neutrino23

Apple's AT&T Deal: Setting the Record Straight

In the one independent test I've seen the iPhone came out as the best at not dropping calls. Also, just anecdotal, but I have both a BB and an iPhone and find the iPhone to be much clearer. In our sales group we joke about how when we call each other on the BBs it sounds like we are shouting in a tunnel.

If AAPL is overpriced at this P/E then why is Amazon so high at nearly an 80 P/E?


On Nov 25 03:48 PM slam stocks wrote:

> The IPhone with all their applications is the most amazing device,
> it's not better than Blackberries for calls or emails used in business,
> but still very good. Besides the business executives, the unit with
> so many other functions is the best available.
>
> Notwithstanding, I totally agree AAPL is far overpriced for a stock.
> they are priced for perfection. Compared to HP the difference is
> enormous: Market Cap 54%+, PE 2X+, PEG 34%+ & P/S 5X+. A good
> company with tremendous growth potential, but not at these prices
> and waiting for a pullback.

Will Microsoft Get Squeezed by Chrome OS?

This is an interesting argument. I don't think many end users will soon give up windows for chrome. Rather, any place you see a PC used for a single task is a candidate for Chrome. Some examples: PCs used in libraries to search card catalogs, PCs used in airports to print boarding passes, PCs used in hotel business centers to print boarding passes and do simple document editing, PCs used in industry for single tasks such as data entry and various kinds of interactions with customers by phone.

The argument about the middle being difficult to sell is quite true. I've seen a number of products suffer this way. When you do find a customer with enough budget and interest to buy your product they are susceptible to a higher end product luring them upscale with features and discounts or you lose your customer downscale to simpler products encouraging the customer to save their money. This is deeply frustrating.

Regarding the hoards of flying executives creating powerpoints, they are perfect candidates for this kind of product though their egos wouldn't let them buy it. All they ever run is Outlook, Word, Excel and PPT, and, of course, solitaire.

Microsofts big, long term problem is that the charge for their product. Just as they killed Netscape by giving away IE for free other companies will kill eventually cause pain for MS by giving away the OS. Google wins by providing a platform that gets more ad hits. If the OS is cheap for them to maintain that is a win for them. Other companies will join in as the economics changes in favor of this. Someday you'll get a piece of junk mail which will be a PC printed on a piece of plastic with an OLED display. To use this free PC you'll have to first watch some short advertisement or there will be advertising printed on the package. That PC will not be running windows or OS X but Chrome or Linux.

Why Research in Motion Is a Takeover Target

I don't see RIM taking off. They'll probably maintain their position or slowly lose share while remaining profitable. They just don't have the software or technology to keep up with expansion outside of their core business (email).

I don't see RIMM as a take over target. Sure, they will have a steady cash stream, but it is a long shot that they will grow rapidly.

I think Palm is a better take over target than RIMM. It takes much less cash and you get a better OS. The downside is that there are fewer customers so again, it is a risk as to whether they will grow rapidly.

While Rivals Jockey for Market Share, Apple Bathes in Profits

Gartner just released a report saying that Apple's world wide share of the smart phone market reached 17.1% just behind RIMM at 20.8% and further behind Nokia at 39.3%. No one else was in double digits.

So if you look at the smart phone market (not all phones) then Apple also has quite good (and growing) share.

I read a similar item a while back claiming that Apple had the lions share of over $1,000 laptops in the US.

This is Apple's good fortune. The message is not that they don't compete in the sub $600 market, it's that they have little competition in the over $1,000 market. Which would you rather be in?

Probably Sony should have been their natural competitor but Sony never really got established in the computer business. I think they didn't have a clear vision of what they wanted to be. Some time back I visited their sales office in Japan and we saw Unix workstations as well as all sorts of windows towers and laptops. So they definitely had their chance at that business.

Expect Apple's December Earnings to Grow 37%

This is a temporary ban that has already been lifted. Once they sell out of current stock the new phones will have WiFi.

www.macrumors.com/2009.../

How Apple's Market Share Will Propel Stock to $500, Part 2

I can't do the arithmetic to say that AAPL might reach a particular target, but I can see that Apple is a very unusual company. They have no debt, a huge amount of cash, no legacy technology holding them back, they own their own technology and designs. They now have this fantastic machine for developing new tech products. They are not limited to PCs, iPods and iPhones. Any consumer product that involves software is a potential target for Apple expansion. This will be fantastic to watch.

