The Cupertino, Calif., company has ordered key components such as display panels and chips for a new iPad it is aiming to launch in early 2012, said the people.

The next generation iPad is expected to feature a high resolution display – 2048 by 1536 compared with 1024 by 768 in the iPad 2 – and Apple’s suppliers have already shipped small quantities of components for the sampling of the iPad 3. Suppliers said Apple has placed orders for a 9.7-inch screen device.

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But since Steve Jobs has already declared that his new building will be “like a spaceship,” now might be a good time to see how the proposed, but presumably real, building stacks up to some of Hollywood’s actual, but fictional, spaceships. Enjoy:

According to several sources close to the situation, Apple CEO Steve Jobs–who is on a health-related leave from the company–is definitely considering an appearance at its big iPad 2 event tomorrow.

But the possibility–which would be a big sensation at the San Francisco gathering and has been subject to great speculation–is also just as definitely not confirmed as yet, stressed sources.

If he did appear, sources said, Jobs would make at least a brief appearance on stage along with other top company execs in showing off Apple’s latest version of it hugely popular tablet.

The new device reportedly has a sleeker look, as well as a camera and other improvements, changes that tech’s top showman would certainly love to tout and that his legions of fans would like to see him introduce.

But what BoomTown would like to see would be more of a focus on the iPad 2 itself, rather than armchair diagnoses of Jobs’s fitness based on any appearance he might make.

That’s no small thing, given the appalling series of photos and video that have surfaced recently, which show the Silicon Valley icon from the worst possible angle and looking quite gaunt.

As I have written before, and as you can see from the photo above taken at last year’s D: All Things Digital conference interview, it is clear Jobs has suffered due to his bout with a form of pancreatic cancer.

Due to nutritional issues, his weight has suffered, one of the key reasons Jobs seems to have taken this latest leave.

That said, in recent weeks, he has made all kinds of public appearances both at Apple’s Cupertino campus and in Silicon Valley restaurants, including a high-profile dinner with President Barack Obama. Jobs sat immediately to the left of the president.

If he decides to make another outing tomorrow, it is certainly with the knowledge that everyone will be trying to figure out his health from a stage appearance.

That’s a risk for Jobs, of course, who relishes in introducing Apple products in presentations that typically garner well-deserved accolades.

Given how innovative most of those products are, what would be a welcome change in the coverage of Jobs’s personal struggles would be to show a level of respect to him by paying more attention to what bells and whistles the iPad 2 has rather than to how his jeans are fitting.

There is no question, with its latest iteration, Apple is making sure consumers realize that it is coming out with a second, flashier version, even before other manufacturers–mostly using the new Honeycomb version of Google’s Android mobile operating system–are still scrambling to get their initial competing devices to market.

That’s the truly dramatic story to watch here, rather than needlessly rubbernecking about the struggles of one man–albeit, a very significant man–to regain his health.

“Each new product category typically causes a significant shift in market shares,” said Canalys senior analyst Daryl Chiam. “Apple is benefiting from pads, just as Acer, Samsung and Asus previously did with netbooks. The PC industry has always evolved this way, starting when Toshiba and Compaq rode high on the original notebook wave.”

And to those who contend that the iPad and similar devices shouldn’t be tallied in the same category as laptops and desktops?
“Any argument that a pad is not a PC is simply out of sync,” said Chiam.

[Image credit: Gizmodo commenter Ahubbuch]

There will be those who are inclined to try to equate Jobs’s health issues with all kinds of near-term product implications, but such speculation is likely off base. While Jobs’s health may have been a factor in the timing of a couple of announcements, don’t expect his medical issues to substantially impact things like the next iPhone or iPad.

The company overall tends to operate on long lead times, so much of this year’s product plans are likely in the works and probably won’t be deeply affected. Jobs practically said as much in his brief statement.

Also, Jobs leaves Apple in extremely capable hands. Tim Cook has ably led Apple during Jobs’s prior medical leaves, and there is every reason to believe that this time will be no different.

Longer-term, though, is another question. Here is where it is hard to overstate the importance of Steve Jobs at the helm.

While Apple has a company full of talented workers, Jobs tends to be involved in major (and plenty of not-so-major) decisions in almost every area. He is a well-known perfectionist with a strong, sometimes maddening focus on having products done just so.

Those who understand Apple know that Jobs is not just a chief executive–he is also the de facto head of every department. If there is a tough call to be made about a product or a decision on the next marketing pitch, Jobs is the ultimate authority. He’s known to weigh in on all manner of more minor issues too. This attention to making every detail just so can make Jobs a tough guy to deal with, but is also key to a good part of the company’s success.

