AT&T is currently believed to be paying somewhere around $350-$400 in subsidy for each iPhone sold. That’s a nice, healthy chunk of change for Apple. Since AT&T has exclusivity of the iPhone, they have decided that this subsidy is an acceptable cost for the higher monthly service fees they receive from smartphone customers on their 2 year contracts.

Over on Verizon, there are now a bevy of Android based smartphones selling like hotcakes. Something more interesting is happening on the Android side though. Because there are so many handsets to choose from, you can get an Android phone for cheaper. Many Android handsets are priced below $99. The Motorola Droid has been out for only 9 months, and already is priced cheaper than at launch. Part of this is due to the Droid X’s release–only 8 months after the Droid. But the fact that Android handset makers need to be on a more aggressive release schedule is evidence of how hard they’re competing against each other.

Compare this to Apple. Their handsets don’t have to compete with other iOS based handsets on AT&T. As a result, Apple can keep their prices higher. Their latest iPhone model released every year in June has had the same price points: $99 and $199, since the iPhone 3G was released. They don’t have to drop their prices, because there’s no alternative iOS handset.

Will this change once the iPhone hits Verizon? I bet it will. How else can Verizon and AT&T compete for iPhone customers, if not on price of the handset? It makes more business sense to give customers a discount on the handset, rather than drop the price of service contracts. Dropping the price of the iPhone another $30-50 is a drop in the bucket compared to losing $10/month over the course of a 2 year contract. Despite the iPhone being available on Verizon and AT&T at that point, it’s not as though customers can jump ship to the other carrier–the cellular radios are incompatible.

When the iPhone comes to Verizon, expect to see the price drop. But this won’t affect Apple, mind you, they’ll get a slightly larger subsidy from the carriers as they compete for iPhone customer’s wallets.

Oh really?  Just watch this video I recorded this evening with the original iPhone 2G, on T-Mobile USA’s network:

Look familiar?!

Anand Lal Shimpi over at  AnandTech did quite a rigorous investigation into iPhone 4′s reception and observed that:

“squeezing it really tightly, you can drop as much as 24 dB. Holding it naturally, I measured an average drop of 20 dB.”

Interesting! I measured an average drop of 20 dB when holding my iPhone 2G naturally, as seen in my video above. But here’s the kicker from Anand’s research:

“From my day of testing, I’ve determined that the iPhone 4 performs much better than the 3GS in situations where signal is very low, at -113 dBm (1 bar)…I can honestly say that I’ve never held onto so many calls and data simultaneously on 1 bar at -113 dBm as I have with the iPhone 4, so it’s readily apparent that the new baseband hardware is much more sensitive compared to what was in the 3GS. The difference is that reception is massively better on the iPhone 4 in actual use.”

In my opinion–and I happen to be an RF communications engineer at one of the largest cellphone designers in the world–the only thing Consumer Reports really can say with certainty is that signal strength depends on a variety of factors, one of which is dependent on how a phone is held. Any smartphone, or really any radio for that matter, will have it’s performance affected by how the antenna is placed, held, etc. It’s irresponsible and dishonest for them to claim anything otherwise.

But wait a minute! Consumer Reports said that they tested the iPhone 4 in a “signal proof room” that simulates “real life conditions”! Before addressing that, some background:

Your smartphone, and the cellular tower (or “base station”) both are really just digital radios. When you make phone calls, you’re talking on a walkie talkie that digitizes your voice and sends it to the base station using radio waves. Once there, the base station relays that voice data through the carrier’s network to the phone on the other end of the call, and vice versa.

For this whole system to work, you need to have a certain amount of Signal-to-Noise ratio, or SNR, at both the smartphone, and at the base station. SNR is measured in dBm, or decibels referenced to one milliwatt (mW), which is the standard unit of measure for RF engineers. If your SNR drops below the level of sensitivity of either radio, packets (small chunks of data, i.e. your voice or network synchronization traffic data) start getting dropped. If SNR is too low for too long, too many packets are dropped (this is where your voice starts “breaking up”) and then the call is dropped by the tower if SNR doesn’t recover to a level above sensitivity so that you don’t end up consuming precious bandwidth and preventing others from making calls.

