iPhone 5 rumour rollup for the week ending July 27

We have a rumour of our own! Plus September dreams and more

The iOSphere roiled over September hopes, and The Rollup contributes its own exclusive rumor from a Trusted Source, natch.

Also this week: fresh "worries" over a shortage of 28-nanometer chips, how iPhone 5 is depressing Apple's stock price, why the Next iPhone will be a colossal disappointment, and rescuing your 30-pin iPhone accessories.

You read it here second.

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"Leaked snaps indicate that although the next iPhone is going to be taller and thinner, its look and feel will remain largely unchanged from the iPhone 4S. Which, you'll not need reminding, itself retained the design of the iPhone 4, a phone that's now over two years old. That's aeons in smartphone years."     -- Jonathan Leggett, uSwitch.com, explaining why the most successful product design in Apple's history ensures that when Apple unveils iPhone 5 "you'll be able to see the sense of disappointment from space."

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Exclusive: iPhone 5 will be announced in September

The Rollup is proud, and pleased, actually thrilled, to present its first, and exclusive, rumor contribution to the iOSphere.

THE HIDDEN iPHONE: New photos from early 2006 show Apple's design tinkering

First, we present the rumor in the style of the Worst Best iPhone Rumors:

The Rollup has learned, exclusively, and from a trusted source, that Apple will announce iPhone 5 in September.

Our source was reliably informed of the date by someone who had a frank exchange with a Apple technical expert about iPhone issues. At the conclusion of the exchange, this person asked point blank, "When is the new iPhone coming out?"

"He stuttered for a moment and put her on hold for about a minute," according to the trusted source, who was an earwitness to one half of this exchange. "He came back and said the newest iPhone would be released in September. He did not have a specific date."

This clear statement, from an Apple employee in a position to know, means the Next iPhone will not be released in August. Or in October.

Further, it means Apple is clearly responding to the economic pressures created by Samsung's smartphone success, the rise of Android, the falling demand for the current iPhone as a growing number of buyers delay their purchase in expectation of iPhone 5, the European debt crisis, and the recent Supreme Court decision on Obamacare.

Apple is not stupid, people! The September announcement, surely to be followed by the release of the phone within a couple of weeks, means that Apple will have nearly one entire quarter to flog the new phone and convince many of us of what we already know: that it's truly magical, even if it does turn out to be the iPhone 4S+.

With the September release date now a certainty, we can confidently know that Foxconn factories in China are already in production mode, cranking out the phones. It's only a matter of time before we see blurry gray-and-blue photos that show white-suited Chinese worker bees manufacturing something roughly the size of the iPhone 5; and unfocused shots of some shipping manifests translated into English from Japanese from Chinese that in all likelihood document cargo flights carrying The Precious to the New World.

[Imagine the story extending several more paragraphs with a breathless recap of long-rumored new features, a litany of iPhone and industry factoids, and insufferably smug revelations on the thought processes of Apple.]

Our information has been conclusively confirmed by the French site App4Phone.fr, which [via Google Translate] "obtained information from a Chinese source that specializes in the manufacture of accessories (one of the three largest factories in Hong Kong), who would have received from some Apple specifications technical apparatus on its future and its specific release date," specifically Sept. 21, 2012.

One could never have believed until now that hubris could feel so exquisitely pleasurable.

So, what lies beneath this exclusive rumor?

A reader sent an email. "I have an interesting bit of info you may be able to use," he wrote. "My wife's iPhone 3GS recently got dunked in soda and hasn't been working right. She called Apple support for some guidance. (They answered her questions.)"

(Of course they did: Apple is one of the few computer makers that consistently rates high in customer service. Although in this case, the answers didn't actually help much. "Her phone got accidentally drowned in cola when a cup leaked in her car," according to her husband. "Amazingly, she can still send and receive calls though her screen is nearly dark. She needs a flashlight or sunlight to see the screen. I am really surprised the whole phone didn't crash!")

"Well, at the end of the call, she asked the representative when the new iPhone would be coming out," he added. "He stuttered for a moment and put her on hold for about a minute. He came back and said the newest iPhone would be released in September. He did not have a specific date.

"Now, I don't know if the rep was given accurate information or not but I was surprised to hear an approximate date from Apple themselves," he remarked.

"Surprised" as in "amazed, astounded, awed, bewildered, blown away, bowled over, confounded, confused, consternated, dazed, dazzled, discomfited, disconcerted, dumbfounded, and about 28 other synonyms for OMGLOLOMG!

There you have it: the alchemy of iOSphere rumoring. You read it here first. [Hat tip to Todd G, and spouse, both iPhone 3GS users, in southern Texas.]

iPhone 5 is lowering Apple's stock price and that's good news

Apple missed Wall Street's expectations for its third quarter, triggering a slide in its stock price to "just" $575.80 last Wednesday. Blame the iPhone 5, says Reuters.

