Hong Kong’s new flagship Apple retail store saw more than 3,000 people show up in hopes of getting their hands on a device or devices, but only 1,250 of those were allowed to actually line up. All new iPhone models were gone only three hours after the store opened. Many of the sales were apparently to people intending to resell the devices on the gray market in China, where the 4S has not yet made its official debut. Interest was no doubt also strong since Apple’s iPhone 4S pre-orders in Hong Kong sold out in just 10 minutes, so going out to stores was the next best chance to get a device early.

Police even had to break up altercations between customers and those waiting in line to secure devices for gray market resale, according to a report from M.I.C. Gadget.

South Korea also saw long 4S lines at Apple’s wireless carrier partner stores, since Apple doesn’t have any official retail outlets in the country as of yet. The first 100 people who pre-ordered their iPhones at SK Telecom were also invited to participate in pre-dawn activation celebrations with popular Korean hip hop stars.

Friday also saw the introduction of the unlocked iPhone 4S to the U.S. online Apple Store in addition to the international launches.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• Connected world: the consumer technology revolution
• Social media reactions to the iPhone 4S
• Mobile Q3: the fight for OS domination continues

Apple plans to have the iPhone 4S up for sale in over 70 countries by the end of the year, and its current pace of adding between seven and 22 countries per batch with about two weeks between each definitely puts them on pace to meet that goal fairly easily. Besides Hong Kong and South Korea, the 4S will also come to Albania, Armenia, Bulgaria, El Salvador, Greece, Guatemala, Malta, Montenegro, New Zealand, Panama, Poland, Portugal, and Romania beginning Nov. 11.

Pre-orders for the phones start in most of those countries, with the exception of Albania, El Salvador, Guatemala, Malta, Montenegro and Panama on Nov. 4, a week prior to the launch. By the time the 4S was available for direct sale in the first two crops of launch countries, it already carried a one- to two-week lead time for online sales, so customers in the new countries who are able to do so are advised to pre-order if they want to get their hands on a device as soon as possible.

International customers should remember that Siri, while not initially configured to work with maps and local search in international markets, should gain localization support sometime in 2012, according to Apple’s official FAQ for the voice-powered virtual assistant.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• Connected world: the consumer technology revolution
• Social media reactions to the iPhone 4S
• Mobile Q2: Smartphone growth surges; iPad’s rule continues

AT&T was the only U.S. carrier partner who didn’t get their own website’s pre-orders off the ground at the originally planned time of 12:01 a.m. PDT (3:01 a.m. EDT). Apple was also behind schedule and its own pre-orders didn’t go live until around 12:45 a.m. PDT. AT&T’s pre-orders on its own site didn’t start going live until around 1:15 a.m. PDT for anyone, and even then the experience was inconsistent. Though each carrier had trouble with network issues, AT&T had by far the lion’s share of issues, as this jab by Verizon on Twitter obliquely points out:

Here’s a great quote by commenter John M from our original news post that sums up a lot of the reaction I saw from frustrated AT&T customers:

Does this also speak to their quality of service??? Guess I won’t know until I can take off the ATT contract handcuffs!!!

Those issues extended to Apple’s own website. Customers trying to purchase an AT&T iPhone 4S through Apple.com at first encountered repeated errors, until finally Apple suspended pre-orders altogether at the U.S. site while they worked on resolving their issues.  Users instead were told their iPhone had been “reserved,” and they’d receive a follow-up email letting them know when they could complete their order. Those emails started going out around 4 a.m. PDT this morning.

Links included in the email lead customers back to the Apple Store to complete their orders, which is working fine this morning. As of this writing, the iPhone 4S is still listed to be delivered by Oct. 14 when ordered through the official Apple online store. We’ve confirmed that customers who have a reservation can still start the process as a brand new customer without following that link, and can still order a phone that way, too. Links to reserved orders from last night’s launch are valid until 5 p.m. PDT Saturday, however, so if stock levels change, customers who reserved a spot will still be able to jump the queue. Also, as of this writing, customers can’t access their account ordering information. Apple may be keeping this offline intentionally in order to avoid people taking down the servers with repeated refreshing of their order status.

