Apple to offer $100 store credit to iPhone customers
The company on Thursday posted an open letter from CEO Steve Jobs on its Web site defending the decision to cut the price of the 8GB iPhone from $599 to $399, but acknowledging that Apple shouldn't have treated its early adopters in such a fashion. Jobs had announced the price cut just a day earlier at a San Francisco event at which the company unveiled a refresh of its iPod line, including the new iPod Touch."Even though we are making the right decision to lower the price of iPhone, and even though the technology road is bumpy, we need to do a better job taking care of our early iPhone customers as we aggressively go after new ones with a lower price. Our early customers trusted us, and we must live up to that trust with our actions in moments like these," Jobs wrote. Details on how to obtain the $100 store credit will be posted on Apple's Web site next week, he said.An Apple representative said the $100 store credit will not apply to the iTunes Store. The store credit also does not apply to customers who are eligible for a rebate because they bought a $599 iPhone either 10 or 14 calendar days before Wednesday (10 days for online sales, 14 days for retail sales).In the letter, Jobs echoed comments he made to reporters Wednesday that Apple wants to attract new customers this holiday season with more aggressive pricing. "It benefits both Apple and every iPhone user to get as many new customers as possible in the iPhone 'tent'. We strongly believe the $399 price will help us do just that this holiday season,"he wrote.He also pointed out that this can be the way of life in the technology business. "If you always wait for the next price cut or to buy the new improved model, you'll never buy any technology product because there is always something better and less expensive on the horizon," Jobs wrote. News.com daily podcast Early iPhone adopter letdown Hear Erica Ogg and Tom Krazittalk about the iPhone price drop.Apple doesn't often admit mistakes, and the letter was a forthright admission that the company didn't handle the price move correctly. "We apologize for disappointing some of you, and we are doing our best to live up to your high expectations of Apple," Jobs wrote.How Apple could not have forseen the backlash, I'm not sure. But the move should go a long way to mollify some iPhone customers peeved by the steep drop, although a store credit isn't as good as money in hand. Still, those who were iPhone early adopters likely own a few other Apple products, and will want to update those in the future. Leopard's coming soon, after all.Some Mac bloggers and users seemed satisfied with Apple's response to the iPhone flap. "I think it's clear that Apple was taken by surprise by the magnitude of the backlash regarding the price cut. They've responded quickly, humbly, and well, to avoid letting this issue spoil the good news from their impressive product releases yesterday," wrote John Gruber on his blog, Daring Fireball. Scott McNulty, on The Unofficial Apple Weblog, wrote "While I still think the reaction to the price reduction was way overblown, this is a great example of Apple listening to their customers and trying to make the situation right."Others noted that Apple, so dependent on a core group of loyalists to help create buzz for its products, had little choice. "You just don't screw over your most ardent fans...always a bad plan. You may not pay for it intitially, but you will long-term," wrote poster TBaggins on AppleInsider's forums. Samir Bhavnani, an analyst with CurrentAnalysisWest, saw a savvy business move in offering a store credit instead of a refund. "They'll get new traffic to the site and stores, and almost everything costs more than $100 in any case, so customers will be spending even more of their dollars with Apple," he wrote in an e-mail.But on our own TalkBack section, Jake Kushner, president of JK Media, said that Apple's response doesn't go far enough to satisfy those who bought a 4GB iPhone for $499, only to see the 8GB model become $100 cheaper. "I feel wronged and misled by Apple. Such a quick price reduction indicates that Apple pre-meditated this reduction before the initial release. I read your public response on apple.com to this issue, but I still feel that the solution you are offering is not adequate," Kushner wrote, calling for Apple to offer a free upgrade to a 8GB model to owners of the 4GB iPhone or a $200 rebate.Some iPhone customers are reporting that they have received at least partial refunds from their local Apple stores. And some AT&T customers have said the same thing, as my colleague Maggie Reardon noted earlier today. It's difficult right now to tell what exactly is going on at individual stores around the country--we're trying to get more details about people who received at least some cash back.Jobs pointedly did not address in the letter whether iPhone sales were living up to expectations, although he said Wednesday during Apple's iPod event that the company remains on track to hit its stated goal of shipping 1 million iPhones by the end of September.
