That’s twice the RAM of the iPad, which, like the new phone, sports a 1GHz Apple A4 processor. This means iPhone 4 buyers can expect some impressive performance gains over the 3G and 3GS.

“This is really about allowing [iOS 4's] limited multitasking to actually have a robust performance,” Rapid Repair CEO Aaron Vronko told Computerworld. “With only 256MB, the iPhone would waste a lot of time and battery power managing memory [during multitasking]. This definitely helps, and will let you keep more apps in the background without affecting battery life.”

[Image Credit: AppleInsider]

Adding new purchases to that, Huberty figures Apple (AAPL) will sell at least 42 million iPhones in calendar year 2010, assuming a 30 percent upgrade rate for existing customers. If the rate hits 50 percent, sales will grow to 48 million. In 2011, Huberty expects another 19 million upgrades.

Result: “We see the iPhone installed base rising from approximately 30M subscribers at the end of 2009 to over 100M by the end of 2011,” says Huberty. “We believe there are several key drivers of iPhone upgrades including: 1) Redesigned hardware with many new important features, 2) ‘Stickiness’ of the installed base due to App store and iTunes, 3) 57% of U.S. installed base is not fully upgradeable to iOS4 (i.e. no multitasking), 4) Early upgrade incentives from AT&T and 5) Maturation of the installed base. We would also point to AT&T’s introduction of tiered data pricing (that potentially reduces iPhone total cost of ownership by 20%+) as a possible driver of the strong initial pre-order activity.”

In a research note this morning, Piper Jaffray’s Gene Munster increased his iPhone sales estimates for both the June and September quarters to 9.5 million from 8.5 million, arguing that Apple (AAPL) will likely sell one million iPhone 4s during the device’s first three days on the market. He also noted that the six-month extension on upgrade eligibility pricing that AT&T (T) is offering should significantly juice demand.

“AT&T has pulled forward existing iPhone users’ eligibility for upgrade pricing by up to 6 months,” Munster wrote. “In other words, all early iPhone 3GS buyers will be eligible for upgrade pricing on the iPhone 4, but last year early iPhone 3G buyers were not eligible for the iPhone 3GS upgrade pricing. Specifically, we believe that the 8.4m iPhone users activated at AT&T between the Sept-08 and Jun-09 quarters will be eligible for upgrade pricing.”

Over at UBS, analyst Maynard Um went Munster one better. “We expect the iPhone 4 launch to be larger than the iPhone 3GS launch last year which sold 1 million units in its first 3 days. Although dependent upon initial supply, we see the potential for Apple to sell 1 million units on the first day of launch.”

At this point, Um’s scenario seems the more likely. As of this writing, Apple has taken pre-orders for more than 600,000 iPhone 4s. With more than a week to go until the official launch, it’s entirely plausible that the company will hit that number. And if launch day walk-in sales are anything like they’ve been in the past, it may far exceed it.

So as I said earlier today, if you want an iPhone 4 by June 24th, but didn’t manage to order one yesterday, best grab a beach chair and get in line. Might want to bring a sleeping bag, too, given this new date.

Curious that Apple (AAPL) would adjust the device’s shipping date twice in such quick succession. Did extraordinary demand drive the company to do so? Or another issue–perhaps the same one that made the white iPhone 4 unavailable for pre-order?

UPDATE: According to Best Buy’s iPhone 4 Pre-order FAQ, the retailer is no longer accepting pre-orders “effective immediately.”

Apple’s (AAPL) remarks coincided with a statement from AT&T (T) claiming first-day iPhone 4 pre-orders were 10 times greater than those of the iPhone 3G S last year and explaining the company’s decision to suspend further pre-orders.

Below, the two companies’ statements in full.

Statement by Apple on iPhone 4 Pre-Orders

CUPERTINO, Calif., June 16 — Yesterday Apple and its carrier partners took pre-orders for more than 600,000 of Apple’s new iPhone 4. It was the largest number of pre-orders Apple has ever taken in a single day and was far higher than we anticipated, resulting in many order and approval system malfunctions. Many customers were turned away or abandoned the process in frustration. We apologize to everyone who encountered difficulties, and hope that they will try again or visit an Apple or carrier store once the iPhone 4 is in stock.

