You can reach me via email (peter@allthingsd.com) or by leaving a comment below. I can’t promise any results, but I’ll do my best.

For the record: From afar, the Nook appears very similar to Amazon’s (AMZN) Kindle, with a few additional bells and whistles–a second color screen at the bottom of the device for navigation, wireless connection from AT&T (T) instead of Sprint (S), Wi-Fi connectivity, etc. The most intriguing tweaks, from my perspective, are a “sharing” feature and the fact that the Nook runs on Google’s (GOOG) Android operating system, which might allow for interesting upgrades over time.

But all of these features seem to be aimed at tech’s earliest adopters and not the general book-buying public that Barnes & Noble (BKS), Amazon, Sony (SNE) and everyone else is hoping to court. Recall that in the early days of music players, plenty of competitors offered competitively priced gadgets with features that Apple’s (AAPL) iPod didn’t have, and today, it’s like we never heard of them. My hunch is that we might see a similar dynamic play out with e-readers.

Amazon’s (AMZN) basic Kindle will now sell for $259, down from $299–and down from $359 earlier in the year. And the new version, which will allow users to download books in 100 countries besides the U.S., will sell for $279. It will be powered by a wireless connection provided by AT&T (T); the U.S.-only Kindle will continue to use Sprint (S) for a wireless connection.

Is there a catch? Maybe. Anti-Amazon gadfly Tom [Redacted!] (Tom, what do you do when you’re not emailing us this stuff?) points out a bit of fine print on Amazon’s order page: If you take your new Kindle outside the U.S. and try to actually buy something–or simply redownload something you’ve already bought–Amazon will charge you two bucks.

Here’s the fine print, which didn’t seem to make it into the press release–or (cough) the embargoed stories: “When traveling abroad, you can download books wirelessly from the Kindle Store or your Archived Items for a fee of $1.99.”

Still, it’s hard to see how Sony (SNE), whose comparable e-reader only offers a U.S. wireless connection (also from AT&T) and is scheduled to go on sale in December for $399, will be able to stay at that price point. And dark-horse Kindle competitors like iRex and Plastic Logic are going to have match or beat Amazon just to get into the race.

We’re seeing lots of that as the last bubble shakes out (see: MySpace and iLike, Facebook and FriendFeed). But that strategy also raises plenty of eyebrows from other buyers, who figure that they’re happy to let a struggling company fold, then pick up the talent piece by piece.

Did that just happen with Joost and Time Warner Cable (TWC)? Looks like it.

The cable provider has snapped up former Joost CTO Jason Gaedtke. The company tells Cable Digital News that Gaedtke will report to Mike Hayashi, the multiple system operator’s executive vice president of advanced engineering.

The assumption is that Gaedtke will be helping the company build out its own version of “TV Everywhere,” the Web-video-for-subscribers scheme that everyone from Comcast (CMCSA) to AT&T (T) is trying out.

Not an earth-shattering hire, but I’m noting it here because prior to Joost’s decision to all-but-pull-the-plug, the start-up was trying to peddle itself to buyers like…Time Warner Cable.

The theory: The Web video company hadn’t been able to generate much business, but it had a lot of smart people who could help, say, a cable company build out its own Web video strategy.

So, given that the Web video industry is in the midst of a long-awaited contraction, is Gaedtke’s hire the kind of thing that could undermine other potential deals? We’ll see.

What is it? A TV (and movie) portal that looks more or less like every other TV (and movie) portal on the Web: Hulu, TV.com, Sling.com, Fancast, etc.

The only reason for AT&T (T) to launch its own portal now would be as a placeholder until it launches its own “TV Everywhere” play, where subscribers to its  “U-Verse” TV service would get Web access to cable shows. That’s the same strategy that Comcast (CMCSA), Time Warner Cable (TWC), Verizon (VZ) and everyone else in the pay TV business is trying.

But while AT&T will likely be doing the same, this site isn’t for that. At least, not according to the note AT&T sent to NewTeeVee, which makes it sound like the company is creating…another free Web TV portal:

We have started a soft launch of a new site called AT&T Entertainment. This site will feature free online content available to any consumer. We’re finalizing a few final elements, and we’ll share more details on our official launch soon.

Allrighty, then. As AT&T says, it’s a soft launch, so maybe when it’s ready for primetime, things will make more sense. But for now it’s a head-scratcher.

One thing that distinguishes AT&T’s site from, say, Hulu: Hulu lets you embed clips from the site on your blog, while AT&T’s site, which relies on Hulu for much of its content, doesn’t. So here’s an awesome, upsetting clip you can see on AT&T’s site, but can only embed by heading to Hulu. Makes sense, right?

That factoid comes via Web-tracking service comScore (SCOR), which says the two sites accounted for 17.4 percent of the display ads in the U.S. market in July.

News Corp.’s (NWS) MySpace, in the midst of a turnaround effort, has a slight lead over Facebook–9.2 percent of the market versus 8.2 percent. That makes sense since MySpace has always been aggressive about loading up with ads, while Facebook has been fairly reticent, much to the dismay of the “when are you going to monetize?” crowd. (Click table to enlarge.)

