rd4sndk

STEC Revisited: Will It Go from Good to Great?

499802... I disagree with your essessment of Sndk. Sandisk financial problems weren't a result of its technology being ahead of the market. Sandisk failure stems from their inability to bring to market the right technology and the right product--namely SSD, OTP and 3D. Sandisk spend more time developing CE products (mp3 particularly) and aquiring msystems. All of these efforts did little to differenciate Sandisk from commodity markets while providing time for its competitors to catch up (albeit with lower profit margins) but never the less comparible or better pricing. Sandisk inability to stay ahead of the competition was its own undoing. STec should heed the message that your competition is more formidable than you are lead to believe by your initial success.

EU Cadmium Ban Would Seriously Hurt First Solar

Cadmium is a naturally occuring chemical extracted from prescious metal refining. Is the EU going to ban the "earth"? I find the EU controlled by a hoard of idiots that have done nothing but inacted rules that favor their own interest. America did well ignoring their elitist plans until Obama. God help us to reverse the economic disaster coming--if not too late. With 10.2% unemployment and the anti-business policies of this administration, God help us if Obama is wrong. For the sake of this country and the world, I really really really hope he succeeds inspite of his policies.

STEC's Massive Selloff: It All Hinges on EMC

leslie... You so right!! Its shameful for a stock that had already sold off on false information (competitive market threat) and to sell off even further after beating both top and bottlom line. Guidance was short of expectations but it didn't warrant a 75% fall in the SP.

I'm under water with Stec by 50% but believe and hoping IBM or some other customer make up the loss in EMC's orders.

There is one area I'm disappoint with STEC in and that is in its ASIC release. The CEO indicated that Mach8 using the FPGA controller isn't cost effective and that it will take the ASIC controller to kick start this market. I would like to have hurd that they were accellerating the release of this controller in order to get out in front of the market. I didn't hear that. Too reminescent of Sandisk and their feet dragging on its technology.

Everybody Loves Apple

Apple's performance isn't so surprising to many who have followed apple for some time now. What is surprising is the lack of honest financial forecasting and reasonable share targets. The relationship between financial analyst, hedge funds and MM makes investing in markable securities almost impossible. There is little correlation between the companies performance and its share price-- particularly in the short term. Long term is less risky but valuations has little to do with a companies performance.

Case in point, every analyst projection is at least 35% above pricing, however, pricing goes up and down, albeit with an upward trend, as though the MM are skeptical. When you have 100% agreement by all analyst that the target price is 35% higher over the next year, why would anyone sale their stock until then? It all defies logic, common sense or facts.

Garmin's Nuvifone: Why I Don't Expect It to Gain Much Traction

Garmin has good brand awareness and is small enough that they don't need to be a major player in the handset business. My belief is that Garmin will vy for the niche logistics, highend recreational and transportation add on markets. The combination could give them 5 to 10 million annual units at an OEM cost of $400. That's a $2 to $4 billion business with greater than 50% GM. They could also pick up another 1 or 2 million units from the broader smartphone market in some select geographic areas. This business doesn't have to compete directly with the Nokias or Apples of the world to be successful to Garmin. What's wrong with high margin niche markets? Nothing.

Should Apple Spin Off Its App Store?

You make a compelling argument. If we are to believe Apple, they don't make much profit off of the app store; so by spinning it off, they could make a lot of money on each down load with none of the cost.

The potential cost to apple would be to leave its app store platform up to less imaginative people who may corrupt the present excellent user experience. Apple needs to make the decision if the long term risk out weigh the short term financial gains.

How Big Is High-Frequency Trading?

This should all be illegal. Lets call it what it is--insider trading. If I were given upfront information about a stock, I too can make a lot of money. It doesn't take a statician to figure out what to do with proprietary information on the stock market. We aren't all stupid.

Stop this preferencial informative stuff and the little man may have a chance. This type of stuff is what makes America's shine another notch duller.

