The business and culture of our digital lives,
from the L.A. Times

Category: Web Scout

Apple's new iPhone hits snag as AT&T online ordering is paralyzed


AT&T has dropped the apple.  Again.

Eager Apple fans aching to be the first to order the company's new iPhone 4 when it went on sale Tuesday morning found that problems with AT&T's online ordering system prevented them from buying the hot gadget.  Attempts to purchase an iPhone through AT&T's website returned a message saying there was a "system error that prevents us from completing your request."

A similar message displayed on Apple's web site, moments after it told asked a user to, "Please wait while we access your AT&T account information." (See image below right.)

Apple-downBlogs reported that lines were forming at AT&T retail stores but that, with the ordering system down, clerks were taking orders by hand.

The ordering problems are the latest in a saga of technical difficulties that has defined the relationship between Apple and AT&T, the blockbuster iPhone's exclusive telecommunications carrier.  IPhone users have long complained of spotty service, slow data rates and dropped calls -- especially in big cities packed with iPhone users.

Then last week, AT&T admitted that a security vulnerability in its website had allowed a group of hackers to obtain the e-mail addresses of a large number of iPad users -- as many as 114,000. 

Appstore-probApple and AT&T also have a record of glitches when it comes to launching the iPhone.  When the iPhone 3GS shipped last year, users had to wait hours to activate their handsets.  A similar bottleneck occurred during the launch of the previous 3G phone in 2008.

AT&T declined to comment (see this follow-up post).  Apple did not return a request for comment.

A clerk at the Apple Store at the Grove in Los Angeles said orders were stuck in the store too.  She recommended prospective buyers try the free Apple Store app that was released Tuesday morning  to make ordering Apple products easier for consumers.  

But attempts to order the phone by way of the new app were also unsuccessful.  (See image at left.)

-- David Sarno and Michelle Maltais

Apple confirms 3G VoIP apps on iPad, iPhone, iPod Touch; Skype is waiting

iPad: Can you hear me now? Credit: Justin Sullivan / Getty Images
Apple Inc. confirmed last night that it is now allowing iPhone, iPad and iPod touch developers to build apps that can make Internet calls over a 3G cellular network.

"We revised our Program License Agreement in conjunction with our updated Software Development Kit for iPhone, iPod Touch and iPad Apps," wrote an Apple spokesperson.  "Included in this update is the ability for developers to create VoIP apps that utilize cellular networks." 

VoIP stands for Voice over Internet Protocol -- essentially, Web-based telephony.

As we reported last night, several VoiP apps have been approved for use on the iPhone, including iCall and Fring.

Skype, one of the most popular VoIP applications, said it had a 3G iPhone app ready to go, but wanted to get a couple of service details squared away.

Skype is waiting for Apple to clarify when the new SDK terms of service for iPhone OS 3.2 SDK beta, which were published yesterday, will go into effect for current iPhone users who are still bound under the terms of iPhone OS 3.12 SDK, according to Skype spokesman Chaim Haas.

"As soon as we have that clarification, Skype will submit its application for approval," Haas wrote.

Apple announced Wednesday that iPad owners will be able to purchase monthly 3G plans for the device, which is quite a bit larger than a normal cellular phone, but could easily be used to make and receive calls.

Now that Apple and AT&T have green-lighted 3G data calls, iPad owners will not necessarily need an additional voice plan (not that the option for one was announced, but plenty of people were wondering).

In fact, the arrival of VoIP to iPhone may well be the beginning of a long decline for the concept of "voice minutes" -- at this point, there's really no point in differentiating one kind of call from another -- it's all data.

-- David Sarno

Journalist, freelance and sci-fi authors groups take aim at Google book settlement

Goog Three national authors groups comprising more than 4,000 writers and journalists today decried the controversial agreement between Google and author-publisher groups that would allow the tech giant to sell access to millions of books online.

In a letter to Congress, the three groups -- the National Writers Union, the American Society of Journalists and Authors, and the Science Fiction and Fantasy Writers of America -- pointed to what they saw as the overly confusing and ultimately unfair rules that would govern what Google could do with the books if the settlement were to be approved in federal court.

