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Apple reported record breaking profits for the three months to 31 December 2011 of £8.36 billion ($13.06 billion)- more than doubling  up 118% from the same period in 2010.The company also sold 37 million iPhones- more than twice as many as they sold in the last quarter of 2010.

“Apple’s momentum is incredibly strong, and we have some amazing new products in the pipeline,” said chief executive Tim Cook.

The firm is expected to release its iPad 3 in March this year.

“We are very happy to have generated over $17.5bn in cash flow from operations during the December quarter,” said Peter Oppenheimer, Apple’s CFO.

“Looking ahead to the second fiscal quarter of 2012, we expect revenue of about £20.96 billion and we expect diluted earnings per share of about £5.48 ($8.50).”

Apple saw strong sales for both its iPads and its Mac range of computers, rising 111% and 26% respectively compared to the same period in 2010.

Software installed on millions of Android phones is thought to be secretly tracking every key stroke, Google search, and text message by their users, it has been claimed.An Android app developer in America has posted a video showing what he claims is ‘conclusive proof’ that ‘Carrier IQ’ software installed by manufacturers of many US phones records the way those phones are used in real time, as well as their geographic locations.

Carrier IQ has claimed that the software only tracks information for the benefit of users, not for any spying purposes, and that it is “counting and summarising” information rather than recording it.

However, in a YouTube video the developer, Trevor Eckhart, did a “factory reset” on his Android phone, returning it to the condition in which it is shipped to customers, and linked it to a computer screen which allegedly displayed what the Carrier IQ software was tracking.

The demonstration shows that the software reads every keystroke put into the phone, as well as every text message sent to it. It also appeared to log location data, and transmit this to Carrier IQ.

Mr Eckhart, claims it is used by manufacturers of phones that use Google’s Android operating system, as well as some BlackBerry and Nokia handsets. It is not thought to be used in Apple’s iPhones.

It is not known if Carrier IQ is in use in Europe, where it might present a serious breach of the Data Protection laws.

A source at a leading mobile operator said his company didn’t install it but that he had been investigating whether UK manufacturers had done so and “couldn’t give a definitive answer”.

Everything Everywhere, which runs the combined T-Mobile and Orange groups in the UK, has said that 65% of its contract customers are now using smartphones.The Orange mobile store Everything Everywhere was formed as a joint venture between Germany’s T-Mobile and France’s Orange

The company siad that it’s user base was stabilising, after losing 227,000 pay as you go customers but gaining an extra 185,000 contract users in the three months to September.

It said 85% of these new contract customers were choosing smartphones.

It blamed new Ofcom regulations which cap charges between providers for a 1.9% fall in revenues to £1.55 billion.

Without the cuts the firm said underlying revenues grew by 3.8%.

Ofcom introduced price capping regulations on mobile termination rates in April 2011.

Mobile termination rates are charged when a call is finished on a different network to the one the call was made from.

Everything Everywhere is Britain’s largest mobile phone company with over 700 retail stores and 27 million customers in the UK.

The watchdog regulator Phonepayplus, has issued plans for more protection for consumers from rogue traders in the UK phone industry.PhonepayPlus is the organisation that regulates phone paid services in the UK

The premium rate regulator has uncovered two cases of smartphone apps charging users without their knowledge or consent.

In one case an app automatically sent and received text messages that could cost the user £4.50 each.

It was shut down by the regulator.

Now Phonepayplus has started 10 week consultations on app based mobilw payment proposals that consumers’ consent to charge is clearer, password requirements are strengthened to prevent children buying items, and there is more explanation of the cost of virtual credit.

“We need to be nimble and flexible in our approach. We know that the best regulation is one that works collaboratively with industry to pre-empt problems that harm consumers and damage markets,” said Paul Whiteing, Phonepayplus chief executive.

“We will not hesitate to use our robust sanctioning powers to drive out rogue providers who could damage a vital part of the UK’s growing and innovative digital and creative economies.”

The mobile phone patents wars are escalating as Google is backing up HTC in its continuing war with Apple over patent infringement.HTC has used patents it bought from Google to lodge a fresh complaint against Apple with the US International Trade Commission (ITC).

