Development issues may cause later-than-expected debuts of 'iPhone 5S,' low-cost iPhone & next iPad mini

The bulk of Apple's 2013 product pipeline will likely launch later than many market watchers expect, according to one insider, due to a variety of complex development challenges associated this year's anticipated iPhones and new iPad mini.

Ming-chi Kuo of KGI Securities, who has a strong track record in revealing Apple's future product plans, shared a research note with AppleInsider on Thursday that suggested Apple's so-called "iPhone 5S," a rumored low-cost iPhone, and a second-generation iPad mini will all launch later than market consensus expects.

These apparent delays are driven by a variety of issues, according to Kuo. For the "iPhone 5S," he said Apple plans to include a fingerprint sensor that poses a number of technical challenges.An "iPhone 5S" fingerprint sensor, Retina display for next iPad mini, and ultrathin plastic casing for low-cost iPhone are expected to cause production challenges for Apple.

"Apple has to work out how to prevent interference from the black and white coating material under the cover glass," he said. "Apple is the first to attempt this function and technology, and time is needed to find the right coating material, which will likely affect iPhone 5S shipments."

Kuo has previously claimed that Apple plans to integrate a fingerprint sensor beneath the home button the next iPhone. This new technology would allow users to bypass password entry, and could also allow Apple to integrate secure e-wallet functionality.

Another hold-up for the next iPhone, according to Kuo, is the development of iOS 7, Apple's anticipated next-generation mobile operating system. The analyst said Thursday that more time is likely to be needed for software development and testing, particularly with respect to the fingerprint scanning functions that will be included with the software.

As for the rumored low-cost iPhone said to be in the works at Apple, Kuo said Apple faces challenges with the casing on the device. He expects that the low-end iPhone will have a plastic casing that will be slimmer than such casings regularly are.Analyst Ming-chi Kuo correctly predicted the bulk of Apple's 2012 product lineup. This year, he sees iPhone and iPad sales shrinking to single-digit growth in the third quarter because of apparent behind-the-scenes production delays.

"The slimmer casing may make it more difficult to ramp up production yields of coating and surface treatment, and could slow down the shipment timetable," he said.

Finally, Kuo said the "iPad mini 2" faces challenges with its display panels, as he expects Apple will opt to include a high-resolution Retina display with the second-generation device. This is expected to make the device more difficult to manufacture, which could delay shipments.

As a result of these issues, Kuo said it's likely that Apple will see single-digit growth in iPhone and iPad shipments in the third quarter of 2013. That would be well below the market consensus, which sees Apple growing its sales by between 30 and 40 percent with the introductions of new products.

KGI Securities' previous roadmap, shown here, called for earlier launches of Apple's "iPhone 5S" and "iPad mini 2."

Last year, Kuo was the first to detail a number of major changes to Apple's product lineup, including thediscontinuation of the 17-inch MacBook Pro, and that Apple would continue to sell the legacy MacBook Pro with disc drive alongside a new, thinner model inspired by the design of the MacBook Air.

Kuo also accurately forecast Apple's entire fall product lineup, including unexpected products like a redesigned iPod nano and tweaked fourth-generation iPad with faster processor and Lightning connector. The analyst also revealed months before the new, thinner iMacs were announced that the redesigned all-in-one desktops would be in short supply. Availability of the iMacs proved to be so constrained that Apple experienced supply issues well into 2013

Hackers could start abusing electric car chargers to cripple the grid, researcher says

If we don't start securing systems today, it will become a problem in 10 years, the researcher said

Hackers could use vulnerable charging stations to prevent the charging of electric vehicles in a certain area, or possibly even use the vulnerabilities to cripple parts of the electricity grid, a security researcher said during the Hack in the Box conference in Amsterdam on Thursday.

While electric cars and EV charging systems are still in their infancy, they could become a more common way to travel within the next 10 years. If that happens, it is important that the charging systems popping up in cities around the world are secure in order to prevent attackers from accessing and tempering with them, said Ofer Shezaf, product manager security solutions at HP ArcSight. At the moment, they are not secure at all, he said.