And even in the short term–although the same products are likely to come from Cupertino, whether Steve Jobs is there to introduce them or not–no one can sell like Steve. There’s a reason that satellite trucks line up for blocks anytime he has something to say.

Update, 1:35 p.m.: Just got done going on MSNBC talking about the situation (video posted below).

Ina Fried talks to MSNBC Dayside about Steve Jobs health
Uploaded by BeyondPixBroadcast. – Videos of the latest science discoveries and tech.

PREVIOUSLY

• Steve Jobs Asked for Privacy–and He Deserves It This Time
• Apple Shares Down Nearly 8 Percent in Frankfurt on News of Jobs’s Medical Leave
• Citing Health, Steve Jobs Steps Away From Apple, Again
• Apple Opposes Proposal on CEO Succession Planning
• Deutsche Bank Joins the Running of the Apple Bulls
• Jobs: “I’m Vertical, Back at Apple and Loving Every Day of It”
• Apple Investors Are Wusses
• When Steve Jobs Said “Stay Hungry. Stay Foolish,” He Did Not Mean This Foolish
• AAPL Sauce
• Apple’s Steve Jobs: “I Have Decided to Take a Medical Leave of Absence”
• The Entire Letter: Steve Jobs Explains His Health Problem: “Hormone Imbalance”–Predicts Recovery by Spring and Will Stay On as CEO
• Ain’t Nobody’s Business If Jobs Is or Isn’t

Or, rather, how has it been responding? Because it’s clear the company has been preparing for this moment for some time. Last year, it accelerated upgrade eligibility for iPhone customers, making it easier for them to get the iPhone 4 when Apple released it. And it locked them all into two-year contracts in the process. And then, last week, it drastically reduced the price of the iPhone 3GS, halving it to $49 from $99.

Presumably, AT&T could follow this with additional pricing promotions that could further limit iPhone subscriber defections to Verizon, though at this point one could argue that it’s as well prepared for its loss of iPhone exclusivity as it will ever be.

Why? Two big reasons:

1. According to Piper Jaffray analyst Christopher Larsen, nearly 80 percent of AT&T iPhone users are currently on family or corporate plans, which makes switching to a new carrier a difficult proposition.
2. Approximately 75 percent of them still have at least a year left on their contracts.

And there’s a third wild-card reason as well: How Verizon’s network fares after a big influx of data-heavy iPhone subscribers. That’s tough to predict, but two analysts I’ve spoken with said they expect Verizon to suffer some network growing pains, though not as bad as the ones suffered by AT&T. Ultimately, Verizon is starting off with a better network, and CDMA is said to be a more spectrally efficient standard than UMTS.

So will there be some AT&T subscribers who switch to Verizon when it begins selling the iPhone? Certainly. But they may not be nearly as large in number as you might think.

“AT&T has done everything it can,” Needham and Co. analyst Charlie Wolf told me this morning. “The company locked in a lot of iPhone owners by waiving early termination fees last summer. It’s moved aggressively to add a bunch of BlackBerrys and Android phones. And it should be remembered that AT&T will continue to sell the iPhone. So I doubt that the loss of subscribers to Verizon will be that large. But it could be material as it pertains to the bragging rights between AT&T and Verizon. “

PREVIOUSLY:

• Why Verizon’s iPhone Won’t Be So Bad for RIM
• How Might the Verizon iPhone Differ From the iPhone 4 (Besides Being Able to Make Calls)?
• Tired: Speculating About Verizon iPhone. Wired: Speculating About Verizon iPhone Sales.
• Verizon iPhone to Debut With Unlimited Data Plan
• Apple CEO Likely to Appear at Verizon iPhone Event
• Verizon Event Set for Tuesday–iPhone Time

But only because those who speculated about the existence of a Verizon iPhone have been struck by a new monomania: Speculating about first-year Verizon iPhone sales numbers.

Indeed, the sales estimates are already rolling out, with the consensus so far hovering between nine million and 12 milion.

“Some think 10 million is possible in the calendar year,” Wedge Partners analyst Brian Blair told me. “And I think it’s a reasonable assumption–not just because of what we’ve seen on AT&T but because you have three years of pent-up demand from users who are loyal to the Verizon network because of its coverage and reliability.”

Gleacher & Co. analyst Brian Marshall agrees, though he’s betting on sales hitting the top end of the range I mentioned.