That’s something you knew intuitively, of course. But interesting to see it in graphic form.

Another data point you already knew, but may still find worthwhile to see in black and white: Just how small the scraps are for the rest of much of the social network ad world. By comScore’s count, the next eight-biggest social networks command a collective 1.4 percent of the market. (By the way, ever heard of MocoSpace.com before? Do you know anyone who claims to be a user?)

Remember that we’re just talking about overall impressions, not dollars. And ad impressions on social networks are famously cheap, so this stat only tells part of the story. But it’s an important part. It illustrates the potential that the services have, even if they haven’t capitalized on it (not that they haven’t tried).

Meanwhile, here’s a bonus table from comScore laying out the top advertisers on social networks. No surprise to see the likes of AT&T (T) and Sprint (S) here. But perhaps it’s noteworthy that Verizon (VZ), the strongest U.S. telco, spends the least on social media impressions. Meanwhile, social network app makers/services like Zynga are spending heavily.

(News Corp. owns Dow Jones, which owns this Web site.)

If the court’s decision holds up, it could well start another round of dealmaking similar to the one we saw at the beginning of this decade in which the industry consolidated to about half a dozen major players.

Reuters:

“The commission has failed to demonstrate that allowing a cable operator to serve more than 30 percent of all cable subscribers would threaten to reduce either competition or diversity in programming,” the court said.

The judges pointed to rising competition among video providers, including satellite companies like DirecTV Group Inc, as well as telephone companies like AT&T Inc and Verizon Communications Inc, which have been rolling out their own subscription television services.

“Cable operators, therefore, no longer have the bottleneck power over programming that concerned the Congress in 1992.” the court said. The FCC’s cable ownership limit has been the focus of court challenges for years.

As Reuters points out, new FCC Chairman Julius Genachowski can try to appeal the decision or try to write a new one. But if the cap stays off, we’re likely to see another round of combinations, or attempted combinations, at the very least.

Lots of handicappers have already been expecting big cable operators like Comcast (CMCSA) to make a run at programming assets, as it did with Disney (DIS) years ago. But what if the company deploy its assets to bulk up with more subscribers instead? Investors in Cablevision (CVC), the smallish, New York-based cable system that is a perpetual supposed takeover target that never gets taken over, like the idea: CVC shares are climbing modestly in a flat market.

But it will come at a price: The device, shown below (click on image to enlarge), will retail in December for $399. That’s $100 more than the current price of Amazon’s Kindle 2. And that price point is almost certain to drop in coming months.

Sony wouldn’t let reporters handle the Daily, and didn’t put it through its paces, either. So hard to get a sense of much here. But here’s a video I shot of Sony exec Steve Haber holding the machine while talking up its virtues — which include free access to books from your public library.

EXTRA, EXTRA: SONY’S DAILY EDITION ROUNDS OUT NEW LINE OF DIGITAL READERS

Wireless 3G Reader Extends Sony’s Commitment to Bring
Open Digital Reading to Mass Audience