   

An EV charging station in Amsterdam

"Essentially a charging station is a computer on the street," Shezaf said. "And it is not just a computer on the street but it is also a network on the street."

Users want their cars to charge as quickly as possible but not all electric cars can be charged at once because the providers of charging stations have to take the local and regional circuit capacity in mind, said Shezaf. "Therefore we need smart charging," he said.

But installing smart charging systems means that the charging stations on the street need to be connected, so the amount of energy is distributed in such a way that electricity grids are not overloaded, he said. But when charging stations are connected, multiple charging stations can be abused if an hacker can access them, Shezaf said.

The easiest way is to physically access the charging stations. "There are systems on the street and it is very easy to access the computer," Shezaf said. "When you get to the equipment, reverse engineering it is actually a lot easier than you think."

Hackers could take apart the systems to determine components and analyze and debug the firmware, he said. By doing this they can potentially spot convenient eavesdropping points and get encryption keys, Shezaf said, who added that he based his research on public sources, and in most cases on documentation from vendors' websites.

Charging stations can be configured by opening them, placing a manual electric DIP switch to configuration mode, connecting an Ethernet cross cable and firing up a browser to get access to the configuration environment, he said. In at least one type of charging station this kind of access doesn't require any authentication, Shezaf found. "You go and open the box with a key and that is the last security measure you meet," he said.

Office for iPad in 2014? Big mistake

Microsoft roadmap for future releases of its Office suite showed a fall 2014 launch date for Office on Apple's iOS and Google's Android mobile operating systems, an online report said today.

Mary-Jo Foley, who blogs at ZDNet, citing an unnamed source and an unpublished timetable, pegged the long-rumored, long-expected Office for the iPad and Android tablets as appearing in Oct. 2014, or 18 months from now.

Other milestones spelled out in the alleged roadmap, said Foley, included an Oct. 2013 refresh to Office 2013 and Office 365 -- part of the "Blue" project to kick off a faster development and release tempo -- and an April 2014 debut of a new version of Office for Macs.

But it was the date for a tablet-ready Office aimed at iOS and Android that drew the most attention.

"That's too late for Office on iPad, the market is moving too fast," said Frank Gillett, an analyst with Forrester Research, in an email today. "It would be a mistake. Users and software vendors will have solved the productivity document issue by then -- Google's buy of Quickoffice is a strong indicator of that -- and it will cause customers to drift away from Microsoft."

Google acquired Quickoffice in 2012, and rolled that firm's development team into the Google Apps group. Last week, Google launched -- the latter for both smartphones and tablets -- for Google Apps for Business customers, the cloud-based suite that costs $50 per user for a one-year subscription. Google issued a similar free app for the iPad in late 2012.

Bob O'Donnell of IDC also viewed an Oct. 2014 ship date as a blunder.

"That's the wrong choice," O'Donnell said in a Wednesday interview. "At the end of the day, Microsoft has to decide whether they are a Windows company or an Office company. They have to come to terms with that."

From O'Donnell's perspective, Microsoft should lean toward Office, not Windows, because the latter's sales are increasingly dismal. Tying Office to Windows -- as Microsoft has done, and assuming the Oct. 2014 date is accurate, will continue to do -- shuts off a revenue source for Office: Non-Windows devices.

"Increasingly, I think Office's strengths are being weakened by the Windows issues they're having," O'Donnell said, citing weak sales of Windows 8- and Windows RT-powered tablets.

Most analysts and Microsoft-watchers believe that Microsoft has hesitated to sell Office on iOS and Android because the company's Windows group sees the suite as a major selling point for its Windows tablets. Wanting to retain that advantage, the Windows team has blocked the move. Meanwhile, the Office group has likely lobbied for a release sooner rather than later by claiming it can book impressive revenue.

Apple The facts first

A very short reprise of the facts as they've been revealed so far:

"Worldwide PC shipments fell by 13.9% year-over-year during Q1, with higher PC prices and mobile devices also contributing."

All PC makers (including Apple) have been impacted, these figures reveal, though the company continues to hold 10 percent of PC sales. In comparison, HP saw 23.7 percent negative growth worldwide.