“The iPhone on Verizon will sell 12 million units in calendar 2011 assuming there’s a ramp-up similar to the one AT&T experienced in 2007-2008 (i.e., 5 percent penetration of the postpaid subscriber base within five quarters of launch),” he told me, adding that AT&T will see a material decline in its iPhone sales as a result.

Taking a more conservative view of the iPhone’s prospects on Verizon is Piper Jaffray analyst Gene Munster, who expects Verizon to activate roughly 25 million smartphones in calendar 2011, of which nine million will be iPhones.

Barclays Capital analyst James Ratcliffe too is betting on that nine-million figure, and of those he expects approximately 500,000 to one million to be purchased by AT&T switchers. Said Ratcliffe, “We don’t believe that the addition of a Verizon iPhone will be a seismic event in the wireless competitive environment, although we do expect it to result in a modest spike in AT&T churn, as customers who love their iPhones but have become unhappy with AT&T’s network take advantage of the alternative.”

PREVIOUSLY:

• Verizon iPhone to Debut With Unlimited Data Plan
• Apple CEO Likely to Appear at Verizon iPhone Event
• Verizon Event Set for Tuesday–iPhone Time

Here’s one way: By offering it with a wireless service plan free of the data caps used by AT&T.

Sources close to Verizon tell me the carrier will offer the iPhone with an unlimited data plan (presumably the same $30 unlimited plan it offers for other smartphones)–though they wouldn’t say for how long. That should distinguish it a bit more from the iPhone on AT&T, which requires a capped plan for data service.

Not that such differences worry AT&T any. “We think customers will prefer AT&T’s faster speeds and better functionality over a CDMA network device,” a spokesperson told me. And he has a point. AT&T’s UMTS network allows the use of data and voice simultaneously. Verizon’s CMDA network doesn’t–at least not yet. So, initially, Verizon iPhone users won’t be able to use the Web or check email while on a call–something AT&T iPhone users have long been able to do.

All Things D reported Friday that the special event Verizon is holding in New York Tuesday will be the carrier’s long-rumored iPhone announcement.

PREVIOUSLY:

• Apple CEO Likely to Appear at Verizon iPhone Event
• Verizon Event Set for Tuesday–iPhone Time

Verizon Wireless’s Tuesday iPhone announcement will be headlined by President and COO Lowell McAdam, but there will likely be a special guest as well.

Apple CEO Steve Jobs.

While the appearance isn’t 100 percent assured, sources in a position to know tell me that, barring any unforeseen circumstances, Jobs will likely join McAdam onstage in New York when he announces the addition of the iPhone to its handset lineup.

All Things Digital reported earlier today that the special event Verizon is holding in New York Tuesday will be the carrier’s long-rumored iPhone announcement.

Update: Apple CEO Likely to Appear at Verizon iPhone Event

And there it is: Verizon will hold a special event at New York City’s Lincoln Center (Frederick P. Rose Hall) on Jan. 11–next Tuesday. No details on its focus, but sources close to the company tell me this will indeed prove to be the long-rumored Verizon iPhone announcement. Question now is will Apple CEO Steve Jobs join Verizon President and COO Lowell McAdam onstage to make it. Remember, while there’s an enormous amount of interest in the Verizon iPhone, this really isn’t much more than a carrier announcement — for last year’s iPhone. If it were more (e.g., a hardware announcement), you can bet the event would be in Cupertino or San Francisco.

Below, the event invite, which I’m posting here despite Verizon’s mandate not to. Just hope it doesn’t result in a personalized data cap.

Palm: Stay the cool kid at Hewlett-Packard, so it’ll keep giving us lots of toys and not merge the smartphone acquisition into the PC unit. Release that tablet we’ve been working on and get our phones out of the clearance section of the stores. Remember to include “and printers” on all our slides when asking for more money.

Microsoft: We were going to copy and paste from last year’s resolutions, but it turns out we can’t copy and paste yet. So, that’s resolution No. 1. But since we’re going to solve that in January, we’ll move on to some other ambitions. Let’s see, open up to more developers, convince developers we’re worth their time, add features, support more networks.

Hmm. Last year’s “Try not to suck so much” is starting to seem easy by comparison.

Research in Motion: Learn some new ways of saying “Everything is great,” so it doesn’t get too repetitive in public speeches. Meanwhile, keep shaking things up behind the scenes. Buy a few more companies. Get some apps for that PlayBook. Find some more really big countries that the other people are ignoring and sell them a boatload of BlackBerrys.