NEW YORK, August 25, 2009 Delivering on its promise to give consumers a variety of choices, Sony today announced the third member of its new Reader family–the Reader Daily Edition™, a highly-anticipated wireless model with 3G connectivity. The Daily Edition caps its new line of Reader products, joining the Reader Pocket Edition™ and the Reader Touch Edition™ which were announced earlier this month.
The Reader Pocket Edition and the Reader Touch Edition are available immediately, and the Reader Daily Edition will be available this December in time for the holidays at SonyStyle stores and SonyStyle.com.
“We firmly believe consumers should have choice in every aspect of their digital reading experience,” said Steve Haber, president of Sony’s Digital Reading Business Division. “Today, we take another large stride to deliver on that promise. We now have the most affordable devices on the market, the greatest access to free and affordable eBooks through The eBook Store from Sony and our affiliated ecosystem, and now round out our Reader offering with a wireless device that lets consumer purchase and download content on the go.”
A Family of Three Readers
The Reader Pocket Edition sports a five-inch electronic paper display packaged in a stylish chassis and is available in a variety of colors, including navy blue, rose and silver. It is available for the ground-breaking price of $199, making it the most affordable dedicated reading device on the market.
The Reader Touch Edition features a responsive, menu-driven six-inch touch screen panel that enables quick, intuitive navigation, page turning, highlighting and note taking with the swipe of a finger or by using the included stylus pen. It comes in red, black or silver and retails for about $299.
The Reader Daily Edition gives consumers wireless access via AT&T’s 3G mobile broadband network to Sony’s eBook store from just about anywhere in the U.S. Book lovers will be able to browse, purchase and download books as well as select newspapers and magazines when and where they want. There are no monthly fees or transaction charges for the basic wireless connectivity and users still have the option to side load personal documents or content from other compatible sites via USB.
The seven-inch wide, touch screen display provides for intuitive navigation and comfortable layout of content, including newspapers and magazines, whether you’re reading in portrait or landscape orientation. In portrait mode, about 30-35 lines of text are visible, making the experience very similar to that of a printed paperback book. A high contrast ratio with 16 levels of grayscale ensures that text and images are crisp and easy to read. The Daily Edition also boasts an attractive aluminum body with an integrated cover for durability. It has enough internal memory to hold more than one thousand standard eBooks and expansion slots for memory cards to hold even more. It will sell for about $399.
All three models feature Sony’s award-winning industrial design and an E Ink® Vizplex™ electronic paper display that emulates the look of ink on paper. Sony’s eBook Library software 3.0, which now includes support for many Apple® Macintosh® computers as well as PCs, makes it easy to transfer and read any Adobe® PDF (with reflow capability), EPUB, Microsoft® Word®, BBeB® files, or other text file formats on the Reader.
Access to Even More Content at the eBook Store by Sony
In addition to announcing a new family of Readers, Sony has also made several changes and improvements to its eBook Store to provide better access to an even greater variety of ebooks. Earlier this summer Sony announced the availability of more than one million free public domain books from Google, and the company made new releases and New York Times bestseller titles available for $9.99.
Today also marks the launch of Sony’s Library Finder application. Sony, working with OverDrive (www.overdrive.com), the leading global digital distributor of eBooks and to libraries, will now offer visitors to the eBook Store by Sony easy access to their local library’s collection of eBooks. Thousands of libraries in the OverDrive network offer eBooks optimized for the Sony Reader, and visitors can now find these libraries by typing their zip code into the Library Finder. Through the selected library’s download website, visitors can check out eBooks with a valid library card, download them to a PC and transfer to their Reader. At the end of the library’s lending period, eBooks simply expire, so there are never any late fees.
The Reader Pocket and Touch Editions, as well as available accessories such as AC adaptors, cases and covers with reading lights, are available now at SonyStyle.com and SonyStyle stores. Book lovers interested in trying out a Reader in person will also be able to find them for sale at Best Buy, BJs, Borders, Sam’s Club, Staples, Target, Toys“R”Us, Wal-Mart and other authorized retailers nationwide.

DIGITAL READING ECOSYSTEM EXPANDS FOR SONY’S READER

NEW YORK, August 25, 2009 Further evidence of the broad support for its open approach to digital reading, Sony today announced relationships with a variety of traditional and digital publishers who provide content in industry standard formats to create a universe of reading material compatible with the Reader.
All of these sites will offer content in the EPUB format, the International Digital Publishing Forum’s (IDPF) XML-based standard format for reflowable digital books and publications. EPUB has gained acceptance among major trade book publishers with dozens of publishers already producing the majority of their eBooks using the standard. Sony recently announced that the company is transitioning its entire content library to the EPUB format, giving consumers the freedom to purchase or download free eBooks from the eBook Store by Sony and read them on any EPUB-compatible device.
“From the beginning, we have said that an open format means more choice for consumers,” said Steve Haber, president of Sony’s Digital Reading Business Division. “Now, working with other industry leaders, we can provide a device that is compatible with the widest selection of content available. Readers can shop around for what interests them rather than be locked into one store.”
Sony’s eBook Store already provides access to more than one million public domain Google Books in EPUB format and, starting today, Sony’s Library Finder application will go live. Library Finder offers visitors to the eBook Store by Sony easy access to their local library’s collection of eBooks. Thousands of libraries offer eBooks optimized for the Sony Reader, and visitors can now find these libraries by typing their zip code into the Library Finder. Through the selected library’s download website, visitors can check out eBooks with a valid library card, download them to a PC and transfer to their Reader.
Other sites offering EPUB content include:
• Independent Bookstores–More than 200 participating members of the American Booksellers Association–including stores such as Tattered Cover (Denver, CO) and Vroman’s Bookstore (Pasadena, CA)–will have the ability to sell e-content to consumers beginning this fall. The stores using ABA’s IndieCommerce platform will offer content in the EPUB format and protected by Adobe’s Content Server 4 (ACS4) digital rights management, which is compatible with Sony e-Reader products. In addition, plans are underway to make Sony’s e-Reader devices available for purchase from independent bookstores in time for this holiday season. ABA is a not-for-profit trade organization devoted to meeting the needs of its core members–independently owned bookstores with storefront locations–through education, information dissemination, business products and services, and advocacy.
·        BooksOnBoard–BooksOnBoard, the largest independent eBook bookseller and member of both the ABA and IDPF, has been a staunch supporter of the EPUB standard through its founder Bob Livolsi. BooksOnBoard was the first eBook site to offer the EPUB standard to its burgeoning customer base and has sold more EPUB formatted books than any other online bookstore. BooksOnBoard believes that the EPUB standard significantly benefits the publisher, authors and most importantly the consumer.
·        NetGalley–NetGalley is an innovative and easy-to-use online service and connection point for book publishers, reviewers, media, librarians, booksellers, bloggers and educators. NetGalley delivers digital galleys and promotional materials to professional readers and helps promote new and upcoming titles. Starting today, NetGalley will support the Reader with the ability to download a protected PDF file and this fall the company will offer digital galleys in EPUB format.
• Powell’s Books and Powells.com–Powell’s Books is the largest independent bookseller in the world.  Innovative since its inception in 1971, it was one of the first booksellers online (beginning in 1994), and one of the first to sell eBooks for reading devices (the Rocket eBook) in 1999. Powell’s offers EPUB content for a wide range of compatible devices, including the Sony line.  Powell’s is an important player in the open access world of eBooks, where titles are provided by a wide range of publishers in a competitive retail environment, read on a range of devices, and downloaded and owned by millions of people around the world.

