Apple's Magic Touch Screen

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You could watch iTunes videos and movies and plug in headphones and listen to music from your iTunes playlists.

And consider the multitouch opportunities. An on-screen keyboard on which you could actually type more or less normally, much like the one on the iPhone. Done correctly, the device could make access to a computer a far less structured affair, not requiring you to sit in front of it at a desk to get anything done. Its presence could become more ephemeral, akin to a TV remote: Reach for it and it's there; use as needed.

Secret Partner

And Apple appears to own the patents around this technology, though it seems a patent has yet to be formally issued. Some of the technology appears to have come from a company called Fingerworks, which was founded by two former University of Delaware professors and ceased operations in June, 2005. The founders may now be working with Apple, Reitzes says. Both Apple and Fingerworks are defendants in a patent lawsuit brought in January by Quantum Technology Management, a British outfit that says it owns a patent on "capacitive field sensing" that's being infringed by the two companies.

To build the screens, Apple has partnered with a German company called Balda, best known for making wireless-phone components for companies such as Nokia (NOK). It owns half of a Chinese company called TPK Holding. Balda and TPK, in turn, have formed a joint venture with an outfit called Optera, a unit of Magna International (MAGBF), which specializes in making glass coatings that conduct electricity—exactly the kind of ingredient you want in a touch screen.

Balda initially confirmed to a news agency that it was the supplier of the touch screen a day after the iPhone was announced on Jan. 9 (see BusinessWeek.com, 1/11/07, "Apple's iPhone Rings a Lot of Bells"), but has since taken a more tight-lipped approach and no longer comments on the matter.

Its many secrets aside, I'm starting to think that the most important thing about the iPhone is not how cool a wireless and media device it appears to be, but the screen that makes it look so good.

Hesseldahl is a senior writer for BusinessWeek.com and his Byte of the Apple column, covering all things Apple, appears biweekly at www.businessweek.com/technology.