Samsung: Keep going with this whole Galaxy thing–it worked to the tune of about 10 million phones this year. Try to convince Google phone king Andy Rubin to get a tattoo that reads “Galaxy S smartphone.” Remind the carriers that they really did agree to market all our phones that way.

HTC: Good thing we went Android a couple years back, but now we’re kind of glad we didn’t give up on Microsoft. Now, we have to figure out how to convince them to let us customize Windows Phone 7.

Motorola: Keep telling Verizon and Google that they’ve hurt our feelings and see what other perks we can get via guilt. Hey, it worked well with that tablet, didn’t it?

Apple: We are already perfect, so where do you go from there? Follow a magical 2010 with an even more magical 2011. How’s that?

What else? Let’s see. Okay, here’s one: Keep trashing smaller tablets until the day we come out with one.

Google: Release six or seven more versions of Android. Rename “Nexus Tablet You Should Have Made” to something less insulting to the hardware makers. Travel to foreign countries and discover more desserts, because we’re running out of code names for the next version of the tasty mobile operating system.

Nokia: Ship something to the U.S. so they’ll stop making fun of us and realize that we actually do make smartphones. Speaking of shipping, we really should ship some of these products we’ve been talking about for years. Most people are starting to think “Meego” is just a code word we use when we don’t know what to say.

Verizon: Stay on Steve Jobs’s good side. Print iPhone posters on the back of all those Droid billboards from last year. Release a whole bunch of LTE phones, so that the iPhone shelf isn’t lonely in the stores.

AT&T: Work on next-generation networks using that spectrum we picked up from Qualcomm. Talk about how we really love the other non-iPhone smartphones and actually mean it this year, because we have to.

T-Mobile: Keep talking about how we can just keep making the current network faster, while trying to convince the feds to let us have some more spectrum. Make more of those commercials making fun of AT&T. They are funny and it’s so much easier than having to deal with Catherine Zeta-Jones. And lots of Android, along with some tablets too.

Sprint: Find a way to remind people that, while we still don’t have an iPhone, we do have a next-generation network up and running, complete with phones and data devices. Add a 4G tablet or two to the mix. (Hey, Jon Rubinstein, is that PalmPad ready yet?)

Apple.

About a five-minute drive from Apple headquarters, the 98-acre parcel of land is adjacent to 50 acres Apple acquired back in 2006 and will be used to house a workforce that’s expanding nearly as quickly as the market for iOS devices.

“We now occupy 57 buildings in Cupertino and our campus is bursting at the seams,” Apple spokesman Steve Dowling told the Mercury News, which first reported the story. “These offices will give us more space for our employees as we continue to grow.”

No word on HP’s asking price for the parcel, but real estate experts estimate that it may have been $300 million or more.

According to a prehearing examination of the patents at issue in the case by the staff of the U.S. International Trade Commission, Apple hasn’t provided enough evidence to establish a violation of its rights. The ITC’s early read on 13 patents Cupertino has accused Nokia of violating is that some were not violated at all and some aspects of others are invalid.

Now this doesn’t mean that Apple is destined to lose this particular battle; ITC Judge Charles Bullock isn’t obligated to follow his staff’s recommendation. But it is something of a setback for Apple, which has asked the Commission to block the import of Nokia phones into the States.

The Cupertino, Calif.-based company will hold an event dubbed “Back to the Mac,” a reference to its line of laptop and desktop computers. The event, which comes just two days after Apple’s planned fourth-quarter earnings release, will feature new bells and whistles in the software that powers Macs and possibly new computer models.

The event comes amid Apple’s rapid transformation. Once known for computers popular with students and graphic designers, the company morphed into a mobile-device giant as its iPod, iPhone and iPad products took off with consumers. Now, those devices are proving popular with business executives, driving Apple to aggressively move into the corporate market.

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The Street won’t like guidance, though: Apple is predicting Q1 EPS of $4.80, below the $5.04 analysts were looking for. They will also sputter a bit on this number: Apple sold 4.19 million iPads, and the consensus was 4.7 million.

And then on the other hand, Apple sold 14.1 million iPhones last quarter, well above both the official 11 million consensus and the 13 million “what we’re really looking for” number.

Ominous/hopeful Steve Jobs quote: “We still have a few surprises left for the remainder of this calendar year.”

UPDATE: Live earnings call coverage here.

Other numbers you care about:

Macs sold: 3.89 million.

iPods sold: 9.05 million.