It has alleged that Apple’s computers and mobile devices infringe patents involving wi-fi capability and processor communication technology.

This is the third complaint that HTC has filed against Apple.

“We are taking this action against Apple to protect our intellectual property, our industry partners, and most importantly our customers that use HTC phones,” said Grace Lei, general counsel of HTC.

HTC is not the only smartphone maker involved in a legal tussle with Apple.

Samsung Electronics, which makes the Galaxy series of smartphones and tablet PCs, has also been fighting a legal battle against Apple.

It is becoming an Apple versus Android war.

Apple has filed complaints against the South Korean manufacturer, accusing it of infringing its patents. It said that Samsung had copied the design and look of Apple’s iPhone and iPad devices.

Samsung has counter-sued Apple, saying it infringed Samsung’s wireless patents.

Both HTC and Samsung use Google’s Android operating system in most of their smartphones.

Analysts said that HTC’s latest legal action, which uses patents it acquired from Google, indicates that the tussle is becoming a much bigger issue than just a simple fight between two manufacturers.

Apple has accused Samsung of infringing its patents with the Galaxy line of smartphones and tablets. The companies have been stepping up their legal action against each other this year.

And in the early salvos, Apple seems to have got the upper hand.

Last month, a court in the Netherlands banned Samsung from selling three models of its Galaxy smartphones in a number of European countries after Apple filed a claim for patent infringement.

Earlier this week, Samsung pulled out its new Galaxy Tab 7.7 from the IFA electronics fair in Berlin, one the world’s largest electronics shows, after a court blocked sales of the product in Germany.

Analysts said the regularity with which these companies have been taking legal action against each other was also an indicator they may be using it as a competition tool.

You’ve built your business’s smartphone mobile app- but how are you going to make money out of it?If you’re thinking of a suitable price tag for it and hoping that it will take the various app stores charts by storm- you could be in for a nasty surprise.

Mobile app downloads are expected to have increased from over 7 billion in 2009 to almost 50 billion in 2012- which works out a growth in revenue from £2.5 billion to £10.9 billion.

But although 80% of the 2009 figure is accounted for by paid apps, by 2012 that is expected to drop by around half.

The rest is made up of a mixture of advertising, virtual goods (things bought within the app environment, such as tools in social games such as Farmville), and other revenue models.

Sometimes giving your app away for nothing may mean a bigger payoff in the future.

Top 5 revenue streams

• Paid apps
• In-app advertising – you get paid for each ad seen
• Virtual goods – for example buying tools in Farmville
• Subscription – charging a monthly fee, for example to access news content
• Marketing – a free app used to promote a product
• Hybrid- free initially then charging for premium content

As such, different business models need to be developed for different types of content. To do this, you need to measure two things – stickiness and utility.

Utility means how much the user values the time using your app.

The general rule is the higher the utility of the app, the more the consumer is prepared to pay for the app up front.

If it’s a relatively simple application, like a web app like chat or messaging, the consumer is less likely to pay anything at all and you have to go for other models.

Stickiness refers to how often you end up using an app – if you ‘stick’ with it.

The majority of games that are only played three or four times and are very unsticky, however some apps like Facebook are extremely sticky.

Stickiness means that advertising might be a good option.

If you have an unsticky app and choose to go with advertising, you will only display it three or four times. As the current rate is £1 for a thousand impressions, you won’t make much.

If you have a high utility but low stickiness you go for a paid app. High stickiness and low utility, like web applications, then advertising is the choice.

Virtual goods – for example things players need to enhance a game – have been pioneered by companies like Zynga, the creators of Farmville.

Considerations include whether your target market can easily pay for things – for example are they underage and have no access to a credit card?

And you need to weigh up the rates taken by the market place for a paid for app with the rates charged for using advertising.

Apple, for example, takes 30% of the face value of every app sold in its iTunes store.

But if you simply want to promote a product – a shiny new BMW, for example – then making your app free and recouping the cost in increased sales is the sensible option, says Mr Laurs.