AT&T Statement on Pre-Order iPhone 4 Sales

DALLAS, June 16 — AT&T issued the following statement today:

IPhone 4 pre-order sales yesterday were 10-times higher than the first day of pre-ordering for the iPhone 3G S last year. Consumers are clearly excited about iPhone 4, AT&T’s more affordable data plans and our early upgrade pricing.

Given this unprecedented demand and our current expectations for our iPhone 4 inventory levels when the device is available June 24, we’re suspending pre-ordering today in order to fulfill the orders we’ve already received.

The availability of additional inventory will determine if we can resume taking pre-orders.

In addition to unprecedented pre-order sales, yesterday there were more than 13 million visits to AT&T’s website where customers can check to see if they are eligible to upgrade to a new phone; that number is about 3-times higher than the previous record for eligibility upgrade checks in one day.

We are working hard to bring iPhone 4 to as many of our customers as soon as possible.

Why? And when will folks who prefer the white version be able to buy it?

Reached for comment, Apple (AAPL) didn’t provide much of an answer to either question. “There is tremendous excitement for the new iPhone 4 and we are working to get as many of them into the hands of customers as possible,” a spokesperson told me. “At launch, we have the black models available for purchase and we will be adding the white models as quickly as we can.”

Presumably, then, Apple has run into some sort of production problem with the white iPhone 4, enough of one that it’s not willing to specify an availability date. Note that the company says it will have only black models available at launch, suggesting white models may not be available when the device officially goes on sale June 24.

And if you want to use Yahoo (YHOO) search, even though it’s going to be merged with Microsoft (MSFT) anyway? You can (still) do that, too.

The app, demoed onstage at Apple’s developers conference by Netflix CEO Reed Hastings, will be available later this summer. Like the company’s iPad app, it will be free, though you’ll have to be a Netflix (NFLX) subscriber to actually access the company’s catalog of digital movies and TV shows.

And like the iPad app, the app will stream video via both Wi-Fi and AT&T’s wireless service. I checked with Netflix spokesman Steve Swasey to see if Apple (AAPL) or AT&T (T) would limit the amount of bandwidth the app could chew up, and he said no: “Same catalog. Unlimited. It will be Netflix as you know it and love it, but in your pocket.”

No caching, though. Like the iPad, you’ll need to be connected to the Web to use the app.

But that’s still pretty cool. And it’s also going to be a lot of strain on AT&T’s network. Which is, um, still pretty strained. I doubt many of you are going to watch all of “District 9” on your phones, but you may well watch an episode of “Weeds” (first couple seasons are pretty good, but then…). And if the carrier can’t handle phone calls, how is it going to keep up with that?

So: Either AT&T really is going to resolve its capacity problems by the end of this summer, as Steve Jobs semi-promised last week at D8. Or everyone involved assumes that AT&T’s new data plans will cut down on the number of people using iPhones to do all the cool, cutting-edge stuff Jobs showed off today.

He reiterated that notion in his keynote today:

“Guess what? Ninety-five percent of all apps submitted are approved within seven days.”

“What about the ones we don’t approve? Well why is that? What are the reasons?

1: The app doesn’t do what you said it would.

2: It uses private APIs…and if they change the app will break.

And the third reason? They crash.”

“If you were in our shoes, you’d be rejecting for the same reasons. Even with this, 95 percent are approved in seven days. Sometimes you read these articles and you think something is going on….”

The numbers will look about six million subscribers lighter than today, according to Davenport & Company analyst Drake Johnstone, who believes AT&T (T) will take a nasty hit if/when Verizon (VZ) receives Apple’s (AAPL) blessing to sell the iPhone.

“Over the past several years, AT&T indicated that 40 percent of its new iPhone customers came from other carriers,” Johnstone theorized in a note to clients this week. “We estimate that AT&T has 15 million iPhone customers (as of Q-1 10) and believe that AT&T could lose as many as 6 million, or 40 percent, of its iPhone customers when Verizon begins selling the iPhone in 2011.”

