Don't Let the Times Stop You from Taking Action [View article]
There is nothing to recommend Dell. Business model that used to be unbeatable but doesn't work any more. So they're tearing up the floorboards and selling them for "cost savings". Product design, manufacturing, support, everything sold off and rented back. Last quarter accounts payable $15.5B; net tangible assets $0.3B. That's one low flying jumbo you're recommending. With undisclosed sub-prime exposure, apparently (see last conf call).
Dell never was a computer company, just the biggest screwdriver assembly and financial smoke and mirrors operation in the market, crucially dependent on growing sales and negative cash conversion cycle to milk the business of delivering Microsoft's monopoly to the world. Microsoft monopoly is dying; netbooks are killing revenue growth, and Apple is taking most of the high margin business.
Far from Michael Dell turning the company round, it was the CEO and CFO who bailed out, who had created the financial smoke and mirrors for Dell, and they set him up with a 2-year cushion to execute his fantasy of a turnaround. Time's up. Expect more bad news.
Consortium To Standardize Digital Rights Management, Take On Apple [View article]
Apple's Fairplay DRM is an optional service to content owners. Since it is proprietary, Apple can both make guarantees to content owners (if security is breached, Apple can force an update to every device wanting to load new Fairplay content), and offer consumers a fair deal (DRM'd content never dies; there is no "keep alive" callback to headquarters required, unlike other systems with guarantees).
The problem with a shared open standard is that once it's cracked, it can't be repaired, and content owners can't be compensated. Therefore it can't compete with Fairplay as an attractive DRM for content owners.
Apple does not in fact demand a monopoly on distribution; but only to distribute on its own terms.
The final solution some years hence may be that Fairplay is licensed broadly by means of Apple chips embedded in devices from all manufacturers.
The paradox for content owners is that no-one wants content until they are aware of it. An owner will pay to get his song on radio, yet wants paying for a consumer to hear it on demand. An industry wide "open" DRM is destined either to be cracked and bypassed (like DVD), or its protected content to be ignored and forgotten by consumers.
The industry needs to cut a long term deal to license Fairplay, in exchange for giving Apple distribution of its content.
Apple's 3G iPhone: Q4 Sales Estimates Are Encouraging [View article]
The market share figures are just that: share of total browsing, not absolute iPhone browsing level. The spike/volatility in share during August is likely due to a fall in general browsing from PC's during Olympics, vacation time & labor day in favour of watching TV or having fun. Level iPhone browsing and falling general browsing creates a peak in share.
It's almost as though Apple has deliberately issued BBY with demo units from early production runs to conceal the run rate data that IMEI numbers initially revealed. In fact I wouldn't be surprised if Apple obfuscated this IMEI covert information channel in future.
Nokia Is the Smart(phone) Bet - Barron's [View article]
Carriers no longer want to subsidize Nokia's high end phones when iPhone still sucks subscribers away and Nokia has a declared intention to become a competing service company ("comes with music"); thus Nokia has lost pricing power at the high end, which damages earnings.
By giving exclusive carrier deals, Apple has avoided this fate.
I suspect China (Nokia's biggest market) wants to give its volume business to domestic handset makers in preference to Nokia. This hits both unit and dollar sales.
How Apple Stock Should Be Valued: P/FCF [View article]
The subscription accounting is in part connected to Sarbanes Oxley. You are not allowed to recognise revenue when you have not delivered 100% of the associated deliverables. Microsoft has also exploited SOX to count XP sales from before the release of Vista as Vista sales (with free temporary XP license), by deferring the revenue recognition until a Vista download was available to the XP customers.
The end-user benefit of a cellphone is experienced over the life of a service contract, and carriers subsidize the handset and receive relatively uniform payments from the user for the handset and service over the life of the contract. Carriers therefore use subscription accounting for the handset subsidy over the life of the contract. Apple's accounting is simply matching this carrier accounting; recognising revenue in step with actual end user payments, rather than doing its accounts like a subcontract manufacturer. Major cellphone brands doing their accounts like subcontractors is just one aspect of their ceding control to carriers.