As long as the app is perceived as free for the consumer then the marketability of the app is generally 50 times higher than any paid app.

It’s obviuosly easier to get consumers converted to free apps than to pay for them. It’s human nature.

Almost half of UK internet users are going online via mobile phone data connections according to the Office for National Statistics.Some 45% of people surveyed said they made use of the net while out and about, compared with 31% in 2010.

The most rapid growth was among younger people, where 71% of internet-connected 16 to 24-year-olds used mobiles.

Domestic internet use also rose. According to the ONS, 77% of households now have access to a net connection.

That figure was up 4% from the previous year, representing the slowest rate of growth since the ONS survey began in 2006.

Among the 23% of the population who remain offline, half said they “didn’t need the internet”.

Household internet access

Year                           Households (millions)                              Percentage
2006                                         14.3                                                        57
2007                                         15.2                                                        61
2008                                         16.5                                                        65
2009                                         18.3                                                        70
2010                                         19.2                                                        73
2011                                          19                                                          77

Northern Ireland excluded from 2011 survey.

Source: Office for National Statistics

The ONS report is the first since dot-com entrepreneur Martha Lane-Fox was appointed as the government’s UK Digital Champion, with a brief to increase internet uptake.

In a statement, Ms Lane-Fox said: “That so many offline households don’t see any reason to get online reinforces the importance of the digital champions network that the Raceonline2012 partners are creating.”

The figure for domestic connections contrasted sharply with the rapid growth in uptake of mobile services.

However, the popularity of 3G broadband did not necessarily mean that more people were going online overall.

Many of those using mobile phones are likely to already have home broadband connections.

Older users, who the government is particularly keen to get connected, appeared to have been relatively untouched by the phenomenon.

While 71% of 16 to 24-year-old who went online said they used mobile broadband, just 8% of internet users aged over 65 made use of the newer technology.

The ONS survey also found a dramatic rise in the use of wifi hotspots – a seven-fold increase since 2011 – suggesting that the rise of 3G has done little to slow demand for free and paid-for wireless access.

All findings were based on a monthly survey of 1,800 randomly selected adults from across the UK.

The increased usage of smartphones has led to an increase in what has long been considered a social faux pas of the highest order, using a phone during a film or a play. – with adults are now almost as guilty of it as teenagers.A new report showed that one in four teenagers and almost one in five adults admitted using their smartphone during a performance.

Ofcom, the communications watchdog, conducted research into how mobile technology was changing habits. People with ordinary mobile phones were far less likely to keep them turned on during a play or film, Ofcom found.

It said the propensity for Britons to use their phones to surf the internet or post messages on Twitter raised issues of “etiquette and modern manners”.

The watchdog found that 27 per cent of teenagers used their smartphones — multifunctional devices allowing access to the internet — in venues where they have been asked to turn them off. Almost 20 per cent of adults also said that they were likely to use their smartphones secretly in supposedly quiet venues.

James Thickett, the director of research for Ofcom, said the high level of smartphone use in venues such as theatres “raises an issue about social etiquette and modern manners and the degree to which we as a society are tolerant of this behaviour”.

Phones going off in the theatre have in recent years become an annoyance for actors. Last month Simon Callow, the actor, said it takes an hour to recover after a phone goes off in a theatre.

Mr Thickett said: “I think what we have found before is that teenagers have always been more likely to use mobile phones in cinemas and theatres. What we are finding now is that for smartphone users, it is much, much higher, but adult smartphone users as well.

So it is not just about adults and teenagers having different values, it is about technology driving the values towards the way you behave in social situations,” he said. The report found that one in four adults and almost half of all teenagers — defined as 12 to 15 year-olds — own a smartphone.

Mr Thickett said smartphones have also altered the work-life balance, with one in four users saying that they would take work-related phone calls while on holiday, compared with just 16 per cent of regular mobile phone users.

Ofcom’s Communications Market Report found that nearly two-thirds of teenagers were “highly addicted” to smartphones, with half admitting using them even in the lavatory. One third of teenagers said that they were likely to use a smartphone during meals, while four in 10 said they answered their phone if it woke them at night.