Here’s the complete internal memo from CEO Owen Van Natta, which describes Millard’s position as head of the ad sales group as an “interim” one and announces that former sales boss Jeff Berman is out. (Van Natta’s official statement for public consumption is here.)

Hi everyone,

I want to share some thoughts about our advertising product strategy and give you an update on the structure of our sales organization.

In the last three months we’ve focused our attention on restructuring the business, refocusing the MySpace user experience, and hiring some talented people particularly in the technology and product organization. I’m proud of the progress we’ve made in these areas and now want to focus on ensuring we have the best advertising product, sales strategy, and team in the market.

MySpace has always been a leader in the social media advertising space. Maintaining our leadership position requires that we foster the perfect balance between content and commerce. With this in mind, I’m pleased to announce that we are bringing a new partner into our global organization. Please join me in welcoming to the MySpace team, Media Link – a top media representation and strategic advisory firm founded by Michael Kassan and whose clients have included Microsoft, AT&T, Unilever, Home Depot, and Colgate-Palmolive. Michael is an internationally recognized leader operating at the intersection of the media, advertising, and entertainment industries. He’s the founder and managing principal of Media Link and acts as an advisor to many of the Fortune 100’s best-of-breed global brands

Media Link will be focusing on two primary objectives. First, the firm will provide guidance as we reconfigure our ad products to meet the current needs of the marketplace.  As a key strategic advisor and partner, they’ll provide us with an external perspective on the larger advertising market as well as insight into what top clients (and those we’re looking to attract) are asking for.

Second, as part of this process on an interim basis the firm will help manage our day-to-day sales organization under the leadership of Wenda Harris Millard. Many of you know and have worked with Wenda in the past and for those who haven’t she’s truly an internet advertising pioneer. Her reputation on Madison Avenue is unmatched and after holding executive sales posts at Ziff Davis, Yahoo, and Martha Stewart Living Omnimedia she recently joined Media Link as President.

After more than three years of managing a highly diverse set of responsibilities at MySpace including content and sales roles, Jeff Berman has decided to explore other opportunities. During his tenure at MySpace, Jeff brought leadership to our sales organization and built an incredible team with expertise across every advertising vertical. I appreciate all the support that Jeff has given the new management team and look forward to welcoming new sales talent to compliment the tremendous group we currently have in place. We wish Jeff the best in his future plans.

Within our sales team, we have a deep bench of talent responsible for managing one of the most dynamic advertising platforms on the Web. I’d to like recognize the sales team for their hard work and dedication in creating meaningful ad solutions for our roster of advertisers.

Our senior sales team (in alpha order) includes:
·         Chris Carlson – Regional Vice President of the Mid West
·         Angela Courtin – SVP Marketing, Entertainment, Content
·         Shari Friedman – Vice President of Entertainment Sales
·         Mitchell Kreuch – Regional Vice President of East Coast Sales
·         Abe Thomas – VP of Online Marketing
·         Valeh Vakili – SVP Sales Strategy and Operations
·         Sam Wick – SVP of Strategy for MySpace Music
·         Andy Wiedlin – Regional Vice President of West Coast Sales

I appreciate your dedication and focus on delivering for our advertising partners during the last few months. I hope you’re as excited as I am to take our sales organizations to the next level.

Full disclosure: News Corp., owner of MySpace, also owns Dow Jones, which owns this site.)

Discovery joins other big names like CBS (CBS) and Time Warner’s (TWX) HBO and Turner, in Comcast’s (CMCSA) “On Demand Online,” which launched last month in a few thousand homes. The program is designed to convince Comcast subscribers to stay on as subscribers, since only subscribers will get Web access to the programming. It’s an answer to Hulu’s offering, which makes shows from News Corp.’s (NWS) Fox, GE’s (GE) NBC and soon, Disney’s (DIS) ABC available to anyone with Internet access.

It’s a variation of the “TV Everywhere” program Time Warner has been touting, and similar to ones that other cable providers, like Time Warner Cable (TWC), and telcos like Verizon (VZ) and AT&T (T) are pursuing.

