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Apple May Be Making Verizon-Compatible iPhone
I'm not surprised that, as the Wall Street Journal reports, Apple could go into production on an iPhone that works over Verizon Wireless's network as soon as September 2010. In fact, I would wager that Apple has continuously maintained a working prototype of a CDMA-network version of the iPhone, given how Apple hedged its bets on the Macintosh processor front and Apple's sometimes stormy relationship with AT&T. (The article mentions just Verizon, but Sprint Nextel also has a national CDMA-based network, and has a bilateral roaming relationship with Verizon.)
There's no technology or patent bar that prevents Apple from making a CDMA version of the iPhone separate from the GSM model it sells worldwide. CDMA is used primarily by Verizon Wireless and Sprint in the United States, South Korean carriers, and in smaller markets worldwide. GSM is the dominant standard with as many as eight times the subscribers around the globe.
Rather, as I wrote eight months ago in "Why AT&T Has a Lock on the iPhone (26 June 2009)," Apple didn't then have a close relationship with a chip maker that created CDMA radio silicon. That wasn't insurmountable, but we know Apple's penchant for secrecy, and any new partner would have to keep things just as quiet as Infineon did for its role in the original iPhone and subsequent models.
In that article, I wondered if it would make sense for Apple to pursue CDMA customers, even though Verizon and Sprint have a combined 140 million subscribers, including some using Sprint's old Nextel iDen network standard. The clock is ticking on 2G and 3G CDMA, as both Verizon and Sprint have committed to different 4G standards.
Verizon is going with LTE, the same as AT&T and most carriers worldwide; Sprint chose WiMAX, which it's deploying already via its Clearwire division. Sprint just announced its first 3G/4G phone - an Android model - due in a few months and targeted at heavy video users. LTE-based phones aren't likely until 2011 at earliest.
In five years, LTE will be available nearly everywhere that 3G is now in the United States with far greater bandwidth and reach; WiMAX's future is less certain, but it's highly possible it will also cover the United States. (Sprint and Clearwire's current plans are to pass 120 million people with WiMAX by the end of 2010; Verizon is more aggressive about stating it will have full 3G overlay coverage with LTE in a few years.)
But it has become clear since I wrote that article that 2G and 3G networks will be around for quite a while still, partly because hardware made for them will get cheaper and cheaper, and 4G networks will drain off higher-bandwidth users and usages, even as 3G network capacity is being improved.
It makes more sense to me now that Apple would want a CDMA phone that it could sell for several years, upgrading all the while, rather than sitting out of that market, letting Google's Android and potentially Windows Phone 7 Series dominate the CDMA networks.
If a CDMA-capable iPhone appears later this year, when and how Apple makes it available becomes merely a matter of negotiating the desired details with Verizon or Sprint, rather than requiring a technological miracle or a radical rethinking of its strategy. In several markets, Apple already sells the iPhone to competitive carriers. Wouldn't that be nice in the United States, too?
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There's no particular technical reason against it, but the cost of integrating to separate, incompatible technologies that would likely require separate support chips is a lot higher than making a separate model.
From the carrier perspective in the U.S., which is the real customer of most American-oriented phones, it's better to have lock in to a network, anyway.
In other countries, you have more flexible deals about buying and using phones, but in many countries all the carriers use the same standard, so there's a certain amount of portability built right in.
From the article: It supports 3G EV-DO Rev. A networks in North America, as well as 3G UMTS/HSPA (2100Mhz) and quad-band EDGE/GPRS/GSM networks abroad.
"Per other articles written at this site and elsewhere by yours truly, it is extremely probable there will be no Verizon nor Sprint CDMA-based iPhone (although expect an LTE one in 2012). T-Mobile is a candidate, but we haven't heard word one leaked about that."
Now you say you're not surprised that Apple could go into production on a Verizon CDMA iPhone as early as September. What changed?
However, with all the specifics in the Journal article about a CDMA phone (a manufacturer and delivery date), it seems like Apple is well along in the process. I expected more leaks because the CDMA world involves fewer players and I didn't think Apple could keep a lid on it.
