One of the most fascinating panels on the Macworld stage during last week’s Macworld | iWorld expo in San Francisco was a conversion about “The State of Apple” among Macworld editor Jason Snell, Daring Fireball‘s John Gruber and Chicago Sun Times columnist Andy Ihnatko.

We’ve excerpted the part that interested us most: 5:40 about what happens to Apple (AAPL) without Steve Jobs at the helm.

Our favorite bit: Ihnatko on why more companies don’t emulate Apple.

“When you try to copy Apple, it’s like trying to copy an oak tree. You have to plant the seed and watch it grow then see what it came up with. You can’t then just watch what it became, go to Home Depot, buy a whole bunch of lumber, paint and fake leaves, then build something. Because what you build is going to be half-assed and not an oak tree in any way, shape or form.”

To hear the rest of their conversation — in which they discuss thermostats, the new J.C. Penney and the advantages of having a crazy billionaire CEO — click here. For other Macworld panels, click here.

Filed under: Apple 2.0

With an IPO on the horizon and a record number of users, the social network has a lot going for it. Maybe too much for its own good.

FORTUNE — When Facebook finally goes public it’ll be a big moment for Silicon Valley, not only because it may be the biggest tech IPO ever but also because it will validate the social network’s staggering growth to date. When I joined, it was a barebones college-only online community where we could talk about courses, dorm life, and stalk that one hot classmate in East Asian History. Now it’s the Internet site people spend the most time on, with 800 million active users from ages 13 up uploading 250 milion photos a day.

In the U.S., the average user spends eight hours a month on Facebook; the self-admitted addict I am likely clocks that much in a week. To quote myself, Facebook eventually became “a way of life — a heady, nonstop road I’ve traveled along for years, where street signs are replaced with dynamic real-time news feeds, and my fragile ego can be crushed or swelled with pride depending on the number of people who deign to like or, even better, comment on my posts.” Heck, for many Facebook practically is the Internet.

I used to “Like” statuses hoping friends returned the favor, retouch “Photos of Me” before they went up, untag those that didn’t portray me in a petroleum-slathered, soft light. (For the most part, I still do.) Worst of all, I spent hours crawling “Friends You May Know,” building up a legion of 1,325 friends and 11,370 subscribers. Some of these people really are friends. Some are people I may have come across at work, gone to school with, dated or wished I’d dated. Others still are likely Fortune readers, to whom I am grateful. So it’s safe to say Facebook awakened and armed a narcissistic beast in me.

Then a few months ago, my relationship with Facebook hit bottom. The compulsion to log on reached a point where I checked Facebook incessantly at home, on the train, and at work. When for some reason I couldn’t sign on, I became frustrated. It was only when I found myself refreshing the News Feed on my phone between crunches at the gym that I realized the extent of my addiction. Would it be a big deal if I waited until afterwards to check? Well, of course not. But try telling that to me as I cursed my phone reception atop the sit-up bench.

I like to think there’s a reason for that incident beyond a mild case of “gym rage.” The way Facebook is structured now, you feel like if you don’t dip your toes into the social network’s stream of information for a second here, a minute there, you will miss out. The dashboard, once a study in relative simplicity, vaguely resembles a busy screen from World of Warcraft. The News Feed breaks up updates by Top and Recent Stories, a distinction I’ve never needed. And the live ticker chronicles the minute moves of friends as they happen, which sounds great in theory, but is more a visual distraction in practice.

Privacy wasn’t an issue (for me) until lately. Facebook’s charm once lay in the feeling of exclusivity it projected, a closed off virtual playground open only to a smallish group of friends where I could communicate without second thought. Now when I do so, I edit myself. To some extent, my profile and updates are visible to extended family, colleagues, professional connections, and a large number of others, so I post rather benign messages, images and links aimed at the largest common denominator. Sure, I could create different groups of Facebook friends and select who can and can’t see my updates, but organizing and maintaining those groups is too much work.

Ever-increasing Facebook partnerships means I need to be careful about the content I consume. Because I naively clicked on an online Washington Post story a Facebook friend read, all the stories I read from that outlet are automatically broadcast. With other apps like Spotify, Facebook integration is mandatory, meaning half the time, I enter a “Private Session” so others can’t see which songs I’m listening to. And while I get that targeted advertising can be a win-win for marketers and consumers, I don’t know whether to be amused or uncomfortable with recurring “Sponsored Stories” like the one to your right. (For the record, Facebook, I neither like guys with tattoos nor cedar enzyme baths.)

Facebook has also given rise to user etiquette unique to the social network — and not all of it’s good. The same way behavior in the movie theater has gone downhill — cell phones ringing, people chattering mid-scene — I’m noticing some users becoming less polite. People bug me if I don’t “Like” something they put up. (“Dude, ‘Like’ it!”) Others expect me to know what they’ve been up to because we’re Facebook friends. (Well, you saw on Facebook… right?”) And because Facebook nurses our propensity for immediate gratification, we expect things to happen even more quickly there than in real life. Wrote one friend un-ironically on another’s wall: “Why haven’t you poked me back yet? It’s been 20 minutes!”