Why Apple Will Blow Away Forecasts This Quarter

I would suspect two differences in your numbers:
1. Cost of Goods may have a more dramatic reduction than your current expectation. My reasoning is that, ipods will make up a smaller part of Apple sales this quarter and ipod-touch will make up an increasing amount of ipod sales. Because the ipod touch share many parts with the iphone, that fact leads to more efficient manufacturing cost and lower material cost. More over I believe that Apple will be looking to control ipod cost by de-emphasizing slower ipod product lines--thereby lowering inventory cost even more.
2. Itunes - Given the high rate of app store sales, I would not expect for itunes sales to decrease this quarter over Q2 numbers. Your projection is Q3 (975M) where Q2 was (1049M). I believe that app store sales will drive itunes at a higher rate going forward than what we've seen in the past. Although itunes typically see a 7% drop in itunes sales from Q2 to Q3, I'm hoping the app store sales growth will start to midigate that at least until the growth rate tails off.

Jobs: Catch the App Store if You Can

Carriers are already dumb pipes. Exactly what do they offer becides talk, text and internet access? All three are formated pipes that includes no content. They don't even have leverage. The vail threat of cutting off Handset providers is just that vail. Truth be told, if Apple were to compete with the telcos it could easy buy its way in and disrupt AT&T and Verizon. Both AT&T and Verizon must may soon have to get into the hardware business to stay relevant.

The only good news for the telcos is that Apples too busy disrupting the handset makers to take on the telcos. However, its just a matter of time (2 to 5 years) that it will eventually take on these blood sucking technicaly illiterate fossils.

On Jul 14 10:42 AM SiliconValleyJoe wrote:

> Someone has to repair the towers, the dishes, the fiber cables and
> the power packs sitting way on top of a remote hill. Someone has
> to design, implement and support the technologies necessary to handle
> all the "packet" switching, transfers and routing. Someone has to
> respond rapidly to the aftermath of a natural disaster. All that
> requires technological know-how and immense resources.
>
> Carriers, if anything, has a strangle hold on the "pipes". Give them
> a decent piece of the pipe or they take that bandwidth to someone
> else and leave a device maker in the dust.
>
> If we ever are arrogant enough to think that carriers are just "dumb
> pipes", we risk losing a key part of our wireless infrastructure.
>
>
> All the shiny Pre, iPhone and Berries out there require a reliable
> and ever faster network to access an ever increasing amount of information.
> Someone has to design, implement and support that network.
>
> No, carriers are not in danger of becoming dumb pipes any time soon.
> They are in danger of losing subscribers if their network is perceived
> to be slow or unreliable for multi-media data access.
>
> I see carriers becoming eager partners with the likes of AAPL, Palm
> and GOOG and Nokia and RIMM.
>
>

More Government Market Manipulation on Its Way?

When some of these speculators go to jail then manipulation of the markets will cease. Short selling was not what most people complained about. It was necked short selling which was never address in any independent means by the SEC. If the SEC was to inforce the laws already on the books, we would have less speculation and stock manipulation than we do today. Analyst like yourself would then have to find other means to support MM whom seek to game the markets. Its not possible for oil to climb to 140 a barrel and tank to less than 55 a barrel in just a month. This is merely plain manipulation. I also believe that if financial analyst were to be held accountable for their analyst, with jail time as penalty for false information, you sir would be sink a different song.

The App Store: A Billion Downloads, But Not Much Revenue

The following article

"news.cnet.com/8301-135... "

suggest that the first week of the release of the iphone 3G gemerate 60+ million downloads and $30 million in revenue. That translates to $0.50 per app store download, including freebees. Translating this number to 1 billion downloads would put apple revenue at $500 million. What's also important to note is that the average cost for downloads are probably increasing given that the ratio of freebees to total apps is dropping. Apple gross profit would be $150 million.

Now the infrastructure to run the apps store is already created through itunes however, the SDK development, and the added support staff for software quality control(SWQC), app review and commission, accounting software all would require additional staff fix and veriable cost. I would assume that I least 50 engineers are working on SDK with 15 SWQC engineers, 10 app reviewers and 10 member management team including accounting, legal, regulatory etc. That's a 75 person team costing Apple about $150K per year puts cost around $11million annually. Its just a guess but Itunes could have been given $10 million initially to upgrade there server farm to handle increase transactions by 10%. Storage would be neglegable given only 50K apps. As time went on, transaction speed would had to have been upgraded further perhaps another $20 million.