Press release text:

Apple Reports Fourth Quarter Results
Record Mac, iPhone and iPad Sales
Highest Revenue and Earnings Ever

CUPERTINO, California—October 18, 2010—Apple® today announced financial results for its fiscal 2010 fourth quarter ended September 25, 2010. The Company posted record revenue of $20.34 billion and net quarterly profit of $4.31 billion, or $4.64 per diluted share. These results compare to revenue of $12.21 billion and net quarterly profit of $2.53 billion, or $2.77 per diluted share, in the year-ago quarter. Gross margin was 36.9 percent compared to 41.8 percent in the year-ago quarter. International sales accounted for 57 percent of the quarter’s revenue.
Apple sold 3.89 million Macs during the quarter, a 27 percent unit increase over the year-ago quarter. The Company sold 14.1 million iPhones in the quarter, representing 91 percent unit growth over the year-ago quarter. Apple sold 9.05 million iPods during the quarter, representing an 11 percent unit decline from the year-ago quarter. The Company also sold 4.19 million iPads during the quarter.
“We are blown away to report over $20 billion in revenue and over $4 billion in after-tax earnings—both all-time records for Apple,” said Steve Jobs, Apple’s CEO. “iPhone sales of 14.1 million were up 91 percent year-over-year, handily beating the 12.1 million phones RIM sold in their most recent quarter. We still have a few surprises left for the remainder of this calendar year.”
“We’re thrilled with the performance and strength of our business, generating almost $5.7 billion in cash flow from operations during the quarter,” said Peter Oppenheimer, Apple’s CFO. “Looking ahead to the first fiscal quarter of 2011, we expect revenue of about $23 billion and we expect diluted earnings per share of about $4.80.”

Apple makes headlines.

That’s the conclusion of a yearlong study from the Pew Research Center’s Project for Excellence in Journalism, which found that Cupertino generates a disproportionately large amount of news coverage compared with other tech companies–even titans like Google (GOOG) and Microsoft (MSFT).

Of the 437 tech stories Pew analyzed, 15.1 percent were primarily about Apple (AAPL)–more than Google (11 percent), Twitter (7 percent), Facebook (5 percent) and Microsoft (3 percent; “Microsoft has, at least for now, fallen off the mainstream media’s radar,” says Pew).

Which, if you follow tech news at all, is hardly a surprise. As former Apple CEO Gil Amelio explaind in his 1998 memoir, “On the Firing Line: My 500 Days at Apple,” people obviously like reading about the company:

I could well understand an extensive interest about Apple in the Bay Area and the trade press covering high tech. But why this excessive level of coverage in other locations? So, I posed the question to a New York Times staffer: “You’re a New York newspaper and we’re a California company, why do you include so much coverage of Apple?”

“Because we sell more papers.”

I asked him to be more specific.

He said, “I can give you the exact statistics. When we run a strong story on Apple, we sell three percent more papers. So, we run stories on Apple. That’s the bottom line.”

Apple (AAPL) has held an end-of-summer event each year since 2005, traditionally focused on the iPod, music and other entertainment-related developments, and it looks like that will be the case again. That still leaves plenty of room for speculation about possibilities, such as a streaming music service, the coming iTV device or a spruced-up iPod touch. Based on Yoko Ono’s recent comments, the traditional Beatles-to-iTunes chatter is likely to be muted this year.

As always, we’ll be there to cover the event live, so be sure to join us on Sept. 1.

“We have to let go of the notion that for Apple to win, Microsoft needs to lose.”

— Apple CEO Steve Jobs, August 1997

And there it is. Today Apple, not Microsoft is the world’s most valuable technology company.

As I write this Apple (AAPL) shares are trading at $244.87, giving it a market capitalization of $223.1 billion. Meanwhile, shares of Microsoft (MSFT) are trading at $24.79 and the company’s market cap sits at $217.78 billion (see table below; click to enlarge).

And so Cupertino has finally surpassed Redmond in total value. The only American company with a market cap greater than Apple is Exxon Mobil (XOM).

UPDATE: Apple closed the day well ahead of Microsoft. Its market cap: $222.07 billion; Microsoft’s: $219.18 billion.

PREVIOUSLY:

• Dueling Market Caps: Apple and Microsoft

If you answered “yes” to any of these questions, Cupidtino.com–a play on the words Cupid and Cupertino, the city in California where Apple (AAPL) is based–may lead you to iLove when the dating site launches in June. Currently available in beta, Cupidtino.com is described as “a beautiful new dating site created for fans of Apple products by fans of Apple products! Why? Diehard Mac & Apple fans often have a lot in common–personalities, creative professions, a similar sense of style and aesthetics, taste, and of course a love for technology.”