As a consequence, the analyst noted that “We are reducing AT&T’s 2011 wireless subscriber additions from 6 million to 2 million (most of these new additions may be lower value connected devices such as eReaders instead of higher value long-term wireless customers), since we believe that Verizon could obtain Apple’s approval to sell and provide wireless service for the iPhone as early as mid-2011.”

A 40 percent drop in iPhone subscribers. Six million AT&T customers gone with the advent of a Verizon iPhone. That’s an ugly scenario for AT&T, for which the device has been a major driver of wireless revenue growth.

But it’s not necessarily an inevitable one. As I noted here just yesterday, subscriber losses triggered by the end of AT&T’s iPhone-exclusivity deal will be tempered by two very important factors:

1. The early termination fee AT&T charges customers who break their contracts.
2. Family-talk and business-discount plans that make switching to a new carrier a difficult proposition. About 80 percent of AT&T’s customers are on such plans.

Beyond this, there’s the simple fact that subscriber churn rates at carriers that have lost iPhone exclusivity hasn’t been all that bad. As Matthew Key, CEO of Telefónica Europe said during a February earnings call, “ever since Vodafone has started selling the iPhone in January, we see absolutely no evidence of people leaving us, churning on the iPhone going back to Orange or Vodafone, so [we are] very comfortable with our iPhone volumes. We continue to out-trade the market and no sign of churn whatsoever.”

This morning, the retailer cut the price of iPhone 3GS devices with 16 gigabytes of memory from $197 to $97 with a two-year service contract. Wal-Mart claims the reduction is simply part of its “ongoing aggressive savings announcements.” But coming as it does amid speculation about the launch of a new iPhone (and rumors of the discontinuation of the 8GB iPhone 3G), it is being interpreted as a move to clear out inventory before that device arrives at market.

Meanwhile, Apple (AAPL) and AT&T (T) continue to sell the 16GB iPhone 3GS at its original price, though I can’t imagine that this will continue much longer. When Apple introduced the iPhone 3GS in June 2009, AT&T slashed the price of the entry-level 8GB iPhone 3G to $99.

The company is expected to do the same thing this year with the low-end 3GS. And, as it did last year, that price cut will likely spur adoption of the device among the lower tiers of AT&T’s customer base. As BTIG Research analyst Walter Piecyk observed in a note to clients this morning:

We estimate that last years price cut of the iPhone 3G to $99 stimulated more than 3 million phone sales to existing AT&T customers that helped the company further penetrate the family plan with higher ARPU, lower churn customers. We believe the impact could be even larger this year for AT&T given its the broad market acceptance of the iPhone, the halo impact of the iPad and the installed base of iPhones that will need to be upgraded to a 3GS phone in order to benefit from Apple’s latest upgrade to its iPhone OS 4.0.

A lot of this stuff has been out in one form or another, but the narrative is pretty fascinating. If you plow through the document embedded at the bottom of the post, bear in mind that it’s a tale told by Matthew Broad, a detective in San  Mateo County Sheriff’s office. So it’s possible that other parts of the story, and/or different versions of the same story, may still end up coming to light.

Among the highlights:

• Apple knew that Brian Hogan, the 21-year-old who found the iPhone, had the thing because his roommate, Katherine Martinson, called and told the company he had it. Her reasoning, according to Apple (AAPL) security chief Rick Orloff: “Suspect Hogan connected the stolen iPhone to her computer and she believed that Apple would eventually trace the iPhone back to her via IP addresses. Therefore she contacted Apple in order to absolve herself of criminal responsibility.”
• Martinson told police that Hogan had offered the phone to Gizmodo, AOL’s (AOL) Engadget.com and PC World. While Gizmodo owner Gawker Media had previously said it paid $5,000 for access to the phone, the affidavit is a bit fuzzier. Martinson says Hogan told her Gizmodo offered $10,000 for the gadget and later said he’d received $5,000 from Gizmodo and a total of $8,500. But she wasn’t clear where the other $3,500 came from. “Martinson said Hogan also told her that he will receive a cash bonus from Gizmodo.com in July if and when Apple makes an official product announcement regarding the new iPhone.”
• There’s a long cops-and-robbers interlude where police show up at Hogan’s house, but he takes off and is eventually tracked down at his father’s place. In the end, Hogan and Thomas Warner, another roommate, help the cops retrieve a computer, a flash drive and other equipment they’d removed from their place “in order to ‘protect’” Hogan.
• Apple CEO Steve Jobs did indeed reach out to Gizmodo to ask for the phone back. Here’s editor Brian Lam’s response to Jobs, via email (click to enlarge):

And here’s the entire affidavit, which we’re able to see because a group of media companies, including CNET, Bloomberg, Wired and the Los Angeles Times, petitioned a California judge to unseal it. Gawker Media, via COO Gaby Darbyshire, declined to comment on the affidavit and its contents.

