It looks like Apple may have adjusted the ranking algorithm behind the App Store recently, propelling apps like Facebook, Angry Birds and other high-rated apps to the top of the list.

“We’ve been noticing changes in the Top Free rankings for at least three days now,” said Peter Farago, vice president of marketing at Flurry, which serves 80,000 applications with its analytics product. “From our point of view, Apple is absolutely considering more than just downloads, which we believe is the right direction go to measure true popularity of an app.”

Apple is reportedly taking user engagement and app ratings into consideration when ranking apps, instead of only their download numbers. This should be a good thing for standout apps and will make sure more popular and engaging apps reside at the top of the list more often. It will also be beneficial for consumers by encouraging developers to build better apps, which is never a bad thing in our book!

Have you noticed any other great apps moving up the top app lists? Let us know in the comments!

[Inside Mobile Apps]

If you're a frequent browser of the iTunes movie section, you may have noticed the addition of a Rotten Tomatoes rating section.  If you're not familiar with Rotten Tomatoes, it's basically a site where users and critics can rate movies as fresh or rotten.  To the left you'll see the classic TomatoMeter rating system while to the right you'll see a few of the most recent ratings for that specific movie.

And if you still want to know more about a movie, clicking the find more option will take you to the Rotten Tomatoes site page for that film.  Fancy! What do you think? Let us know in the comments.

[via TUAW]

The latest piece of hardware to come out of Cupertino, Apple's iPhone 3GS, has claimed the honor of being ranked number 1 in Consumer Reports new smartphone ratings. Now does this come as a surprise to anyone? In all actuality, it was pretty close within the top 8 devices: (Device/Overall Score):

• iPhone 3GS (16 GB) 73
• iPhone 3G (8 GB) 70
• Samsung Omnia 69
• BlackBerry Storm 69
• HTC G1 69
• BlackBerry Bold 69
• Samsung Epix 69
• Palm Pre 67

While the race to top honors was anything but a blow-out, the iPhone shined when it came to it's 3.5-inch widescreen display, top of the line multimedia, ease of navigation, web browsing, and battery life. Devices like the Palm Pre, among others, beat out Apple's gem when it came to messaging along with superior multitasking capabilities.

So the iPhone ranked number 1 this year as it did almost two years ago, congratulations goes out to Apple for a continuing job well done!

Update - We love our friends over at PreCentral.net so to be fair we wanted to let it be known the Palm Pre did not come in last place, we simply just cut the list off after the Pre. For the full list please visit the Consumer Reports site.

[Thanks to everyone who sent this in!]

More new finds in iPhone 3.0 Beta 5: it seems like those Restriction Settings -- allowing parental control over apps based on ratings -- we heard rumored in the wake of Reznor-gate have been surfaced in the latest beta.

Options include:

• Don't Allow Apps
• 4+
• 9+
• 12+
• 17+
• Allow All Apps

It's still unknown, however, whether Apple will take it upon themselves to determine ratings, leave it up to developers, or use a hybrid model where devs pick a rating and Apple approves or returns it for re-rating.

Regardless, we hope -- when it's finally released to the public this summer -- it puts an end to the sillier rejections we've seen.

Hot on the heels of all the iPhone 2.2 firmware Beta 2 goodness from Google, which included Street-View, Transit and Walking Directions, and Location Sharing, comes word on a couple more features for us to rumor over. TUAW says:

A tipster shared with us some screenshots of the new firmware, including what appears to be the ability to download podcasts directly to your iPhone (and presumably your iPod touch)

TUAW says this could explain Apple's rejection of PodCaster, but an explanation still does not a justification make. Still, this would be awesome functionality for those who don't always have a chance to tether and sync for their podcasts. We're guessing it will still be limited to WiFi only, however, like the iTunes store, to limit carrier data load for 50MB+ sound files -- and even them will the (typically much larger) video podcasts be enabled?

MacRumors (via iPhoneHellas), meanwhile, shows off a new alert box that asks users deleting an application to rate it prior to deletion. Valuable metrics, or Just Another Annoying Pop-up?