One argument for the subscription accounting is that the carriers are an intermediary between Apple and their true customer, the end user, and if Apple ever removes that intermediary and provides the service too, there is no earnings impact on the handset business despite the loss of the massive carrier handset subsidy.
Why Is Dell Trying to Compete With the iPod? [View article]
It can't be about the music player; it's about the desktop. Dell can pre-install an iTunes alternative on every consumer machine it ships ( the delLife suite?), and hopes this large number of pre-installs can bootstrap an ecosystem the way Apple bootstrapped the iPod/iTunes using Mac users. Dell need a music player to make their ecosystem look plausible. They can't believe they have a chance to sell better than, say, Zune.
Dell has a hard lesson to learn - marketing efforts in a market where you don't dominate create more business for the market leader than they do for you. The people who were only thinking "Dell" start thinking "music", then they actually look at the alternative.
This just re-emphasises that the Dell/Microsoft era is over, and consumers will realise they need to widen their horizons.
Apple's 3G iPhone Has Some Kinks to Resolve [View article]
Mr Bober: You must explain what you mean by asserting Infineon's baseband solution is "subpar". Please identify the population of solutions whose average is higher, and what metric you are using to evaluate, and how the user of a phone could possibly tell the difference between a TI and an Infineon chip inside.
Buildings don't fall down when their architect dies.
for crappletv:
Like most commentators, you're wrong; Steve Jobs' health IS a private matter unless ill health is affecting his role in the company. When a board member says, on the record, "Steve's health is a private matter", that statement alone tells you that there is no known issue with his health. Even SJ doesn't know more than that. If there is a known problem with SJ's health affecting Apple, this statement by Oppenheimer could put him in prison later.
Steve Jobs did not conceal his cancer from the board. The board concealed it from the world, because there was plenty of time to make a succession plan, and to defer drastic medical intervention while SJ worked on unaffected as CEO. When Apple was fully prepared, further medical action was evaluated, surgery performed and immediately reported to the public. The SEC has investigated the sequence of events and found it to be proper. I'd say it was exemplary.
Your Macbook sleep problems are to do with the software you are running. Other people don't have this issue. It's just laziness to simply blame Apple. Have you for example got HP printer drivers installed that didn't come with MacOS?
Steve Jobs does not "cultivate the cult of personality". He appears only twice a year, and makes a very professional product focussed presentation crammed with factual detail. He restricts his activities ruthlessly to doing his job. It's the media and followers that create the cult. SJ is a private person. For example he does not go in for the attention seeking public charitable contributions and activities popular with the rich and self-obsessed.
Apple: Confusion Reigns Over iPhone Sales Projections [View article]
You're right, we don't know for sure, but you're wrong to deny 10M in calendar Q3. It's a subtle but important distinction: Apple has publicly aspired to (like a competitor), but never forecast (like an analyst) 10M in 2008. In fact in recent conf call, 10M was almost stated as a plain fact even as iPhone 1 supplies dried up. That tells us that real expectations are higher. 3 million a month for the rest of the year, is the most likely, IMO, with the timing of availability in each of the 78 countries being adjusted as required, and maybe there's even time to ramp up for the fourth quarter.
Sandisk: Will Samsung Help or Will Intel Hurt? [View article]
"Apple, on the other hand, needs a constant string of innovations every year . . ." shows you have not understood Apple. This is a single minded, integrated and very ambitious 10-20 year plan, not a string of disjoint fashion-powered innovations. Keep watching; more stuff will be happening soon.
Fortune Can't Make Up Its Mind on Apple's Steve Jobs [View article]
When you hop on a soapbox, you get to slant things any way you want. If that's all the badness Elkind can make about Steve Jobs, Apple are in good shape.
The only significant new data is that the Apple board decided to keep his cancer secret, even though Steve Jobs had disclosed it. Reviewing the known facts: At that time, it was not known to be operable, and presumably not known to be growing. When a scan revealed it was growing, the issue became urgent, leading to immediate biopsy, diagnosis as the rare curable kind, surgery and disclosure.
Personally, I find Apple / Steve Jobs these days to have very high standards of integrity. That doesn't mean business isn't a ruthless game that has to be played hard.
