WaveNet Pharma

How the iPhone and Poor Management Contribute to Apple's Downfall

This article misses the point ENTIRELY !

The reason for subscription method of accounting has nothing to do with the CFO's preference and everything to do with the service revenue share arrangement with AT&T as it reflects the lock-up of the subscriber over a 24 month period to pay for the subsidized handset. Only RIMM has a similar arrangement with the mobile operators while Nokia is keen in copying that model with its new PDA handets.

Apple is brilliant for having switched to that method and it has done nothing to affect its business fundamentally. The company is still a strong contender for dominance of the market-segment they are in.

Accountants should know their place. Trying to explain business or product strategy choices without understanding the rationale is an exercise in futility.

The Outlook for Apple's iPod Business

That the iPhone will cannibalize a sizable amount of iPod sales is more likely than the reverse. That being said, the assumption that a touch-screen interface and a larger display will continue to propel iPhone into unimaginable heights needs revisiting. Most corporate users do NOT want to have the imprecise touch- screen input and every mobile unit manufacturer has larger-screen models available.
The exclusive relationships that Apple has obtained to launch iPhone might well end-up being an obstacle to growth over time. At this moment it is still unclear that iPhone is poised for unimpeded growth until and unless the market outside the US shows real traction.