What can cause SNR to drop? A whole slew of things:

• Distance from the cell tower
• Interference from other radio waves
• Attenuation from buildings, trees, trucks passing by, and how you hold the phone ;-)
• Multipath distortion (a phenomenon in radio communications where multiple copies of the signal sent bounce off of buildings, etc. and arrive at slightly delayed times, causing inter-symbol interference (ISI). Think of it as the radio confusing 0′s and 1′s, causing corruption in packets sent. Though 2G, 3G, and 4G technologies do have equalization circuits and forward-error-correction (FEC) circuits that can help combat this, it does require a stronger SNR that otherwise to help decode the bits sent over the air.

So, back to the “real life condtions” in Consumer Report’s “signal proof room.” The room they’re referring to is what’s known as a screen room. In their video, they claim that this environment simulates “real life conditions”. No it doesn’t! Screen rooms are designed to test radio performance while ignoring real-life issues, such as multipath, deep fades, interference, etc.

Does shorting the two antennas together cause a degradation in the performance of iPhone 4′s antenna? Sure. Does holding any phone change the performance of the antenna? Absolutely. Is the iPhone 4′s antenna a flawed design? Absolutely not. Could it be better? Definitely…but so can anything. Anand does suggest that Apple should “add an insulative coating…or subsidize bumper cases”. I’m not sure I agree, at least not yet. Depending on how Apple designed their antenna and radio front end, they could improve radio performance with a software update–I’ve implemented algorithms that did precisely this.

All in all, it seems clear that Consumer Reports didn’t prove anything is “flawed” with the iPhone 4, and acted irresponsibly in making the claims they did. The evidence they gave doesn’t support their claims, and was more smoke and mirrors than concrete information. It’s going to be difficult for me to trust their reviews of products in the future. As for what Apple does next, stay tuned for their invitation only press conference, scheduled for this Friday.

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It’s sort of shocking how long web servers have been behaving in this way. Except for the fact that hardware is cheap and thus, many end up throwing more hardware at the problem. That is certainly an option in many cases, but it isn’t really ideal, or the best allocation of resources. Additionally, the web has also become far less static, and Web 2.0 apps compound the problem.

Then today I saw an article over at ArsTechnica about this new server architecture from SeaMicro, the SM10000. They’ve crammed 512 Atom processors into a system where networking and storage resources are pooled in a way that is hidden from each individual processor.  It sounds like a perfect mate for node.js. It would be very cool to see how the two together would perform on web applications. I can envision using this to create a very efficient, scalable cloud-server, while being environmentally friendly to boot!

If you thought past TV spots for the DROID were bad, check out the latest. You’ll swear you can hear the ‘Team America, World Police’ theme song in the background.

This ad campaign seems hellbent on condemning the DROID to be a niche device rather than one with consumer mass-appeal. No wonder rumors of Google launching their own phone had everybody buzzing over the weekend. There are too many niche devices emerging on the Android platform, and Google is rapidly turning into the Microsoft of smartphones by providing the OS to hardware manufacturers but not launching any devices themselves.

It’s not clear that replicating a Microsoft business model will be profitable for the likes of Motorola, HTC, et. al. Just look at what has happened to PC margins over the past few years: you can go buy a netbook for $200 at razor-thin margins to the manufacturer, yet Apple continues to grow their laptop and desktop market share while commanding margins in excess of 30%.

Google may not be a hardware company, but Motorola better hope that they’re not thinking, “oh this is why Apple made their own phone.”

The rise of the iPod and the MP3 brought us to the final destination for music’s distribution medium–the  Internet.  CDs are practically extinct.  Sites like Pandora and newcomer GrooveShark allow nearly unlimited free music listening in streaming format.  More recently, cheap hardware devices like the iPhone, Roku, and even some BluRay players have added streaming capabilities from the likes of Pandora and Netflix.  Access to music and movies has never been cheaper for consumers.