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If you are Apple (AAPL), you sound the trumpets and assemble the techie press at your Cupertino HQ as soon as possible to preview the new operating system you hope will bring even more powerful magic to your latest creation.

As soon as possible was this morning, and AllThingsD‘s Drake Martinet was there to liveblog the event, which announced, among other things, iPad sales of more than 450,000, a new app-based mobile advertising platform, and long-awaited multitasking functionality for the iPhone operating system. The liveblog is below.

9:11 am: We’ve arrived at Apple’s Town Hall at Cupertino HQ. The electricity John Paczkowski described in his liveblog from the iPad event is missing today.

9:57 am: Just walked in. Room is pretty full. Empty stage, with the standard Apple setup: Apple logo backdrop for the slideshow. Music a la an iPod commercial playing in the auditorium.

10:00 am: Voice on the loudspeakers: “Please turn your electronic devices to silent, we are about to begin.”

10:03 am: Steve Jobs takes the stage and gets down to it. “The next generation of the most advanced mobile operating system in the world.”

10:04 am: Jobs opens with a quote from Walt Mossberg’s review. Says he will get to OS 4, but first, shares some iPad numbers. As of today, he says, Apple has sold 450,000 iPads, 300,000 on the first day. Over 600,000 iBooks downloaded as of today. And I Pad apps? Jobs says that 3.5 million have been downloaded so far.

10:06 am: Jobs says, “When you create something, you really have butterflies when you create things and put them out into the world. We are feeling really good about this.”

He then moves on to the App Store. Users have downloaded 4.5 billion apps as of today. Jobs is now showcasing some screenshots of apps.

10:09 am: Jobs is running through media apps.
Now, he’s getting to the iPhone.

10:10 am: Says Apple has just won its third J.D. Power award for the iphone.

“What is the real measure of usage? iPhone has a 64 percent browser share; everyone else together is half of the iPhone,” says Jobs.

85 million iPhones and iPod touches sold to date.

10:12 am: Now the subject is iPhone OS 4.

Developers can now access the calender, photo library, SMS, full map overlays. In total, they will have access to 1500 APIs. There are over 100 new user features.

10:13 am: Users will be able to change home screen wallpaper, use a spell checker, tap to focus video, create playlists.

10:14 am: Jobs says there will be multitasking.

“We weren’t the first to this party, but we will be the best,” he says, with a nod to Google’s (GOOG) Android.

10:15 am: Jobs demos multitasking. No exposed interface. The active window lifts vertically and a slider of all the apps running appears.

10:17 am: Jobs shows that multitasking takes you back to the exact place in the app where you were when you left, including games.

“That, is our multitasking UI. We’ve been using it a lot and it really changes the way you use the iPhone.”

10:19 am: Jobs leaves and Scott Forstall, Senior VP of Software, takes the stage.

He’s here to talk about the nitty-gritty.

Seven mutlitasking services will be available to developers.

First: Background audio.

10:21 am: Forstall introduces Tim Westergren, founder of Pandora, who is talking about how his streaming radio service will make use of background audio.

Basically, users will now be able to use Pandora or other background audio apps just as they can use the iPod function.

He showcases how users will be able to buy songs from iTunes while Pandora is still playing the song.

10:24 am: Forstall retakes the stage.

“Next service is VoIP,” he says.

“Now, when you’re on the iPhone, you can run Skype in the background.”

10:26 am: David Ponsford of Skype comes onstage.

Skype now can run in the background and receive calls when you are using other apps.

He switches to Yelp while still in Skype call.

10:28 am: Forstall back now; he says the next major change is background location data.

He uses TomTom as an example. TomTom can be getting location data while you are listening music.

“There’s another class of application that wants to use your location all the time, but isn’t used while you are plugged in.”

The new OS will use less accurate cell towers (which uses less power) when doing background location features in social networking apps.

There will be a new icon on the taskbar showing that there are background apps currently using their locations.

10:32 am: Next feature up: Push notifications.

Now there will be “local notifications.” These will come from the apps themselves, rather than from outside servers.

10:33 am: Now talking about task completion.

Forstall says task completion will allow apps to complete tasks, like photo uploads, in the background.

He finishes with “fast app switching.”

“The app moves into a quiescent state in the background and uses no CPU power.”

10:34 am: Jobs retakes the stage to talk about the next major push.