UPDATE: Here’s Gawker’s position, via an email Darbyshire sent Saturday afternoon:

First of all, the warrant and supporting affidavit do not appear to acknowledge the sanctity of the newsroom or even address the serious issues at stake.

Second, the idea that it is a felony trade secret theft to photograph an item that was admittedly left in a bar is ridiculous.

Finally, Gizmodo from the start was attempting to investigate if this item was a genuine prototype of a product belonging to Apple; we believed that confirmation of its authenticity and ownership quite reasonably needed to be made in writing – and once we obtained that, the item was returned immediately.

EFF has a detailed piece on the warrant issue here.

Gizmodo-iPhoneOrder

“As the innovator of the original Windows Mobile PocketPC Phone Edition in 2002 and the first Android smartphone in 2008, HTC believes the industry should be driven by healthy competition and innovation that offer consumers the best, most accessible mobile experiences possible,” said Jason Mackenzie, vice president of North America, HTC Corporation, in a statement announcing the litigation. “We are taking this action against Apple to protect our intellectual property, our industry partners, and most importantly our customers that use HTC phones.”

The intellectual property to which Mackenzie refers here isn’t clear, since the company has not disclosed the patents it believes Apple (AAPL) violated. Which is a little odd, considering the breadth and heft of Apple’s 20 patent claim against HTC.

That HTC hasn’t announced the patents it believes Apple to have infringed seems…unusual. Unless, of course, there’s not much to them, in which case it might make sense to make a big splash with a press release that prevents observers from assessing the viability of the claims it’s making against Apple. Also unusual, the fact that HTC hasn’t yet filed a lawsuit in federal court, which might suggest a lack of confidence in its case.

HTC declined to provide me with a copy of the suit or a list of the patents involved.

Reached for comment, Apple declined to offer one, referring me to its original complaint against HTC, which can be found here.

UPDATE: Here’s a copy of HTC’s suit.

Further Reading:

• Apple Sues Nexus One Maker HTC Over iPhone Patents
• Apple Sues HTC [Complete Court Filings]
• Apple vs. Google: Game On
• HTC May End Up Bringing Knife to Apple Gun Fight
• HTC to Apple: We Built a Touchscreen Phone Before You Did

If it’s true that Apple CEO Steve Jobs personally monitors the list of employees who have permission to take pre-release versions of the company’s products off campus, he might want to raise his standards for inclusion a bit. Because the company seems to have lost yet another next-generation iPhone prototype.

Photos of the intact device and a teardown were posted to the Vietnamese forum, Taoviet, yesterday, and they look genuine, though obviously, there’s no way of knowing for sure.

The prototype is nearly identical to the one lost in a German ale house and subsequently purchased by Gizmodo, though it’s a bit more polished. It features the same iPad-esque glass and aluminum design and a chip with an “APL0398″ designation–the same one found on the iPad’s A4 system-on-chip. It lacks the two screws so prominent on the Gizmodo device, which suggests it may be a near-final production model.

Again, there’s no way to be certain. But I imagine we’ll find out for sure during Apple’s (AAPL) Worldwide Developers Conference keynote address, the traditional venue for introducing new iPhones.

Below, photos and video of the device.

[Image/video credit: Taoviet.nv]

Really? Really, says NPD.

The consumer research shop says U.S. sales of smartphones using Google’s mobile operating system climbed past Apple in the first three months of this year. Google (GOOG) nabbed 28 percent of the market, while Apple (AAPL) claimed 21 percent, NPD says. Less surprising is that BlackBerry maker Research in Motion (RIMM) still leads the market, with 36 percent.