Apple's New MacBook: Favorable Price Comparison to Dell [View article]
The two take-home points from any proper comparison are (a) Microsoft's hardware partners in general choose not to offer valuable features that Apple products have, because, at the point of purchase, customers don't notice them and choose the cheaper product, and (b) when a branded computer from a Microsoft partner is properly configured as nearly as possible to match an Apple product, it is almost always more expensive, usually by $100-300. (This isn't an accident - Apple carefully evaluates competitor pricing and makes sure it is so).
In this case, Apple simply doesn't make a laptop as poorly specified as the $1119 M1330, let alone one of Dells high volume cheapies.
Apple's New MacBook: Favorable Price Comparison to Dell [View article]
Actualy, you should really add about $200 to get a truly comparable Dell 1330 config.The Dell is actually wedge shaped and 1.4 inches thick on the thick end; the config listed is with the crummy four-cell battery. $30 extra for the 6-cell like Macbook's. The weight quoted is with the four cell and the extra cost slimline LED screen which it doesn't have, so you need to add half a pound or so for a comparable weight. The Dell config has no 802.11n ($35 extra), and a home version of the OS rather than the full Vista Ultimate ($150 extra), or even XP Pro ($120? extra) to match full Leopard. It has no gigabit ethernet (unavailable), no power over firewire (unavailable; need power brick for pocket drives etc). No optical sound out for your AV amp either. And no Magsafe power connector. Priced config has no modem, contrary to description.
But it does have an Expresscard 54 slot and a memory card reader.
They are both good computers; the Dell is undoubtedly significantly more expensive, and lacks many of Macbook's subtle Apple qualities (target disk mode, for example).
The "can't paint it" story was convincing for a 2 week delay at product launch. It's now clearly nothing to do with the problems, and looks to have been a small problem used to distract from the larger real problem (whatever it is). Where's the problem in scrapping 50% of the painted plastic pieces while you're fixing the painting problem? It would only put cents onto the cost of the laptop.
And how come the overstated earnings were while Michael Dell was CEO and cashing his billions in options at shareholder expense, while the understated earnings were while Rollins was CEO, and the SEC were starting their informal investigation? Doesn't sound like Michael Dell resuming as CEO is in the least bit helpful. Let's see some action from the SEC, please, and some straightforward honesty from the analyst community.
Don't Let the Times Stop You from Taking Action [View article]
Dell never was a computer company, just the biggest screwdriver assembly and financial smoke and mirrors operation in the market, crucially dependent on growing sales and negative cash conversion cycle to milk the business of delivering Microsoft's monopoly to the world. Microsoft monopoly is dying; netbooks are killing revenue growth, and Apple is taking most of the high margin business.
Far from Michael Dell turning the company round, it was the CEO and CFO who bailed out, who had created the financial smoke and mirrors for Dell, and they set him up with a 2-year cushion to execute his fantasy of a turnaround. Time's up. Expect more bad news.
Consortium To Standardize Digital Rights Management, Take On Apple [View article]
The problem with a shared open standard is that once it's cracked, it can't be repaired, and content owners can't be compensated. Therefore it can't compete with Fairplay as an attractive DRM for content owners.
Apple does not in fact demand a monopoly on distribution; but only to distribute on its own terms.
The final solution some years hence may be that Fairplay is licensed broadly by means of Apple chips embedded in devices from all manufacturers.
The paradox for content owners is that no-one wants content until they are aware of it. An owner will pay to get his song on radio, yet wants paying for a consumer to hear it on demand. An industry wide "open" DRM is destined either to be cracked and bypassed (like DVD), or its protected content to be ignored and forgotten by consumers.
The industry needs to cut a long term deal to license Fairplay, in exchange for giving Apple distribution of its content.
Apple's 3G iPhone: Q4 Sales Estimates Are Encouraging [View article]
It's almost as though Apple has deliberately issued BBY with demo units from early production runs to conceal the run rate data that IMEI numbers initially revealed. In fact I wouldn't be surprised if Apple obfuscated this IMEI covert information channel in future.
Nokia Is the Smart(phone) Bet - Barron's [View article]
By giving exclusive carrier deals, Apple has avoided this fate.
I suspect China (Nokia's biggest market) wants to give its volume business to domestic handset makers in preference to Nokia. This hits both unit and dollar sales.