That may be why several current and former users I’ve spoken with continue to steer clear of Facebook, deactivate their accounts, or ratchet down their usage. The evolving Facebook experience has either turned them off or the social network increasingly drew them away from the real world, breeding a false sense of intimacy where following friends and family on Facebook displaced deeper, quality interactions with them.

Of course, all of this is the result of Facebook’s genius and I won’t be deactivating my profile any time soon. But, I will try using it less. I’ve invested so much in my Facebook profile, spent countless hours building it up with friends, photos, links and status updates, that the idea of unplugging seems like the less attractive option. As I try to find a happy medium between gym checks and deactivating, I’ll remind myself of Facebook’s virtues. That it connects me with old friends. That it does expose me, through equal parts social recommendation and serendipity, to new bits of information. When really at the core of it, whether I’ll say so, I still want to be liked, however fleeting the online equivalent of that may be.

Editors’ Note: By the way, if you liked this article, well, see that little button down there. . . ?

Filed under: Uncategorized

As the middle class expands, Apple’s sales in China could soon reach 60 million per year

Click to enlarge.

Morgan Stanley has seen the future and it’s a well-heeled Chinese man (or woman) with an iPhone.

In a note to clients Sunday, Katy Huberty drew on Morgan Stanley’s proprietary AlphaWise survey of buying patterns among China’s rapidly growing middle class to paint a picture of the smartphone market on the mainland after Apple (AAPL), as widely expected, finally signs deals with China Mobile (CHL) and China Telecom (CHA).

She assumes:

• That there are roughly 150 million high-end subscribers in China currently paying at least RMB 100 ($16) per month for mobile phone service.
• That China Unicom (CHU), currently Apple’s only official carrier, has 15 million of those subscribers, or roughly 10%.
• That late this year or early next, Apple will begin selling next-generation iPhones through China Mobile (120 million high-end subscribers) and China Telecom (15 million).
• That because 20% of China Unicom’s high-end subscribers buy iPhones, the other two carriers’ subscribers will follow suit. (8% China Mobile’s high-end customers already use iPhones, even though they get only 2G service.)
• Assuming 20% penetration, Apple should see, at a minimum, 24 million addition iPhone sales in 2013, adding $6.5o per share to the company’s bottom line.
• As the iPhone catches on and the middle class expands, that number could grow to nearly 40 million next year, adding $10 to Apple’s earnings per share.
• Eventually, says Huberty, the iPhone in China will reach penetration levels comparable to those of AT&T (T), where 63% of smartphone customers currently choose iPhones.
• In Morgan Stanley’s bull case scenario, Apple within a couple of years will be selling an additional 57 million iPhones per year in China alone.

To put that in perspective, Apple sold 68.5 million iPhones worldwide in fiscal 2011, although with the launch of the iPhone 4S in October it sold more than half that many (37 million) in just one quarter.

Below: Part of the crowd that showed up at one of Apple’s Beijing stores for the launch of the iPhone 4S.

Pent-up demand. Photo by Feng Li/Getty Images via the Mercury News

Filed under: Apple 2.0

Fortune’s curated selection of tech stories from the weekend. Sign up to get the round-up delivered to you each and every day.

Barnes & Noble CEO William Lynch.

* Once the “brutal capitalist” of booksellers, Barnes & Noble (BKS) now finds itself the David to Amazon’s Goliath. Can CEO William Lynch navigate the company and its well-received Nook readers to long-term success? The New York Times takes a look and also reveals that a new Nook is likely coming this spring. (The New York Times)

* Facebook could file to go public this Wednesday, raising some $10 billion at a valuation of between $75 billion and $100 billion. If true, Facebook’s could be considered the largest tech IPO ever. (Fortune)

* Former Research in Motion (RIMM) co-CEO Mike Lazaridis on the challenging decision to step down from his role with the company after 27 years. Though Lazaridis is still on the company board and will chair the board’s new innovation committee, he won’t be involved in day-to-day operations. ”Stepping aside, as a founder, after 27 years, I would be lying if I said that wasn’t emotional for me, and for my whole family.” he said. (The Record)

* Not everyone in Silicon Valley is benefiting from the tech boom. Some older tech professionals are finding it hard to get work as many rising startups simply focus on younger applicants or applicants with skill sets that better align with their needs. (The New York Times)

* Bill Gates on his complex relationship with Steve Jobs: ”There was no peace to make. We were not at war. We made great products, and competition was always a positive thing. There was no [cause for] forgiveness.” (The Telegraph)

* Thanks to husband and wife team Kate Imbach and Tom Conrad, Silicon Valley finally joined the “Sh*t [insert name] Says” viral video genre last week. But is the video accurate or off-the mark? You decide.

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Filed under: Today in Tech

Facebook has plenty of challenges as it readies to go public.

By Rob Go, contributor

The entire tech world is waiting with baited breath for the filing of Facebook’s IPO next week. I’m excited – the company is an absolute monster and has completely transformed the web.

