What about the company’s awesome new iPhone app, the one that will let you stream music directly to your handset? You know, like the one that Apple (AAPL) just approved for Spotify, the superhyped service you can’t even get in the U.S. yet?

Don’t hold your breath says Best Buy (BBY). That Napster app is not coming anytime soon. And neither are apps for Google’s (GOOG) Android platform or Research In Motion’s (RIMM) BlackBerry.  And it’s because of those darn music labels. From a press note the company sent out this morning:

One of the most common questions Napster receives is, “When will you offer an iPhone app?” Well, Napster has created an iPhone application that allows subscribers to stream music on-demand to their iPhone—including personal playlists, albums and radio stations. You can imagine the company is also looking at streaming applications for several other mobile platforms as well (Blackberry, Android). However, due to the high licensing fees for streaming to a mobile phone, Napster has not yet submitted the iPhone app to Apple for approval or attempted to bring the application to market.

Now that’s an interesting approach–something akin to showing off a shiny new sled in a toy store window below a sign that reads “Not coming soon, not our fault.” Or that bank ad where the jerk takes the truck from the chubby kid.

I also don’t know if Napster’s explanation tells the whole story: Best Buy/Napster and the big labels already have an agreement that lets the company stream unlimited music to your PC for $5 a month. Just how much more would the company have to charge to accommodate the fees the labels want for mobile streaming? I’m supposed to talk with Napster folks later today, and if there’s anything I can pass along, I will.

UPDATE:  A little clarification from Napster president Brad Duea. His company’s position is that it doesn’t want to move about its $5 a month price, and that it would have to do so in order to offer streaming.

Why would it have to do that? Duea won’t spell it out. But henotes that RealNetworks’ (RNWK) Rhapsody, which has submitted an streaming music app to Apple, charges $15 a month for “on the go” service it already offers, and assumes it will charge the same for a service that works with the iPhone. Similarly, Spotify charges the equivalent of $16 a month for its premium service in the UK.

Of course, it’s possible that RealNetworks or Spotify will try subsidizing some of the cost for a mobile app in order to grab market share, and offer their iPhone/mobile services for something closer to Napster’s $5 fee.

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.

I’ve never stepped foot in the state, though I have peered out at Wilmington from the window of an Amtrak car. But Akamai (AKAM) tells me I’ve get better odds of getting a high-speed connection there than anywhere else in the U.S.: 62 percent of the state’s Internet connections run at more than five megabits per second, and the state has the highest average speed in the country. The numbers come via the content delivery network’s quarterly “State of the Internet” report, out today.

According to Akamai, 5Mbps fits its definition of “high broadband,” and it’s the speed the company says you’ll need to have in order to watch a DVD-quality movie on your PC, though a mere 2Mbps will let you watch a TV show.

Of course, if you’re really want a good broadband connection, you’re better off living outside of the U.S. altogether. America ranks 18th in the world in average connection speed, and lags behind 11 other countries when it comes to “high broadband” connections. And if you’re reading this in Japan or South Korea, chances are this page got to your screen very, very quickly.

You can see the full report for yourself here. More interested in babies on rollerskates? OK. I can accommodate that need, too:

The newly announced Google Chrome OS won’t show up until the second half of 2010, when it will first appear on lightweight netbooks. Eventually, it’s supposed to run on full-sized PCs. But Chrome OS will start working long before consumers start booting it up next year as it forces Steve Ballmer and company to open up yet another front in their long-running war against Google.

In its blog post announcing the move, Google (GOOG) explains that Chrome is supposed to address the shortcomings of existing operating systems: “Computers need to get better.” This could even be true. But what Google really wants to do here is vex its rival.

Google has been on this path for years as it systematically rolled out products that compete directly with Microsoft (MSFT) franchises: First mail, then a full suite of office software, then a mobile operating system, then a browser.

All of them are free or practically free. All of them launched without the full array of bells and whistles that their Microsoft rivals boasted. None of them produces any significant revenue for Google. And so far, mail is the only one that has generated mass adoption.

But all of them have succeeded just by existing: The chief aim here is to force Microsoft to defend its existing business, which makes it even harder for the company to attack Google’s search franchise. Now comes a full-fledged OS, the core of Redmond’s business.

As Techflash points out, Microsoft has been gearing up to roll out its newest operating system, Windows 7, as early as next week. That launch has already been a challenge, given that Redmond disappointed everyone with its last effort. And now Windows 7 doesn’t just have to compete with the ghost of Vista, but with the specter of an OS that doesn’t even exist yet.

