Apple has clearly been struggling with how to manage the demands of Hollywood and the networks on the handling of high definition (HD) content, DRM, within iTunes, their current hardware and new hardware. It wasn’t hard to see all this coming, especially when one looks at how the Apple TV works.

However, with the new MacBooks and DisplayPort, it’s fairly clear that, in general, HD content is going to be restricted to paired devices that respect HDCP, or its follow-on, DPCP.
(High-bandwidth Digital Content Protection and Display Port Content Protection)

The basic issue is that, in general, high definition content in iTunes has to be protected from pilfering. To do that, a source (Mac + iTunes) and a display must handshake, then create an encrypted connection. The Apple TV does that via the HDMI physical connector and protocol plus HDCP.

On an older Mac, however, with just DVI out, there is no way to support the modern DPCP protection used with DisplayPort or the HDCP used with HDMI. As a result, Apple is going to have to gingerly move into these protected pairings. That’s why the new MacBooks were also announced with a companion display that also has DisplayPort.

Until this product transition is complete in Apple’s hardware lineup, customers with the older DVI-based displays are going to have headaches. Whether Apple can or will make an concessions or adjustments is not clear at this point.

However, I have noticed things are still in transition with respect to HD TV shows. For example, season one of Eli Stone (ABC) was previously available for purchase in HD for $2.99 per episode. Now, it can only be streamed. On the other hand, NCIS (CBS) episodes can still be purchased in HD and played on a five year old PowerMac G5.
It all depends on the network policy.

For movies, however, there is good consistency. You are going to need a pair of DRM compliant devices, like the Apple TV and a modern HDTV with HDCP to display HD movies. Once Apple has its customer base moved over to Macs and displays with DisplayPort, then we’ll start to see the streaming or even the purchase of HD movies.

It’s that simple, whether we like it or not.

On to the debris of the week. There was an alarming story at BusinessWeek about how NASA networks and computers have been compromised by, allegedly, Chinese and Russian hackers who have stolen information about rocket engine design, the operation of the Space Shuttle and satellites. One attack involved taking control of a U.S. satellite and pointing its sensors at the sun to kill it.

There was never any mention of the OSes involved, but I know from my own experience that one of the incidents cited was directly due to the use of Windows. I could write a lot more, but it’ll be sufficient for you to read the BusinessWeek article and keep in mind how NASA, for many years, worked hard to eradicate Macs from its networks. Since 2003, things have gotten a lot better, but NASA still has a Windows-centric mentality in many places, especially Houston.

On Wednesday, NVIDIA announced a supercomputing-class GPU, the Tesla C1060 card priced at US$1,699 which is capable of four TF (teraflops). Computers from Dell, Lenovo, Asus, Western Scientific, “Tesla Personal Supercomputers,” can be had with the card for under US$10,000. There has been no announcement from Apple that I know of about support for this fabulous GPU.

Also on Wednesday, we learned that the OpenCL standard has been approved in just six months, just in time for Snow Leopard. This is a technology that allows applications to utilize the GPU for ordinary computing, issue threads, and so on, just as if it were another core. The open standardis supported by 3DLabs, AMD, NVIDIA, Intel, ARM, Freescale, Qualcomm and Apple. Microsoft, however, is not a participant, but will be going its own way with Direct11 X.

On Thursday, ExtremeTech had a neat article about how VISA is testing a new credit card with a built-in computer, keypad, and one-time password algorithm. If the card can survive a guy’s wallet, it’ll be a welcome security improvement. A one-time password is generated for each sales and combined with a user PIN. That fulfills the security requirement of 1) Something you have, 2) Something you know, and a randomly generated password.

On Friday, The New York Times posted a fascinating article about how Netflix has invited the community to improve on its algorithm for suggesting movies to customers. A database with no personal information can be downloaded, and anyone who has the mathematical experience can try to improve on the algorithm that predicts what a given customer will like based on the the ratings of previous movies. Its a great read and further suggests how active Netflix is aggressively developing its business.

Finally, those who have unlocked their iPhone 2G should note that the iPhone Dev Team, while confident they can deal with the iPhone 2.2 update, warns users not to install the update until they have a compliant pwnage tool 2.2.

Recently, Robert X. Cringely at PBS theorized about the departure of Tony Fadell from Apple. That was based on personality issues and the possible arrival of Mark Papermaster. However, John Gruber has possibly shed more light on the whole affair with how he heard a story that Mr. Fadell was against the use Mac OS X in the iPhone while Bertrand Serlet and Scott Forstall were in favor. It’s an intriguing prospect.

It’s the kind of thing that sounds good to me, even if it’s not confirmed. Scott Forstall’s fortunes are rising. Mr. Serlet is the current father of Mac OS X. A possibly limited vision by Mr Fadell, an iPod that makes phone calls, instead of a new platform with the App Store, almost eclipsing the ability to play music, could have been an alluring judgment call.

Further, it’s not unrealistic to surmise that a time will come when the dedicated iPod as a music player will become a thing of the past as Apple transitions to the iPod touch, the iPhone, mayhap an iPhone nano, and even more capable mobile devices. When I look at the diversion into a boxy iPod nano 3G and then back to the slimmer profile 4G, despite Mr. Jobs’ explanations, I wonder if some of the vision and momentum for the dedicated music player had stalled. And so Mr. Fadell had to go. It’s all just speculation and a soap opera at this point, but examination by all these astute sources starts to shed some light on things.