Microsoft shoots for the stars with Bing update
Microsoft shoots for the stars with Bing update
WEST HOLLYWOOD, Calif.--Microsoft is hosting a celebrity-laden event here on Tuesday, announcing a variety of new entertainment features it hopes will give Bing a little more star power.In truly LA fashion, the event started late as reporters battled the southland traffic to get to the Soho House on Sunset Boulevard. However, Microsoft's blog post with the news posted promptly at the 6 p.m. starting time.According to that, Microsoft is adding casual games, more TV content as well as Zune music and lyrics to the service. Each of several million songs can now be played once for free, with 30-second samples available thereafter. Songs can also be purchased from Amazon, iTunes or Zune. The event, meanwhile, just kicked off at 6:30 p.m. PT, with Senior Vice President Yusuf Mehdi talking about Bing's history and showing a clip from the promotion Bing recently did with Stephen Colbert.Bing's Hollywood fling (photos)See full gallery1 - 4 / 12NextPrevIn the clip, Colbert notes that Bing is for real, adding that he knows that because he "Googled it." Mehdi said that despite a 47 percent gain in market share, Microsoft knows it still faces an uphill challenge."It isn't like people wake up and say dang, if only I had another search engine," he said. "We're definitely humbled about a lot of work we have to do."Turning to entertainment, Mehdi said that there is a huge opportunity around entertainment and search, noting that there are some 1.5 billion entertainment-related queries per month.Microsoft is hoping to get more of that traffic by including a lot of content within the search engine itself.Bing results will feature more TV content as well as Zune music and lyrics to the service.MicrosoftFor music, Microsoft is adding 5 million tracks in partnership with the labels. Although the songs can be played or bought form Bing, Mehdi stressed that Bing is not trying to compete with Microsoft's Zune music service."This is not a music service," he said. "This is about music discovery."In gaming, Microsoft is adding both 100 casual games that can be played without registering or logging in, along with thousands of cheat codes for hardcore gamers. For TV, Microsoft says it now has 20,000 episodes, including content from Hulu, CBS, and Viacom.Mehdi's talk has wrapped up, but a panel on entertainment and technology is set to begin at 8 p.m., followed by a red carpet after-party with music from hip-hop artist Drake.In an interview after his talk, Mehdi acknowledged that the Hollywood thing is a bit of a stretch for the company, even if it does have a long history and games and music, through MSN, Zune, and Xbox."We're No. 2," Mehdi said. "We have to try harder. We have to think outside the box."The event, he said, is part of that. "We'll see how this works out."Disclosure: CNET is published by CBS Interactive, a unit of CBS.
WEST HOLLYWOOD, Calif.--Microsoft is hosting a celebrity-laden event here on Tuesday, announcing a variety of new entertainment features it hopes will give Bing a little more star power.In truly LA fashion, the event started late as reporters battled the southland traffic to get to the Soho House on Sunset Boulevard. However, Microsoft's blog post with the news posted promptly at the 6 p.m. starting time.According to that, Microsoft is adding casual games, more TV content as well as Zune music and lyrics to the service. Each of several million songs can now be played once for free, with 30-second samples available thereafter. Songs can also be purchased from Amazon, iTunes or Zune. The event, meanwhile, just kicked off at 6:30 p.m. PT, with Senior Vice President Yusuf Mehdi talking about Bing's history and showing a clip from the promotion Bing recently did with Stephen Colbert.Bing's Hollywood fling (photos)See full gallery1 - 4 / 12NextPrevIn the clip, Colbert notes that Bing is for real, adding that he knows that because he "Googled it." Mehdi said that despite a 47 percent gain in market share, Microsoft knows it still faces an uphill challenge."It isn't like people wake up and say dang, if only I had another search engine," he said. "We're definitely humbled about a lot of work we have to do."Turning to entertainment, Mehdi said that there is a huge opportunity around entertainment and search, noting that there are some 1.5 billion entertainment-related queries per month.Microsoft is hoping to get more of that traffic by including a lot of content within the search engine itself.Bing results will feature more TV content as well as Zune music and lyrics to the service.MicrosoftFor music, Microsoft is adding 5 million tracks in partnership with the labels. Although the songs can be played or bought form Bing, Mehdi stressed that Bing is not trying to compete with Microsoft's Zune music service."This is not a music service," he said. "This is about music discovery."In gaming, Microsoft is adding both 100 casual games that can be played without registering or logging in, along with thousands of cheat codes for hardcore gamers. For TV, Microsoft says it now has 20,000 episodes, including content from Hulu, CBS, and Viacom.Mehdi's talk has wrapped up, but a panel on entertainment and technology is set to begin at 8 p.m., followed by a red carpet after-party with music from hip-hop artist Drake.In an interview after his talk, Mehdi acknowledged that the Hollywood thing is a bit of a stretch for the company, even if it does have a long history and games and music, through MSN, Zune, and Xbox."We're No. 2," Mehdi said. "We have to try harder. We have to think outside the box."The event, he said, is part of that. "We'll see how this works out."Disclosure: CNET is published by CBS Interactive, a unit of CBS.