Like most of the other networks that have linked up with Comcast for the On Demand test, Discovery isn’t handing over its top-tier stuff. You can’t see “Deadliest Catch,” the network’s show about grumpy Alaskan fishermen, for instance.

Meanwhile, some of the stuff you can get will be “windowed”–the industry’s term for holding shows back from viewers to maximize TV eyeballs. Episodes of something called “Verminators,” for instance, won’t be available until a week after they air on TV. But! Comcast subscribers will be able to watch episodes of “Man Vs. Wild” and “Swords,” which will be available the day after they air.

And any full-length programming that Discovery puts on the Web is a change for the cable network, which has held off from doing so precisely because it didn’t want to upset Comcast, which pays it a hefty fee for its programming.

Related note: I hate the “On Demand Online” tag Comcast uses to describe this strategy. And the Comcast people hate it when I call this “Web TV you’ll pay to see.” Their point is that you’re not paying any additional fees in order to get this stuff on the Web; my point is that only paying Comcast subs can see this stuff, as opposed to Hulu’s free-for-all (for now) offering.

So, can anyone suggest a different name? Give me a good one and I’ll use it.

Meanwhile, here’s a “Man Vs. Wild” clip featuring a pesky porcupine:

Privately held Plastic Logic says it will rely on AT&T (T) to supply its gadgets with a wireless connection, in the same way that Sprint (S) is the network provider for Amazon’s Kindle.

It’s the second big partnership Plastic Logic has unveiled this week; yesterday, it linked up with Barnes & Noble (BKS), which will be its virtual bookstore. I’m guessing it’s not a coincidence that Amazon (AMZN) announces its earnings Thursday afternoon.

Even if Plastic Logic’s reader becomes as successful as the Kindle, it’s unlikely this will be hugely significant for AT&T, the wireless company iPhone users love to complain about.

Each Apple (AAPL) phone on AT&T’s network represents $30 in monthly data charges alone, plus fees for a voice plan. But while Sprint and Amazon haven’t disclosed their terms, it’s estimated that Amazon pays Sprint something like $2 per Kindle user, per month.

If that’s the kind of thing that makes you happy, then you would love today’s call, in which the exact same thing happened again. Twice! From my transcription/paraphrase this afternoon:

Q: What about getting into the low priced/netbook category?

Apple COO Tim Cook: “Our goal is not to build the most computers, it’s to build the best. Whatever price point we can build the best in, we will play there. At this point, we don’t see a way to build a great product at that price point, $399, $499.” We think many customers buying those find themselves “disenchanted” after buying cheapo/netbooks.

Q: Do you think there is an emerging market for a “truly mobile device” with a larger screen, a market big enough that you may want to participate?

Cook: “Never want to discount anything in the future,” and never want to answer specifically your question about new products. [Duh.] But boy, do we think netbooks are lousy, and we think customers agree.

Two things here:

1. Apple has a history of disparaging products and markets right before they unveil their own. So it’s not unreasonable for analysts to keep asking about the prospects for a supercheap Mac laptop. But Apple really is emphatic about its distaste for these machines.
2. Apple is not ruling some sort of device that’s more expensive than a netbook and less expensive than a $999 MacBook…and may have a big touchscreen…and is bigger than an iPhone, etc. Something, perhaps, like an $800 iTablet. We’ll see.

EARLIER:

Joining call late; analysis of Q3 results here.

Reading from prepared statement:

• Eight billion songs purchased and downloaded from iTunes store.
• Slight uptick at Mac retail stores. 50 percent of Macs sold at stores to customers who didn’t own Macs before. 258 stores. 27 store remodels.
• Gross-margin improvement: Component cost increase not as high as expected; weaker U.S. dollar helped.
• Cash pile: Will be invested in short-term investments. First week of Q4, made $500 million payment to Toshiba for future supply of NAND flash memory.

Q&A:

• Please talk about your relationship with wireless carriers (i.e., when will you dump AT&T (T) for Verizon (VZ). Tim Cook: “I think that most of the carriers we’re doing business with are thrilled with lower churn…and, of course, their customers are demanding the iPhone.” Do you see opportunity beyond the iPhone, like data plans for laptops with AT&T? “Nothing to be announced today.” How’s your relationship with AT&T? “I think it’s an excellent relationship and we’re very happy with it.”
• Discussion of education and professional market for Mac laptops/PCs–both affected by economy more than consumer market, i.e., schools and corporations are less likely to spring for shiny new Macs than Joe Sixpack.
• How is the $99 iPhone performing? As we made changes–launch of 3Gs and lower-priced iPhones–we saw acceleration of unit sales. But won’t break down mix. Supply of phones has been “constrained” and demand is robust. Opportunity for enterprise sale? Big opportunity. Doing well with small business, and with big corporations and agencies where employees can purchase for themselves.
• Guidance details? No change in thinking regarding guidance offerings. We usually see an increase in Mac units from June to September, but we think the sequential increase will be less than in previous years since we’ve refreshed our lines a while back. Also, education sales are “under pressure from budget shortfalls.” Same thing with the iPod: We think we’ll see a decline for regular players but an increase for the iPod touch. Seasonality makes projections a little funky this time around given timing of product launches.
• Channel inventory for iPhone lower is than we would like; there are 1.83 million phones in inventory.
• Given the $999 MacBook and price cuts for the Mac line, is the MacBook more or less elastic than anticipated? As we expected, some people are now buying up, because they can get the Macbook Pro for $1,199, down from $1,899. “We’re not thinking fundamentally different about the Mac business than we were before.” If we can build great Macs at lower prices, we will, but we won’t put the Mac brand on products that aren’t up to our standards.
• Update on Snow Leopard? Why such a low price point? Snow Leopard is priced aggressively so that all our users can upgrade to it, and we expect that they will. What commodity prices are you worried about, what should we think of the Toshiba prebuy? Are others coming? The market for DRAM and large-size LCDs has “shifted to constrained environment” and prices have moved accordingly. The NAND supply is getting better. We have a long-term supply agreement with Toshiba. We view flash as key component because we use it in so many products, and we’re a big consumer on a worldwide basis. We’re always open to similar deals. We’ve done one with LG on LCDs. We may do others, but we’re not working on one now.
• Please talk more about consumer demand for lower-priced laptops. No details forthcoming. But on macro level: Once price changes, people are upsold from $999 unit to $1,199 unit. [We just heard that.] Prior to change, we had seen people leaning toward the $999 product. What about pricing on iPhone side? Sounds like $99 3G iPhone helped drive traffic to the $199 3GS iPhone. Was that the plan? We’re focused on total iPhone units. So we’re psyched about 5.2M iPhones sold. Also, take note that the 3GS is in short supply and not available in all territories. Also, early in cycle, you have more upgraders, and upgraders are more likely to get higher priced phones. Still, too early to tell about product mix.
• Competitors are now finally coming out with rival app stores–Pre (barely), BlackBerry, etc.). What are you up to in answering back? Well, we just launched OS 3.0. That’s pretty great. It has an Installed base of 45 million (iPhones and iPod touch). We have a gazillion apps. According to the latest numbers from Nokia (NOK) and RIM (RIMM), they have a couple thousand each; Android has maybe 5,000. “We feel extremely good about our competitive position and continue to believe that we’re light years ahead of other people.”
• What about getting into the low-priced/netbook category? Tim Cook: “Our goal is not to build the most computers, it’s to build the best. Whatever price point we can build the best in, we will play there. At this point, we don’t see a way to build a great product at that price point, $399, $499.” We think many customers buying those find themselves “disenchanted” after buying cheapo/netbooks.
• Is the carrier network strong enough to handle all the apps and the more robust apps you’re coming out with every day? Non-answer. Do you think you guys will make investments on the side to take pressure of carrier-capacity issues? No plans. When we entered business, we looked at it, decided what we could do well was deliver the handset. I think there are other people that have more skills in the network area, and I think we have a lot of those partners.
• Back to netbooks and things like netbooks, but better, like the iTablet: Do you think there is an emerging market for a “truly mobile device” with a larger screen, a market big enough that you may want to participate? Cook: “Never want to discount anything in the future,” and never want to answer specifically your question about new products. [Duh.] But, boy, do we think netbooks are lousy and we think customers agree.
• Any info on iPhone sales split between new buyers and upgrades? Nope. Okay, how about the app store? It looks like prices are in a “race to the bottom”; there are lots of 99 cent apps. Are you worried about that? And can you help customers distinguish between good ones and “garbage”? Cook: “We realize there’s further opportunity for improvement” regarding promoting quality apps, etc. Regarding price: It’s up to the developers. As the installed base grows, it makes more sense to have lower prices, but that’s up to the developers.

Call finished.

Now Twitter, which has suffered multiple security breaches in the past, has been punctured again. Someone has gotten into the personal Web services accounts of co-founder Evan Williams, his wife and at least one other Twitter employee, and used that access to make off with a pile of confidential company documents. He’s now distributing them on the Web, and TechCrunch promises to publish many of them.

The media ethics colloquy is well underway and will go on for a while (Boomtown’s Kara Swisher is holding her session, appropriately enough, via Twitter). Beyond that, I’m pretty sure Twitter is going to be okay when this dies down.

Based on Williams’s description of the attack (see the bottom of this post), as well as both TechCrunch’s and the hacker’s descriptions of what got pilfered, this looks roughly akin to having your underwear drawer rifled: Embarrassing, but no one’s really going to be surprised about what’s in there.

The hack certainly will be worrisome for people who are using, or thinking about using, any kind of “cloud computing,” whereby work data/documents are stored on servers accessed via the Web. Google (GOOG) in particular is going to get some scrutiny, both because it’s Google and because it appears that a lot of this stuff was stolen after the hacker used Google’s “password recovery” system to root around. UPDATE: Twitter is now going out of its way to say that the attack isn’t Google’s fault, but Twitter’s fault for using passwords that are easy to guess.