The issue for me was never whether Apple could make the phone, but whether it was poised to do so. I figured without any leaks in 2009, it wasn't ready in 2010. They may be.
I also didn't think a couple days ago about the issue of Android and Windows Phone 7 Series. Those two platforms, along with the perennial favorite BlackBerry, will dominate CDMA. Apple may not like to give its competitors an edge by letting them own Verizon among them.
The last thing apple wants to do is cut the price of the phones. Competition would do that.
They would probably have a lot of dissatisfied customers on CDMA who suddenly get mad that the phone doesn't live up to earlier claims.
Apple may not want to risk that bad publicity. It's not like they're having a hard time selling these things as it is...
I think the CDMA rumors are just a way of putting pressure on AT&T.
One of the biggest problems with a CDMA phone would be the bifurcation of not just the manufacturing, but the marketing, training, and support. Asterisks everywhere.
(I've seen daringfireball.net also make the same error.)
1G networks were operated for years after they were cost effective to run because of deals carriers had for CDPD (very low speed packet data), rural markets, and some FCC deals. AT&T wasn't able to turn off 1G until 2009, which is how it freed up 850 MHz spectrum to better 3G in-house/building penetration.
What I meant is that I thought the plan last year was for an aggressive move into 4G networks so as to move the money there, and eventually keep 2G/3G running as a legacy system that paid for itself.
Instead, it's become quite clear to me this year that 2G/3G will be cash cows, and carriers will be scrambling to bring users onto 4G networks, partly due to initial minimal coverage, and a lack of viable voice options.
Unless Verizon gives Apple this control we'll never see the iPhone on their network.
I have seen nothing that even hints they (Verizon) are willing todo this.
With all that Verizon did to market the Droid, it took them 4-5 months to sell as many as iPhone 3GS sold in its first weekend.
If Apple offers them a CDMA iPhone, there would be a lot of pressure on them to take it on Apple's terms.
There are a couple of things at work. Verizon has always insisted on control and squeezing its users for every penny. I can imagine Verizon insisting on Apple having to use its VCast store or to allow Verizon to allow certain features, but not others.
I see two things converging on this: Verizon is realizing that the good ol' days when carriers had the power to decide which phones could use their network and the features these phones would have are long gone. Verizon is probably more flexible than they use to be.
The other is that Verizon's LTE rollout is delayed. Verizon which owns most of Verizon wireless has spent countless billions of dollars rolling out FIOS and the company is in a lot of debt. There isn't the money for a grand LTE rollout, so CDMA will be around for a while. Apple was suppose to be waiting for LTE before granting Verizon the iPhone. Now, with Android and the delay, there isn't time to wait.
LTE has not been delayed per se. It's actually happening faster than most people predicted a couple years ago. Back in 2008, there was little expectation of phones before 2011 or 2012, and now it looks like there may be phones in 2011. I personally thought we'd see mid-2011 for any production deployments (which is more like AT&T's plan).
The big problem with a CDMA iPhone is Apple has to build proprietary (and obsolete) hardware and then support it, deal with consumer confusion, multiple SKU's,different bandwidth and battery ratings, and so on. If the Verizon iPhone was just an iPod touch in a case then it doesn't get in the way of the actual iPhone at all. It's just yet another iPod accessory.
Or if you put the iPhone in the CDMA case you'd have a phone that worked on Verizon in the US and GSM internationally, for users who want that.
A lot of Verizon/Sprint subscribers apparently already have iPod touch along with a feature phone and might jump at a way to unite their 2 devices.
Really, Apple just has to engineer a CDMA module into the guts instead of a GSM module. The modules are tiny, just a few chips.
More of concern would be all the firmware/OS stuff to make call handling work identically, and to deal with what commenters have noted here: the lack of simultaneous voice/data access in EVDO.
As to obsolete, as we've talked about here in the comments, the 4G networks that are coming won't be replacements for 2G or 3G any time soon. It might be 10 years or more before you see most voice traffic handled over 4G.
If 2G/3G CDMA is obsolete, then so is 2G/3G GSM, which it's not...