Here are the data in chart form: Android is the green line with the prominent spike:

NPD’s numbers come from self-reported online consumer surveys (corporate sales aren’t included), so there’s likely some variance between its results and actual sales data. And indeed, NPD’s numbers look quite different from the most recent numbers from comScore (SCOR), which showed Google with a 10 percent share in February.* Still, NPD is usually considered a reasonably accurate estimator of retail sales, so the report is worth taking seriously.

The best argument in support of NPD’s numbers, meanwhile, is that Google’s handset and carrier partners, particularly Verizon Wireless (VZ) and Motorola (MOT), have been pushing their Android phones hard in recent months. And perhaps potential iPhone buyers are in a wait-and-see mode until June, when Apple is expected to unveil a next-generation handset. But this explanation requires an awful lot of iPhone buyers to be awfully savvy about Apple’s product cycle.

Anyway, this isn’t necessarily terrible news for Apple, as the company faces a possible federal antitrust probe. The NPD number is certainly more humble than the data Steve Jobs was boasting about last month when he noted that the iPhone had 64 percent of the mobile browser market.

*Important distinction between the NPD and Comscore data: NPD is measuring sales, and Comscore is measuring installed base. So entirely possible for those two data sets to sync up. More in Digits.

Gizmodo claims it is and it certainly appears to be a legitimate Apple prototype. “Found” in a bar in Redwood City, Calif., (reportedly running iPhone OS 4), the device boasts a number of new features. Among them: A front-facing camera, improved back-camera with flash, Micro-SIM, a screen with a seemingly higher resolution, and a new glass and aluminum design more akin to the iPad.

Could it be a fake? Perhaps, but as Gizmodo notes, the device’s build, design and internal components reek of Apple (AAPL). Beyond this, it behaves like an iPhone when connected to a computer and its internals feature a number of parts clearly labeled “APPLE.”

“We get false tips all the time,” the site explains. “But after playing with it for about a week–the overall quality feels exactly like a finished final Apple phone–and disassembling this unit, there is so much evidence stacked in its favor, that there’s very little possibility that it’s a fake. In fact, the possibility is almost none. Imagine someone having to use Apple components to design a functioning phone, from scratch, and then disseminating it to people around the world. Pretty much impossible.”

Indeed, my guess is that Apple is getting ready to throw the person responsible for losing this off the roof of 1 Infinite Loop. Or it’s investigating the incident as a potential theft.

Below, Gizmodo’s too-short video overview of the device. You’ll find additional pictures, longer videos and a more detailed tear-down here.

[Image, video credits: Gizmodo]

Looks like Apple (AAPL) may have decided to add Verizon (VZ) as an iPhone carrier, because The Wall Street Journal reports that the company is working on two new iPhones, a fourth-generation model and another designed for a CDMA network like Verizon’s.

Sources tell The Journal that Pegatron Technology, Apple’s manufacturing partner for the CDMA device, is scheduled to begin mass-producing the new iPhone in September, though it is not yet clear when or on whose network the company intends to launch it. The publication says the new model “appears” to be designed for Verizon Wireless. But other carriers use the CDMA standard–Sprint (S), China Telecom and SK Telecom, to name a few.

That said, Verizon certainly seems a likely candidate, as the carrier would immediately give Apple access to about 80 million new customers. But rumors of an Apple-Verizon deal for the iPhone and the iPad have been circulating for quite some time and none have ever panned out. Which is not to say they won’t pan out this time, just that The Journal has not yet been able to confirm that they will.

A Verizon iPhone would, of course, be bad news for AT&T (T). As I’ve noted here before, a move to nonexclusivity in the U.S. would likely have some negative impact on the carrier’s subscriber base.

[This post was clarified and updated with new details at 2:45 pm PDT]

“iPad yields should improve dramatically throughout the year even if the launch starts out capacity constrained,” Reitzes wrote in a research note to clients today. “These developments support upside to consensus forecasts for the iPad, should demand materialize like we think it can. We estimate Apple will sell almost 5 million iPads for CY10; including 1.2 million in the June quarter–which could prove conservative.”

As for the iPhone, the analyst says, “Also, we have increased confidence that Apple will make a big splash this summer with a new iPhone form factor. We believe that the new model will launch with considerable fanfare and expect unit expectations to rise in turn.”

