Julian Ivan-Alexander

U.S. Handset Subsidies to Be Replaced by Something Worse?

Are you nuts? Subsidised handset sales are the norm in Europe. You really need to get out more.

The Google Phone: Blockbuster or Bust?

Google is not positioning itself against Apple. Its positioning itself against Windows Mobile and its lesser competitors. I'm not sure why people find this so hard to understand.

Verizon Wireless Unveils Device to Rival iPhone

Hmmm .. let me see.. no WiFi, twice as thick as an iPhone, worse battery life (power-sapping double screen).. no iTunes. No iPod. No multi-touch screen. Second-rate web browser. I could go on...

"iPhone Killer?" More like a reputation killer for Mike Lanman for coming up with such a stupid statement. Lanman will be hoist by his own petard once the holiday season sales numbers are out.

Was Verizon Really Wrong To Pass On The iPhone?

Verizon is/will lose millions of high paying, high ARPU customers to AT&T. About half of AT&Ts iPhone buyers are new to the network, and about 50% of those are ex-Verizon.
In addition, AT&T aren't subsidising the phone, so whatever revenue sharing they are giving Apple is counterbalanced by being able to profit on the handset itself.

So to answer your question bluntly and simply - yes Verizon was stupid-wrong to pass on the iPhone.

Verizon May Counter iPhone With LG Prada

Lol.. they might as well try attacking tanks with swords for all the good it will do. The Prada phone is rubbish. Everyone here in the UK thinks its just overpriced garbage.

Apple: Biting off More than It Can Chew?

AAPL's PEG is 1.3. AAPL's forward PE is 22. AAPL grows earnings by 30-40% YoY for last 4-5 years. AAPL saw growth of almost 80% YoY last quartter. AAPL guided for 30% YoY growth for this quarter, its "traditionally slowest."
The iPhone, even if it just meets Apple's own sales targets, stands to boost earnings by between 30-40% annually. Possibly more if sales are more.

Someone tell me that doesn't add up to a grossy underpriced stock.

Why Apple's iPhone Doesn't Really Matter To Verizon

"Larry" gets no brownie points from his editor for being right. He gets points for getting hits, and taking a contrarian approach, which means bashing Apple and the iPhone. Dan, you're spot-on. Larry and his blinkered pals can't think for themselves, so they just regurgitate the crap they're spoon-fed by the PR FUD-meisters and spin artists. The idea of doing any meaningful research of their own is completely alien to them.

Why Apple's iPhone Doesn't Really Matter To Verizon

Rob, take one look at the demos of the UI at apple.com/iphone and you'll see its 100% Apple, 0% Cingular

Verizon Hung Up on iPhone Deal

Thomas, yes he actually did say 10M. That very figure. So you can bake in a minimum of 10M sold between June 2007 and 2008 sometime. I'd say more like 20m though, especially once cheaper "nano" versions are released.

Verizon: "We're Happy We're Not First to Market With the iPhone"

"Looking at the product line that we have, particularly the handset lineup, we’re very confident with our strategic partners and we’ve had a lot of good product from all three of our major suppliers, and there too, more on that as the year rolls out."

I remember Steve Ballmer saying much the same thing about Microsoft's "PlaysForSure" partners and how their products were so great that between them they were going to wipe the floor with the iPod. We all know how that ended.

Behind the scenes Verizon are probably saying to their "strategic partners" something along the lines of: "we are going to have to discount the crap out of your products to get anyone to buy them now. If you don't come out with anything competitive with the iPhone, your margins are going straight to hell, along with your stock options."

Verizon: "We're Happy We're Not First to Market With the iPhone"

Translation: "we, and our handset partners, are collectively crapping ourselves."

Verizon Happily Rejected Chance To Be Sole iPhone Service Provider

""The iPhone product is something we are happy we aren't the first to market with," Strigl noted, citing Apple's steep and one-sided terms including a cut of monthly subscription fees and total control over distribution and customer relations. Another Verizon spokesman added, "We have great distribution partners nationally, regionally and locally... And the deal [Apple] wanted would have frozen out those partners."

Translation: Boy oh boy did we screw up two years ago by not taking this product. Now we're dependent on Motorala, Palm, Nokia, and Samsung to get us out of this hole. Oh boy oh boy oh boy are we crapping ourselves! Maybe if we tell people we don't care about the iPhone they'll forget about the fact that our products will suck in comparison at that price point.

Why Apple's iPhone Doesn't Really Matter To Verizon

"Apple gave rivals a big heads up by preannouncing the iPhone. Don't be surprised if Verizon's key partners come out with iPhone killers shortly."

Verizon are crapping themselves at missing out on the hottest phone in the market, from a resurgent Cingular. You expect them to discuss what is potentially their biggest competitive threat in the smart phone market on their conference call? Come on, grow up, get real. As for "iPhone killers," we heard the same about the iPod. Where are the "iPod killers?" It isn't just about the hardware - its about the software. No handset manufacturer - not a single one - has a great UI. The iPhone does, and its tied to an innovative new touchscreen and input technology. You really think any of them have the expertise or resources to even come close to the iPhone's sophisitcation without several years of design and research? Give me a break.

Verizon Hung Up on iPhone Deal

SJ has publicly stood up and said he sees 10m iPhones sold by 2008. Its incredible for Apple to have actually pinned a firm number like this down as it is. The only reason I can think is that Apple are not just hoping to sell that many, but are supremely confident of doing so because they have guaranteed minimum orders from Cingular and possibly other, overseas, networks too. When was the last time Apple ever, at any time, publicly forecast sales numbers for any product, let alone a completely new one?

The 10m number is as good as sold as far as I'm concerned. No way would SJ have mentioned a number like this unless it was virtually a done deal.

And so, if Apple do have a revenue sharing arrangement with Cingular, and they do intend to sell 10m iPhones, then they will have to include guidance for such income in their Q-ahead numbers. If they get just $5/month per subscriber (which is about what RIMM get for their Blackberry email service from the networks), then as I've pointed out, that's 10m * $60 = $600m. That's pure profit - it will go straight into earnings - translating to about 40-50c in FY earnings in 2008/9.

I can't stress this enough: 10m iPhones is a done deal or SJ wouldn't have mentioned the figure. He never gives sales forecasts like this. Never. That's $6 billion in revenue - about enough to add $1.50 to FY08 earnings (or somewhat less if you assume a lot of those may be sold after the launch while still in FY07). On top of that, you can add another 50c from subscriber revenue sharing to FY08/09. So in total, the iPhone could be bringing in an additional $2 to FY08 earnings estimates - enough for a 65% earnings surprise for the year.

Its laughable - simply laughable - that this hasn't been more widely picked up in all the analysis. SJ would not just pluck anticipated sales out of thin air. Its a done deal, or as good as, or he wouldn't have mentioned it. Thus the earnings for FY08 are also a "done deal." You know what analysts are still estimating for FY08, having not adjusted their estimates after raising FY07 through the roof? A pathetic 15% increase in earnings over FY07

And that's if they only sell the expected 10m. What if they sell 15m? Or 20m?

Insane! I say a 60% earnings surprise for FY08 from here at a bare minimum. Possibly as high as 100%. AAPL is way undervalued here, and the absolutely certain impact of the iPhone to earnings has been way underestimated. People who say they can't see 10m iPhones sold by 2008 are misunderstanding what's happened. Apple have ALREADY sold the 10m, or as good as, or they wouldn't have been throwing around that sales figure. Apple just don't talk about sales numbers, ever, if they can avoid it. 10m iPhones. At a minimum. In the bag.