Albert Wenger, a partner at Twitter investor Union Square Ventures, says in a post that his shop is currently considering moving its systems to Gmail and Google Docs, but notes the big problem: “The threat of access by a third party increases exponentially with the move to the cloud, because the machines that now contain the documents and the links to those documents (as sent by email) are accessible to the Internet at large.”

But cloud computing isn’t going away, so someone’s going to need to figure out how to make security better, yet still practical. There’s a reason no one follows the standard advice about having a different, impossible-to-remember password for every account you have. Wenger takes a stab at it in post–he suggests something tethered to a mobile phone. But whoever figures it out is going to have a lot of fans.

Williams’s description of the hack, via TechCrunch:

Yes, we did suffer an attack a few weeks ago and are familiar with this list of stuff. This is unrelated to the hack of twitter where someone gained access to user’s accounts. This had nothing to do with the security of twitter.com, and there were no user accounts compromised here.

Some notes:

- He did not actually gain access to my @ev Twitter account (or any Twitter accounts) nor any administrative functions of the site.
- There is also no evidence that he gained access to my email. There was one administrative employee who’s email was compromised, as was my wife’s Gmail account, which is where he got access to some of my credit cards and other information.
- He also successfully targeted a couple other employees personal accounts (Amazon, AT&T, Paypal…)

In general, most of the sensitive information was personal rather than company-related. Obviously, this was highly distressing to myself, my wife, and other Twitter employees who were attacked. It was a good lesson for us that we are being targeted because we work for Twitter. We have taken extra steps to increase our security, but we know we can never be entirely comfortable with what we share via email.

[Image credit: Wikimedia Commons]

So this one doesn’t even faze me: Swedish regulators are looking into insider trading charges at Global Gaming Factory X, which saw shares jump several days before it said it would buy The Pirate Bay.

From Wired (via PaidContent):

AktieTorget, a Swedish exchange listing some 116 public companies, suspended trading in Global Gaming a week before the announcement as trading volume and share prices jumped without public news to account for it.

“There are reasons to suspect that information was leaked,” said Peter Gönczi, executive vice president at AktieTorget.

Before the sale, average daily volume in Global Gaming was about 162,000 shares. From June 5 to June 18, there was little trading in the stock with an average price of about 9 cents. On June 22, shares nearly doubled to 18 cents with 1.2 million shares sold before trading was halted.

Trading resumed Tuesday, the day of the announced purchase, and shares closed at a high of 38 cents, with a heavy volume of 5.8 million shares traded. Trading closed at 25 cents Wednesday, down 13 cents, and the volume was nearly 7 million shares traded.

But I have a question: Why would anyone think that Global Gaming Factory X shares would be worth more once this news got out?

The company’s announced plan–to sell legal downloads to users who flock to the site for free downloads and to somehow resell bandwidth its users generate to the likes of Comcast (CMCSA) and AT&T (T)–is a nonstarter. If anything, you’d expect insiders to be dumping whatever shares they owned in advance of the news, right?

I’m going to go out on a limb and assume that Swedish penny stocks are like U.S. penny stocks–murky caveat-emptor things that widows and orphans want to avoid. So it’s hard to get too worked up about this or try to puzzle it out. Still, if anyone wants to explain it to me, I’m all ears.

The service is laying off the majority of its employees, and CEO Mike Volpi (pictured right) is out, replaced by Matt Zelesko, who had been SVP of engineering. The Joost.com portal site will stay open, but best to think of it as an ad for the company’s hosting and distribution services, which it will try to sell to cable companies and the like.

A Joost spokesperson declined to say how deep the layoffs will be; but I’m told that the company, which had more than 100 employees last fall, will be down to a couple dozen after the cuts are done. In a post on Joost’s Web site, Volpi said the company “will say goodbye to many of our colleagues and friends.”

This isn’t a shock: Joost’s fate has been the subject of whisper and rumors for the last year or more. The service made an initial splash in 2007 by raising $45 million from the founders of Skype and an array of high-profile investors and media companies, including Sequoia Capital and Viacom (VIA), and was initially supposed to deliver copyrighted content via a peer-to-peer distribution system and a player that users downloaded to their desktops.

But YouTube, and later Hulu, conditioned users to watch video via their browsers, and Joost’s software never caught on. By last fall, the company had retooled and began offering video via the browser like everyone else, but it has never been able to generate a significant audience. In November, a month after the company launched its Web browser, it said it was attracting 2.1 million unique users world-wide, a fraction of YouTube’s audience, and well behind rivals like Hulu, MetaCafe, Veoh and DailyMotion.

Here’s the service’s unique visitor count, per Comscore (SCOR); Joost’s unique viewer count, which is the more relevant metric for video sites, is considerably smaller (click to enlarge):

Joost has been a frequent candidate for buyout rumors, and the company hasn’t gone out of its way to deny them. The supposed buyers would be cable companies like Comcast (CMCSA) Time Warner Cable (TWC) or telcos like AT&T (T) and Verizon (VZ), which would presumably use Joost’s technical team to help build out their own Web video plays.

