a third issue being tracked in a nearly 300-post thread involves users experiencing no audio on a subset of outgoing phone calls.

Picked up a Verizon iPhone 4S - 32GB and on about 1 in 10 calls I get no outbound audio when dialing. Call shows the timer counting as if the call is progressing but absolutely no ring back and cannot hear the party on the other end when they answer.

As with the echo issue, some users have reported that toggling the speakerphone option may fix the lack of audio on a given call, but others claim that the tactic does not always work. For its part, Apple support staff have been unable or unwilling to specifically diagnose the issue as either a hardware or software problem. At least one user has reported that the first developer beta of iOS 5.0.1 released yesterday does not fix the issue.

Avid today announced new versions of its flagship video editing software products, Media Composer 6, Symphony 6 and NewsCutter 10.

Media Composer version 6, Symphony version 6 and NewsCutter version 10 are rebuilt from the core on an entirely new open, 64-bit architecture that raises the bar for performance, flexibility and productivity. With this version, Avid is also introducing a sleek, new User Interface—designed to speed workflows while simultaneously preserving the same functionality that so many professionals have built their careers on.

- Media Composer 6.0 starts at $2499 with upgrades starting at $299.
- NewsCutter 10 starts at $2499 with upgrades starting at $499.
- Symphony 6.0 starts at $5,999 with upgrades starting at $499.
- Nitris DX starts at $5,499 USD.

Media Composer Academic 6.0 starts at $295 for educational institutions and students.

Avid continues to offer a discount to Final Cut Pro (not FCP X) users who switch to Media Composer. The company is offering Media Composer 6 plus free online training to help users move from FCP for $1499.

The company says it is "investigating" the Mac App Store as a distribution point for its software, but has nothing to announce yet. Media Composer 6, Symphony 6, and NewsCutter 10 will be available on November 15.

Business Insider shares a portion of a research note issued today by Barclays analyst Ben Reitzes, who recently visited with Apple CEO Tim Cook and CFO Peter Oppenheimer in a meeting that included discussion of Amazon's new $199 Kindle Fire tablet based on Android.

According to the executives, Apple welcomes the entry of the Kindle Fire to the market for its ability to further fragment the Android ecosystem. While the Kindle Fire does utilize Android, it has been heavily modified by Amazon to integrate specifically with Amazon's products and services.

While the pricing at $199 looks disruptive for what seems to be the iPad’s most important rising challenge, the Amazon Fire – it is important to note that it could fuel further fragmentation in the tablet market—given it represents yet another platform. While compatible with Android, the Apps work with Amazon products. The more fragmentation, the better, says Apple, since that could drive more consumers to the stable Apple platform.

Reitzes notes that he believes Apple will eventually lower pricing on the iPad, but will not compromise on quality and customer experience to approach or match its competitors' pricing.

Apple and Amazon are approaching the tablet market from opposite perspectives, with Apple achieving significant profitability on the hardware while selling content and services at near break-even prices. Conversely, Amazon is said to be taking a loss on sales of the Kindle Fire, using the device to attract customers into its content and product ecosystem.

As noted by Domain Name Wire, Apple has filed a complaint under the Uniform Domain Name Dispute Resolution Policy in an attempt to gain control of the iPhone4S.com domain name and six other iPhone-related domain names. All seven of the domains currently forward to pornography sites, meaning that readers should obviously exercise caution in visiting the sites.

The complaint is case number D2011-1897 with the World Intellectual Property Organization.

Apple did not gain control of the iPhone4.com domain name until July of this year, a transfer that appears to have been made outside of any formal dispute resolution process. Apple does occasionally turn to UDRP complaints in order to win control of domain names related to its products, although it is unclear why Apple chose that route in this case.

It is possible that the domain name's owner demanded more compensation than Apple was willing to offer or perhaps was unresponsive to Apple's attempts at contact. Alternatively, Apple may simply have proceeded directly to a UDRP complaint due to a sense of urgency given the nature of the sites involved.

Last week, Apple began offering customers the option of having their online orders shipped to their local retail store for pickup, a service especially valuable for those who have difficulty receiving shipments at their home or office. The "ship to store" option initially rolled out in the company's three San Francisco stores, and quickly expanded to include all sixteen Bay Area stores before the four New York City stores jointed the program earlier this week.

Apple has been said to be taking the service full-scale as of today as part of a series of retail enhancements that will also allow customers to use self-checkout for shelf-stocked items at Apple retail stores using the company's iOS app.

Evidence of Apple making minute-by-minute tweaks to the ship to store program is visible in Apple's online store, where just a short time ago customers had the option of using the service throughout the company's 51 California and four New York City stores.

The new expanded program did not last long, however, as Apple now appears to have completely shut down the ship to store option, with all stores listing online-only items as "unavailable for pickup". Items stocked in-store can still be purchased through the system, with California and New York City stores listing those products as "available now".

Apple is said to be viewing in-store pickup and self-checkout as major changes for the future of its retail stores, expecting that the majority of its customers will utilize in-store pickup as their default delivery method for Apple purchases.

Digitimes claims that Apple is going to "completely overhaul" its product lineups in 2012. The site specifically lists the iPad, iMac, iPhone and MacBook Air lines.

It's not clear if this is an all inclusive list or not. Notably absent are the MacBook Pro, Mac mini, Mac Pro and iPod lines.

Apple plans to completely overhaul its product lineups, including iPad, iMac, iPhone and MacBook Air, in 2012 and is expected to finalize order volumes for key parts and components for the next-generation iPad in December, according to sources in the upstream supply chain.