The phones have also significantly affected how people use leisure time. Almost a quarter of teenagers said they watched less television due to having a smartphone, while 15 per cent say that they read fewer books because of it.

“The rapid growth in the use of smartphones – which offer internet access, emails and a variety of internet-based applications – is changing the way that many of us, particularly teenagers, act in social situations,” said Mr Thickett.

Smartphone use is skewed towards young males in higher social economic groups. However, one in 10 Britons over the age of 55 owns one. BlackBerries are the most popular smartphones among teenagers and students, with their free messaging service, while iPhones are the most popular among adults.

Apple’s new rules for iPad and iPhone apps payments have been criticised after they forced Amazon to change the Kindle app to make buying new books more complicated.The new terms and conditions, which mean publishers must give Apple 30 per cent of the price of any content they sell via apps, came into force on 30 June.

In response, in July, Amazon removed a “Kindle Store” link within its app in order to preserve its profit margin on e-books.

Kindle app users are still able to buy more books, but they must exit the app and navigate to the Kindle Store via the iPad or iPhone web browser.

But the change has left users confused and angry. On the iTunes page for the app, some indicated they didn’t understand the new purchasing process.

“Pointless update,” said SJH31. “Wish I didn’t update now. What’s the point if I can’t buy books.” and “In reality Apple didn’t like the competition and so has hamstrung apps like Kindle. Shameful from Apple.”

Those who did understand the change overwhelmingly blamed Apple.

Apple is competing with Amazon via iBooks, which still allows users to make purchases from within the app. The rule change has forced Barnes and Noble, Kobo and Google to make similar changes to their e-books apps too.

Apple’s rivalry with Amazon is expected to intensify, with the online retail giant reportedly poised to expand its range of gadgets beyond e-readers to include a full colour touchscreen tablet.

Steve Jobs originally announced the new apps payments regime in February.

Apple has since softened it slightly by allowing publishers to charge more for content in apps than they do on their own website, where they do not have to pay a 30 per cent cut to a third party.

Apple announced last week that in just 3 years 15 billion apps have been downloaded through it’s online store.
With a sizeable revenue cut of paid programmes, it has become the accidental goose who has laid the golden egg for Steve Jobs.

And although Apple did not invent the smartphone application, its system has defined the user experience. iOS apps are simplicity at every turn – payment, installation and use.

Others have followed-suit, with great success. Android Market passed three billion downloads in May.

But after a period of rapid growth, native smartphone apps are facing a fight for survival.

That threat comes from web apps – software that runs in a browser rather than being downloaded and installed on the device’s operating system.

Mubaloo, one of the UK’s biggest mobile app developers, estimates that requests from clients for web apps has doubled in recent months – enough to make them the third big player in app development.

The reason for that is simple – developing web apps solves several headaches.

Firstly, like the regular internet, a good web app can be made to adapt to a wide variety of devices rather than forcing the developer to create different products for each platform – be it iPhone or Android, smartphone or tablet.

Secondly, by circumventing the strict guidelines associated with official stores, Mr Mason’s clients can have exactly what they want, and can say for certain when it will be ready for the public.

Should any changes need to be made once the app is live, they can be made instantly, rather than wait several days for approval.

And then there’s the matter of money.

Put an app in the App Store and 30% of each sale goes to Apple. Android takes the same, but the cash goes to payment processors and mobile carriers. Microsoft and BlackBerry also get a cut of what sells in their stores.

Web apps offer developers the chance to cut out the middle man.

If that was not enough of an incentive to fly solo, in February of this year, Apple announced that it would also be taking 30% of revenue from in-app subscription payments.

It is that levy which may have proved be the final straw for cash-strapped publishers relying on a lucrative digital strategy to keep operations moving.

The first major player to adopt a web-apped approach to mobile subscribers was the Financial Times (FT). In June, the newspaper released its debut web app. Since launch it has attracted 200,000 users.

FT bosses have said subsequently that future app development will be focused on web platforms rather than native.

Key improvements in smartphones’ ability to power staple web components mean the FT web app does almost everything the company would expect from a downloaded app – including offline reading.