In language by turns wry and outraged, the writer groups accuse Google of inadequately explaining the terms of the agreement to the many authors it could affect, and the Authors Guild and publishing industry of fashioning a deal that favors current authors, while leaving less lucrative out-of-print authors behind. 

The deal does not cover books currently in print.

"Think about it," the letter reads. "The existing competitive marketplace is best for the books that publishers care about. It's just the rest of us they want shoved into the straight jacket of the Book Rights Registry which they and the Authors Guild are proposing."

If the settlement were approved, it would include the creation of a "Book Rights Registry" to oversee licensing and revenue claims for all books covered by the agreement -- many of which are out of print but remain copyrighted. Under its current terms, authors are automatically included in the settlement, and must "opt out" if they prefer that their books not appear in Google's search results. 

By the nature of older books, many authors are dead or difficult to find.

Still, many authors have objected to being automatically included in the settlement process. 

"Are you ‘opting in’ or ‘opting out’ of the Google Books Settlement? If you don’t
know what that means – or don’t know what it means for you and your book – you’re in good
company," read the letter. "No attempt was made to locate the vast majority of authors, and the rest were sent emails. Of those, how many thought they were email spam and deleted them unread?"

Google declined to directly address the concerns expressed in the letter, noting instead that if it is approved, "the settlement will open access to millions of books while giving authors and publishers new ways to distribute their work online."

The Authors Guild did not immediately respond to a request for comment. 

Find the full text of the letter embedded below.

Updated 8:35 p.m. with comment from Google.

-- David Sarno

Video: Tips for using an antenna to watch digital TV

Many readers may be surprised at the quality of viewing experience they can get using old-fashioned rabbit ears -- a technology that's been around for the better part of a century. Thanks to 2009's digital TV switch-over, the number of channels and clarity of signal have both increased dramatically. Most shocking of all is that many channels are now broadcasting over the air in high definition, and the picture quality is as good as -- if not better than -- HD over cable.

Here's the longer story about rabbit ears making a comeback. And here are a few tips to help you decide if it's the right choice for your home. In the meantime, watch the video below to see some of the tips in action.

-- David Sarno

Google News adds 55 more newspapers and publications to its Fast Flip lineup


Google Inc. announced today that it was adding 55 publications to its Fast Flip feature, which allows readers a glimpse of articles and images from nearly 100 newspapers, magazines, blogs and other sources without the need to leave Google's site.

With Fast Flip, Google shares some advertising revenue with publishers whose content features ads inserted by the search company. Google has said this arrangement is one way it is trying to help an industry whose bottom line has been sorely affected by the rise of the Internet and digital media.

Additions to Fast Flip include the Los Angeles Times, Chicago Tribune, Miami Herald, Kansas City Star, Huffington Post, Popular Science, Reuters, Politico and U.S. News & World Report. 

"Readers of the Los Angeles Times, Chicago Tribune, Baltimore Sun and the rest of our newspaper brands operate in a multimedia universe, and our goal is to ensure our content is available on the platforms they choose," said Marc Chase, president of Tribune Co.'s interactive division. "We’re always looking for new technologies to help us reach an even wider audience."

Chase did not respond to a request for details about how much revenue Tribune stood to gain through Fast Flip. Google said the program was largely experimental at this point, but that "the majority" of revenue generated through the feature would go to the publishers.

Google has been under attack by many in the newspaper industry who see the instant, free access Google grants users to news articles as undermining newspapers' profitability. Even after years of improvements and added features, newspaper websites have not generated significant revenue.

Earlier this month, media mogul and News Corp. Chairman Rupert Murdoch continued to rail against Google, accusing the company and other online aggregators of stealing news content, which can be expensive to produce.

Google maintains that it sends more than a billion clicks every month back to newspaper sites -- and that each click is a business opportunity from which newspapers could potentially profit. 

-- David Sarno

Bing continues to gain search market share ... from Yahoo

YahooBing, the nearly 6-month-old search engine from Microsoft Corp., has steadily been capturing more of the Web search market.  But instead of stealing users from market leader Google Inc., Bing is still siphoning them from ally Yahoo Inc. 

Bing2Bing captured 10.3% of the search pie in November, according to the latest numbers released by ComScore Inc and reported today by the Associated Press.  That's up from 9.9% the month before.  But Yahoo's share decreased by about the same margin, dropping from 18.0% to 17.5% during the same period.  