The Problem with iPhone Killers

I don't much care for the religion analogy as it obscures rather than illuminates. The whole business of iPhone killers (or BB killers or what have you) is driven by the tech pundits looking for splashy headlines. I think the business people are just looking for profits and survival. As such Apple seems to be looking for a secure market position, they are not trying to dominate the market.

The tech blogs focus too much on superficial features of phones and extrapolate market penetration based on that. Market share is earned by a mix of characteristics, one of them being the product itself. In addition you need to consider company reputation, product reputation, customer support, retail outlets, advertising, and many other things.

For a newcomer to become a hit is not an overnight process. Share grows over time and now the competitive situation is much tougher. When Apple introduced the iPhone there was no Apps store and no other phone similar to the iPhone. Newcomers don't have that benefit. Apple and others will not sit idly by and let another company gain share without a response.

My take is that Apple will continue to see strong growth. Apple has a great mix of reputation, 200+ retail outlets that also provide support and now they have a huge installed base. Keeping a customer is cheaper and easier than getting a new customer. Apple also has the power to add more extrinsic value to their phones. iTunes Music Store and the Apps Store are examples. Expect more ventures like this next year (my opinion).

RIMM will do OK but continue their slow loss of market share.

Android phones will replace Nokia as the provider of low cost phones. Probably in a few years the numbers of Android phones will exceed the number of iPhones. iPhones will capture the lions share of the profit and will continue to be the feature leaders.

WM will malinger but not die as MS will keep shoveling money at it. Perhaps they will find a way to give it away and make money elsewhere such as in selling office for mobile phones?

Symbian OS will fade away year by year. It might not be bad, but there is just no reason for it to live. Why switch to something that is maybe almost as good as Android and a distant second to OS X?

When the Going Gets Tough, The Tough Get an Apple

It would be interesting to know who all the new Mac customers are. Apple's ads are heavily focused on people switching from windows to OS X indicates that they are seeing a lot of activity in that area.

The ads also indicate that this is a personal decision. There are no Apple ads showing an IT guy buying 2,000 Macs for a company. This makes sense. If you set up some sort of a sea of cubicles filled with people doing something like tele-marketing where they run one application all day long then the cheapest computer possible is what you want. If you are investing in yourself then you may consider a higher quality device with more diverse applications and capabilities. Customers satisfaction (as mentioned in the ads) would be important to you.

Verizon's Droid Is the Real Deal

It will be interesting to see how this plays out. A problem is that most of the people who know about products like this at the roll out are far more detail oriented than the general public. Nothing bad with either group, just that you can't project the reactions of one group based on the reactions of the other.

I doubt that most people care about a phones OS or heritage very much.

Apple has a tremendous head start in the market. They have access to customers through 200 odd Apple stores plus the ATT stores plus online sales. They have tremendous mindshare in that the Apple brand and iPhone name are extremely well known. Not to mention the App Store which has been a true phenomenon.

Droid will probably do OK as it has no competition from Apple on Verizon. We'll see how reliable it is and if it really works out in the wild.

I'll agree with some earlier posters. I travel a lot on business and use an iPhone. Now and again the network slows down but I've had good connectivity in every major city in the US. Only when you get out in the dessert or farmland does the signal drop off. Now and again I see four bars of signal but very slow internet speeds. In these cases I can still make calls and text.

I'll offer a defense of those touting Apple's seeming invulnerability. Apple has already achieved tremendous market penetration and built a large infrastructure for support. They were able to do this partly because there was almost no competition when they first came out and they were able to piggyback on the support structure put in place for computers and iPods. The competitors like Pre and Android phones don't have that luxury. They have to compete in today's world where Apple already exists as a fierce competitor (and RIM and Palm as well). The Apple App store is a reality that Apple didn't have to contend with when they first came out. Android phones face that reality. Most of all, if Apple gets a hint that any competitor is encroaching on their growth Apple has massive resources in engineering, design and marketing to make a very strong response. They may stumble but you have to like their odds.

