Gadget Stock Watch: Apple Dips, Digital TV Set for '09, More

1. Apple's run to $200 a turkey. Apple (AAPL) lost 3.6% to $171.25 on Tuesday's late market selloff, slipping further from the $200 level it was unable to hold between Dec. 26 to Jan. 2. Its shares are off more than 15% since peaking on Dec. 27th and are at their lowest level since around Thanksgiving. Apple had been trading higher most of Tuesday, following its introduction of a new Xserve and Mac Pro, using two Intel (INTC) Xeon quad-core chips.

2. The iPod economy. One estimate of the economic impact of Apple's iPod puts accessory sales north of $1B this year (+45% y/y). Sales of iPod speakers and gadgets are seen surpassing sales of shelf stereo systems and home theaters in a box. Here's Amazon's ranking of the most popular iPod accessories. Separately, Reuters reports Microsoft (MSFT) Chairman Bill Gates told a German newspaper the firm will not launch a product to compete directly with the iPhone. "No, we won't do that. In the so-called smart phone business we will concentrate solely on software with our Windows Mobile program."

3. Palm's painfully slow comeback. Shares of Palm (PALM) are trading in the $5 range these days, considerably below highs of recent years (don't even ask what its all-time high is). Palm shed some light on its planned comeback in smartphones, anchored on finally rolling out a new operating system. In short, don't expect anything really new until 2009.

4. No digital TV switcheroo. Speaking at CES, FCC Chairman Kevin Martin confirmed the planned switch to digital TV by Feb. 2009 will not be postponed, calling it a "hard deadline." About 50% of homes have digital TVs and 28M digital TVs are expected to be purchased this year, according to the president of the Consumer Electronics Association. Mr. Martin declined to comment directly on the planned merger of Sirius Satellite Radio (SIRI) and XM Satellite Radio (XMSR), but views favorably their talks of a la carte pricing plans, saying he encourages other content providers (especially cable TV co.'s) to offer a similar plan. It seems a merger between satellite TV broadcasters Echostar (DISH) and DirecTV (DTV) would have a better reception following a successful SIRI-XMSR merger and adoption of new pricing programs.

5. Calpers to invest in Silver Lake. Media reports say an announcement is expected Wednesday of a $275M (9.9% stake) investment by the California Public Employees' Retirement System in technology-focused private equity firm Silver Lake Partners.

6. The high cost of product returns. An Accenture executive explains the nearly $14B (cost to manufacturers, retailers and communication carriers) of annual consumer electronics product returns in the U.S. are often the result of new gadgets not meeting consumer expectations.

7. Ford cars to get Sony audio. Sony (SNE) has an OEM amp designed for Ford (F) cars on display at CES. Sony will be supplying Ford with branded amps and speakers, expanding an ongoing relationship with Ford in Europe.

8. Bridging the Internet and TV. Internet-connected TVs are a hot product at this year's CES. Sharp (SHCAY.PK), Samsung (see ETF EWY) and Panasonic/Google are among the promoters. HP (HPQ) and Sony (SNE) already have commercial products.

9. The rise of Newegg. California-based computer and electronics e-tailer Newegg.com achieved sales of about $1.5B in 2006 and has been profitable since its founding six years ago. Low prices leading to strong consumer loyalty is one reason for Newegg's "rise from obscurity."

Comments

[Long-ShortGuy]

The new Mac Pro just isn't exciting -- who wants a desktop now anyway? We'll have to wait for the super-thin notebook.

Interesting that Apple's own external speaker system for the iPod doesn't rank in the most popular accessories, and it's now almost impossible to find on Apple's own website.