Says there will be App folders.

10:35 am: “We came up with a really beautiful implementation of folders.”

The process of creating folders seems pretty easy. Just drag apps on top of each other and a folder is created.

Folders can then be dragged around like apps.

10:37 am: Jobs now shows us what the wallpaper selection function looks like. Feels like a mix of iPad and OS X.

His wallpaper now matches his pants.

Now, with folders, uses could store over 5,000 apps on their phones.

10:39 am: Jobs moves on to the next new feature, the unified inbox.

Multiple accounts feeding to one mail inbox.

“We’ve also added the ability to organize by thread, so you can follow conversations much easier.”

“And, open attachments. Now you can download an attachment and open it with an app from the App Store.”

10:41 am: Number four is iBooks. Jobs says Apple is adding iBooks to the iPhone, just like the iPad.

“Its a delightful e-book reader, and you can buy the books once and read them anywhere.”

They will wirelessly synch your current page between devices.

Also, free Winnie the Pooh, just as on the iPad.

10:43 am: Forstall retakes the stage to talk about enterprise.

10:43 am: The new OS allows encryption of email and data inside apps.

OS 4 will allow for mobile device management.

Also big for enterprise: Wireless app distribution. “A company can wirelessly distribute apps from its own servers to iPhones anywhere in the world.

Also adding SSL VPN from both Cisco (CSCO) and Juniper Networks (JNPR).

10:45 am: Now talking about something called, “Game Center.” This is the gaming push analysts were predicting.

OS 4 will have a social gaming portal that allows friends to invite you to play games, or will match make you with opponents.

10:47 am: Jobs retakes the stage. “It’s called iAd.”

10:47 am: “There are lots of apps in the App Store for free.”

“Developers are starting to put ads into apps, but we think most of these really suck.”

Jobs says, “On desktops, search is where its at. That hasn’t happened on mobile. On mobile, apps are where it’s at.”

10:49 am: “This is a pretty serious opportunity, says Jobs.

He says this could open over one billion impressions per day.

“What we want to do with iAds, we want to deliver interactivity and emotion.”

The ads keep you in your app, versus getting “yanked out of your app” like before.

“Because iAd is in the OS itself, we have figured out how to deliver that ad.”

Apple will sell and distribute the ads.

Apple will give developers 60 percent of iAd revenue.

10:53 am: Jobs demos ads, starts with a “Toy Story 3″ ad. Says he’s seen the movie, which comes out in June. Crowd laughs.

He adds that, “it’s all done in HTML5, by the way.” More laughter at his point because the audience is well aware that Jobs is not a fan of Adobe’s (ADBE) Flash.

10:55 am: The ad Jobs is showing is really more like a mini app, with streaming video, interactivity, a game, posters, background wallpapers and ability to buy app right from the iAd.

“Users like free stuff.”

“Have you ever seen an ad like this? Anything even close?”

10:57 am: Next up, Jobs shows an ad for Nike, reiterating that these ads were created by Apple “just because we really like these brands.”

He showcases how iAds have access to location and the accelerometer. No word on whether that location data the iAd gets is user-selectable.

11:00 am: “iAd is built into the OS, and the developer will get the majority of the revenue.”

Jobs goes into review mode.

11:01 am: A developer preview will be released today.

Jobs says Apple will release the new OS in summer.

OS 4 will be for 3GS and third-gen iPod touch.

Older devices will get some upgrades, but hardware won’t allow all features like multitasking.

OS 4 wont make it to the iPad till the fall.

11:04 am: Jobs thanks everyone, and leaves the stage.
Lights up, music back on, press starts milling.

11:06 am: Takeaways:

There are obvious concerns about what multitasking will do to battery life, though Jobs emphasized that Apple has figured out a way to offer multitasking without using too much more battery.

Job’s didn’t get into specifics on how.

Forstall emphasized that implementing the new features was easy for developers, saying things like, “they added this [feature] in a single afternoon.”

11:09 am: Now Jobs, Forstall and Phil Schiller take the stage for a Q&A.

There’s a question about multitasking using more AT&T (T) data. Jobs says that it won’t be a big deal, adding that multitasking doesn’t up the amount of use.

He emphasizes that video is the big data draw, and you don’t use more than one video at a time.

11:11 am: Question about whether there will be an approval process for iAds as there is for the App Store?

Jobs pauses, “I’m not sure its going to be any more than a light touch.”

11:13 am: Question about development of iAds.
Job: “No development environment for iAds, just HTML5.”