All of this leaves me (and probably lots of musicians) to wonder, what’s the point of record labels?  Distribution costs on a per-listen basis are effectively $0, and many people are discovering their new music by streaming it.  99.9% of songs are just a URL away.  It used to be the label did your marketing, PR, and distribution, but the cost of all of those things is nearing zero as well.  Bands have a litany of tools freely available to market themselves online, the most powerful of which is services like Pandora and Grooveshark, and now iTunes’+Lala.

I ask today’s musicians, are record labels really doing anything other than stealing a slice of your hard earned money?

For music lovers, how do you feel about pay-per-listen versus owning physical media?

This, dear friends, was inevitable.  But many people may be asking, why?  Just like many asked the same question when Google released their Chrome Browser.

It has nothing to do with the fact that Google and Microsoft are competing like, well, Goliath and Goliath.  It runs much deeper than that.  As years have gone by, operating systems (well, Microsoft’s in particular) have gotten way too bloated, and the Internet has gotten way too fast.  You know the routine by now: every 2-3 years, you buy a new PC, with a faster processor, faster graphics processor, bigger hard drive, and with a new version of Windows on it.  And I’m sure plenty of you asked, “Why?  The Internet looks the same on all of these computers!”.  You’re exactly right.

How much time does anyone spend on their computer these days that’s not in a web-browser, using web-based email or web-based instant messenger?  The Web Browser is the new OS (well, at least the part of it you see).  Anyone still surprised that Google’s web browser and newly announced OS share the same name?

In the last few years, web technologies have gotten incredibly good at making you feel like the browser is the same as your desktop.  AJAX really opened the floodgates for web-based applications that behaved like “regular” programs.  As a result, Google Docs have gotten pretty damn good.  In fact, I don’t even own a copy of Microsoft Office anymore, I just do all of my documents in Google Docs.  I have yet to find a feature that I need they don’t have, and my documents are available to me anywhere, because they’re in the cloud.

More recent developments are pushing us even closer to a web browser OS world.

Does it shock you at all that Google has been heavily involved in providing APIs to do rich 3D graphics rendering right in the browser?

What about the HTML 5 video standard? Once codecs are decided on, embedding video will be as easy as embedding an image in your HTML.  This means Flash video will be rendered obselete.  Apple doesn’t look so dumb after all not worrying about Flash running on the iPhone now do they?

So, the web browser becomes the artist’s blank page, for software slingers to serve up applications for email, photo editing, making presentations, editing documents.  And underneath with be the OS kernel, providing access to the hardware on your device.  And that’s it.  It doesn’t have to be complicated, because you don’t need to have all your software installed locally.  It’s in the cloud, where it belongs.

To be honest, I was pretty excited about the Palm Pre.  After all, it won the Best of CES 2009‘s “Best in Show” award.  The design was headed up by an Apple veteran, Jon Rubinstein. It sports a brand new OS, WebOS, which if it is as good as it sounds, is a huge plus.  And (control yourselves), it can multitask.

And who can deny, it looks beautiful in all the pictures!

Hey there, sexy ;-).

I mean, jeez, I want the phone just to hold in my hand.  The screen looks so big, bright, and beautiful.  Goodbye iPhone!  Helloooooooo Pre!

I walked into the Sprint store yesterday afternoon, after eating Chipotle for probably the 5th or 6th time in a week (it’s only an addiction if you don’t admit you’ve got a problem, I admit it openly).  I saw it there, on it’s wireless charging pedestal, practically floating like the magical amulet that those crazy unicorns are after.  I walked right up to the demonstration model of the Pre and took it into my hands.  And…

WTF.

I have never been so misled in my life about a piece of technology.  The Pre is a Preice of shit.  First of all, it’s screen is not as big as the iPhone’s, despite many of the pictures floating around on the web.  Exhibit A:

Objects in image may not be the same size as they appear.

Head on over to Gizmodo’s Smartphone Comparison to see the real thing side by side with the iPhone.  The iPhone’s screen is 3.5″, the Pre’s is 3.1″.  That may not sound like a lot, but there’s a reason all of the icons on the Pre are tiny.  That screen real-estate does matter.  I wouldn’t have thought so, but as I was playing with the Pre in the Sprint store I started to feel honestly claustrophobic (something I never feel), and it wasn’t because the store was crowded–the Pre’s user interface was.