But Microsoft’s (MSFT) latest campaign, which features documentary-like tales of  youngish people priced out by Apple (AAPL), may actually be working. At least when it comes to youngish people’s perceptions of the two brands. So says tracking service BrandIndex. More from AdAge:

The perceptions of value the two brands offer has shifted dramatically in the eyes of 18- to 34-years-olds since Microsoft began running its “Laptop Hunters” campaign in late March. Apple’s “value perception” has fallen considerably, while Microsoft’s has risen…

Based on daily interviews of 5,000 people, BrandIndex found the age group gave Apple its highest rating in late winter, when it notched a value score of 70 on a scale of -100 to 100 (a score of zero means that people are giving equal amounts of positive and negative feedback about a brand). But its score began to fall shortly after and, despite brief rallies, hovers around 12.4 today.

Microsoft, on the other hand, has risen from near zero in early February to a value-perception score of 46.2.

The real test, of course will be actual sales data, and we won’t see anything resembling official numbers for this period until several months from now. But for the record, tracking service NPD says that overall PC sales dropped seven percent in the first three months of this year, while Apple’s Mac shipments dropped 1.8 percent.

Here’s the Microsoft ad starring “Lauren,” which kicked off the latest campaign:

And here’s Apple’s sort-of response:

But COO (and temporary CEO) Tim Cook’s dismissal of the netbook market will continue to spark speculation that the company is readying something that sits in between a laptop and an iPhone (which is itself a computer, of course). Silicon Alley Insider’s Dan Frommer got more of Cook’s response than I did so I’ll reprint his quote here:

“When I look at what is being sold in the netbook space today, I see cramped keyboards, terrible software, junky hardware, very small screens, and just not a consumer experience and not something we would put the Mac brand on. So it’s not a space–as it exists today–that we’re interested in, nor do we believe that customers in the long term would be interested in. That said, we do look at the space and are interested in how customers respond to it. People who want a small computer than does browsing and email might want to buy an iPod touch or iPhone. We play indirect basis. Then of course if we find a way where we can deliver an innovative product that really makes a contribution, then we’ll do that. We have some interesting ideas in this space.”

EARLIER:

Apple (AAPL) just turned in a strong quarter and followed it up with conservative guidance. A fairly typical performance for the company. Now investors will want to know about new product lines, Steve Jobs’s health and other matters. I’ll be covering the call live. Please refresh this page for the most current information. Click here if you want to listen in yourself.

Joining call now. Tim Cook CFO Peter Oppenheimer going over info that’s already in the release.

Mac products: 2.2 million Macs, a three percent decline year-to-year. Tough comparison from last year. But better than the seven percent drop in PC sales overall. “We feel very positive about our Mac performance.” Began and ended quarter with three-to-four weeks of Mac inventory.

iPod: People still buying ‘em! iPod touch selling well, and so are apps. Claims people like the new shuffle player. [Dubious about that]. We own the MP3 player market. [Duh.] Began and ended the quarter with four-to-six weeks of inventory.

iTunes store: 35,000 apps available in store, up from 15,000 a quarter ago. “We are within hours” of one billions app downloaded.

iPhones: Unless I’m missing something, absolutely no new data here. Praising new iPhone 0S 3.0 that’s in the works. Apple delayed the start of revenue recognition of all iPhones sold after the company announced the new OS, which was March 17. Will start up again once OS is released.

Stores: Half our Macs sold to people who had never owned one before. Average revenue per store is down year over year, because the economy is lousy.

Gross margins: Commodity and other component costs lower than expected. Higher-margin sales better are also than expected. Apple also spent less on operating expenses than expected.

Guidance: Forecasting is “challenging” in macroenvironment. Again, noting delay in revenue recognition for iPhones (see above). Excited about new products in pipeline, etc.

Q&A

Outlook for pricing on component supply? Mostly favorable, but some commodities, like NAND, will increase sequentially. Cook does not expect to see the level of reduction seen in calendar Q1. Will it be down? It will be “in a similar range as last quarter.”

Cash flow issues? Not really, for several reasons: 1) Apple made prepayment to…. [sorry, I didn't catch who that was]; 2) accounts payable were down, from holiday quarter to spring quarter, which is standard; 3) at $1.3 billion, tax payments were up “significantly” from last year.

Mac business: Desktops selling well, but average selling price down quite a bit. What’s going on? Sales accelerated in March after Apple announced new product launch. Higher-end Pro products sold to professionals are down a bit, which is related to economy for obvious reasons. Education sales also down a bit, for same reasons. Hoping Federal stimulus funds will help with that.

Back to netbooks–why won’t Apple sell them? Cook is still criticizing netbooks. The ones available today are ”just not a consumer experience and not something we would put the Mac brand on, quite frankly. It’s not a space today that we’re interested in, and it’s not a space we think that customers in the long-term are interested in.” But… a slight hedge with regard to smaller computers, which are, of course, what the iPhone and iPod Touch are. We “have interesting ideas in this space.” Today’s netbooks really shouldn’t even be called computers, really.

App store: What’s the mix between paid and free downloads and the iPod and iTouch mix? Nope. Apple won’t say. Again, Cook notes that we’re just “hours away” from the one billionth download. Cook: One of the keys behind the growth of iPod has been that sales of the iPod touch “more than doubled year-over-year.” The iPod and iPod Touch have reached sales of 37 million units, a big platform for developers. So there’s a virtuous cycle there.