On Tuesday, Fortune published a really good background story on Apple’s COO Tim Cook: “The Genius Behind Steve.” If you’re eager to get a feel for the operating style and personality of Mr. Cook, this is the best article I’ve seen to date.

On Friday, I wrote an editorial about operating systems. I didn’t want it to get too long, so I didn’t reference this piece by Frank Fox. Basically, what Mr. Fox said is that while Windows 7 won’t be remarkably different from Vista, it does give Microsoft a chance to start over. There will be new, more uniform and less controversial system requirements, better hardware, smoother UI, and a more recognizable brand name. It may not be the whole answer, but given Microsoft’s constraints, it’s a start.

On Thursday, Chris Seibold made an interesting point. Mr. Steve Ballmer appears to say dumb things, but they’re only dumb from an outsider’s perspective, even more so for Macintosh customers. What Mr. Baller says is always in the context of the Microsoft customer’s realm and perspective.
As a result, when Mr. Ballmer says, regarding Android, “I don’t really understand their strategy…,” it’s not because he doesn’t understand it. Rather, it’s because he knows well how to pose his argument within the context of the Microsoft customer. And sow some FUD. Of course, one can also conclude that’s he’s running scared, but most executives in his position would be.

The difference with Mr. Steve Jobs is that his genius is the ability to couch his own assertions in a more intelligent, acerbic, humorous way without looking like an idiot — and still get his marketing message across. With a smile. It’s like the difference between John F. Kennedy and George W. Bush.

In my editorial, I also elected not to reference an interesting piece by Don Reisinger who affirmed that marketing efforts and their effects on journalists can dictate the attitudes, if not the fate, of an operating system. It’s also all about how the personality of the respective CEOs can sway the public on some very technical products. It’s a good companion piece to Mr. Seibold’s.

We don’t often have much visibility into the Microsoft empire, but if there’s one person who is ultimately responsible for Windows, it’s not Steve Ballmer, the CEO, rather, it’s Steven Sinofsky, Senior Vice President, Windows and Windows Live Engineering Group. Looks to me like this guy is the equivalent of Apple’s VP Bertrand Serlet. I read that he replaced Jim Allchin last year.

Have a great weekend!

I am extraordinarily suspicious cloud computing. I think it has its place for corporations who want to make their data available to all their offices and travelers in a uniform way. However, for home users, it’s just crazy.

The reason it’s crazy for home users is something every Apple customer who follows Apple and Steve Jobs understands: Control. You want to own your data and have access to it when you need to, not when it’s convenient for some company.

Moreover, that private data is stored on some server in the sky and could be compromised. Finally, once all your data is on their servers, those service providers will figure out a way to charge you to access your own data.

I can buy a terabyte of storage now for about $250. I can back up that terabyte of data for another $250. I won’t be doing any cloud computing anytime soon.

Moving on.

Thanksgiving is almost upon us, and that means Black Friday.
I really don’t like the sound of that term, but it’s innocent enough. It’s that time of year when some merchants move their books from the “red” to the “black,” that is, profitable for the first time. Still, I’d love to see a better term used.

And that means many of you will be shopping for an HDTV and/or a Blu-ray player. Watch The iPod Observer next week; I’m planning a novel approach that won’t be the ordinary buyer’s guide or Top Ten Secrets article.

Speaking of HDTV, there’s been a lot of news lately on Netflix, and so long as Netflix is making news with its aggressive plans and announcements, when it’s of interest to Mac and Apple TV users, we’ll cover it.

In fact, I think the all the Netflix moves in 2008 got to its biggest competitor, Blockbuster. We didn’t hear much from them for a long time, but on Thursday, Blockbuster chairman and CEO Jim Keyes revealed that his company is preparing a set-top box that would deliver movies on demand. Additional details were not made available.

That’s news, but that’s also a blunder. If such a service and box is being planned, it’s far too late to being playing things close to the vest. Home Theater magazines for Christmas are already in the mail, and it’s even too late to think about reviews on the Internet. Worse, in these tough economic times, who’s going to buy another box for the living room that does only one thing?

In my opinion, Blockbuster is too late and too clueless.

Finally, I saw an amusing article at Wired about how the U.S. Air Force is lamenting the free-wheeling nature of the Internet and wants to re-write the rules to avoid the hassle of all those nasty people constantly attacking their systems.

When I was at Apple, I formed a personal opinion about the Air Force and the Army. The Army was tech savvy and used Macs when appropriate for added “genetic diversity” and security.
The Army’s CTO was a sharp guy. On the other hand, the U.S. Air Force had, in my view, an almost antagonistic relationship with Apple. According to the USAF, Microsoft products were the ultimate solution for all their needs, and Apples were dismissed as toys.

Now, after all these years of Windows mania, the USAF is fed up with all the threats, viruses, break-ins, malware and wants to rebuild an exclusive club, with new protocols and technologies, that will insulate them from the pain of the Internet.

Welcome to the club.

“We’ll start with blue,” said Information Directorate chief Donald Hanson, using the military term for friendly forces. “If you’re not blue, you can’t come in,” he said according to Noah Shachtman for Wired.

If the USAF hadn’t sold its soul to Microsoft and instead focused on advanced UNIX and security technologies, and used the best of the open source solutions available, they’d have spent a lot less money and be in better shape today. Instead, they’re issuing a request for proposal (RFP) to help them get out of the fix they put themselves into.

In my tax paying, security minded opinion, the whole course of action has been an expensive mistake.