Following last night's reports on AirPort Express, AirPort Extreme and Time Capsule stock running low at several Apple retail store locations in the United States, speculation has arisen claiming that Apple may either discontinue the line, or refresh it altogether bringing major new functionalities that integrate with iCloud and allow iOS devices and Macs to access content stored in the cloud faster. 9to5mac has received word that Apple has been internally testing a new version of the Time Capsule which is capable of downloading software updates for connected iPhones, iPads and Macs in the background, and distributing them locally once they've been downloaded from the Internet. According to the report, the Time Capsule would recognize devices owned by a user that are connected to the local network, automatically find and download software updates in the background, keep them in its cache, and send them quickly to a device once it's ready for the upgrade without having to force a user to wait for the download process.
What we do know is that Apple has been internally testing Time Capsules to cache Software Updates for both Mac and iOS devices. The way we’ve heard it works is that the new Time Capsule learns which devices connect to it via Wifi. It then goes out to Apple’s servers and downloads Software Updates for those products.
When the user wants to install the software update, the Time Capsule, which is also the router, routes you to the locally stored update, rather than downloading the whole thing over the Internet. This works for iOS updates as well, though the updating still happened via the Mac.
This new smart technology would know which devices are connected to the local network and, unlike Mac OS X Server, (which can download software updates for clients but it's not as smart as the proposed solution above) it would be capable of precisely knowing which devices need or can install what kind of software update. Imagine a system that based on user's behavior always downloads updates related to iPhoto for Mac, but asks with a popup box whether you want to grab the latest OS X version. The possibility offered by a "smart router" with local caching functionalities are practically endless when combined with Apple's fast pace of weekly software updates.
9to5mac also speculates the new Time Capsule could be used to cache content stored on Apple's iCloud -- such as music or movies and TV shows -- so that iOS devices with limited Flash storage would be able to quickly start streaming without having to wait for an Internet connection. If the rumors are true and Apple is building a service to backup music collections to the cloud or simply mirror existing songs after a scanning process, Apple might come up with a solution to keep most consumed content in a local cache for when you're listening to music or watching a movie on your iPad from the couch. Another idea is that Apple could store snippets of media locally (as a patent suggested), and let iOS devices start playing back music instantly. Or then again, the opposite may be true: instead of acting as a bridge between the cloud and iOS devices to provide content, the Time Capsule could back up content and settings from Macs and iOS devices to the cloud.
Update: John Gruber suggests the rumored new Time Capsule could handle iOS updates without tethering an iOS device to a computer -- that certainly sounds like a possibility, and something a lot of people have been wondering about on Twitter today.
There might be something to this. What if this is a way for iOS devices to do software updates without being tethered to a Mac or PC?
A rumor in May claimed iOS 5 would finally introduce over-the-air updates on a carrier's network -- considering iPhone and iPad owners are used to updating their devices at home, with their desktop computers, Apple could simply update the Time Capsule to make sure new OS updates are downloaded in the background on a local network (not a slow 3G connection), bypassing the need of iTunes.