While stock levels in the U.S. appear to remain strong at the moment, delivery times have quickly dropped  already in other international stores. In the U.K., Canada, Germany, France and Australian stores, for example, the iPhone 4S shows a shipping time of between one and two weeks. That, as well as the obvious network issues encountered by Apple during last night’s launch, point to strong interest in the smartphone. We’ll have to wait until we get some firm numbers about pre-order volume before we can tell how this launch stacks up to previous ones.

Additional reporting by Cyndy Aleo.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• Connected world: the consumer technology revolution
• Social media reactions to the iPhone 4S
• Mobile Q3: the fight for OS domination continues

Typically, Apple does its big product unveils at larger venues, like San Francisco’s Yerba Buena Center for the Arts, but AllThingsD’s John Paczkowski says this time around, it’s aiming closer to home.

Earlier this month, AllThingsD also reported that the iPhone event would take place Oct. 4, and it reiterates that announcement timeline in the new report. Oct. 4 is just over a week away, and Apple has yet to make any official announcements or send out press invites.

Paczkowski suggests Apple’s decision to host the event at its own on-campus Town Hall Auditorium might have to do with the company having trouble nailing down a fixed launch date in order to book an outside venue, or that it could be designed to help new CEO Tim Cook’s first time taking the helm go more smoothly.

Whatever the reason, a smaller venue means a more exclusive guest list. It’ll be interesting to see who will and who won’t be in attendance if the event happens as reported next Tuesday.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• Mobile Q2: Smartphone growth surges; iPad’s rule continues
• Social media reactions to the iPhone 4S
• The future of mobile advertising, 2011 – 2016

The first customer at the Leawood, KS store gets his iPads! From Dave Greenbaum:

The Apple Store opens in Leawood, KS, and Dave Greenbaum is there to catch the action:

3:20 — More new pictures in the gallery. A few new videos still to come.

2:44 — New photos in the gallery, including shots of Geoffrey Goetz getting his hands on an actual iPad 2!

Charles Jade shot this video of an Apple Store employee in NC telling people how to buy their iPads, and of the long line wrapping around the building:

2:18 — Updated with a bunch more photos, including some from San Francisco and one of the store opening in Durham, NC. Videos of store opening coming soon!

1:45 — Added a few new photos from Leawood, KS and Durham, NC to the image gallery below.

Another Mall of America customer looking forward to getting his hands on the iPad 2:

1:07 – Just added a bunch of new photos, including one of Apple setting up the new iPad 2 window display. Scroll down to the gallery to check them out.

The first two guys in line at the Leawood, KS store talk to Dave Greenbaum about the experience:

An interview sent in by Andy Flochinni with an early line-goer at the Mall of America:

Ryan Kim provides a longer look at the situation outside the NYC 5th Avenue Store:

Here’s a new video from Ryan Kim filmed at the NYC 5th Avenue Apple Store:

Writer Dave Greenbaum stopped by AT&T before heading to check out the line at the Leawood, KS Apple Store:

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• Why iPad 2 Will Lead Consumers Into the Post-PC Era
• The Near-Term Evolution of Social Commerce
• Content Farms: The Players, The Benefits, The Risks

Those buying at local Apple Stores will have the option of a free Personal Setup service. Introduced last year with the original iPad, Apple Store employees will help iPad 2 buyers set up email, load apps from the App Store, and customize settings. While not as time consuming as iPhone setup, this won’t help shorten lines already lengthened by a lack of pre-orders and the evening launch time. Plan on being at an Apple Store early (lines are already forming at some locations).

If you can’t get to an Apple Store, Best Buy, Target, Walmart/Sam’s Club will also begin selling the iPad 2 at 5:00 PM local time tomorrow, and presumably will have an option for buying online, though online plans have not yet been formally announced for these outlets. Prospective iPad 2 buyers should be aware that historically Apple retail partners have had considerably less stock of new Apple products, so while lines might be smaller, iPads will sell out much quicker.

Those looking for a 3G iPad will have to choose between Verizon and AT&T, both of which will offer the iPad for sale at retail stores tomorrow at 5:00 PM local time. In addition, AT&T will be selling the iPad 2 online, but not Verizon. If you’re still trying to decide on which network, price favors AT&T on data plans at the lower end of the bandwidth cap spectrum, but Verizon offers more data at a better price:

If you haven’t already decided which iPad 2 you want to buy, now is the time to choose, because tomorrow you’ll be too busy trying to find stock to worry about making decisions.

Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.

• Why iPad 2 Will Lead Consumers Into the Post-PC Era
• The Near-Term Evolution of Social Commerce

The new Mac App Store launches with more than 1,000 software titles already in its library, including software from Apple’s own iWork and iLife suites, and from major Mac software vendors like AutoDesk, Omni Group and others. iPhone App Store users will also recognize titles like Flight Control HD and The Incident from the mobile storefront.

Once you’ve installed the Mac OS X 10.6.6 update, the Mac App Store icon should automatically appear in your dock next to the Finder. As with the iOS App Store, you purchase software using your iTunes ID and password, and they are then downloaded and installed automatically. Charts are carried over from the iOS version, too, including Top Paid, Free and Grossing apps for the whole store and for individual categories.

We’ll be featuring ongoing coverage all day. Many early users are reporting problems with downloading apps, probably due to server congestion at Apple, so be patient. Go get it now and let us know what you think.

Related content from GigaOM Pro (sub req’d):

• How to Market Your iPhone App: A Developer’s Guide
• Mobile App Developer Survey: Profiles, Platforms and Monetization
• App Developers: Are You Ready for HTML5 and Metered Data?

Apple announced Thursday that the Mac App Store will officially launch on Thursday, Jan. 6, 2011. The Mac App Store, like its iOS equivalent, will be used to sell and distribute applications, only for OS X instead of for Apple’s portables. The newly-announced date falls well within Steve Jobs’ stated release timeframe of 90 days, which he announced at Apple’s Back to the Mac event in October.

In the press release, Jobs notes that he hopes the Mac App Store will do for OS X software what the App Store did for mobile apps:

The App Store revolutionized mobile apps. We hope to do the same for PC apps with the Mac App Store by making finding and buying PC apps easy and fun. We can’t wait to get started on January 6.

The official announcement goes on to briefly describe how the Mac App Store will work. New and noteworthy apps, staff favorites, category searching and customer reviews and ratings will all make the jump from the iOS version of the software marketplace. Apps can also be downloaded and installed in one click, and once you’ve bought an app, you can download and install it on any other Mac associated with your iTunes store account. Updates for software purchased through the Mac App Store are delivered directly through it, too.

Some things the Mac App Store will be missing from its iOS counterpart include in-app purchases and trial versions of software with limited content or gameplay. It’s unclear whether or not Apple plans to implement any of these things down the road.

When it does arrive, users won’t even have to go to Apple’s site to grab the download, since it’s being pushed out to all Snow Leopard users via Software Update as a free download. Apple clearly doesn’t want to risk anyone missing this boat.

Related content from GigaOM Pro (sub req’d):

• How to Ride the Freemium App Wave to Success
• App Developers: Are You Ready for HTML5 and Metered Data?
• How to Market Your iPhone App: A Developer’s Guide

According to Foxconn’s sources, Apple originally planned to have the iPad 2 shipped by January 2011, but the device’s firmware isn’t yet ready for a wide release and needs more testing, leading to a postponed release timeline. Though devices are said to be shipping in February, the iPad 2 won’t make its way into consumer hands until April 2011, which is normal for Apple’s supply chain. An April launch would mark a one-year product upgrade cycle for the iPad, which is in keeping with Apple’s schedule for the rest of its iOS devices.

Foxconn reportedly shipped around 6 million iPads in the third quarter of 2010, leaving around 1.8 million surplus units after all channel sales for the fourth quarter according to DigiTimes. Apple will greatly reduce its ordering in January according to the blog’s sources, in order to try to divest itself of its existing iPad inventory before the launch of the iPad 2.

Taiwan-based DigiTimes has a mixed track record when it comes to predicting future products releases, but it does appear to have genuine connections to many of Apple’s suppliers. This particular report seems sound, if for no other reason than that the information it relates isn’t really  a surprise to any Apple watchers. It’s basically a textbook breakdown of how Apple approaches the release of a new product iteration. We’ll see an iPad 2 in 2011, that much is certain, and April seems like a safe bet for a specific release window. This new DigiTimes report only serves to reinforce that anticipated timeline.