Yahoo and Microsoft, which signed a deal in late July to allow Microsoft to operate the search engines for both companies, have not been able to boost their combined market share much past 28%, where it's been hovering at least since the debut of Bing.

Meanwhile, market leader Google has been slowly but surely gaining share, rising from 65% in June, when Bing launched, to 65.6% in November.

-- David Sarno

AT&T plans to charge smart phone customers for heavy data traffic [Corrected]

Smart phones are powering increasingly high-octane applications.  Here, a student in Berlin steers a converted, full-size Dodge minivan using an iPhone. Credit: Sean Gallup / Getty Images.
The current crop of high-tech smart phones can take the place of all manner of other devices: music players, cameras, televisions, the remote control, arcade machines, even video surveillance consoles.

But for major smart phone carriers like AT&T, there's another appliance that the iPhone and its ilk resemble all too closely: a vacuum.

In a presentation to investors today, AT&T's head of consumer services, Ralph de la Vega, acknowledged that just 3% of iPhone users accounted for a massive 40% of the data traffic on AT&T's mobile network. By using data-intense applications such as streaming audio and video services, a small number of iPhone users have been putting a huge burden on the company's network, causing lackluster performance in major markets including New York City and San Francisco.

But those data hogs may soon see their phone bills fattening, too.

AT&T will probably introduce a pricing system that penalizes heavy data users, he said, to encourage them "to either reduce or modify their usage so they don't crowd out the other customers in those same cell sites."

"We've got to get to those customers and have them recognize that they need to change their pattern, or there will be other things that they are going to have to do to reduce their usage," De la Vega told a group of investors at UBS.

De la Vega did not offer specifics on the data pricing. In general, smart phone users pay a fixed monthly rate for unlimited data, but AT&T and other companies have found that the explosion of phone applications that must connect to the Internet has caused a major surge in the amount of transmission capacity users are consuming.

Companies can barely build cellular towers fast enough to keep up with the demand. De la Vega said AT&T will have built 2,000 new cell sites this year, and plans to continue investing heavily to keep its networks fast and dependable in the face of the data onslaught.

"What we're seeing in the U.S. today, in terms of smart phone penetration and 3G data, nobody else is seeing in the rest of the planet," he said.

[Corrected, Dec. 10, 5:13 p.m.:   In a previous version of this post, a quote by De la Vega that began with "We've got to get those customers...," should not have ended with the phrase "or have to face other things." The quote was also incomplete, and a full version is provided in the updated post above.

Also, the statement, “But those data hogs may soon see their phone bills fattening, too,”  should not have been attributed to de la Vega.

Finally, the headline of the post may have given the impression that AT&T had announced a plan to charge heavy data users.  No specific plan was announced.]

-- David Sarno

TomTom says it's wary of Google, but that the navigation company isn't going anywhere

TomTom on iPhone. Source:
TomTom, the navigation technology company that says it has sold 30 million portable navigation devices in the U.S. and Europe, took a major hit to its stock in October when Google Inc. announced it would be giving away its own turn-by-turn navigation software to owners of many smart phones.

The Dutch company's stock is down nearly 40% since the announcement that sent shivers through the navigation industry, which has long charged both for its devices and for its service.

Google's move raised questions about whether stand-alone navigation devices were still necessary in the face of intelligent handsets that can perform thousands of functions.

But TomTom says that "rumors of the death of the portable navigation device are premature."

"I think there's been perhaps a bit of overreaction," Tom Murray, vice president of market development at TomTom, said in a visit to The Times today. "I don't really share in the worries. There are a lot of things that Google has to do in order to have a material impact on our business." 

"It's not going to change the landscape overnight," he continued, acknowledging that the issues was "top of mind" for industry insiders. "It's provocative, but when the dust settles, it'll just be another player, and it'll prompt us to get better."

Murray highlighted what he said were still major differences between what Google might offer on smart phones, and the kinds of features stand-alone units have: larger screens, louder audio directions, longer battery life. Most simply, he said, a dedicated navigation device is not as vulnerable to the "multitasking problem," where users may have to make a choice between making a phone call or checking their e-mail (not recommended while driving!) and using their mapping software.

