xwallster

Apple Could Crush Competitors With a $99 iPhone

I believe this is the ticking time bomb in iPhone sales - the total cost of ownership. In these tough times, spending $1000 or more per year for a phone is going to be viewed as a place for budget-cutting, at least in the US where lower-cost phone options are available.

If you REALLY want iPhone sales to explode, get multiple carriers in a market to offer it and have them drop the cost of their service.

When IP-based wireless networks prevail (WiMAX is the tip of the iceberg), all proprietary cell networks will lose their value and service pricing will drop. Meanwhile, the carriers will milk customers for all they can - look at SMS pricing for a great example...

This will take at least ten years, but it is inevitable. Apple wins in this scenario, and the carriers lose.

Price Isn't Everything: Dell Is Still Problematic

Dells business model has been optimized for market growth and component price declines.
Worldwide PC market growth is slowing (although there are still underpenetrated hot spots,
they will likely be served by very low cost devices, which doesn't do much for Dell), and
the rate of component price decreases is also slowing.

How do you grow in this environment? Expand into other markets (printers, TVs, enterprise
storage, etc) and/or add services. Both are likelyto increase the company's cost structure,
putting more pressure on margins.

For many years, the "Dell model" was unassailable because the market was booming.
Those days are over. There's a reason IBM got rid of its PC business...

Analysts Remain Bullish on Motorola

Motorola's business is fragile because of lingering structural issues from the past five years, which the
company is trying to address. Zander has done a pretty good job of focusing the company and
rebuilding its brand image in handsets, which are a part, but not all, of its business.

When Apple introduces its phone, Motorola will have some competition at a relatively high
price point, but, Apple still has to disclose its carrier strategy. Remember, the best handset in
the world will flop unless the carriers support it. Don't see a whole lot of risk to most of Motorola's
business at medium to lower price points, at least from Apple.

Lastly, a comment like "penny stock within 12 months, no question", without any supporting
quantitive analysis, would have never made it past editorial when I was on the Street. Either
back up your statement by showing how MOT's P/E would suffer asteriod-hitting-the-E...
damage, or think twice before spouting.