Related content from GigaOM Pro (sub req’d):

• Can Anyone Really Compete With the iPad?
• Five Things Needed for a 48 Million iPad Market
• In Q3, the Tablet and 4G Were the Big Stories

On Friday, the iPad goes on sale in Austria, Belgium, Hong Kong (China), Ireland, Luxembourg, Mexico, Netherlands, New Zealand and Singapore. While not all localities have announced pricing, the 16GB Wi-Fi model will cost 499 € in the new European countries and NZ$799 in New Zealand. If you can find one, that is.

Insatiable demand continues to hamper Apple from getting the “magical” into every pair of hands that wants one. For the U.S. and Europe, the Apple Store online currently shows a shipping delay of seven to ten days for all models. This has been the situation since the U.S. launch of the iPad in April, which ultimately forced the delay of the first international launch to late May for Australia, Canada, France, Germany, Italy, Japan, Spain, Switzerland and the United Kingdom.

If it seems like a questionable business decision to launch the iPad in yet more countries when demand cannot be currently met, there may be hope for an increased supply. Everyone’s favorite Apple rumormonger in Taiwan, DigiTimes, reported earlier this month that iPad orders to manufacturers “surpassed two million units for July.”

On June 22, Apple announced the iPad had sold some three million units in 80 days, or roughly at the rate of about a million iPads per month. If production has been significantly increased, it seems possible that additional launch countries could be added even before shipping times showed improvement.

Hopefully we’ll find out tomorrow during Apple’s quarterly earnings report and conference call. I expect the company will announce as many as five million iPads sold to date. To put that number in perspective, sales estimates for all Windows Tablet PCs combined in 2010 range from three to five million.

While that’s good news for stockholders, as well as those interested in the success of the platform, for those residing in one of the countries launching on Friday, the advice remains the same. Get up early and get in line or be hitting refresh online at the Apple Store.

Remember also that the iPhone 4 is only available for sale in five countries so far, including Britain, France, Germany, Japan and the U.S. Even with the limited initial launch, Apple had trouble keeping the iPhone in stock and shortages caused crowds to become disgruntled at multiple locations.

Steve Jobs apologized for the delays, while also patting himself on the back for a job well done. “This is the most successful product launch in Apple’s history,” he said. “Even so, we apologize to those customers who were turned away because we did not have enough supply.”

The iPhone 4 reached record heights despite numerous reports of signal problems when the phone is held in a certain way, with fingers touching two contact points in the steel band surrounding the case, which doubles as an antenna. While some news outlets are billing the flaw as a major design problem, not all units appear to be affected, and Steve Jobs has advised users who are affected to either hold it a different way or put a case on the iPhone to prevent issues.

The new iPhone also has yet to be offered in significant quantities at secondary retailers like Best Buy and Walmart, so when stock levels are sufficient enough to allow for more presence there, we’ll most likely see more big gains. AT&T is also having trouble keeping the device in stock, and I wouldn’t hold my breath for Apple sticking to the July date promised if you don’t live in one of the initial launch countries.

For context, remember that the iPhone 3GS sold almost half this number during its launch weekend, with one million units moved, and Canada, Italy, Spain and Switzerland were among the first countries to get the device that time around. When the iPhone 4 launches in 15 more countries next month, expect sales to break even more numbers, despite any negative press Apple happens to be getting regarding reception issues and the breakability of the iPhone’s case when dropped from relatively small distances.

If you haven’t yet purchased an iPhone 4, but were planning to, are the reported problems with the device influencing your decision at all? I’m in Canada, but I still plan on picking one up next month when it comes out, even if there is no sure fix for the receptions issues. Am I just a glutton for punishment, or do the benefits outweigh the downsides?

Customers who originally pre-ordered before Apple’s recent cut-off date should expect their iPads to arrive in the mail today, or you can try your luck with retail stores, which are going to be selling the new iPads beginning at 5 p.m.. today. Pre-orders for the Wi-Fi + 3G models were originally lower in volume than those for the WiFi-only version, so it’ll be interesting to see what the response is like at brick-and-mortar retail.

I personally am also very interested in seeing how soon unofficial sales start across the border here in Canada. Following the launch of the original Wi-Fi model, you could buy one the same day at a not completely ridiculous markup, so I predict the same thing this time around. Of course, international iPad users won’t yet be able to get 3G service, since no deals or pricing have been announced with carriers yet, but presumably the devices will work fine with those networks late in May when the Wi-Fi + 3G iPad ships worldwide.