Still, Murray said, though revenue from TomTom's iPhone app has been a small slice of the company's overall income, it has sold more than 100,000 copies of the app, making it one of the top-grossing apps available on the iPhone. That milestone is made more remarkable by the TomTom app's hefty price tag. At $99, the app is the same price as TomTom's lower-end standalone devices.

The company considers itself a software maker first, Murray said. TomTom plans to be flexible enough to work on a variety of devices and handsets, ideally enabling users to maintain one account that works across multiple platforms.  

But for the time being, Murray said, Google's Android mobile operating system may not be one of those platforms. Though Android will be available on more than a dozen smart phones this year, TomTom would not comment on when or whether it will even try to compete on Android.

"Maybe that wouldn't be the best place for us to invest, although I'm not saying we're ruling it out."

-- David Sarno

As complaints mount, Google enables news publishers to limit free content

Google-news Over the last several weeks, Google Inc. has frequently found itself in the crosshairs of news publishers. Most recently, media mogul Rupert Murdoch has been accusing the search company and its competitors of "theft" and "misappropriation" of his company's news articles. Services like Google News, which has become a major destination for consumers of online news, generally do not pay for the content it features.

That has caused consternation among news publishers like Murdoch, who largely have been unable to wring a profit from their online news operations even as revenues from traditional print newspapers continue their steep decline.

Google is now taking steps to mollify an irate industry by allowing news publishers more control over which content Google's users can access for free. Yesterday the Mountain View, Calif.-based Internet giant said it would allow news sites to limit the number of free articles that online readers could browse without having registered or subscribed to the site. 

When a user registers at a website, it allows the site owners to provide more effective products and advertising.

Any website -- including those run by news organizations -- has the ability to prevent Google from listing it among the search engine's results -- but Google is now giving news organizations more precise controls over which stories are freely accessible and which require either registration or payment.

Google told news publishers today that they'll also be given more say over which parts of their content are accessible through Google News, the site that collects headlines and news summaries from more than 25,000 news and blog sources.

News sites will be able to decide which of their articles, photos, and other content will be available on the popular news platform -- and which will not. 

-- David Sarno

Murdoch says journalism's future is 'more promising than ever,' but rails against Web 'theft'

Murdoch speaking at the FTC event. Credit: FTC Web site.
News Corp. Chairman Rupert Murdoch continued his campaign today to style the digital news media according to his for-pay vision, declaring he was optimistic about journalism's future, but added that in that future, consumers would no longer have free access to expensive news content.

"The future of journalism is more promising than ever, limited only by editors and producers unwilling to fight for their readers and viewers, or government using its heavy hand either to over-regulate or to subsidize," Murdoch said at a meeting at the Federal Trade Commission.

But, he said, "we need to do a better job of persuading consumers that high-quality, reliable news and information do not come free.  Good journalism is an expensive commodity."

One of many newspapers executives and industry observer's to speak at the FTC today, Murdoch used his speech to outline a three-part mandate for newspapers wishing to survive: deliver content to consumers via every possible medium, digital and physical; get them used to the idea that they'll have to pay; and continue agitating for media deregulation.

But the question of whether newspapers should charge online readers has continued to be the most controversial.  For decades, newspapers have made fat profits from print advertisers eager to reach a daily audience.  The problem, said Murdoch, is that "the old business model, based on advertising only, is dead."

"The reason is simple arithmetic: Though online advertising is increasing, the increase is only a fraction of what is being lost from print advertising. That is not going to change, even in a boom."

That's because the in-print classified advertising market upon which newspapers relied has been "decimated" by Web competitors such as Craigslist and, Murdoch said.

But Murdoch saved his strongest words for the companies that aggregate news -- Google Inc. among them -- in a now-familiar accusation.

"There are those who think they have a right to take our news content and use it for their own purposes without contributing a penny to its production.  Some rewrite -- at times without attribution -- the news stories of expensive and distinguished journalists who invested days, weeks, or even months on their stories -- all under the tattered veil of fair use." 

"Their almost wholesale misappropriation of our stories is not fair use -- to be impolite, it's theft."

-- David Sarno


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