CUPERTINO BUSINESS REPORT
Of DoJ Probes, Lost Marketers and Nvidia Vexations

It's been a pretty bad week for the financial markets in general, and it seems the bears may stick around for a while. On Tuesday, the S&P fell to a 10-week low; meanwhile the Obama administration began muttering about a new stimulus package, the Dow fell more than 161 points, and the Nasdaq fell more than 40 points.

In the first week of July, Apple's (Nasdaq: AAPL) share prices fell US$4.22, to close at $138.61 on Tuesday.

However, that's still almost $48.50, or almost 54 percent, higher than the Jan. 9 closing price of $90.13, and iPhones are flying out the door.

Overall, it's a mixed bag for Apple this week. The iPhone's top marketer has left Apple for a venture capitalist firm, and rumors are swirling around Apple's relationship with graphics chip maker Nvidia.

However, there are also some bright spots. In a move that might result in freeing Apple of contractual obligations to AT&T (NYSE: T), the Department of Justice is taking a hard look at wireless exclusivity as part of a more wide-ranging probe.

Bye Bye, Bob Borcher

Bob Borcher, who served as senior director of worldwide product marketing for the iPhone, has left Apple for early-stage venture capital firm Opus Capital.

He will focus on investments in mobile applications and services as well as related hardware and software opportunities.

Borcher, part of the original iPhone team. He played a key role in the development, launch and global expansion of the iPhone, iPhone OS, the Apple App Store, and the launch of the iPhone 3GS. He also led the iPod partnership with Nike (NYSE: NKE) and worked with major dealers to get them to integrate the iPod into their products.

His departure won't pose a problem for Apple, said Gartner (NYSE: IT) vice president and distinguished analyst Ken Dulaney. "There are plenty of great executives to take care of the iPhone at Apple," Dulaney told MacNewsWorld.

The sentiment was echoed by Yankee senior analyst Josh Martin. "The iPhone is such a transcendent device that it wasn't affected much even by Steve Jobs' absence," he told MacNewsWorld. "Anyone can leave Apple and it won't impact sales of the iPhone."

When the Chips Are Down

Meanwhile, the grapevine is blossoming with rumors of an Apple-Nvidia split.

Apple has turned away from partnering with Nvidia for iMacs and for computers based on the Intel (Nasdaq: INTC) Nehalem chipset, according to a technology news blog. That blog's name: Semiaccurate.com.

Nvidia provides the graphics processors for the MacBook Pro. The falling out, if it exists, may stem from performance issues. A statementon the Apple support Web site says Nvidia acknowledged in July 2008 that some of their graphics processors had an unusually high failure rate, but it blamed this on a packaging defect and assured Apple that Macs with these processors were not affected.

"However, after an Apple-led investigation, Apple has determined that some MacBook Pro computers with the Nvidia GeForce 8600M GT graphics processors may be affected," the site said. The site carried Apple's offer to repair such failed processors in all MacBook Pros free of charge if the failure occurred within three years of the original date of purchase, even if the MacBook Pro is out of warranty.

On the other hand, Fudzilla later said it learned from industry sources that the two vendors still have a good relationship.

Apple did not respond to requests for comment, while Nvidia spokesperson Hector Marinez dismissed the reports of differences between the two.

"These rumors are baseless," Marinez told MacNewsWorld.

If the two are really at loggerheads, Apple might find a use for the chip maker it bought last year, as well as Imagination Technologies, the UK-based chip maker it increased its investment in recently.

DoJ Cries Havoc

Following on from last month's Senate hearing into wireless exclusivity -- a situation wherein a carrier like AT&T has an exclusive deal to carry a certain handset like the iPhone, for example -- the Department of Justice is reportedly looking into whether or not the two biggest major U.S. carriers, AT&T and Verizon, are engaging in anticompetitive behavior, according to The Wall Street Journal.

That probe will apparently touch on the question of wireless exclusivity.

"Why doesn't the government go after cable companies?" Gartner's Dulaney asked. "They're far more anti-competitive than wireless carriers."

"This is a waste of taxpayer money," Yankee Group analyst Josh Martin said. "The exclusivity issue will address itself when manufacturers realize there's money they're leaving on the table by having exclusivity, provided they don't lose money adding on other carriers."