11:14 am: Jobs says, “So far the ads haven’t been rich enough to warrant a world class ad agency. For the first time, they can bring their storytelling skills. I think this can be a whole new avenue for the advertising industry, because for the first time you can take advantage of the skills of an add agency in the digital world.”

11:16 am: Schiller has yet to take a question.

11:17 am: Question about widgets and glance-able information. Jobs says, “Anything’s possible.”

11:18 am: Of OS 4′s way to switch apps, called “fast-app switching,” Jobs says, “Our competitors are tripping all over themselves to copy it.”

11:20 am: Jobs on iAd: “iPhone customers are among the most desirable demographics in all of advertising.

Schiller gets a word in edgewise: “On the phone, you have apps that help you do things. That becomes the customer’s way into information. Ads attached to those are potentially more interesting than ads just attached to search. “

Jobs: “This is the first time in history that this has ever existed. We have all these apps and a friction-free way to deliver them right to the phone. This has never existed before on PCs, still doesn’t.”

Jobs: “We tried to buy a company named AdMob, but Google came in and snatched them from us. So we bought Quattro, and they are teaching us we are making ads that are different than anything I’ve ever seen.”

11:24 am: Jobs: “This is not a get-rich-quick scheme for Apple. This is to help our developers survive.”

11:29 am: Question about running unsigned apps. Jobs shuts it down saying that there is a porn app store for Android, and Apple doesn’t want to go there.

11:30 am: Jobs brings up Walt Mossberg again, saying how impressed he is with how fast people are “getting it” with the iPad.

Schiller reiterates that the speed of adoption of the iPad, especially with the developers, has been incredible.

11:32 am: Jobs, continuing on the iPad: “If our competitors ever release a device like the iPad, they will be hoping for 3,500 apps in a year. We have that in the first week.”

11:34 am: Jobs, on the App Store: “I’m now seeing an infrastructure being developed through other mediums (blogs, etc.) that help with app discoverability.” This is in response to a question about the app store getting crowded and dense.

11:36 am: This question comes up: “How do you close an app?”

11:39 am: Jobs: “on the iPad, if you saw a stylus, they blew it. On this, if you see a task manager, they blew it.”

He doesn’t really answer, saying you never really have to close an app. Doesn’t elaborate.

11:41 am: Packing up, Q&A over.

More iPad Coverage »

Welcome to the World, iPhone
(Summer 2008)

Welcome to the world, my new friend and pocket master.
Your 3-G-ness makes my world so much better and lots faster.
Your App Store is the killer app of mobile D-to-C,
Although you are surprised that 90 percent of apps are Free.

100 Million is a frighteningly awesome number,
And threatens to eclipse Nintendo, put PSP in your penumbra.
Who’d have expected games like Rolando would have put you on the map,
Or that a virtual beer mug would become a killer app.

Your baby brother iPod Touch is rustling, restless in the wings,
With tens of millions multi-touchers browsing iTunes for new things.
With so much excitement already, your future’s hardly hazy;
Christmas Season in the Apple Stores this year will be, like, crazy.

Thanks, iPhone, for giving us a White to go with Black.
Thanks, iPhone, for making Leopard mobile, and connecting to my Mac.
iPhone, you’ve launched into the world, like a Cupertino rocket!
Steve envisioned computers on each desk; now it’s iPhone in every pocket!

Welcome to the World, iPad
(April 2010)

Welcome to the world, iPad, we’ve been awaiting you for months.
You give my hands an article of lust they both can touch at once.
3 Billion downloads in two years from 150,000 titles in App Store,
We’ve seen previews under NDA that will drive many billions more.

You’ve inspired new computer scientists on every college campus,
Who invented killer apps for toddlers, texting teens and check-in grampas.
Entrepreneurs without previous experience are creating jobs and wealth,
If they skip class to finish their new app, do they have to keep in stealth?

Thanks, iPad, for giving us a Cinerama screen.
Thanks, iPad, putting soul into your new machine.
iPad, you are the next chapter in the Apple Computer lore,
But we have to take our tent and leave now, the line is forming at the store.

Headed straight for The Norton Anthology Of Poetry, I imagine …

“Jerry joined Apple’s Board in 1997 when most doubted the company’s future. He has been a pillar of financial and business expertise and insight on our Board for over a dozen years,” CEO Steve Jobs said in a statement. “It’s been a privilege to know and work with Jerry, and I’m going to miss him a lot.”

Apple has posted a full-page memorial to York on the front page of Apple.com.