Some stock analyst lowered their target prices for Apple's stock, but most see this sell-off as a buying opportunity, according to Reuters.

Revenues were off in part due to the weak European economy, and in part due to customers deciding to delay buying the current iPhone 4 ahead of the upcoming announcement of the Next iPhone.

From Reuters: "'Owning Apple ahead of iPhone product cycles pays off,' Morgan Stanley analyst Katy Huberty wrote in a note, referring to the stock's usual post-launch bump. 'This is likely one of the last buying opportunities ahead of the iPhone 5 launch as we expect headwinds to reverse in the calendar fourth quarter.'"

And to reverse in a big way. "Apple shares are famous for climbing new highs after product launches -- even though many of these debuts are well anticipated by industry insiders and Apple enthusiasts," Reuters noted. "They have risen 13 percent since the launch of the new iPad in March this year and more than doubled since the iPhone 4 debuted in June 2010."

J.P. Morgan analyst Mark Moskowitz raised concerns about the "greater-than-expected decline in the average selling price (ASP) of the company's products and the slowdown in its China business. Overall margins have been falling as sales of the iPad -- less profitable than the iPhone -- go up." Reuters again: "'The accelerating rates of decline in blended ASPs of iPhone and iPad, as estimated by the J.P. Morgan IT Hardware research team, could imply that Apple is being forced to test price-elasticity to drive incremental demand,' Moskowitz warned."

Rollup thinks Moskowitz means something like price-cutting, but not Walmart style. Apple consistently has lowered the price of certain models of prior iPhones and iPads, over time, creating a range of price points for differing product generations, compared to prices for the newest phone or tablet model.

iPhone 5 will be in short supply because of a lack of 28-nanometer "chips"

There seems to be less to this than meets the eye.

"Worries about whether Apple's iPhone 5 will be delayed due to a shortage of 28 nanometer processors are surfacing again," according to Larry Dignan, ZDNet editor in chief, in a post that picked up on a summary at Taiwan-based WantChinaTimes.com, of the original story in Shanghai's First Financial Daily.

The basic thrust of all this referencing is the contention that Apple will or might or "is set to" delay iPhone 5 because of the shortage of the advanced 28-nanometer chips.

But it depends on which 28-nanometer chips. iPhone 5, like most mobile devices, has a lot of chips. Qualcomm earlier this year said it was facing challenges in meeting customer demand for the advanced chips, but there seem to be two types: CPUs and cellular baseband chipsets. Dignan doesn't help matters because he doesn't clearly distinguish between them.

Qualcomm offers its highly integrated Snapdragon CPU, and is bringing this chip out in 28 nanometers. But Apple relies on Samsung to build its iPhone/iPad CPUs, the Apple-designed A series chip. Apple relies on Qualcomm for the cellular baseband silicon, and the 28-nanometer process is critical because it promises more power-efficient chips for LTE, which today can quickly drain smartphone batteries.

"In other words, if someone is gobbling up all the 28nm chips in the supply chain it's likely to be Apple, which has the clout to ensure it has components for the iPhone 5," Dignan declares. "The most likely outcome: The iPhone 5 will launch in October, but supplies will be tight for a few months."

This explains away more than it explains.

A very thorough June 2012 analysis, "What the 28-Nanometer Shortage Means for the Chip Industry" by Brian Colello with the investment research firm Morningstar, argues the shortage is due to a surge in orders from smartphone chip-makers for 28 nanometer silicon, stretching the capacity of the big Asian chip foundries.

Qualcomm is one of those vendors, seeking the advanced chips both for its CPU line and its LTE-compatible baseband chips.

Colello: "We suspect that Qualcomm's LTE baseband chips will be used in Apple's upcoming iPhone 5, and that Qualcomm will need to rely on 28 nm manufacturing in order to provide Apple with sufficient energy efficiency from these baseband chips, as poor battery life has been a common customer complaint for previously launched LTE-based smartphones."

He notes that Qualcomm "has long maintained a diversified foundry strategy, and it will seek to source 28 nm chips from other foundries."

Partly in response, the foundries doing 28-nanometer chips have jacked up their 2012 capital spending, by billions of dollars, to expand capacity as fast as possible. And the market dynamics are prompting greater competition and flexibility to meet the higher demand.

In other cases, Colello says, though this doesn't apply to Apple, chip-makers like Qualcomm can package larger discrete chips to meet the CPU requirements of some other markets, in effect delaying the introduction of 28-nanometer silicon until foundry capacity catches up.

Colello seems to think that the industry will work out the supply issues over the next few months at least enough to meet most of the 28-nanometer demand for 2012.

If that's the case, then iPhone 5 won't be delayed and may not even be "constrained" as Dignan puts it, or at least not constrained by a lack of 28-nanometer LTE baseband chips.

iPhone 5 will be a: disappointment, largely unchanged and much more

Jonathan Leggett, writing at uSwitch.com, is overflowing with outrage, in a post titled "iPhone 5: 5 reasons why it'll be a disappointment," warning readers that the Next iPhone is "not the hero handset you're hoping for."