We interpret the report to mean new designs for the listed product lines.

The iPhone seems the most likely of the bunch to get a full redesign. In fact, we may have already seen a glimpse of what the next iPhone might look like. Tapered iPhone 5 case designs leaked in China flooded the market in mid 2011, leading to the belief that Apple would be releasing such a design this fall.

Apple ended up releasing the iPhone 4S instead, which shares the same design as the previous generation iPhone 4. Based on Apple's release pattern, however, it seems certain that the 2012 iPhone will receive a new external design.

The iMac design has remained relatively stable in design over the past few years. Given the constraints of the design, we're not sure how drastic a change we could see in the iMac.

The iPad has only seen two releases, each with a slightly different design. Again, the basic design constraints will limit it to a 9.7" display, but another report has suggested the 2012 design will be an even thinner design.

Finally, the MacBook Air. While we're certain that the MacBook Pro will see new design next year, how it integrates with the MacBook Air line remains to be seen. Rumors of a 15" Air-like design have been circulating since July. We expect that the Air and Pro lines will have to eventually merge into one. Intel believes that the Air form factor will dominate the consumer market in the near future.

When Apple launched OS X 10.7 (Lion) to the public in July, most of the media focus was on the user-facing changes, such as the iOS-like Launchpad, or trackpad scrolling direction. In Lion, Apple also made a number of under-the-hood changes in their security model that may start affecting Mac App Store customers in the near future.

Amongst the many new features in Lion, Apple included a more robust sandboxing system that can prevent 3rd party applications from causing unintended damage. In their Lion review, ArsTechnica explains how sandboxing works in general:

Running an application inside a sandbox is meant to minimize the damage that could be caused if that application is compromised by a piece of malware. A sandboxed application voluntarily surrenders the ability to do many things that a normal process run by the same user could do. For example, a normal application run by a user has the ability to delete every single file owned by that user. Obviously, a well-behaved application will not do this. But if an application becomes compromised, it may be coerced into doing something destructive.

Developers of these sandboxed applications must take special measures to break up their application into individual processes that only are able to do exactly what they need. Apple still allows user initiated actions to perform as expected and override the sandbox, but app-initiated actions in sandboxed applications will be restricted. This means that system wide file access and inter-app scripting and interactions will not be allowed.

Apple had originally told developers that sandboxing would become a requirement for Mac App Store apps as of November, 2011. Tonight, however, Apple emailed developers that the Sandboxing requirement will now go into effect on March 1, 2012.

As of March 1, 2012 all apps submitted to the Mac App Store must implement sandboxing.

While sandboxing will increase the security of Mac App Store apps, there have been concerns that the restrictions will stifle features and innovation on the Mac platform.

In October, Macworld published a pair of articles from Jason Snell and Andy Ihnatko expressing their concerns about the new restrictions.

Snell reported that he had heard that some Mac developers will be removing features from their apps or reducing their functionality to fit them in Apple's sandbox.

Not only does this approach risk turning the Mac App Store into a wasteland of arcade games and one-trick-pony apps, it risks dumbing down the Mac app ecosystem as a whole. While developers can always opt out of the Mac App Store, they’re reluctant to do so.

Examples of Mac Apps that will be affected include iTunes controllers (Tagalicious, CoverSutra), inter-app communication (Fantastical), apps that browse the file system (Transmit), system-wide keyboard shortcut utilities (TextExpander), file syncing, and backups utilities.

While Apple is offering developers some short term exceptions to get around sandboxing, the company promises that those exceptions will be temporary. Some developers have said there is a lot of uncertainty around how long Apple will allow these apps in the Mac App Store after the deadline. With the new delay until March, some developers are holding out hope that Apple may be trying to come up with a better solution than simply pulling these apps off the Mac App Store.

As Snell points out, developers can choose to distribute their non-sandboxed apps outside the Mac App Store, but those developers would be giving up a huge distribution point.

On-again, off-again, industry publication Digitimes is claiming that Apple's next iPad will enter mass production soon and will launch in March 2012. The catch is that according to their sources, this new iPad product is not seen by Apple as an iPad 3, but instead an upgraded iPad 2. Instead they say "the real iPad 3" won't be launched until the 3rd quarter of 2012 at the earliest.

The publication provides no distinction as to what qualifies as a "real iPad 3", but does claim that this interim iPad 2 upgrade will be thinner than the iPad 2 and offer longer battery life.

The most obvious distinction, though not mentioned in the article, could come from the use of a ultra-high resolution Retina display. Talk of a such a display has been ongoing for months, but the most recent reports indicate that Apple's suppliers are finding it challenge to produce such high density displays.

Digitimes has been particularly prolific in the past year with their rumors, but have become particularly spotty in their accuracy. While plans could have obviously changed, their previous iPad 3 report claimed a Fall 2011 launch. So, take this new report with some skepticism. That said, an ultra high resolution iPad-sized Retina display could easily be the production bottleneck for Apple's plans.

Apple has issued Beta 2 of iTunes 10.5.1 to developers tonight to provide further testing for the upcoming iTunes Match service:

iTunes 10.5.1 beta 2 is now available and includes a number of important stability and performance improvements. iTunes Match is also now available for testing on Apple TV.

iTunes Match stores your music library in iCloud and allows you to enjoy your collection from anywhere, any time, on your iPhone, iPad, iPod touch, computer and now your Apple TV.

iTunes Match is Apple's $25/year subscription service that will match your existing iTunes library with 256-Kbps versions in the iCloud. The service was expected to be launched at the "end of October", but has since missed that target.

Apple has provided no new estimate for a launch date for the iTunes Match service.