Don’t just show up at the Apple store this morning expecting to pick up a new iPad, though. The launch is scheduled for 5 p.m., and Apple stores across the country are closing down between 4 and 5 specifically to set up for the launch. It’s odd timing, and will no doubt cause some confusion at retail sites in terms of people coming by too early, but Apple must have a reason for not just starting the shopping day with the iPads on the shelves. Whatever the case, expect a lot of confused customers being ushered out the doors at 4 p.m. who are oblivious to the product launch.

The 3G capability is a killer feature for the iPad, in my opinion. Undoubtedly the iPad’s UI is a hit with consumers, as is the user experience in general, but the ability to remain connected while traveling, be it just around town or internationally (as international providers become available) elevates the device from being an amazing entertainment and media player to a lifestyle changer, in terms of both work and play.

Are you getting one? Does your local Apple Store have stock? Is there a lineup? Are you upgrading from a Wi-Fi only model? Let us know your thoughts on all things 3G iPad in the comments.

Related GigaOM Pro Research: How AT&T Will Deal with iPad Data Traffic

iPad By the Numbers

300,000 iPads were sold on the Saturday and as of today, 450,000 have been sold. For comparison the original iPhone sold 250,000 units on opening weekend in June of 2007. About 1 million units of the iPhone 3G were sold in July 2008 when that revision launched.

The iPad launch compares very well to the original iPhone. The two devices are also close in that they had US-only launches and really mapped out a new category for Apple. The comparison to the 3G launch will only be interesting when the next revision of the iPad is launched simultaneously in several countries.

iPad Apps

Customers were also quick to embrace iPad specific apps and books. About 1 million iPad apps were downloaded on the first day. 3.5 million have been downloaded through today (about 7.8 apps per iPad). This number is a bit higher than I expected. Every iPad is prompted to download iBooks, so that bumps the number a bit.

I wonder if Apple is including Universal Apps (contains both iPhone and iPad binaries) that iPhone users have downloaded but have not installed on an iPad. Technically, I am not sure there is a way for Apple to distinguish when a user downloads an app with iTunes so I suspect these numbers are artificially inflated by iBooks and Universal apps.

iBooks

Books have also been a big success. 250,000 books were downloaded on the first day, and 600,000 books (1.3 books per iPad) have been downloaded through today. If the bundled Winnie the Pooh book is included in those numbers, it is less impressive. Since Winnie the Pooh is not actually downloaded, I would guess that these numbers represent additional books downloaded through the store, but the other caveat would be the free samples for paid books. Those might bump the numbers slightly. With all the free books available through the Gutenberg Project I would have expected a higher number per iPad.

I know I have downloaded 6 books myself (2 paid). It would be really interesting to see the usage patterns here. I suspect that there is a small number of people that have downloaded 5-10 books and a large number that has not downloaded any.

While some of the usage numbers for downloads are a bit of a mixed bag, the number of iPads sold is impressive, especially for a new device category. I suspect that the iBooks downloaded will increase even further as iPhone users pick up the app in iPhone OS 4.0.

This morning, Apple finally announced the release date for its anticipated iPad, detailing that the tablet device will be available starting Saturday, April 3.

The early April weekend launch will see only the Wi-Fi model of the touch-screen device being made available, starting at $499, with the 3G model being introduced later that month. Apple detailed that these dates only apply to the U.S., with international releases in Australia, Canada, France, Germany, Italy, Japan, Spain, Switzerland and the United Kingdom to come towards the end of April. Sadly no specific dates or pricing for the international launch have been confirmed as of yet, however Macworld UK has been speculating about the price for British customers.

In the lead up to the official launch, Apple will be running a pre-order scheme, which starts March 12. Then on April 3, customers based in the U.S. will have their Wi-Fi iPad delivered to their doorstep or to their local Apple Store for pickup, whichever they choose. No word yet on the official launch or delivery date for the 3G model.

Apple CEO Steve Jobs, who revealed the iPad back in January, said the following about the upcoming launch: “We’re excited for customers to get their hands on this magical and revolutionary product and connect with their apps and content in a more intimate, intuitive and fun way than ever before.”

