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Apple's 4 Biggest Surprises of 2010

If you've been tracking Apple earnings, you know that Apple has had a record-breaking year. Apple's market cap is nearing $300 billion. On the product side, Apple delivered the hot iPad this year, super-slim versions of the iPhone and Macbook Air, and unveiled Mac OS X Lion--all while fending off an army of new Droids and iPad contenders.

While Apple's accomplishments this year could have been predicted on the success of the iPhone the preceding years, how Apple achieved its dramatic rise is a bit of a surprise. Here are four of Apple's biggest surprises this year:

Heard of the iPad?

Remember when the iPad was just a rumor? Of course you do. A new twist on the rumor popped up every week or so for years. The fact that Apple finally delivered the iPad in April this year wasn't the big surprise--but its amazing run is mind-boggling.

More than 65 percent of Fortune 500 companies are deploying or piloting the iPad, Apple said during its most recent earnings call. "We haven't pushed it real hard in business, and it's being grabbed out of our hands," says Apple CEO Steve Jobs.

[ Here are 12 iPhone and iPad accessories that define you, reports CIO.com. ]

The iPad shut down the rocketing netbook market, rattled the laptop market, threatened to take over Christmas--and became an enterprise sensation. Even IT staffers are loving it, checking up on servers on the iPad. (Learn why one company is ditching sales laptops for iPads, reports CIO.com.)

Rise of the Droid

The iPhone's beautiful touchscreen is the face that launched a thousand Droids, or thereabouts. Most people figured RIM, which has traditionally focused on enterprise needs, wouldn't be able to keep up with Apple's consumer-driven iPhone design. Could Google? The search giant, along with mobile manufacturers such as HTC, delivered an army of Droids that shocked the industry by outselling iPhones in the third quarter of this year.

So will Android smash the iPhone in the long run? Piper Jaffray predicts Android will overtake the iPhone in smartphpone market share in only a couple of years. But that's a red herring, say analysts. The Android market is spread across many handset makers, and it's unlikely any one maker will surpass Apple in the foreseeable future, according to Gartner analyst Van Baker.

Also, rumors of a Verizon iPhone hitting the market early next year are gaining validity. If this happens, tech analyst Rob Enderle told CIO.com, then Apple "could quickly overcome this [Android] lead."

The Biggest Blunder

Apple can make mistakes (see iPod Hi-Fi, Mac OS 9, mouse claw), even with its precious iPhone. When the iPhone 4 came out last summer, Apple fans shook with excitement over its sleek design, Facetime video chat, and Retina display. Then came the hangover after the party.

Problems with the iPhone 4's antenna reception cropped up, leading to a scathing iPhone 4 review by Consumer Reports. At first Apple ignored the problem, then called it a software problem, and finally issued free "bumpers" to fix it. Next, the iPhone 4 showed signs of being more breakable than its predecessors. (Check out Cracking the Case of the Troublesome iPhone 4 Glass.)

A World Ruled by Apple

If you've ever wondered what life would be like if Apple ruled the world, this year we got a glimpse, and it ain't pretty. Where to start?

Let's begin with Apple's bikini ban. Apple suddenly decided that some approved iPhone apps were showing too much skin, so Apple yanked them from the App Store overnight. Developers were not given warning, nor did Apple return their frantic calls.

Next, Apple was so outraged at the iPhone 4 prototype leak, whereby an Apple engineer left it at a Silicon Valley bar and the finder sold it to Gizmodo, that Apple sent the police to search a Gizmodo editor's home and seize computers. Of course, Apple has taken a hard stance against leakers in the past, most notably shutting down a website that posted Apple insider info.

Apple is well known for its secrecy, a cloak that rose time and again this year. For instance, Apple refused to address antennagate for weeks. When Apple finally called a press conference, a miffed Jobs seemingly dismissed these concerns as trivial and hyped by the media. (Check out CIO.com's teardown of Apple CEO Steve Jobs.)

Apple's feud with Adobe reached a boiling point when Apple refused to support Flash in iOS. Jobs penned a damning technical take on Flash to support his position. Analysts wondered whether there was more to it. Was this a shrewd business decision? Was this payback for Adobe abandoning Apple for Microsoft when Apple was at a low point a few years ago?

The fact that these possibilities were even considered shows what Apple is capable of.

Tom Kaneshige covers Apple and Networking for CIO.com. Follow Tom on Twitter @kaneshige. Follow everything from CIO.com on Twitter @CIOonline. Email Tom at tkaneshige@cio.com.

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