Record Companies Starting to Shun iTunes [View article]
How Apple Stock Should Be Valued: P/FCF [View article]
The end-user benefit of a cellphone is experienced over the life of a service contract, and carriers subsidize the handset and receive relatively uniform payments from the user for the handset and service over the life of the contract. Carriers therefore use subscription accounting for the handset subsidy over the life of the contract. Apple's accounting is simply matching this carrier accounting; recognising revenue in step with actual end user payments, rather than doing its accounts like a subcontract manufacturer. Major cellphone brands doing their accounts like subcontractors is just one aspect of their ceding control to carriers.
One argument for the subscription accounting is that the carriers are an intermediary between Apple and their true customer, the end user, and if Apple ever removes that intermediary and provides the service too, there is no earnings impact on the handset business despite the loss of the massive carrier handset subsidy.
Why Is Dell Trying to Compete With the iPod? [View article]
Dell has a hard lesson to learn - marketing efforts in a market where you don't dominate create more business for the market leader than they do for you. The people who were only thinking "Dell" start thinking "music", then they actually look at the alternative.
This just re-emphasises that the Dell/Microsoft era is over, and consumers will realise they need to widen their horizons.
Apple's 3G iPhone Has Some Kinks to Resolve [View article]
Time to Stand Up for Steve Jobs [View article]
for crappletv:
Like most commentators, you're wrong; Steve Jobs' health IS a private matter unless ill health is affecting his role in the company. When a board member says, on the record, "Steve's health is a private matter", that statement alone tells you that there is no known issue with his health. Even SJ doesn't know more than that. If there is a known problem with SJ's health affecting Apple, this statement by Oppenheimer could put him in prison later.
Steve Jobs did not conceal his cancer from the board. The board concealed it from the world, because there was plenty of time to make a succession plan, and to defer drastic medical intervention while SJ worked on unaffected as CEO. When Apple was fully prepared, further medical action was evaluated, surgery performed and immediately reported to the public. The SEC has investigated the sequence of events and found it to be proper. I'd say it was exemplary.
Your Macbook sleep problems are to do with the software you are running. Other people don't have this issue. It's just laziness to simply blame Apple. Have you for example got HP printer drivers installed that didn't come with MacOS?
Steve Jobs does not "cultivate the cult of personality". He appears only twice a year, and makes a very professional product focussed presentation crammed with factual detail. He restricts his activities ruthlessly to doing his job. It's the media and followers that create the cult. SJ is a private person. For example he does not go in for the attention seeking public charitable contributions and activities popular with the rich and self-obsessed.
Apple: Confusion Reigns Over iPhone Sales Projections [View article]
Sandisk: Will Samsung Help or Will Intel Hurt? [View article]
Fortune Can't Make Up Its Mind on Apple's Steve Jobs [View article]
The only significant new data is that the Apple board decided to keep his cancer secret, even though Steve Jobs had disclosed it. Reviewing the known facts: At that time, it was not known to be operable, and presumably not known to be growing. When a scan revealed it was growing, the issue became urgent, leading to immediate biopsy, diagnosis as the rare curable kind, surgery and disclosure.
Personally, I find Apple / Steve Jobs these days to have very high standards of integrity. That doesn't mean business isn't a ruthless game that has to be played hard.
Apple's New MacBook: Favorable Price Comparison to Dell [View article]
In this case, Apple simply doesn't make a laptop as poorly specified as the $1119 M1330, let alone one of Dells high volume cheapies.
Apple's New MacBook: Favorable Price Comparison to Dell [View article]
But it does have an Expresscard 54 slot and a memory card reader.
They are both good computers; the Dell is undoubtedly significantly more expensive, and lacks many of Macbook's subtle Apple qualities (target disk mode, for example).
Dell: Stick A Fork In It [View article]
And how come the overstated earnings were while Michael Dell was CEO and cashing his billions in options at shareholder expense, while the understated earnings were while Rollins was CEO, and the SEC were starting their informal investigation? Doesn't sound like Michael Dell resuming as CEO is in the least bit helpful. Let's see some action from the SEC, please, and some straightforward honesty from the analyst community.