But, as I’ve reflected on Facebook this past weekend, I can’t help shake a nagging feeling that the company’s success feels somehow…fleeting. In some weird ways, Facebook makes me think a bit of Yahoo (YHOO). Not the Yahoo of today, but the Yahoo of the past. And I wonder if Facebook will see a similar decline over the next 10 years.

Here are the major vulnerabilities that I see:

1. Network fragmentation. Facebook’s success is largely based on its ability to aggregate the biggest audience on the Internet and understand and monetize that audience. Social networks should be incredibly robust because of network effects. But I really have a hard time believing that Facebook will continue to dominate the pageviews 10 years from now. I think we are already seeing that while Facebook serves as a great repository of one’s identity and relationships, deep engagement is starting to happen in more targeted, fragmented communities. Photo sharing is done best on Instagram. Social curation of products on Pinterest. Self-expression on platforms like Tumblr. Sure, Facebook participates in this activity somewhat and could copy these companies, but Swiss Army knives almost never win long term.

2. Not natively mobile. I think the mobile Internet will further accelerate the trend of network fragmentation. Part of Facebook’s challenges will be driven by the rules of the app ecosystem that Apple has created. But mostly, Facebook’s main challenge is that it was not built in a mobile-first context. We are in (or will soon be) in a mobile-first world, and I think it’s hard to expect a large company like Facebook to own that domain in the same way.  Just as Google (GOOG) ceded ground to Facebook because it was not natively social (and Yahoo was way, way worse), I can see Facebook ceding ground pretty quickly to products that are built with a mobile, distributed computing context in mind from the beginning.

3. Advertising effectiveness. Facebook’s impressive revenue relies largely on advertising. But I think the jury is still out on how transformative it as as an advertising medium. Social advertising can be pretty compelling, but intent is pretty low, much like display advertising. I also think that Facebook falls pretty far short currently on its effectiveness as a brand advertising medium. Do you remember any really impactful brand campaigns this year that were deeply integrated with Facebook? I don’t, but do remember several that were largely driven through YouTube and Twitter. Finally, Facebook hasn’t yet developed a meaningful off-Facebook advertising product that has scale. These are more opportunities than criticisms, but if the company doesn’t maintain leadership in these areas, I see it as a further challenge in the face of #1 and #2.

4. Talent exodus? This is a big question mark. I think one of the most incredible things about Google is the company’s excellent culture and unique ability to hang on to outstanding talent for a long long time. There were certain management practices that were core to Google that made it an exciting place to work. From the distributed nature of its product teams, to its maniacal focus on valuing engineers, to its free-market-like prioritization of resources and products, to 20% time, etc etc. It means something special to be a Googler. And although some of these practices have evolved and the company has changed,  I’d argue that Google will maintain higher calibre talent much longer than other large scale technology leaders like MSFT, Ebay, Yahoo, etc.  Will Facebook be able to do the same? I’m really not sure. We’ll hear much much more in the coming years about how Facebook is run and how it represents the next step in the evolution of high-performing engineering organizations. But if it can’t bottle some of the magic that Google was able to achieve, I think the company will risk sliding slowly from the center of the internet to its periphery.

All this said, it’s obviously easy to poke holes at a company from the sidelines. Facebook is an amazing company and will continue to look pretty dominant for at least the next 5 years (much like Yahoo). But I think its ability to remain a great company for 10+ years will depend on how well it navigates the four challenges/opportunities above.

I look forward to the company’s public offering and will probably be a buyer… at least the first couple years.

Rob Go is co-founder of NextView Ventures, a seed-stage investment firm focused on Internet-enabled innovation. He previously was with Spark Capital, and blogs over at www.robgo.org

Filed under: Contributors, From the Crowd

ABB of Switzerland is nearing a deal to acquire Memphis-based electrical components maker Thomas & Betts Corp. (NYSE: TNB) for approximately $3.9 billion. The $72 per share offer represents a 24% premium to last Thursday’s closing price. www.tnb.com

Siemens AG has agreed to acquire RuggedCom Inc. (TSX: RCM), a Canadian maker of utility-grade communications networking solutions, for C$382 million. The C$33 per share offer represents a 26% premium to RuggedCom’s closing price last Friday, and tops a rival offer from Belden Inc. (NYSE: BDC). www.siemens.com

TonenGeneral Sekiyu KK, Japan’s second-largest oil refiner, has agreed to acquire a 99% stake in ExxonMobil‘s Japanese subsidiary (ExxonMobil Yugen Kaisha) for approximately $3.94 billion.

HgCapital is seeking to sell SHL, a UK-based provider of psychometric testing services, according to the FT. The deal could be valued at around $700 million, with Morgan Stanley managing the process. www.shl.com

U.S. Steel Corp. (NYSE: X) has agreed to sell its Serbian plant to the Serbian government for $1. U.S. Steel had bought the facility out of bankruptcy for $33 million in 2003, but had been losing money on its continued operation. www.uss.com

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Filed under: Term Sheet