An undeservedly close reading, however, shows it's actually only 3 reasons, all of which have the most tenuous connection to facts.

Though iPhone 5 will be taller and thinner, "its look and feel will remain largely unchanged from the iPhone 4S ... a phone that's now over two years old," Leggett asserts. "That's aeons in smartphone years."

Aeons. As in the pre-Jurassic Phone Period. Even before it's been announced, it's boring. By contrast, Android phones have been introduced with humongous screens "that blur the line between tablets and smartphones." And we know how successful they've been, eh? And let's not forget those "innovative pebble-shaped form factors." Leggett calls these "sea changes" in smartphone design. But Apple? "Apple's design department seems to have stood still," he sneers.

Reason 2 is that "Apple could once again fail to manage expectations" for the iPhone. In other words, because Apple refuses to talk to people like Jonathan Leggett, rumors run amok and credulous consumers, who will believe anything, think the Next iPhone will be heroic and legendary and magical. "The iPhone 4S left many tech fans crestfallen partly because Apple allowed the hype whirlwind around the phone to blow up to [Hurricane] Katrina proportions," Leggett intones.

Leggett claims that Apple took a different approach to iPad 2 rumors that it would have a Retina Display. "Apple got in touch with select tech sites and leaked info to put them right about it. The result? Punters adjusted their expectations accordingly and were grateful for what they got, not what they didn't." But Leggett doesn't cite or link to any evidence for this claim, which runs counter to Apple's famously leak-proof corporate culture.

He simply asserts that the current state of iPhone 5 rumors "could mean that Apple hasn't learned it's [sic] lesson and is allowing the rumour mill to stir up expectations that the phone won't fulfil.[sic]" He warns darkly that such a "PR mistake that might not hurt sales in the short term but could do real damage to the company's reputation in the long run."

Rollup isn't quite following that logic: Unmanaged expectations mean everyone thinks iPhone 5 will be a hero handset, only to discover when it's announced that it's not, yet though disappointed, they buy it anyway, and later inevitably conclude that Apple screwed them over. Or something. So iPhone 5 will be a failure because Apple didn't announce it before they announced it.

The other reasons why iPhone 5 will be a bust are:

+ rumors after Steve Jobs' death that he was deeply and directly involved in designing iPhone 5, so it's "Steve's Last Phone" and will therefore be "legendary" (this is clearly a variant of the failure to manage expectations claim);

+ the "old-fashioned" design of the iPhone, with its small screen compared to rivals like HTC Sensation, Galaxy S2, and now even bigger, newer Android phones (this is essentially the same point Leggett made at the outset);

+ Apple's rumored decision to create a new type of port, which means existing peripherals won't work with the Next iPhone, a "seismic change with what we're guessing will be predictably angry consequences."

"Sure, Apple will probably manufacture an adaptor," Leggett acknowledges, apparently unaware that he's now talking about a less-than-seismic change. "But we're equally sure that you'll need to shell out extra for it. And we're even more sure it'll sell at the kind of premium price mark-up for which Apple is famed." Leggett repeats his point with "premium price mark-up" for those people who don't know what "shell out extra" means.

Seriously, what else can one expect from arrogant, dumb, short-sighted, Stone-Aged, price-gouging Apple?

iPhone 5 will have an adapter for the new, smaller dock connector

Speaking of that new dock connector, iMore declares that Apple will indeed offer an adapter so that the new iPhone will be able to work with most if not all existing peripherals.

Rumors have been circulating for months that the Next iPhone will have a 19-pin dock connector to replace the 30-pin connector that's been in place since the original iPhone. The decrease in size will free up a chunk of space inside that Apple could use for goodies like LTE, batteries and so on.

"iMore reached out to the original sources that gave us the new Dock connector story way back in February just to make doubly sure -- and yes, there will be an adapter for the iPhone 5's smaller Dock connector that will let it work with many of the accessories designed for the old 30-pin Dock connector," writes iMore's Rene Ritchie.

"We haven't heard if one will be included in the box along with the iPhone 5, or will only be sold separately, but either way, come October, you'll be able to get a new-to-old Dock adapter from Apple," he assures readers.

"Apple has done this recently with the MagSafe to MagSafe 2 adapter, and in past years with a variety of other display adapters," Ritchie notes. "Of course, there will likely be some accessories that, due to the physical size or shape, are awkward or impossible to use with the Dock connector adapter, but anything that doesn't require tight, flush contact should be okay."

Even if you do have to pay a "premium price markup" for it.

John Cox covers wireless networking and mobile computing for Network World. Twitter: http://twitter.com/johnwcoxnww Email: john_cox@nww.com Blog RSS feed: http://www.networkworld.com/community/blog/2989/feed

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