But some of the cable guys and telcos insist that they’re fine with the people they have. And if they do want to buy a video player, they have plenty of options: Just about all of Joost’s peers have been on the block, formally or informally, for the past few months.

JOOST TO PROVIDE WHITE LABEL ONLINE VIDEO PLATFORM

NEW YORK AND LONDON – June 30, 2009 – Joost, the online video startup, announced today that, along with Joost.com, it will focus on providing white label online video platforms for media companies, including cable and satellite providers, broadcasters and video aggregators. This technology and service offering will support content owners’ efforts to build comprehensive branded environments online.

Media companies around the world are embracing internet-based video portals as a key path to distribute their premium video, but building a world-class video portal is increasingly difficult and expensive. Joost will focus on this issue and provide the market with a cost-effective, end-to-end solution for media companies to publish video under their own brands.

As a part of this new direction, Joost will reorganize and restructure its business. A core team in New York and London will work on providing these solutions, as well as operating and supporting Joost.com and its associated video applications. Joost also will wind down operations in its Leiden development center.

Matt Zelesko, currently SVP of Engineering at Joost, will take over as CEO while continuing to lead the engineering organization. Stacey Seltzer, currently SVP of international business development and content acquisition at Joost, will run the business operations. Mike Volpi has stepped down as CEO of Joost but will remain actively involved as Chairman of the Board.

Joost plans to make its white label video platform commercially available to media companies around the world. This offering will provide a solution for companies looking to build a branded experience for their content on their own site as well as other sites and platforms in their distribution networks.

The idea is to protect cable subscription revenues by giving pay TV customers–but only pay TV customers–Web access to all the shows they get on TV, and hoping this keeps them from canceling their subscriptions.

But that’s old news: Comcast (CMCSA) already told Bloomberg earlier this month that the two companies are linking up, and that Time Warner (TWX) would offer programming from some of its networks in the first part of Comcast’s tests.

Presumably Bewkes and Roberts will offer up a few more details, like which Time Warner networks are participating (good bet: TNT and/or TBS), along with a timetable. But I worry that the press conference will be light on details, in large part because many of the details haven’t been hammered out yet.

Still, I’ve been able to glean more from industry executives who’ve been involved in discussions with Time Warner, Comcast and other players in the authentication effort, which Bewkes has been calling “TV Everywhere” and Roberts has been calling “OnDemand Online.” Some of the details:

• The test will start very small–with some 5,000 subscribers–but Comcast is determined to expand it aggressively and wants to have it available throughout its system by the end of the year. Comcast plans to use its Fancast video portal as a hub for its efforts. And it  may use other digital assets it has acquired as well. Online Rolodex Plaxo, for instance, which the company bought last year, could be used to help subscribers sign in to watch their shows.
• The test is separate from Time Warner Cable’s (TWC) own authentication offering, which is essentially the same thing but will launch later than the Comcast test, using different technology, and will likely offer a different mix of programming.
• And those tests are separate from the one that telcos Verizon (VZ) and AT&T (T) have been working on with satellite operators Echostar (SATS) and DirecTV (DTV). That one also has the same thrust, but will take the longest to roll out.
• Comcast isn’t likely to announce other programming partners for the tests until later this month.
• Hulu is interested in playing along, because its owners–GE’s (GE) NBC, News Corp.’s (NWS) Fox and Disney’s (DIS) ABC–see authentication as a way to appease riled-up cable providers. The cable guys are upset that Hulu shows (some) cable programs for free while they have to pay for the right to air them. In theory, authentication solves that problem for Hulu because everyone will be on a level playing field: Only cable subscribers will get access to cable programming, whether it’s on Hulu, Fancast or anywhere else. But the cable guys aren’t rushing to let Hulu in just yet.
• Separately, NBC has been talking about offering some cable programming that isn’t already on Hulu for the tests. That could also be seen as an appeasement move, but I’ve heard a more benign suggestion: NBC merely wants to figure out if authentication technology works because it is considering using it for some of its coverage of the Vancouver Olympics next year.
• CBS (CBS), which isn’t a part of Hulu and which doesn’t have any cable assets of its own, would still like to get into the mix. The idea is that the network would offer the cable guys shows that it has kept offline until now (say, “The Mentalist”) while tying the Web programming to “retransmission” fees it would like to extract from the cable companies for all of its shows. Comcast executives seem amenable to the notion.
• Big cable players like Viacom (VIA) and Liberty’s (LINTA) Discovery may participate in some trials but not others. Viacom, for instance, has been talking about working with the telco group but not with Comcast during the trials. It has also discussed offering a “premium product”–like access to the full “Spongebob Squarepants” library or other kids’ shows that have a very limited online profile–to Time Warner Cable subscribers for an additional fee.

Bewkes and Roberts are scheduled to speak at the Time Warner Center at 9:45 am EDT, so we’ll know more shortly.