802.11n Upgrade Fee Confirmed at $1.99

[rjfiske]

1) I don't give a **** if you disagree or not, you're wrong. I paid for an N card the proof of which is that I have a ****ing N card in my computer, you idiot. The fact that it was disabled by Apple is another issue entirely. Or are you trying to tell me that Apple paid g. card prices to its n. card distributor? Are you daft? By that logic a CD chip costs the same as a C2D chip but as we all know there is a premium for the latter. Why on earth (and by what proof, more importantly) are you claiming that an .n card costs the same as a .g card?

2) I still haven't heard that this is definitely an accounting issue. If Apple says that's the case, I would accept that. But they haven't. Until that time, I'm slightly pissed off but more importantly I am concerned what this means in the future regarding their "functionality upgrade" policies.

Some of you people don't get the point. Let me rephrase that: most of you people don't get the point. It's not about paying "only $2, stop your whining." You same idiots will be here complaining when, next year, you have to input your credit card # to get that next Software Update because people like me have grown tired of speaking up and being told to shush by you lemmings.

First of all calm down and stop with the namecalling please.

I'm not concerned with what APPLE paid for the card. I'm concerned with what Apple promised and charged you. Both of these things were an 802.11g card. The fact that your card is capable of 802.11n with a software upgrade means that Apple, being compliant with accounting, has to "account" for this upgrade monetarily, if you in fact want to now have access to something they originally did not charge you for. They have to.

A software update fixes bugs and add features to make your previously existing operating system work as normal. This $1.99 charge is to give you new functionality that will cause your computer to work BETTER than normal. See the difference? No I don't think Apple will ever charge for a software upgrade unless it's brand new software (iLife, Leopard, Quicktime Pro 7, etc.). There are exceptions to this (iTunes, which was free to begin with) but the exceptions are there when Accounting isn't involved. Confusing? Yes. Evidence that Apple is screwing you? No.

Just my opinion.

 

[shamino]

Is it Apple's contention that a portion of the revenues that they recognized in their Q1 (on N-draft machines) may have to be reversed and as such they have to charge us so that they can say that it wasn't part of the revenues that they recognized?

Not quite. By charging, they can say that you're buying a new feature. Therefore, your computer was completely delivered as specified.

By providing an enabler without charging, they are saying that they shipped a not-fully-functional product and have to record the revenue as of the point in time when the product becomes fully functional (that is, when you install the updater.)

This means pushing last year's revenues to this year, which mean restating all kinds of earnings reports, which will mean investigations and all kinds of government badness.

In terms of real life we DID pay for n hardware.

No you didn't. You paid for the spec sheet that was printed on the box, or on the Apple Store's web site.

If you saw some blog reports about n hardware, bought a Mac based on that, and found that your unit had a b/g card, you would not have any legal basis to complain or demand a change.

1. Does this do anything for non Intel Macs running on Airport Extreme?
2. Also, does this do anything for Intel Macs that are wired to the Airport Extreme via Ethernet?

No, and no. If you don't have one of the Macs specified here, then the update won't do a thing. And if you're not using WiFi, then upgrading your WiFi firmware to pre-n won't affect anything.

 

[adamget]

What's the problem?

I can't believe what a load of childish ranting there is in this thread.

I imagine that Apple would rather enable it free of charge. It has probably cost them more to get the legal advice etc. than they will recover on the 1.99.

The reason they are doing it is claimed to be the law. If you have a problem with that then whinge to Bush and the law makers you have over there. Maybe whinge to execs at Enron that Sparked all this.

Even if this is NOT the reason - if you don't like it, don't pay it, and shut up.

Apple is not a charity. If I were a shareholder (sorry - stockholder, forgot you don't speak English), then I would be pleased they were covering their legal obligations and not exposing the company to some smart ass class-action suit that you all love so much.

A

 

[clevin]

yeah, for whatever reason apple want to charge u, u do have the choice not to pay it, so, who cares
802.11n isn't obviously better than b or g for most ppl, just like 11g isn't obviously better than b. why bother?

 

[gwangung]

Apple should have taken the hit on this one and not charged their customers.

Not legal.

And if you note, the legal advice to do this is quite probably more than the revenue they will realize on this.

 

[macenforcer]

Not legal.

And if you note, the legal advice to do this is quite probably more than the revenue they will realize on this.

Getting tired of people reinforcing this myth. Someone made this up and apple is sitting back laughing at this thread and how you all are backing them up. PROVE its illegal or stop using this as an excuse.

Companies have been updating their hardware for years via software updates just like this and I have NEVER been charged for it.

 

[NightStorm]

OMG I just thought of something... Apple has been doing this for years! They install Quicktime Pro on my computer, but force me to pay them to unlock the features. The cost of installing Quicktime on my computer is part of the cost of the system right, so therefore I should get this feature for free! I think we should get a class action lawsuit going!

While we're on this bandwagon, we should go after Microsoft too... I mean, this Vista Home install will copy everything to the hard drive, and be upgradable to Premium by getting a new key. I mean, I paid for Vista and its on my computer, I shouldn't have to pay to use it!