Reports popped up early this week hinting that the iPad would launch on March 26, with further rumors suggesting that iPad’s would be arriving in stores for staff training as early as March 10. Of course word from Apple regarding the launch has now set the record straight, confirming the speculated delay until April.

So with the iPad launch details now laid bare, will you be picking one up at launch? If so are you opting for the Wi-Fi or 3G model? Let us know in the comments.

Related GigaOM Pro Research:
• How AT&T Will Deal with iPad Data Traffic
• With The iPad, Apple Takes Google To the Mat
• Web Tablet Survey: Apple’s iPad Hits Right Notes

Sources from within Apple are claiming that the iPad will be in stores starting March 10, if a recent Examiner post is to be believed.

Examiner’s report claims that the tablet devices will be hitting Apple retail stores early in order to give employees and employees only, plenty of time to get up-to-speed with using the new tablet device, ahead of its official launch.

The iPad is expected to arrive before the month is out, with many blogs increasingly hinting at a March 26 launch date. Examiner sources, which allegedly include an anonymous “Apple Store manager in Southern California,” also claimed that the iPad’s advertisement campaign will kick off around the 15th of this month. The advertisement campaign is said to be focusing heavily on the iBookstore and e-book capabilities of the upcoming device, no doubt with an intent to take some steam out of the Kindle’s successes.

Finally, the Examiner report also hinted that individuals who set up camp ahead of the launch, in order to become one of the first to get their hands on an iPad, will be rewarded. Just what this Apple related reward may be is unknown.

However, despite all the detailed dates, rumors of possible production problems could negate the planned launch. Let’s just hope it doesn’t.

Shows already being offered at 99 cents are cited as examples of testing for this new scheme, but the shows in question aren’t exactly the most popular, so it seems almost as likely that the discounting is designed to stimulate sales in these specific cases. MTV’s “Wonder Showzen” and Warner’s “Children’s Hospital” are among those on offer at the reduced rate.

Still, we’ve heard rumblings of this before, and the article in the WSJ fits almost exactly the description of what an intentional leak from Apple looks like. Also, I have no doubt that while networks might not be that crazy about this idea, there’s no reason Apple wouldn’t want to see the price of standard definition TV shows cut in half (they currently cost $1.99 per episode).

There are plenty of reasons why they would want that to happen, though, and the biggest of all is iPad marketability. To people who, for example, think a ReadWriteWeb post is actually the Facebook login page, the iPad is a mysterious device indeed, with few sellable qualities. Why would such people pay for the ultimate web browsing experience, for example, when they’re terrified of the web? What they will pay for, and what they do understand, is TV.

Bestselling shows offered at a dollar isn’t only an attempt to woo iTunes TV-viewers to the new platform, although it will probably help do that. The advantage of such competitive pricing for a single, popular type of media is that it will make the iPad a destination device for said media, in the same way that the iPod has become the digital music player. Apps might sell the iPod touch and iPhone now, but make no mistake, what sold their predecessors and allowed them to even exist in the first place was music.

TV could do for the iPad what music did for the iPod, and Apple knows it. Sure, the iPad has apps, but I’d be willing to bet that apps still remain mostly untouched territory for a massive number of people who use the media playback capabilities of their iPods and iPhones. Books aren’t priced competitively enough, nor do they appeal to a wide enough market to create the kind of consumer rush Apple is looking for with its new device. No, it has to be TV, and for that to become a reality, consumers have to see prices that compete with or improve upon cable subscription models.

Offering cheaper TV is a step in the right direction, but there is an alternative if talks break down and Apple can’t offer steep discounts on its current TV prices, which by all accounts are fairly high. Apple should merely open the platform a little by either developing easy conversion options itself for .avi files and other formats, built right into iTunes, or by encouraging third-party companies to do so. In short, make it easier for users to get their own files onto the device, and you broaden the hardware’s appeal immensely.

Apple currently makes it somewhat difficult to get your own differently formatted media onto its devices because by doing so, it encourages content providers to offer their media for licensed use with the device. It gives Cupertino the ability to negotiate with those providers, since Apple is actually protecting their interests by discouraging piracy.

But if networks don’t begin to take Apple seriously as a contender to cable companies and other TV service providers by offering competitive prices, I say the Mac-maker is well within its right to go its own way and open the platform up. Consumers will reward them with big hardware spends to make up for lost media revenue.