"If a new timetable report is accurate, Microsoft's making the wrong move, say analysts."

"A purported Microsoft roadmap for future releases of its Office suite showed a fall 2014 launch date for Office on Apple's iOS and Google's Android mobile operating systems."

Decoding the data

Neither IDC not Gartner (who also published PC market figures yesterday) account for tablet sales as PCs. A third analyst firm, Canalys, does do this, and believes tablet sales will eclipse notebook sales by 2014.

Many critics continue to argue that iPads are not PCs, which is true, but as these devices become more powerful and developers introduce ever more advanced apps, it's clear tablets will pretty soon be equally as capable as any low power PC, at least for the majority of general use.

More sophisticated computational operations will continue to require a PC, but this may end up being nothing more than a remote machine accessed by a mobile device over private or public clouds.

The IDC and Gartner figures also confirm that  and, indeed, has served to slow that market.

Bob O'Donnell, IDC Program Vice President, Clients and Displays:

"While some consumers appreciate the new form factors and touch capabilities of Windows 8, the radical changes to the UI, removal of the familiar Start button, and the costs associated with touch have made PCs a less attractive alternative to dedicated tablets and other competitive devices. Microsoft will have to make some very tough decisions moving forward if it wants to help reinvigorate the PC market."

Disruption in the enterprise

I've written endlessly on this, so I won't repeat myself too much. In brief, the reality across enterprise users is a move to adopt BYOD policy, to establish socially-based collaboration systems accessible via mobile devices, to embrace home and remote working, and a huge transformation in management culture (which is just beginning) which turns away from silo-based management in favor of group-focused working practises.

Autonomy is seen as a route to efficiency in the new management doublespeak, and part of this autonomy is a move to allow employees to choose their own devices. Of course, reflecting consumer trends, Apple is shooting up the enterprise sales charts. Android is being looked at, but most CIOs remain unconvinced by its security model, mainly because, well, because they think what I think on Android security: it sucks.

Windows tablets have failed to interest the rank and file of enterprise workers. This is because Microsoft has made a fundamental error in its approach to business -- the company continues to insist that enterprise culture reflects the antique "Greed is good" autocratic top down management culture, and has failed to recognize the significance of how things are changing.

The significance is that it's no longer enough to convince the CEO or CIO to adopt Microsoft products, you must also convince an increasingly autonomous workforce to adopt these things, too.

[ABOVE: It's not as if it isn't already happening. Wouldn't it look better to Microsoft if the solutions were Microsoft? (Office 365 doesn't cut it)]

Customer experience

One obvious way in which Microsoft could keep its key enterprise customers happy might be to deliver good customer experiences to the platforms they are on. Given the importance of its business productivity suite, Office, and its historical importance in underpinning Windows sales, it makes sense to deliver Office to as many platforms as possible, given the new diversity in enterprise systems.

Except this isn't what is happening.

Instead, Microsoft, with its anachronistic worldview, believes that by making Office software unavailable to users of other mobile platforms, it can leverage this lack in order to create future demand.

This isn't going to work.

The advantages of Office are being eroded. Increasingly people do business in different ways. Alternative applications and services that can create documents, spread sheets or whatever in Office-compatible formats now exist. These don't have the hegemonic market share of Office, and probably never will, but given Office is the one thing Microsoft has that everyone might want, it's Microsoft's perfect calling card with which to convince people to have a little faith in its other products.

In other words, as the company's core markets -- and indeed the wider consumer markets -- adopt different platforms, Microsoft doesn't have a challenge, but a huge opportunity.

Were the company to introduce good versions of Office for the plethora of other devices, it would create new revenue, create good feeling, and, if the software's liked, stimulate interest in its other products.

However, by making its customers wait until some indeterminate point next year, Microsoft looks like it isn't watching what's happening, isn't interested in serving the needs of its customers, and looks out of touch. These steps encourage disinterest in its products. These actions drive its customers -- including its precious enterprise customers -- to look elsewhere.

By adopting this path, Microsoft is signing its own death warrant.