jbelkin

Apples to Apples: Will History Repeat Itself as Android Gains on the iPhone?

First, it's clear that market conditions are different - the easiest one you might understand is that unlike the days of yore where MS could buy up distribution - with the internet, no one can. You may not realize this market share does NOT equal margins or ROI. Apple makes $600-$700 PER iPHONE SALE including iTunes (with margins of 35-40%) - how much does GOOGLE make? ZERO. That's right. They are hoping to make money down the line with search and of course, stab WIN Mobile in the head and jump ahead of Yahoo ... but its two different strategies - Apple is more than willing to concede the "free" market share to Google - Google is free to take 100% of the $49 smartphone market while Apple much prefers the 70% market share (like the ipod) of the top of the $600 smartphone market (with subsidy). Bottom line, guy, it's a new century - you might want to understand a little more before committing it to the internet.

AT&T: The (Apple) Brand Destroyer

There's a lot of random bits in here. First, the PE ratio is a 1890's measurement that does not take into account the deferred revenue that Apple has banked but not reported for the iPhone nor the $30+ BILLION in the bank so if that's all your using to take the measure of a company, you might want to upgrade from index cards.

As for the fire, you have ONE or even a few fires out of 200 MILLION ipods sold - do we know for a fact if the person was using an apple charger and not one they picked up for $4.99? Or is the car battery & voltage converter to blame? Was the car parked in the Sun - sometimes close to 150 degrees plus already and then the car battery goes nuts? But of course, blame Apple for 1 fire out of 200 million sold? There are more people who drown in their own bathtubs EVERY YEAR ... who do we blame or try to sue there?

As for the Google Voice thing - there is no law that says they have to approve every app for their products - when it's a competiting product - that's just a fact of life. Just as a bookstore can choose not to sell a book called THIS BOOK CHAIN IS A**, STEAL THIS BOOK (it's only censorship by gov't actions not private enterprise).

Unlike Dell's lackof quality & R&D ... Apple is disliked by open sourcers and hackers and programmers who think they know best on how to w5rite a UI ... they will TRADE useability, UI & ease of use just so they can write their own OS. For that, they have the Google phone (which it shoudl be noted, Google makes ZERO money off of providing the tools) while 98% of consumers do NOT want to program a phone - they want to use it so while 10% of the tech webloggers are loud haters (100,000?), 98% of 6 BILLION people want an iphone. That is the difference.

Apple's AT&T Deal Is Costly

For a guy who claims to be a numbers guy, you don't do much calculating yourself.

Apple is selling an EXTRA 400,000 or 1+ million phones where other cell phone manufacturers might sell a few thousand more ... that's right - not on the network but still buying ...

This would be a problem if Apple was subsidizing each phone sale but it's NOT- every one at FULL PRICE 100% of the time.

As for people who can't/won't switch to AT&T ... how much does AT&T make for this customer? That's right - ZERO.

How much does Apple make? That's right $400 to $500 DOLLARS!

Versus ZERO.

It's ALL found money. Even better, Apple has to provider ZERO tech support - how much savings is that?

And with everyone that goes overseas that's not "legal," that just adds to the cachet of the product. How many products are considered FREE ADVERTISING & MARKETING for a company yet they made $450 TODAY?! Not to mention every Iphone sale is potential iTunes sales (even overseas ones either have stores or if they have a US credit card can buy tracks & movies) ...

By your math, since everyone on this planet doesn't have an iPhone, that's a trillion loss?

So you prefer possible future monthly revenue versus a $450 sale today? The future monthly stream is never guaranteed even if you sign up a carrier - people drop out, people don't pay ... but you don;'t factor that in because it's too hard?

The real world is more complex than just A+B-C ... or perhaps you should stick to analysing industries that aren't so complex.

Microsoft's R&D Far Outpaces Google and Apple: Is That a Good Thing?

You're absolutely right - spending money wildly on R&D means nothing if you produce nothing. MS seems to be proud to announce they've spent $9 BILLION dollars on Vista & Office 2007. First, how much more do you need to spend on Office? What more of the corporate market share do you hope to grab?

And presuming $8 to $8.5 billion was spent on Vista - so far, NOTHING to show for it and the last year, you'e spent time & more money madly ripping out main features ... and not to rub salt in the wound, Apple not only introduced a complete OS break from the past but managed to provide 3 substantial upgrades with a 4th to come out anyday now ... Apple's R&D in the past 5 years has provided the ipod, world class laptops, innovative designed desktops, the ability to switch processor lines and new and updated evolutionary & revolutionary software. All profitable.

And MS in the past 5 years? Spend $10 BILLION to launch xbox with a profit of ZERO. Spend $4 BILLION to fight AOL with MSN and again, zero profit. Spend a couple billion here and there to lose out in the battles with WebTV, home networking, cableTV, watches and cell phones.

And in the meanwhile, ignore companies like eBay, yahoo & Google ... oh, we'll spend $5 BILLION to catch up ... or another billion to try and catch Apple's ipod with Zune?

And now, they're going to spend $40 billion to prop up Steve Ballmer's stock holdings? Do shareholders really think this and the past efforts are in the best interest of shareholders?

MS seems to be the Halliburton/KBR of technology - money goes in but what's coming out?

A New iTunes Rip-Off? Microsoft Reinventing Itself in all the Wrong Ways (MSFT)

Chad is absolutely right but John also brings up an intersting point and why MS' old habits no longer work. BG & MS were brilliant at selling to corporations, agencies & governments because MS looked at the best features and threw them all into their OS & apps. Didn't really matter that you don't need 200 starburst shapes in PPT - it beats Harvard Graphics by 175 shapes.

Corporations who don't mind buying something and getting it right three years later on a maintenace upgrade because they are two budgets from two different departments - the guy who okayed the purchase (capital expenditures) could care less about the upgrade contract or viruses - those costs do not his his bottom line or his responsibility.

Conversely, there are limited sellers to the corporate marketplace - easy for MS to give them free tools or lock up contracts (legal or otherwise) but on the consumer, things are literally the wild west. We'll say one thing but we do not follow through - sure we want a Pc we can write and change our scribbles (tablet pc) but the reality is we're willing to pay maybe a $25 premium and not if it's weird ... or we don't really know what we want until it's out (do I want to convert all my Cd to figital files and carry it around with me? Why?) But then you put an ipod in front of 50 million people and they go - ah ... yes ...

MS is clueless because their old habits/culture doesn't work on consumers.

a) we don't really care if something has more "features," if anything, we actually prefer many things with less features.

b) unlike corporations who will tell you straight out - here's our spec list, consumers say they want video on the phones but not if it's too hard and they won't pay $15 a month for that feature. Or ultimately - show us, if we like it, we'll buy it ... but only after you build the thing.

c) collolary to that is that consumers will not buy if it doesn't work and until you do, we'll wait ... unlike corporations, we only have one budget and as you point out, we do CARE if you copy and WE KNOW.

That's why Ms is confused about consumers in more ways than one. They presume they are smarter than us and don't get it when we don't buy what they offer (MSN, MSN search, WMA stores, WebTV and even XBox) ...

Compounded is that all the real go-getters have left to start their own companies - leaving just bureaucrats who are good at creating their own fiefdom and "maintaining," and with Bill metaphorically gone, it'll only get worse as things will bog down with:

This isn't the way would've done it.

You're not Bill G, I'm not following this order.

and for engineers and programmers, Steve Ballmer is just a pile of sweaty steaming detergent salesman who garners no respect.

MS in the 1990's weere the 1950's to GM. They are ot what they once were ...