The information coming from this anonymous source lines up pretty closely with what we've been told by David Stanfill, founder of AirParrot and Reflector developer Napkin Studio. Apple engineers are apparently aware that the current implementation leaves something to be desired since it introduces lag and compression artifacts, but the adapter's firmware is supposedly upgradeable and improvements will evidently be made to the compression in future iOS updates. This setup is apparently future-proof according to the poster, since it's entirely software-driven. The encoded data is transferred as packetized data across the Lightning bus, where it is decoded by the ARM SoC and pushed out over HDMI. Airplay itself (the network protocol) is NOT involved in this process. What happens here is that we use the same hardware to encode an output stream on the fly and fire it down the Lightning cable straight into the ARM SoC the guys at Panic discovered. Posting to Slashdot, the anonymous individual claims that AirPlay isn't actually being used at all, and that contrary to some speculation the adapter's processor doesn't run a stripped-down version of iOS: They had some thoughts on how the accessory might be working its magic, namely that it could be using AirPlay in some way, but now someone claiming to be an Apple engineer has come forward with what's said to be the official explanation of how it works. To their surprise, they found that it contained a tiny computer featuring an ARM processor and 256 MB of memory. Last week, we shared how the folks at Panic had pulled apart one of Apple's Lightning to HDMI digital AV adapters in an attempt to figure out why it didn't seem to output true 1080p HD video.
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