“Big splash,” “considerable fanfare”: That’s certainly been the case with iPhone launches to date. No reason to expect things will be any different this time around.

As for iPad sales, there’s really no telling yet, though “people familiar with the matter” have told The Wall Street Journal that Apple has sold hundreds of thousands of units via pre-order and could end up selling more iPads in the first three months than it sold iPhones in the three months after that device’s debut.

“We expect Apple to launch new iPhones in June that offer both a lower total cost of ownership and new functionality, potentially including gesture-based technology,” she wrote in a note to clients today. “As we’ve highlighted in the past, the cost of device + service plan is currently the biggest barrier to incremental demand in both mature markets like the US and emerging markets like China.”

Now, when Apple (AAPL) introduced the 3GS in 2009, it dropped the price of the iPhone 3G to $99, so it seems reasonable to expect the company to follow a similar pattern when it introduces a new iPhone. Might the price of the new device itself also be lower than expected? Perhaps. Certainly the fact that Apple was able to bring the iPad to market at $499 suggests it’s possible.

More intriguing than these ruminations on price, however, is Huberty’s mention of new “gesture-based technology.” The analyst doesn’t offer any details on what this might be, but presumably she’s referring to advances disclosed in some recent Apple patent filings.

Among the possibilities here: A touch-sensitive bezel that would turn the outer edges of the device into intelligent “sense lines” that give users quick and easy access to their favorite applications, and some camera-based swipe controls that offer one-handed control over a variety of iPhone functions.

Here’s a description of the latter from Patently Apple, which does a far better job explaining these things than I ever could.

[This] patent reveals yet another innovative concept that is designed to help users control their incoming calls and voicemail by simply swiping their finger over the external camera lens. It will control rewinding and fast forwarding voicemail. In addition, the new methodology will also enhance one handed navigation of Web pages, documents, a contact list or your iTunes library by simply swiping the camera lens in different swiping motion combinations. In the future, the iPad may be able to take advantage of this feature if the camera is positioned correctly. This would theoretically allow a user to simply flick a finger over the camera lens to turn the page of a book or scroll a webpage without ever having to move your hand.

Sounds pretty slick, yeah? Certainly, a feature like this would take smartphone navigation to a new level. Were it to be included in a next-generation iPhone along with a five-megapixel camera, LED flash and video chat support that’s rumored–well, Apple might not need the lower price point as Huberty suggests to juice demand for the device.

The real problem, Ars Technica says, is that the iPhone–and other modern smart phones–disconnect from the network whenever possible to save power.

“The fact that almost all of the complaints from iPhone users come from the U.S. suggests that AT&T’s network is at least partially to blame,” the story asserts. “In fact, users in other countries have told Ars that they don’t experience the kinds of problems that U.S. users often report. Well, other countries except one.”

Read the rest of this post on the original site

“In the vast majority of locations, we think that iPhone customers are having a great experience from the research that we have done,” Cook said. “As you know, AT&T has acknowledged that they are having some issues in a few cities and they have very detailed plans to address these. We have reviewed these plans and we have very high confidence they will make significant progress towards fixing them.”

That reiteration of Apple’s (AAPL) support for AT&T (T) and its decision to debut the iPad on the carrier’s network are fueling speculation that AT&T may hold on to its iPhone exclusive far longer than anyone is expecting. Indeed, in a note to clients today, Barclays Capital analyst Vijay Jayant suggests that the arrangement will last through the summer, perhaps to year’s end.

“Launch of Apple’s iPad on AT&T’s network is a vote of confidence in AT&T’s network by the equipment maker,” Jayant writes. “While iPad sales are unlikely to materially impact wireless revenues in the short term, selecting AT&T to launch its second major communications product reflects Apple’s bias for the global GSM platform and the prospects of AT&T’s network capability. Moreover, it could suggest the iPhone exclusivity may continue, at least through the end of 2010.”

That’s great news for AT&T, if it should prove true. And not simply because it gives the company more time to enjoy the benefits of iPhone exclusivity, but because it gives it nearly a year to improve its network before exclusivity expires. And if AT&T manages to do a good job, the carrier’s iPhone subscribers will presumably be less likely to flee for another network first chance they get.