[Sorry, missed two questions here.]

Why is Apple still doing an exclusive with AT&T for the iPhone? And how’s Steve Jobs? AT&T (T) is the best wireless provider in the U.S. “They have done a very good job with iPhone….We’re very happy with the relationship we have and do not intend to change it.” Structurally, we’re using GSM architecture, and Verizon (VZ) uses CDMA, and we wanted a world phone.

And Steve Jobs? Apple CFO Peter Oppenheimer: “We look forward to Steve returning to Apple at the end of June.” [Translation: No news.]

[Yet another question missing here. Apologies.]

Any info on DRM-free/”iTunes plus” sales? Too early to tell.

How much impact did Wal-Mart (WMT) have on Apple sales? Very key partner for the iPod. The company believes Wal-Mart provides extended reach. Pleased with results, but “early going, and not much to report there yet.”

So many iPhone Apps. How can you make them easier to find on iTunes? (Same problem as music.) Any kind of unusual patterns? Nonanswer here.

Please talk about competition for smartphones–i.e., please discuss the Palm (PALM) Pre. “Difficult to comment on products that aren’t shipping. So there’s nothing intelligent I could say on the Pre.” But “we think we’re years ahead.” We see things through software lens and that has benefited us and customers very well. Power of device and ecosystem enormous and we’re now just scratching the surface.”

What about suing Palm re: patents on the Pre, etc.? “We think that Apple’s innovation is leading the industry by years. We think competition is great; we think it makes all of us better as long as other companies invent their own stuff.”

Here’s one small step in that evolution: Joost, the once-hyped video site, is going to start selling ads for clips it shows via its Apple (AAPL) iPhone app. Doing the heavy lifting will be FreeWheel, a well-regarded start-up that already handles ad-serving for some of the Web’s biggest video players.

As with video, everyone knows the mobile ad market will be worth something–maybe a lot–one day. But right now, there’s no there there. The Internet Advertising Bureau, for instance, doesn’t even bother to break out mobile ads in its annual breakdown of digital marketing spend.

Still, Joost needs any boost it can get: Like a lot of other video start-ups in the past few years, the company has raised an awful lot of money but hasn’t made much of a dent in the market. Maybe it can get some traction by staking an early claim to mobile video. Last week, Veoh, another well-funded video site chasing after the same eyeballs, made drastic cuts to its staff and announced that it would put its resources into a new browser-based app.

Separately, the Joost announcement is a nice get for FreeWheel, which is staffed by veterans of Google’s (GOOG) DoubleClick, and which last I heard, was looking for a significant funding round.

The details, from MusicWeek (via Coolfer): You give the company 100 British pounds, and for the next year you can download all the music you want. And because you’re downloading the files in the unencrypted MP3 format, they are yours to keep, and yours to do whatever you want with: Play them on any Apple (AAPL) iPod or iPhone, make copies, burn them to CDs, etc.

Are there catches? Of course: The offer is only available to U.K. residents, who have to use a special USB dongle to make the Datz software work, and it only works on PCs running Microsoft’s (MSFT) Windows, for now. Most crucially, the company only has music from two of the big four music labels–EMI and Warner Music Group (WMG)–and it doesn’t even have all of those companies’ new releases, but a “wide selection of new music released in 2009.”

But play along, for just a minute. Say Datz does end up striking deals with Sony (SNE) and Universal Music Group (and the other big indies), and does end up getting most of the majors’ catalogs. And say Datz is still able to keep the price point about the same: Something in the $15 a month range for unlimited music to own. Could that work, from both a consumer and industry perspective?

Yes. It could.

That’s around the same price point as music subscription services offered by RealNetworks’ (RNWK) Rhapsody and Napster’s (NAPS)/Best Buy’s (BBY) Napster.com. The big difference: Those services only give you access to music, not ownership. And while I’m not hung up on owning music as long as I can get what I want when I want, I’m in the minority on this one.

But if you could hang on to your music–and not have to worry about what format you’re using, since MP3s will work on all formats–then that seems like a compelling offer. The thought of shelling out $162 in advance will likely give people pause, but presumably Datz could figure out a way to extract the payments, à la the mobile carriers, over a one-year period.

Meanwhile, $162 a year is much, much more than most people were ever spending on CDs, even during the format’s boom years. And those, obviously, are long gone. Today the industry would be pleased if the average consumer spent $20 a year on music, no matter what format it’s in.

And yes, we know what many of you are going to say: Why pay for music at all when I can steal whatever I want? Or the faux-sophisticated alternate version: Music should be free! Because it can be replicated for no marginal cost!

Well, can’t argue with that–unless you’re in favor of compensating people who create intellectual property for their work. And I’m one of those old-fashioned types who still thinks that’s a good idea. Hope Datz can pull this off.