Apple's tough iTunes note meant for indie labels
Apple's tough iTunes note meant for indie labels
Apple wrote in e-mails to an undisclosed number of music industry executives--made public on Tuesday--that it would soon offer longer samples for songs that are at least two-and-a-half minutes in length. For shorter songs, iTunes would continue to offer 30-second previews, the company wrote.CNET broke the news in August that Apple planned to offer longer samples. What raised eyebrows about Apple's note was that it appeared the company was offering an ultimatum to the entire record industry. But the largest stakeholders, the four top labels--Universal Music Group, Sony Music Entertainment, Warner Music Group, and EMI Music--signed off on Apple's plan to boost the length of iTunes' song previews from 30 seconds to 90 seconds in August, according to multiple music industry sources. Apple has also penned individual deals with some of the top publishing companies. Instead of the big guys, Apple's letter appears to be directed at the scores of independent record labels, industry insiders said. Apple stated in the letter that it would roll out longer samples soon at iTunes and that anybody who left their music up at the Web store was automatically agreeing to give Apple the right to offer the longer song samples "gratis," or for free. The message is pretty clear: accept the longer previews for longer songs, or pull them off iTunes. An Apple representative confirmed that the note was sent but declined to comment for this story. Managers at some of the bigger indie labels were reluctant to comment today, saying they hadn't seen Apple's letter or hadn't had time to analyze it.Two did acknowledge that it seemed that Apple was playing hardball. There's a reason for the tough approach. Apple is in a hurry to get the deals done so it can offer the longer samples for holiday shopping. Time is running out. Apple CEO Steve Jobs was expected to announce the longer samples at a press event on September 1, music industry sources told CNET. Before that could happen, the National Music Publishers Association notified the company that it would need to negotiate a deal with the publishers before going ahead with its plans. Sources said the NMPA is still in negotiations with Apple, as is Broadcast Music Inc.. (BMI), a group that collects royalties on behalf of songwriters and publishers. Hanna Pantle, a BMI spokeswoman, told CNET today, "We are in active and positive negotiations with Apple for the performance right of our repertoire." At a time when many iTunes users favor YouTube to sample and discover music, a longer sample seems like a no-brainer. In its note, Apple said, "We believe that giving potential customers more time to listen to your music will lead to more purchases."But some in the music industry have grumbled in the past that Apple should compensate rights owners for the previews. "It's like giving away ice cream samples--someone has to pay the cost," said Rick Carnes, president of the Songwriters Guild of America. "I think it would be a good thing for consumers to go to 90 seconds. But they're tripling the amount of time, and they want it for free. I think there ought to be compensation. I believe anytime you use music, you ought to reward the people making the music."
Apple wrote in e-mails to an undisclosed number of music industry executives--made public on Tuesday--that it would soon offer longer samples for songs that are at least two-and-a-half minutes in length. For shorter songs, iTunes would continue to offer 30-second previews, the company wrote.CNET broke the news in August that Apple planned to offer longer samples. What raised eyebrows about Apple's note was that it appeared the company was offering an ultimatum to the entire record industry. But the largest stakeholders, the four top labels--Universal Music Group, Sony Music Entertainment, Warner Music Group, and EMI Music--signed off on Apple's plan to boost the length of iTunes' song previews from 30 seconds to 90 seconds in August, according to multiple music industry sources. Apple has also penned individual deals with some of the top publishing companies. Instead of the big guys, Apple's letter appears to be directed at the scores of independent record labels, industry insiders said. Apple stated in the letter that it would roll out longer samples soon at iTunes and that anybody who left their music up at the Web store was automatically agreeing to give Apple the right to offer the longer song samples "gratis," or for free. The message is pretty clear: accept the longer previews for longer songs, or pull them off iTunes. An Apple representative confirmed that the note was sent but declined to comment for this story. Managers at some of the bigger indie labels were reluctant to comment today, saying they hadn't seen Apple's letter or hadn't had time to analyze it.Two did acknowledge that it seemed that Apple was playing hardball. There's a reason for the tough approach. Apple is in a hurry to get the deals done so it can offer the longer samples for holiday shopping. Time is running out. Apple CEO Steve Jobs was expected to announce the longer samples at a press event on September 1, music industry sources told CNET. Before that could happen, the National Music Publishers Association notified the company that it would need to negotiate a deal with the publishers before going ahead with its plans. Sources said the NMPA is still in negotiations with Apple, as is Broadcast Music Inc.. (BMI), a group that collects royalties on behalf of songwriters and publishers. Hanna Pantle, a BMI spokeswoman, told CNET today, "We are in active and positive negotiations with Apple for the performance right of our repertoire." At a time when many iTunes users favor YouTube to sample and discover music, a longer sample seems like a no-brainer. In its note, Apple said, "We believe that giving potential customers more time to listen to your music will lead to more purchases."But some in the music industry have grumbled in the past that Apple should compensate rights owners for the previews. "It's like giving away ice cream samples--someone has to pay the cost," said Rick Carnes, president of the Songwriters Guild of America. "I think it would be a good thing for consumers to go to 90 seconds. But they're tripling the amount of time, and they want it for free. I think there ought to be compensation. I believe anytime you use music, you ought to reward the people making the music."
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