I've gotta say, probably 90% of the people in this thread are complete idiots who would argue if Apple had left 802.11n chips out of it entirely and made us pay $70 for a USB or PCI card to add this feature. The official specifications said 802.11b/g and made ABSOLUTELY NO mention on n support. That's a bonus feature. Grow up; not everything in life is free, and if you don't play by the rules, especially in today's corporate environment, you get in a lot of trouble.

 

[killmoms]

I love all the non-accountants, who are clearly unfamiliar with the laws involved, sitting here shouting about how they're being screwed and someone needs to PROVE to them that this is necessary, while for the entire thread there have been two or three very knowledgable people explaining calmly why this situation is occurring and why other situations cited aren't analogous. And yet, we still have screaming and moaning.

Look, if you don't understand accounting or the law or why this is being done, that's fine. But don't shout about it being untrue when people who are clearly knowledgable are doing their best to explain it to you. If you understand it and don't LIKE it, well, that's a different issue—then you ought to be pissed at the laws and the people who passed them, not Apple, who are merely trying to comply with the law during a time when they are under strict scrutiny for other monetary issues.

 

[weckart]

Save it. You are preaching to a bunch of Think Different folks. People who think differently. Bending over and taking it in the rear end is highly subjective. If you think different you might even like it.

Aaaannnnd breathe..... Feel better now?


What Apple appears to have done has a logic which makes perfect sense if you are steeped in accounting knowledge and experience, but seems idiotic and unbusinesslike to the average person. But them's the breaks.

I am unfortunately (it's boring) involved in SOx work now and have been for the past couple of years for various firms. The reason why Apple has gone to this extreme is because it is under especial scrutiny by the SEC thanks to the options scandal. When companies attract the attentions of this or any other oversight board, they overreact in order not to give the authorities any possible additional means to haul them over the coals with. I have seen it enough times already. Following the spirit rather than the letter of the law is not good enough. Remember, Apple has announced bumper profits and growth. It would be a feather in the cap of any ambitious investigator involved on its case.

And no, I do not like it any more than you do. After all, we are all consumers, too.

 

[BuzWeaver]

So wait: you're telling me that for accounting purposes, Apple has to charge something for the upgrade, but that it doesn't matter what they charge? This seems like an invitation to wacky accounting. Imagine if a corporation said: "Yes, our CEO received a house in Malibu, but we SOLD it to him for 1 cent."

I have a hard time believing that this is way things work...

I resisted making any 'political' comment as I didn't want to give the impression I was saber rattling or trollling, however I found it amusing during the Keynote how there was a lot of Democrat overtones with Al Gore's (who amusingly enough is a board member) voice message and the Nancy Pelosi's splash article in the New York Times during the iPhone demonstration.

I'm curious why there isn't a bigger outrage of having to pay a fee to make your systems compliant considering Apple just post its billion dollar earnings. Its typical of Dem's to point out Fat Cats and cringe, yet Job's seems to get away with such stuff.

 

[gwangung]

Getting tired of people reinforcing this myth. Someone made this up and apple is sitting back laughing at this thread and how you all are backing them up. PROVE its illegal or stop using this as an excuse.

Companies have been updating their hardware for years via software updates just like this and I have NEVER been charged for it.

Getting tired of people ignoring what's being said plainly. Gives me the impression that you're stupid (mistaken as that may be).

Do note that Apple DID get spanked for cutting corners on accounting. A company would be more careful in the future; obviously, you wouldn't.

Also note that it's undoubtedly true that they're NOT going to make any money on this; the legal advice they got on this and the costs they incur in collecting this fee is going to outweigh the rather minor revenues they will reap from this.

 

[joeconvert]

why charge anything for a simple firmware update!? i have tons of gadgets that get firmware updates that dont cost a cent, AND add functionality! apple is starting to nickel and dime us and i dont like it one bit. has success gone to their heads? hope not.

seems like many here agree with ANYTHING apple does and find reasons, even stupid ones, to justify the company's actions. sure, its just for accounting purposes, 1.99 is nothing, its adding value, apple is right in charging, ....

Please, just stop typing. This issue seems to be over your head.

 

[TheSpaz]

The thing is... Apple did not Advertise it as having "n" capabilities. You paid for the specs they gave you. Just because it's a SOFTWARE update and not a HARDWARE update, why should they give it to everyone for free? I think a lot of people think of software as something that they can get for free but, in fact, software costs money too. How many people would prefer that Apple did not mention it at all and not give anyone a choice? I suppose Apple should include iWork full install and Microsoft Office full with the computers they ship because it comes with the trial versions and a software update would make them fully functional......... for free!

On the other hand, they could just start shipping the new MacBooks with the "n"abled airport cards for only $1,100.99 that way, the users would be paying the $1.99 by force instead of by choice.

 

[failsafe1]

I will be glad to give them $2 so I can be free to buy whatever N Equipment I want on sale at Circuit City.

 

[NightStorm]

I will be glad to give them $2 so I can be free to buy whatever N Equipment I want on sale at Circuit City.

Better make sure whatever N equipment you buy on sale at circuit city is compatible with the draft-n spec used by Apple. Some chipsets may not be play nicely together; I can't wait for all the posts of people complaining about this (you all know it's coming!)...