Apple's Solid Triple Play Will Be Hard to Beat

I use a Mac for both home and business. Most of the time I can use just Mac OS X. My company has a few things that are windows only and for that I use Parallels and XP. It works pretty well. When I need to do something XP specific I run XP and as soon as I'm finished I shut it down and get it out of the way.

Regarding Apple and imitators, this is an interesting point. Normally you would expect an imitator to copy a successful product. To some extent this has happened a lot. When the colored iMacs first came out then suddenly everything came with translucent colored plastic. Some laptops look something like MacBooks, MP3 players ship with white earbuds. This is all superficial. What Apple has done is to create an ecosystem of interrelated products. The same OS runs on the iPhone, the iPod touch, the laptops and desktops. This is a huge barrier to entry. Nothing lasts forever, but with their cash hoard and their desire to stay in front then Apple should be able to stay ahead of the pack for many years to come.

Why Android Is Gaining Ground on Apple

Android will have its place but it does not compete directly with the iPhone. My guess is that a couple years down the line Android phones will largely supplant Nokia phones in the low end, low margin market. RIM will survive but lose share. The iPhone will own the high end, high margin business. Watch for Nokia to drop Symbian OS and adopt Android on some phones.

I think the Android world will be too chaotic to develop much in the way of a useful App Store.

The End of Exclusive: How Apple Plans to Grow Market Share

The article correctly identifies some of the external pressure on Apple to end the exclusive with ATT, it doesn't shed much light on how that will happen. I don't particularly fault the author. No one outside of Apple knows the answer to that .

My guess is Apple will not make a phone for Verizon. They will wait till Verizon deploys the next generation network.

Beyond that, my intuition is that Apple is thinking more deeply about this than simply increasing share by adding a carrier. Just as the App Store changed the landscape I suspect they are looking at some other new feature in the near term that will once again change the landscape whether Verizon is involved or not.

Microsoft: Whistling in the Dark

MSFT has a long term problem in that the PC manufacturers mostly compete on lower prices. It gets harder and harder to justify hundreds of dollars for the OS and Office when the underlying hardware cost is only a two or three hundred dollars.

Yes, MSFT's worldwide unit share is high but I'll suggest that outside the US and Europe a high number of those units are illegal copies that provide little or no revenue to MS.

In China MSFT has cut its prices to the bone to try to compete with piracy. No revenue growth there.

Now MSFT is coming out with free, web versions of Office. Where is the future revenue stream in that? Will they try to support it with ads? How annoying will that be?

This is the danger for MSFT. They have a history of leveraging Windows to force people to use their formats. For example, they forced the use of IE in windows which forced web developers to code for IE instead of open standards. In business you have to have Office because everyone else uses it. If the world decides to change directions and switch to web based/cloud type apps that are almost free, or if they decide to go in the direction of the iPhone/BB/Android, then MSFT is starting from a position of being an also ran and outsider. They'll have a hard time using windows to force people to buy into their proprietary formats if the world decides they don't need windows. If MSFT is not forcing standards then they cannot force people to give them money.

It doesn't mean MSFT will disappear. They have a lot of momentum and there may be a core business in MSFT at much less than their current size. But if they enter a long period of slow revenue decline that will kill the stock. How do you value the stock if you expect revenue to decrease 1% or 2% or 3% a year for the foreseeable future? How do you attract bright people when their stock options are worthless?

Disclosure: Long AAPL, not an analyst, just a guy.

Why Apple Isn't Making iTunes Available for the Palm Pre

First of all, Apple can't formally allow Pre to sync to iTunes as that becomes a liability. They are now responsible for providing this service and if they do it for Pre they do it for everyone. I see no way Apple can do this.

Second, I agree with James Katt. There are other ways Palm could have gotten iTunes content onto the Pre without pretending to be an iPod. This would not have put them at odds with Apple.

Did Apple Steal the Palm Pre’s Thunder?

AT&T charges what the market will bear. It may seem high but that is what people are willing to pay.

Palm is lucky in that they can sell to Sprint without much competition, yet. They may have enough breathing room to establish a niche. Time will tell if poor handset quality and poor sales will sink them.