Bottom line, I believe cost for app store is annually $10 million to $15 million annually with an initial start up cost of $41 million. It looks as though Apple will do somewhere near 1.5 billion apps the first year. That'll amount to around $200 million with a first year cost of $50 million. Gross profit would be north $150 million.

Cash Mirages: S&P 500 Companies with Large Balances But Not So Visible Liabilities

How can you use CA - CL and not consider the average cash generated by operations? I could believe your matrix if it included not just the assets and liabilitie due this current year but it should also include the expected cashflow from operations due this current year. Those assets which where paid for by the companies liabilities where acquired under the presumption that they will generate earnings. It is from these earnings that the liabilities are funded. This is why many of us believe Apple and GE is insanely under valued.

FASB Unlikely to Suspend Mark to Market

The only important measure for transparency is the cash flow from the asset and the future discard value. There's nothing else necessary to evaluate a companies asset. Fair value accounting doesn't do neither which is why transparency claims are hollow and disengenuous. Congress should can mark to market as it provides unrealistic expectations of assets during before and after market turmoil. Pricing the value of one asset to the that of one based on proximity and type is as stupid as valuing Toyota based on Chryslers performance.

Apple and Amazon's Open Embrace

As far as content distributor, its not amazon. How ever controls the hardware will control content. Just look at the mp3 market. A book saler will soon by past amazon and go directly to itunes. A middle man is not required. Amazon however is doing best they can by providing there content on as many platforms as possible. In the end, itunes will win out. Its a matter of time.

Apple: Is a Low Cost iPhone in the Works?

Turley... I believe Apples approach to lower cost is not in the mechanical systems or the feature rich components but rather in its core electronics--the mpu. Apple wants to lower power consumption and cost for the iphone and it needs to lower cost for the ipod--particularly the touch. Some and including yourself have over looked the cost involved with the cpu core for both the ipod and iphone.

CPU core

Apple can lower its BOM with its own mpu and given the volumes its not hard to ring up billions in savings. It's been estimated that the current Samsung processor used in the ipod and iphone cost upwards of $20. This processor was not designed to interface with other feature components and perhaps carry another dollar amount in glue logic and discrete components (both passive and active). I can see at least a $20 cost savings in components and another $3 savings in PCB realistate per iphone and a similar amount for the touch. Its not a stretch to forecast apple selling 50 million iphones and ipods-touches this year. With a cost savings of $20 plus per device Apple reaps a $1Billions in component cost alone-- not to mention labor and handling cost.

Elimination External DRAM

Its possible now to eliminate external DRAM with eDRAM patented by IBM. Since non of the current smartphones uses more than several 100's of Megabytes of DRAM its possible to include 256 MB or 128MB of eDRAM. Although this wil drive up the size of the cpu chip and cost there's a greater savings in inventory, PCB realistate, total component and glue logic cost.

Law of large numbers

Many have concluded correctly that $5 cost savings in removing a feature is not worth the lost in functionality. However, when that $5 is saved without lost of functionality and is multiplied by 10's of millions of devices, it becomes a profit center for Apple. That $5 cost savings on 100 million devices becomes a $1Billion in gross margin expansion.

If my premises is correct that Apple will save a $1Billion a year in component cost, an interesting question is what would be the most productive use of that cost savings? My answer is drive innovation by buying a controlling interest in Sprint/Nextel inwhich they could then offer the iphone with reduced service plans say $10/month and thereby completely alter the mobile lanscape in America over night. Apple's iphone volume will escalate north of 100 million annually as aforedability will extend down to the low cost consumer.

Apple having controlling interest in a carrier will drive innovation products in movie down loads, music down loads, ebooks, navigation, education, texting ect.

At todays current prices, Sprint/Nextel would only require about $5billion for a 50% stake in the company. However, for much less, Apple could get access to the network with just the capabilities it wants to revolutionize things.