Next, usability.  I couldn’t figure the damn thing out.  I am a hardware engineer, with software experience as well, and I hate having to read instruction manuals.  I usually don’t need to, in fact ever since I was little I could always figure out electronics without them.  The Pre stumped me.  I even sat through the incredibly condescending “Demo” the phone had on it to teach me how to use it.  Isn’t the point of multi-touch screen phones to not need to learn how to do anything?  Shouldn’t I just touch what I want (giggle)?  I didn’t have to re-learn how to use the mouse when I switched from a Gateway computer to a Dell.  I mean, yea it (usually) would respond when I tapped it with my fingertip, but I just really wasn’t sure how to get what I wanted done quickly (browse the web, make phone calls, open a new tab in the browser, etc.)

I think maybe part of the problem though is that I’ve had an iPhone for over a year now.  It’s user interface is so obvious and so simple, I think it has sapped any patience I might have for even slightly cumbersome user interfaces.  I get angry with ATM machines and gas pumps nowadays, thanks to my iPhone.  I find myself asking random pieces of electronics, “Don’t they have an App for this already?” or “Jesus why is this thing so damn slow!”.

What about the web browser?  It was OK.  It was better than my old RAZR, that’s for sure.  But navigating around big web pages just wasn’t nearly as smooth, precise, or easy as on the iPhone.  They rendered fine and everything, but hey, what’s what WebKit is for…you can’t really fuck that up.

The slide out keyboard is a joke.  The keys are about half as big as the ones on the BlackBerry Curve (already pretty tiny), and they remind me of miniature versions of those puffed up stickers my sisters used to have when we were little.  I practically had to use my thumbnails to type properly on the thing.  Thankfully I hadn’t trimmed my nails in about 2 weeks or I’m really not sure what I would have done.  And I don’t have that big of hands.

Honestly, I am so disappointed, I’m just gonna stop my little review right here.  There are plenty of them out there.  But honestly, people, the iPhone has changed the game forever, and they may just be way too far ahead (for now).  I never really appreciated how good Apple’s touchscreen technology was until I played with the Palm Pre.  I had many occasions with the Pre not registering my touches properly.  That has never happened to me on the iPhone.

So, can the Pre really save Palm?  I don’t know.  Everybody used to think the RAZR was a cool phone.  And for it’s time, it was.  But I can promise you this, anybody who tries an iPhone will see the Pre as a childish, cheap-feeling, slow-running, and more expensive knock-off.  Oh and about that “multitasking”?  Yea, not so much.  Unless you consider multitasking “minimize current application, slide finger over to scroll to the other application I want, touch application I want to be running now”.  Oh wait, that’s exactly the same finger motions I make to open a different application on the iPhone.  Except it happens faster.

Each year there is a competition known well by those in the field of artificial intelligence called the Loebner Prize.  The ultimate goal of artificial intelligence is to make it indistinguishable from real intelligence (so someday geeks like me can just code up a friend in C++). In the 1950s, Alan Turing proposed a test–cleverly named the Turing Test–to measure an AI’s level of intelligence, which the Loebner Prize competition uses to select their winner.  The contestants basically write software to implement their artificial entities, and then judges chat with both real humans and the artificial entities and then guess which ones are real humans and which ones are not.

Criticisms of the accuracy of the Turing Test aside, today I saw something that reminded me of just how far off truly intelligent artificial beings really are.  I was watching a video on YouTube from Bill Maher’s TV show and he threw out some statistic like “8 kids are shot and killed with guns every day in America.”  Since that seemed like an awfully high number I decided to check into it.  So I pull up Google and type in “kids shot”.  Not my best Google search query ever, but I figured it would get the job done.  Google dutifully returned a saddening number of news stories about kids being shot by guns.  It also came back with a single advertisement generated by good ‘ole Adwords…

Adwords Epic Fail

Not only is the statistic true, if you click on that advertisement, it goes to a toy gun that Target is selling!  If Target ran a TV ad for toy guns right after a news story of a kid getting shot, they’d have a PR nightmare on their hands.  Lucky for them, you can’t yet blame a computer for doing the Adwords equivalent.