 

[failsafe1]

Better make sure whatever N equipment you buy on sale at circuit city is compatible with the draft-n spec used by Apple. Some chipsets may not be play nicely together; I can't wait for all the posts of people complaining about this (you all know it's coming!)...

Great point. How or where would you find the draft specs?

 

[gwangung]

Hmph. If people want to save $1.99, why don't you write the drivers yourself, after the specs get past the draft phase?

 

[ClimbingTheLog]

Better make sure whatever N equipment you buy on sale at circuit city is compatible with the draft-n spec used by Apple. Some chipsets may not be play nicely together; I can't wait for all the posts of people complaining about this (you all know it's coming!)...

You're backing into an incredibly important point here - with this upgrade we'll have a draft-n standard radio.

To be consistent when the 802.11n standard is finalized and they have another upgrade from a draft-n radio to an n-radio - they'll *have* to charge $1.99 again.

And if an extension becomes popular (authentication, WPA-3, whatever) and they update the radio again, they'll *have* to charge again, since they "never sold us an 802.11foo radio).

Disturbing this is.

 

[aranhamo]

Bootcamp

Bootcamp is purely software.

Bootcamp is also pre-release, beta, use-at-your-own-risk software with no official support or liability on the part of Apple.

 

[gwangung]

You're backing into an incredibly important point here - with this upgrade we'll have a draft-n standard radio.

To be consistent when the 802.11n standard is finalized and they have another upgrade from a draft-n radio to an n-radio - they'll *have* to charge $1.99 again.

And if an extension becomes popular (authentication, WPA-3, whatever) and they update the radio again, they'll *have* to charge again, since they "never sold us an 802.11foo radio).

Disturbing this is.

Yes---to think that the legal education of people around here is so poor.

This line of reason doesn't follow from an unadvertised, firmware/hardware capability, which has already been explained ad nauseum.

And it certainly doesn't realize that the costs in collecting and distributing these changes are most probably going to be more than the $1.99 charge.

 

[Eraserhead]

To be consistent when the 802.11n standard is finalized and they have another upgrade from a draft-n radio to an n-radio - they'll *have* to charge $1.99 again.

No, I think with this charge they'll be OK, I mean $1.99 hardly matters if it has to be delayed in terms of revenue realisation. Basically if they re-charge they are awful.

I would expect it to be available for illegal download quickly and unless it takes the piss too much Apple won't do anything.

 

[calvin]

Hi,

I've read through this discussion, and I'm still not convinced about this really being necessary for accounting. Value wise I agree it's insignificant, however the accounting geek in me finds this quite interesting. If somebody can explain why my interpretation below is wrong, please do.

As I understand the relevant US GAAP rules on revenue recognition, a company may only recognise revenue once *obligations* related to the sales transaction are met. (I believe older rules allowed full revenue recognition with an estimated accrual for future costs).

To me it is the word *obligations* which is crucial. Apple is under no obligation to update the firmware to enable .11n. They have already met all obligations under the sales contract by supplying the relevant hardware, and so are already entitled to recognise all the revenue. There is no restatement issue that I can see with issuing this upgrade. There is therefore no reason I can think of why, from an accounting perspective, it is necessary to charge.

Incidentally, a point to those who said that without charging for the upgrade Apple would be saying that they shipped a product that previously they had 'hidden', and that the paperwork trail would not tie up. This makes no sense. Apple will not be recording inventory as '802.11g' cards. They will be recording by assigned product numbers - irrespective of the capabilities of that product. Check your last Apple invoice - it lists product numbers next to a brief description. The paperwork trail ties up perfectly for having sold a pre-n spec card in the new macs, even if it wasn't fully activated at time of sale.

I should mention that I am only an exam-qualified accountant, with another 7 months of time experience to get before full qualification. Furthermore my training was under IFRS rather than US GAAP. I am however aware of some US GAAP.

 

[morespce54]

A buck ninety-nine people. Sheesh.

Well, it's not about money ($1.99 is quite cheap) but it's about the idea of charging for an upgrade (soft or hard)...

 

[Diatribe]

Geez people, don't get your panties all wet.

Apple gives you an upgrade that you didn't expect when you bought the damn computer and you complain about it costing a buck ninety nine?

You have got to be kidding me.

It's like saying you bought a regular Honda Civic and later the dealership tells you that they shipped you a turbo version without you knowing and you'd have to pay $100 to unlock the power and still you complain.

If you don't want it don't get it. Nothing will have changed the computer you bought as Apple advertised it.
If you're smart you're just gonna fork over the $2 and be happy that you got such a great upgrade almost for free.

Get a grip people.

 

[morespce54]

Ok, so I have an Intel Core 2 Duo iMac with 802.11n draft.

If I download the $1.99 software when it comes out, is that enough to bump my speed, or do I need to replace my Netgear wireless router (3 yrs old) with a newer version (new hardware or new software or both) as well?

You most likely do need to replaced it. Unless your 3y old NetGear was already up to the 'n' protocol. Chances are that you 'Gear was 'b' and 'g' compliant (and not 'n' compliant)