How much longer does Apple plan to continue its iPhone exclusivity contract with AT&T? Some say until June, when the device arrives on Verizon’s airwaves. Others say fall.

Not unreasonable predictions given issues with AT&T’s network and the simple fact that adding Verizon (VZ) would more than double the iPhone’s addressable market. But perhaps a bit overeager, particularly in light of Apple COO Tim Cook’s remarks about the carrier during a company earnings call Monday.

Asked about AT&T (T), the bad press its network has been receiving lately and the impact of negative reports on the Apple (AAPL) brand, Cook defended the carrier.

“First of all, AT&T is a great partner,” he said. “We’ve been working with them since well before we announced the first iPhone. And I think it is important to remember they had more mobile broadband usage than any other carrier in the world.”

Emphasizing the large view, Cook continued, “And in the vast majority of locations we think that iPhone customers are having a great experience, from the research that we have done. As you know, AT&T has acknowledged that they are having some issues in a few cities and they have very detailed plans to address these. We have personally reviewed these plans, and we have very high confidence that they will make significant progress toward fixing them.”

Now, Cook’s remarks certainly don’t preclude the possibility that Apple will end its exclusivity arrangement with AT&T. But his eager defense of the carrier suggests there’s at least a chance that his company will renew it.

Of course, Apple did a hell of a job talking up the PowerPC architecture too–right up until it dumped it for Intel’s (INTC) x86 design in 2006.

That’s the word from AppleInsider, which claims some insight into the next iteration of Apple’s (AAPL) iconic device.

“People familiar with Apple’s initiative” tell the publication that the company has been ordering “tens of millions” of LED camera flash components for delivery this year, presumably with the intention of building them into the next-generation iPhone and iPod touch.

I have no confirmation of this myself, but it certainly seems plausible, and given the lousy photos the iPhone takes in low-light situations, more likely an inevitability.

If you find this metric as astonishing as I do, consider this: The increase in Bay Area data traffic is actually below the national average–significantly below. According to AT&T (T) CTO John Donovan, 3G data traffic on the company’s wireless network has risen nearly 5,000 percent in the past 12 quarters nationally (see chart below; click to enlarge).

“Today, we’re seeing unprecedented growth in mobile broadband traffic,” Donovan said during his keynote at the Open Mobile Conference on Nov. 5. “This growth has required extensive rethinking of wireless networks as we know them, as well as significant advances in the supporting IP backbone and other infrastructure.”

A 5,000 percent increase in 3G data traffic: That’s an astonishing figure. Seems to me it’s entirely likely that any carrier that had been first with the iPhone–including catcalling rival Verizon (VZ)–would have suffered network troubles similar to those that plague AT&T today.

No other U.S. carrier offers a super-smartphone that has sold as well as the iPhone and that people use much like a laptop. Sure, Android and Palm (PALM) webOS devices are used in this way as well, but there are far fewer of them and they have significantly fewer data-hungry apps.

Research in Motion (RIMM) offers some BlackBerries that are used this way, but only some, and there are only 3,000 or so apps available for them. iPhone owners have 100,000 apps from which to choose. And while it’s obvious that there are more BlackBerries in use than iPhones, some of these rely on AT&T’s network, which only compounds the carrier’s problems.

So, really, any carrier that had been first to market with the iPhone would have seen its network overtaxed, especially after Apple (AAPL) launched the iPhone 3G and the iTunes App Store. Those events effectively upended traditional planning models for network capacity in a way that no one was prepared for.

Perhaps other carriers would have fared a bit better. Verizon’s 3G network, even back in 2007, was much deeper and broader than AT&T’s. But could it really have supported a 5,000 percent increase in data traffic without incident? I’m not so sure.

Which is not to say that AT&T is blameless. Its network has lagged and continues to do so, and the iPhone and the massive surge in data traffic it brought with it are not entirely responsible for that.

But they are obviously a big factor. It will be interesting, then, to see how Verizon’s network holds up in comparison if and when the carrier gets the iPhone.

[Image Credit: Morgan Stanley Managing Director Mary Meeker]